Money Market

Money Market: The money market provides investment avenues of short term tenor. Money market transactions are generally used for funding the transactions in other markets including Government securities market and meeting short term liquidity mismatches.

By definition, money market is for a maximum tenor of up to one year. Within the one year, depending upon the tenors, money market is classified into:

i. Overnight market or Call money - The tenor of transactions is one working day.

ii. Notice money market – The tenor of the transactions is from 2 days to 14 days.

Iii. Term money market – The tenor of the transactions is from 15 days to one year.

Money market for short-term and long-term funds with maturity ranging from over night to one year.Indian Money market consists of unorganized sector,money lenders,indigenous bankers, NBFCs,RBI,PSBs,LIC, finance corporatio,IDBI and co-operative sector.
Short-term markets are called Money markets
Long-term markets are called Fixed income markets

The instruments of money market in India are

• call money/Notice Money market
• Repo/Reverse repo
• Inter-Corporate Deposits
• Commercial Paper
• Certificate of deposits
• T-bills

Call money: All banks in India participate in the call money.this is very short term money market where the maturity not more than 14 days

Inter corporate deposits(ICDs): The minimum period of ICDs is 7 days which can be extended to one year

Certificate of Deposit (CD): Certificate of Deposit (CD) is a negotiable money market instrument and issued in dematerialized form or as a Usance Promissory Note, for funds deposited at a bank or other eligible financial institution for a specified time period.

 
Minimum amount of CD should be 1 lakh

Period: Banks can issue CDs for maturities from 7 days to one a year whereas eligible FIs can issue for maturities 1 year to 3 years.

Commercial Paper (CP):Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note. Introduced in 1990

Corporate, primary dealers (PDs) and the all-India financial institutions (FIs) that have been permitted to raise short-term resources under the umbrella limit fixed by the Reserve Bank of India are eligible to issue CP.

Scheduling bank alone can act as issuing and paying agent  for CP

Period: CP can be issued for maturities between a minimum of 7 days and a maximum up to one year from the date of issue.

 A corporate would be eligible to issue CP provided –

a. the tangible net worth of the company, as per the latest audited balance sheet, is not less than Rs. 4 crore

b. company has been sanctioned working capital limit by bank/s or all-India financial institution/s; and

c. the borrowal account of the company is classified as a Standard Asset by the financing bank/s/ institution/s.

CP can be issued in denominations of Rs.5 lakh or multiples thereof.

The total amount of CP proposed to be issued should be raised within a period of two weeks from the date on which the issuer opens the issue for subscription 

CP may be issued on a single date or in parts on different dates provided that in the latter case, each CP shall have the same maturity date. Further, every issue of CP, including renewal, shall be treated as a fresh issue

Individuals, banking companies, other corporate bodies (registered or incorporated in India) and unincorporated bodies, Non-Resident Indians (NRIs) and Foreign Institutional Investors (FIIs) etc. can invest in CPs. However, investment by FIIs would be within the limits set for them by Securities and Exchange Board of India (SEBI) from time-to-time.

CP will be issued at a discount to face value as may be determined by the issuer.

 

Treasury Bills (T-bills):Treasury bills or T-bills, which are money market instruments, are short term debt instruments issued by the Government of India and are presently issued in three tenors, namely, 91 day, 182 day and 364 day. Treasury bills are zero coupon securities and pay no interest.

Taxes

Direct Taxes: As the name suggests Direct tax means the tax which is directly paid to the government by individuals and the companies. 

Ex: Corporate Tax, Personal Income Tax, Securities Transaction Tax, Banking Cash Transaction Tax, and the Fringe Benefit Tax

Indirect Taxes: As the name suggests Indirect Taxes are those taxes which are paid indirectly to government by the individuals or the companies. 

Ex: Sales Tax, Service Tax, Custom and Excise Duties, VAT and Anti-Dumping Duties, Ad Valorem tax.

Taxes levied by central government

      Direct Taxes

• Banking cash transaction tax
• capital gains tax
• Corporate income tax
• Fringe benefit tax
• personal income tax
• Securities transaction tax

    Indirect Taxes

• Customs duty
• Excise duty
• Service tax

Taxes levied by state government

• Dividend tax
• Endowment tax
• Estate tax
• Gift tax
• Flat tax
• Fuel tax
• Inheritance tax
• Transfer tax
• Payroll tax
• Poll tax
• Self employment tax
• Usage tax
• VAT or sales tax
• wealth tax

Note: Service tax levied by both state and central government

Goods and sevice tax

1.    What is GST?

It is an indirect tax that will lead to the abolition of all other taxes such as, central sales tax, state-level sales  tax, excise duty, service tax, and value-added tax (VAT). Both the state  and the central governments will impose GST on almost all goods and  services produced in India or imported into the country

2.    What categories are exempt from GST?

Exports will not be subject to GST. Direct taxes, such as income tax, corporate tax and capital gains tax will not be affected.

3.    How will GST benefit the economy?

It will simplify India's tax structure, broaden the tax base, and create a common market across states. This will lead to increased compliance and increase India's  tax-to-gross domestic product ratio. According to a report by the National Council of Applied Economic Research, GST is expected to increase economic growth by between 0.9 per cent and 1.7 per cent.  Exports are expected to increase by between 3.2 per cent and 6.3 percent, while imports will likel rise 2.4-4.7 per cent, the study found.

4.    How will GST benefit corporate?

It will be beneficial for India Inc as the average tax burden on companies will fall. Reducing production costs will make exporters more competitive.

5.    Will goods and services become costly? 

The highest rate of taxation under GST will be around 15 per cent in the first year, and eventually come down to 12 per cent in the second year. By comparison, the current rate of the various indirect taxes levied in India amounts to roughly 20 per cent. Goods deemed necessary or of basic importance will be taxed at a lower rate.

6.    Will state governments lose out? 

Some states fear that a uniform tax rate, if lower than their existing rates, will dent collections.  However, the central government has said it will compensate states for the potential revenue loss. The reduced and uniform taxation will help more pouring of money in the state. 

7.    Can states decide to opt out of GST?

In a deviation from its earlier stand, the government has agreed for a phased roll-out of GST. States will also have the flexibility to opt out of GST.

8.    How will it become a reality? 

The GST can be implemented only through a Constitutional Amendment Bill, which means it needs to be approved by not less than two-thirds of the members present and voting in each House of Parliament. The GST must also be ratified by the legislatures of at least one-half of the states.

National Housing Bank(NHB)

• The Sub-Group on Housing Finance for the Seventh Five Year Plan (1985-90) identified the non-availability of long-term finance to individual households on any significant scale as a major lacuna impeding progress of the housing sector and recommended the setting up of a national level institution.
• The Committee of Secretaries considered' the recommendation and set up the High Level Group under the Chairmanship of Dr. C. Rangarajan, the then Deputy Governor, RBI to examine the proposal and recommended the setting up of National Housing Bank as an autonomous housing finance institution. The recommendations of the High Level Group were accepted by the Government of India.
• The Hon’ble Prime Minister of India, while presenting the Union Budget for 1987-88 on February 28, 1987 announced the decision to establish the National Housing Bank (NHB) as an apex level institution for housing finance. Following that, the National Housing Bank Bill (91 of 1987) providing the legislative framework for the establishment of NHB was passed by Parliament in the winter session of 1987 and with the assent of the Hon’ble President of India on December 23, 1987, became an Act of Parliament.
• The National Housing Policy, 1988 envisaged the setting up of NHB as the Apex level institution for housing.
• In pursuance of the above, NHB was set up on July 9, 1988 under the National Housing Bank Act, 1987.
• NHB is wholly owned by Reserve Bank of India, which contributed the entire paid-up capital.
• The general superintendence, direction and management of the affairs and business of NHB vest, under the Act, in a Board of Directors.
• The Head Office of NHB is at New Delhi.
• Chairman and Managing Director Shri Mohammad Mustafa

NHB has been established to achieve, inter alia, the following objectives –

1. To promote a sound, healthy, viable and cost effective housing finance system to cater to all segments of the population and to integrate the housing finance system with the overall financial system.
2. To promote a network of dedicated housing finance institutions to adequately serve various regions and different income groups.
3. To augment resources for the sector and channelise them for housing.
4. To make housing credit more affordable.
5. To regulate the activities of housing finance companies based on regulatory and supervisory authority derived under the Act.
6. To encourage augmentation of supply of buildable land and also building materials for housing and to upgrade the housing stock in the country.
7. To encourage public agencies to emerge as facilitators and suppliers of serviced land, for housing.

Type	Public
Industry	Banking
Founded	July 8, 1988
Headquarters	New Delhi, India

FDI Limits

List of Limits in Various Sectors (In %)

1. Defence Raised to 49% from 26%
2. Pension 49
3. Insurance 49
4. Print Media 26
5. Civil Aviation 49
6. Public Sec. Banks 20
7. Private Sec. Banks 74
8. Multi Brand 51
9. Single Brand 100
10. Tourism 100

Rabi and Kharif Crops

Kharif

The Kharif crop is the summer crop or monsoon crop in India. Kharif crops are usually sown with the beginning of the first rains in July, during the south-west monsoon season.
Millets (Bajra and Jowar)
Paddy (Rice)
Maize
Moong (Pulses)
Groundnut
Red Chillies
Cotton
Soyabean
Sugarcane
Turmeric

Rabi Crop

The Rabi crop is the spring harvest or winter crop in India . It is sown in October last and harvested in March April every year.

Wheat
Barley
Mustard
Sesame
Peas

Confederation of Indian Industry(CII)

The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the development of India, partnering industry, Government, and civil society, through advisory and consultative processes.
CII is a non-government, not-for-profit, industry-led and industry-managed organization, playing a proactive role in India's development process.

Our primary goal is to develop Indian industry and to ensure that government and society as a whole, understand both the needs of industry and its contribution to the nation's well being. For this, we work

• To identify and strengthen industry's role in the economic development of the country
• To act as a catalyst in bringing about the growth and development of Indian Industry
• To reinforce industry's commitment to society
• To provide up-to-date information and data to industry and government
• To create awareness and support industry's efforts on quality, environment, energy management, and consumer protection
• To identify and address the special needs of the small sector to make it more competitive
• To promote cooperation with counterpart organisations
• To work towards the globalisation of Indian industry and integration into the world economy

This is done by adopting a proactive and partnership approach with the government on various national and international issues concerning the Indian economy. It closely interacts on policy issues at both the central and state levels. Extensive dialogue and interaction with members and all sections of the community to build consensus are held.

Founded	1895
Type	Association
Headquarters	New Delhi, India
Area served	World wide

Key people	Mr Ajay S. Shriram(President) Mr. Chandrajit Banerjee(Director General)

Cups and Trophies

NATIONAL

Agarwal Cup : Badminton Agha Khan Cup : Hockey All-India Women's Guru Nanak Championship : Hockey Bandodkar Trophy : Football Bangalore Blues Challenge Cup : Basketball Barna-Bellack Cup : Table Tennis Beighton Cup : Hockey Bombay Gold Cup : Hockey Burdwan Trophy : Weight-lifting Charminar Trophy : Athletics Chadha Cup : Badminton C. K. Naydu Trophy : Cricket Chakoia Gold Trophy : Football Divan Cup : Badminton Deodhar Trophy : Cricket Duleep Trophy : Cricket D. C. M. Cup : Football Durand Cup : Football Dhyan Chand Trophy : Hockey Dr. B. C. Roy Trophy : Football (Junior) Ezra Cup : Polo F. A. Cup : Football G. D. Birla Trophy : Cricket Ghulam Ahmed Trophy : Cricket Gurmeet Trophy : Hockey Gura Nanak Cup : Hockey Gyanuati Devi Trophy : Hockey Holkar Trophy : Bridge lrani Trophy : Cricket I. F. A. Shield : Football lndira Gold Cup : Hockey Jawaharlal Challenge : Air Racing Jaswant Singh Trophy : Best Services Sportsman

Kuppuswamy Naidu Trophy : Hockey Lady Rattan Tata Trophy : Hockey MCC Trophy : Hockey Moinuddaula Gold Cup : Cricket Murugappa Gold Cup : Hockey Modi Gold Cup : Hockey Narang Cup : Badminton Nehru Trophy : Hockey Nixan Gold Cup : Football Obaid Ullah Gold Cup : Hockey Prithi Singh Cup : Polo Rani Jhansi Trophy : Cricket Ranjit Trophy : Cricket Rangaswami Cup : Hockey Ranjit Singh Gold Cup : Hockey Rajendra Prasad Cup : Tennis Ramanujan Trophy : Table Tennis Rene Frank Trophy : Hockey Radha Mohan Cup : Polo Raghbir Singh Memorial : Football Rohinton Baria Trophy : Cricket Rovers Cup : Football Sanjay Gold Cup : Football Santosh Trophy : Football Sir Ashutosh Mukherjee : Football Subroto Cup : Football Scindia Gold Cup : Hockey Sahni Trophy : Hockey Sheesh Mahal Trophy : Cricket Todd Memorial Trophy : Football Tommy Eman Gold Cup : Hockey Vittal Trophy : Football Vizzy Trophy : Cricket Vijay Merchant Trophy : Cricket Wellington Trophy : Rowing Wills Trophy : Cricket

HOCKEY related Cups/Trophy’s:

1. Agha Khan Cup

2. Dhyan Chand Trophy

3. Nehru Trophy

4. Scindia Gold Cup

5. MCC Trophy

6. Bombay Gold Cup

7. Ranga Swami Cup

8. Gurmeet Trophy

9. M R.S.Gold Cup

10. Beighton Cup

11. Bombay Gold Cup

12. Guru Nanak Trophy

13. Gyanuati Devi Trophy.

14. Indira Gold Cup

15. KuppuSwamy Naidu Trophy

16. Lady Rattan Tata Trophy

17. Murugappa Gold Cup

18. Modi Gold Cup

19. Obaid Ullah Gold Cup

20. Ranjit Singh Gold Cup.

21. Rene Frank Trophy

22. Tommy Eman God Cup.

23. Azlan Shah Cup

24. Lal bahadul Shastri Cup

25. Johar Cup

FOOTBALL related Cups/Trophy’s:

 1. Santosh Trophy.

2. Rovers Cup

3. D.C.M Trophy

4. Nizam Gold Cup

5. Vittal Trophy.
6. G.V.R.M.Trophy

7. Durand Cup

8. Bandodkar Trophy

9. Chakoia Gold Trophy

10. F.A. cup

11. I.F.A shield

12. Raghbir Singh Memorial

13. Sanjay Gold Cup

14. Subroto Cup

15. Todd Memorial Trophy

16. Ashutosh Mukherjee

CRICKET related Cups/Trophy’s:

 1. Ranji Trophy.

2. Sheesh Mahal Trophy

3. Duleep Trophy

4. Irani Cup.

5. Rohiton Trophy

6. C.K.Naydu Trophy

7. G.D.Birla Trophy

8. Deodhar Trophy

9. Ghulam Ahmed Trophy

10. Moinuddaula Gold cup

11. Rani Jhansi Trophy

12. Rohinton Baria Trophy

13. Vizzy Trophy

14. Vijay Merchant Trophy

15. Wills Trophy

TENNIS related Cups/Trophy’s:

1.Jayalakshmi Cup.

2. Barna Bellack Cup.

3. Rajkumari Challenge Cup.

4.Ramanujan Trophy.