New RBI Governor Assumes Charge
Sanjay Malhotra took over as the 26th governor of the RBI for a three-year term. Malhotra succeeds Shaktikanta Das, who served as governor for six years. Malhotra was previously revenue secretary. He is also the first RBI governor since D Subbarao to transition directly from the finance ministry.
Meanwhile, the RBI at its monetary policy committee meeting left the benchmark repo rate unchanged at 6.5% and maintained its monetary policy stance ‘neutral’. It also raised the inflation projection for the current fiscal year to 4.8% from 4.5%. Other key rates, including the marginal standing facility and the standing deposit facility, remain unchanged. The RBI predicted food inflation will ease in the coming months, thanks to favourable harvests and seasonal easing in supplies.
Swiss Suspends MFN Status
Switzerland has suspended the most favoured nation clause in its double taxation avoidance agreement with India, citing a ruling by the Supreme Court relating to the multinational Nestle. This move will double the withholding tax rate on dividends paid to Indian tax residents to 10%, starting January 2025.
Adidas, Nike Supplier Enters India
Taiwanese footwear major Hong Fu marked its India entry with a groundbreaking ceremony in Panapakkam, near Chennai. The group is the world’s second-largest manufacturer of non-leather athletic footwear and is a supplier to Nike, Vans, Adidas and Reebok. The Panapakkam facility is projected to create jobs for 25,000 people.
India Tops Global Remittances
India was the world’s leading recipient of remittances with an inflow of $129bn in 2024, according to World Bank. The surge was attributed to the recovery in job markets across high-income countries. Driven by strong flows to India, Pakistan and Bangladesh, remittance flows to South Asia registered the highest region-wise increase in 2024. The other top recipient countries were Mexico, China, the Philippines and Pakistan.
ITC Expands Stake In Hospitality Chains
ITC, which demerges its hotel business this month, has acquired shareholding of rival hospitality chains Oberoi and Leela from its wholly owned arm, Russell Credit. The Kolkata-headquartered company acquired 2.44% of EIH, the flagship company of the Oberoi group, and 0.53% of HLV, which owns and operates The Leela. Following the acquisition, ITC’s shareholding in EIH and HLV is 16.13% and 8.11% of their paid-up share capital, respectively. The ITC board had in October approved the consolidation of the shareholding of EIH and HLV under the company.
