Weekly Current Affairs

Welcome to the Endeavor Editors’ Weekly Current Affairs Choicest Blog series. Get a weekly roundup – of news from business, economy, markets, policy, and more. A quick capsule format news summary and update to keep you abreast with all the latest current affairs.

1) International News and Global Economy

‘Massive’ drone attack on Black Sea Fleet – Russia

Ukraine has carried out a “massive” drone attack on the Black Sea Fleet in the Crimean port city of Sevastopol, damaging one warship, Russia says. Without providing evidence, Russia accused British troops of being involved in Saturday’s attack – and in blowing up gas pipelines last month. In its response, the UK Ministry of Defence (MoD) said Russia was “peddling false claims of an epic scale”. Saturday’s attack comes as Ukrainian troops successfully retake territory occupied by Russian troops since they launched their invasion on 24 February. Russia has replied by launching large-scale attacks on Ukrainian infrastructure, particularly on the country’s energy grid. Crimea was annexed by Russia from Ukraine in 2014 and is extremely symbolic for Russian President Vladimir Putin.

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‘Massive’ drone attack on Black Sea Fleet, Russia says – BBC News

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Russia suspends UN-brokered Ukraine grain deal over ship attack claim

Russia announced Saturday that it will immediately suspend its implementation of a U.N.-brokered grain deal that has seen more than 9 million tons of grain exported from Ukraine during the war and has brought down soaring global food prices. The Russian Defense Ministry cited the alleged Ukrainian drone attack against Russia’s Black Sea Fleet ships as the reason for the move. The Russian declaration came one day after U.N. chief Antonio Guterres urged Russia and Ukraine to renew the grain export deal, which was scheduled to expire on Nov. 19. Guterres also urged other countries, mainly in the West, to expedite the removal of obstacles blocking Russian grain and fertilizer exports.

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Rishi Sunak becomes Britain’s first Indian-origin Prime Minister

Rishi Sunak on Tuesday became Britain’s third prime minister this year and the first person of color to lead the former imperial power, vowing to mend the “mistakes” of Liz Truss’s calamitous 49-day tenure. Sunak became the ruling Conservatives’ new leader on Monday after triumphing over rival contender Penny Mordaunt, who failed to secure enough nominations from Tory MPs. Sunak said a disastrous budget that felled Truss was motivated by a well-intentioned desire to kick-start growth, but its tax-cutting measures were “mistakes nonetheless”. Sunak has now staged a stunning turnaround in political fortunes and vowed to do the same for Britain as it confronts decades-high inflation, surging borrowing costs, and imminent recession.

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Rishi Sunak’s Fast Rise to Become Britain’s New Prime Minister | WSJ

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Rishi Sunak eyes as much as £50 billion of UK spending cuts, tax rises

UK Prime Minister Rishi Sunak is seeking to build a buffer in the public finances as he draws up an economic plan to plug Britain’s budget shortfall, which could entail tax rises and spending cuts totaling as much as £50 billion ($58 billion). Britain’s new premier is trying to restore calm to the financial markets after his predecessor, Liz Truss, sparked turmoil during her 7-week tenure with a massive package of unfunded tax cuts that tanked the pound to an all-time low against the dollar and sank the gilts market.

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50 dead, dozens feared missing as storm lashes Philippines

Flash floods and landslides set off by torrential rains left at least 50 people dead, including in a hard-hit southern Philippine province, where as many as 60 villagers are feared missing and buried in a huge mudslide laden with rocks, trees, and debris, officials said Saturday. The unusually heavy rains flooded several towns in Maguindanao and outlying provinces in a mountainous region with marshy plains, which become like a catch basin in a downpour. About 20 typhoons and storms batter the Philippine archipelago each year. It is located on the Pacific “Ring of Fire,” a region along most of the Pacific Ocean rim where many volcanic eruptions and earthquakes occur, making the nation one of the world’s most disaster-prone.

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Wuhan shut down again? Covid 19 spreads in China as 31 cities implement varying degrees of lockdown

Wuhan, the epicenter of Covid in 2019, is grabbing headlines again. New lockdowns are being implemented from Wuhan to China’s industrial belt on the east coast to Tibet making matters worse. More than 900,000 people in the Hanyang district were instructed to stay at home till Sunday after the central Chinese city, the location of the first COVID-19 epidemic in the globe in late 2019, reported 20 to 25 new illnesses daily. According to Nomura, as of October 27, 31 cities were enforcing various degrees of lockdown, affecting over 232 million people in areas that contributed about 24.5% of China’s GDP.

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Germany dodges recession but inflation climbs to 11.6%

Germany staved off the threat of recession in the third quarter with unexpected growth but the economy remained in choppy waters as high inflation driven by a painful energy standoff with Russia surged, data showed on Friday. Consumer prices, harmonized to compare with other European Union countries, were up 11.6% on the year in October, the federal statistics office said. The Ifo economic institute warned on Friday that the full effect of inflation had not yet reached consumers, even as its survey showed a slightly lower number of companies in Germany planning price hikes in October. Economists said inflation was likely to stay in double-digit territory for some time, keeping pressure on the European Central Bank to continue raising interest rates after it hiked them to their highest level since 2009 on Thursday.

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Seoul Halloween Stampede: Death toll rises to 151; world leaders express condolences

At least 151 people were killed and 76 others were injured in a deadly stampede during Halloween celebrations in Seoul’s Itaewon district on Saturday, South Korea’s Yonhap news agency reported citing authorities. The incident reportedly occurred when a large group of people rushed to an Itaewon bar after hearing an unidentified celebrity was visiting there. Social media footage showed several people being assisted by rescue officials and private citizens at the scene, and many rescue officials performing CPR on people lying in poor condition on the streets.

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2) India

Delhi moves to GRAP Stage 3 As Air Quality Turns ‘Severe’, Here’s What it means

Amid worsening pollution levels in Delhi, the Centre’s air quality panel Saturday directed authorities in the National Capital Region to implement curbs such as a ban on construction and demolition activities under the Graded Response Action Plan stage III. The Commission for Air Quality Management (CAQM) further said states might impose restrictions on the plying of BS III petrol and BS IV diesel four-wheelers in the NCR considering the worsening air quality. This direction is non-binding on authorities. Stage III of GRAP means a ban on all construction activities except those of national importance.  As per an official press release by CAQM, “Under this, all construction work will be banned except for special projects like Central Vista and other projects of national need.”

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Telangana govt withdraws general consent to CBI, 10th state to do so

The Telangana Government has withdrawn general consent earlier given to the Central Bureau of Investigation (CBI) in the state. The Telangana government issued an order on August 30 withdrawing general consent given to the Central Bureau of Investigation in the State. From now on prior consent will be required on case to case basis for probes in any case. The development comes after the BJP and TRS have indulged in a war of words over several issues in the recent past that have led to acrimony between the two parties. Before Telangana’s action, nine other states had withdrawn consent to the CBI. The list of states includes Meghalaya Maharashtra, Punjab, Rajasthan, West Bengal, Jharkhand, Chhattisgarh, Kerala, and Mizoram.

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3) Economy

India GDP to grow at 7%, inflation is seen at 6.8% in FY23; RBI to hike repo rate 25-35 bps in Dec meeting

Indian economy’s recovery from the coronavirus pandemic, as well as the pace of the economy, is better as compared to global peers despite headwinds such as high inflation, monetary policy tightening, rising interest rate, and the Russia-Ukraine war. Recently, IMF trimmed its 2023 global economic growth forecast to 2.7%. The agency also warned of a possible $4 trillion loss in global economic output between now and 2026. Given the conditions within India, and globally as well, CareEdge economists expect the Indian economy to grow at 7% in FY23. The fiscal deficit for the current fiscal year is seen at 6.5% of GDP. The current account deficit (CAD) is projected to widen to 3.6% of GDP. RBI in its December MPC meeting is expected to hike the repo rate by 25-35 basis points (bps).

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India’s foreign exchange reserves hit another low as RBI’s rupee defense makes it burn $118 billion

India’s foreign exchange reserves further fell to an over two-year low for the week ended October 14, as the central bank continued to defend the rupee’s downslide while ignoring depleting forex reserves to be a major concern. The foreign exchange reserves of Asia’s third-largest economy fell by $3.85 billion to $524.52 billion for the week ending Oct 21, according to data released today by the Reserve Bank of India. The forex reserves have now depleted for 11 weeks out of 12. The one time it got lucky was for the week ended Oct 7, when gains in gold reserves had lifted the forex reserves by just $204 million. The foreign exchange reserves had fallen to their lowest level since July 2020 to $528.37 billion for the week ending Oct 14.

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4) Markets, Banking, and Finance

The credit card base of major issuers erodes in Q2 over RBI’s norms

Credit card issuers saw significant erosion of their card base during the July-September quarter as the Reserve Bank of India’s (RBI) norms mandated the deactivation of cards that have been inactive for a year. The second quarter of the current financial year saw an outstanding cards-in-force decline by 2.55 million to 77.7 million. Prior to this, the industry, on average, was witnessing a net addition of over 1.5 million credit cards a month as players became aggressive in the unsecured lending business after the pandemic. In April this year, the RBI came out with a master direction on credit and debit card issuance.

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5) Business

Elon Musk takes over Twitter, Parag Agrawal, other top executives fired

Elon Musk has taken over Twitter, wrapping up his $44 billion acquisition of the network after over six months of public and legal wrangling over the deal. Among Musk’s first moves — change in leadership. He has fired chief executive Parag Agrawal, who went to court to hold the billionaire to the terms of a deal he tried to escape. Other departures include Vijaya Gadde, the head of legal, policy, and trust; Chief Financial Officer Ned Segal, who joined Twitter in 2017; and Sean Edgett, who has been general counsel at Twitter since 2012. Agrawal stepped into the CEO role in November when co-founder Jack Dorsey unexpectedly resigned. Agrawal had been at Twitter for almost a decade, most recently as a chief technology officer, but his run as CEO was quickly disrupted by Musk’s arrival as a major shareholder and increasingly vocal antagonist of its current leadership.

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Gautam Adani’s group to invest $150 billion in pursuit of a $1 trillion valuation

Gautam Adani’s group will invest over $150 billion across businesses ranging from green energy to data centers as it chases the dream to join the elite global club of companies with $1 trillion valuations, according to a report by PTI news agency. The Adani Group is planning to invest $50-70 billion in the green hydrogen business and another $23 billion in green energy over the next 5-10 years, the company’s CFO said. Last week, Adani Group agreed to acquire Air Works, one of India’s major centers for the maintenance, repair, and overhaul (MRO) of aircraft. The Group is also in advanced talks with debt-laden Jaiprakash Power Ventures Ltd. to buy its cement unit. The Group has already bought Ambuja Cements Ltd. and ACC Ltd. The market capitalization of Adani Group was around $16 billion in 2015 and, it has surged to $260 billion in 2022 – an increase of over 16x in seven years.

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AMNS India to invest Rs 60,000 crore to expand Hazira plant: Chairman

ArcelorMittal’s arm AMNS India will invest Rs 60,000 crore to scale up the capacity of its steel plant here to 15 million tonnes (MT), the company’s chairman Aditya Mittal said on Friday. The existing capacity of the plant is 9 MT. The investment will create over 60,000 crore job opportunities across the country in various verticals of the company, the chairman said. In 2019, ArcelorMittal along with Japan’s Nippon Steel completed the acquisition of the Essar Steel Limited plant located at Hazira in Gujarat and later renamed it to ArcelorMittal Nippon Steel (AMNS) India. On October 6, steel maker AMNS said it has received environmental clearance for the expansion of the plant.

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Chinese mobile maker Xiaomi shuts financial service business in India: Report

The company’s Mi Pay app, which allowed users to make bill payments and money transfers, is no longer listed among the recognized third-party Unified Payments Interface (UPI) apps on the National Payments Corporation of India’s (NPCI) website. Chinese smartphone maker Xiaomi Corp has shut down its financial services business in India, four years after its launch. Xiaomi recently pulled its Mi Credit, which connects smartphone users with lending firms for quick loans, and Mi Pay apps from the local Play Store and its own app store. In India, Xiaomi’s strongest market outside of China, the company has been subject to government probes for allegedly dodging tax regulators. In April, India’s federal financial crime agency froze $676 million worth of Xiaomi’s assets, alleging the company made illegal remittances to foreign entities by passing them off as royalty payments.

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‘Make-in-India, for globe’: PM on ?22K cr Tata-Airbus Gujarat plant

With Ratan Tata’s vision – ten years back – of a private manufacturing aircraft facility coming closer to reality, Prime Minister Narendra Modi on Sunday laid the foundation stone for a plant of the Tata-Airbus consortium in Gujarat’s Vadodara. At least 15,000 skilled jobs are expected to be generated with the project. This is the first aircraft manufacturing facility in the private sector. PM Modi laid the foundation of the project in the presence of Defence Minister Rajnath Singh, Gujarat Chief Minister Bhupendra Patel, and Civil Aviation Minister Jyotiraditya Scindia. The estimated cost of the project is about ?22,000 crore. The C-295 planes – which would be manufactured here would give a boost to the Indian Air Force fleet. “This is the first time that such a huge investment is being done in the defence aerospace sector,” PM Modi underlined, adding that the Vadodara plant would not just help in giving a boost to the air force but also develop a new ecosystem for aircraft manufacturing.

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Cab Aggregators Vs Karnataka: Govt Looking At Making 10% Convenience Fee A Permanent Fixture

In what could emerge as another flashpoint, the Karnataka government now plans to urge the High Court to ratify a temporary arrangement that capped the convenience fee charged by cab aggregators at 10%. This comes two weeks after the Court put in place an interim arrangement that fixed the convenience fee charged by ride-hailing apps at 10% of fares, exclusive of GST. At the center of the controversy are two issues flagged by state transport authorities – high convenience fees and confusion over whether cab aggregators are allowed to offer auto services. Earlier this month, the department banned Uber and Ola from offering auto rides, saying that the two players have been licensed to offer only four-wheeler cab services. The order came amidst a public outcry over high prices charged by cab aggregators, even as parts of Bengaluru city recovered from heavy rains which inundated the IT hub.

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Walmart to raise $3 Bn for Flipkart, seeks $40 bn valuation

As competition in the e-commerce space heats up, homegrown giant Flipkart is mulling over raising $2 Bn – $3 Bn to expand its product offering and directly better compete with its rivals. The Walmart-backed e-commerce major is planning to raise the investment at a mammoth valuation of more than $40 Bn, according to people privy to the development. Further, Flipkart may dilute around 7% for raising as much as $3 Bn via the fundraiser. Flipkart’s growth has largely been the result of a resurgent middle class, higher internet penetration, and increased disposable income. The result has been the rapid adoption of e-commerce as a preferred destination of purchase. Sensing the opportunity, users and investors alike have jumped onto the e-commerce bandwagon, looking to get a pie of the burgeoning sector. The last $3.6 Bn funding round saw participation from some of the biggest investors in the world including Canada Pension Plan Investment Board, GIC, SoftBank, Qatar Investment Authority, and Tiger Global, among others.

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6) Technology

Decoding CCI’s INR 2,274 Cr Penalties: Why is Google in the line of fire?

India’s antitrust watchdog, the Competition Commission of India (CCI) slapped two penalties on Google in less than a week. Worth a total of INR 2,274.2 Cr ($276.37 Mn), the two penalties come as Big Tech is under increased scrutiny in India. Both the rulings came under different cases and warrant a review of what has happened so far. After Google acquired Android Inc in July 2005 (the original creators of the Android OS), it seems that Google has an edge over other operating systems, virtually being a part of every phone. Google has entered into several agreements with OEMs, forcing them to install Google Mobile Services (GMS) and give the tech major preferential access to users. These agreements then stem out into various Android ecosystem markets which it dominates. India is one of the biggest markets for the tech major. Therefore, it can’t afford to be on the wrong side of the law of the land. Since there is a 30-day timeline for Google to respond, it can either move to a court or answer pending CCI questions and pay up.

For details visit here.

7) Politics

Gujarat Assembly passes proposal to Constitute Committee for UCC Implementation

The ruling Bharatiya Janata Party (BJP) in poll-bound Gujarat on Saturday, October 29, moved a proposal to constitute a committee to look into all aspects regarding the implementation of a Uniform Civil Code (UCC) in the state. Incumbent Gujarat minister of state for home Harsh Sanghvi said that the proposal to create the committee was cleared by the state cabinet during the Saturday meeting; which was likely the final meeting of chief minister Bhupendra Patil’s cabinet. “The committee will be headed by a retired high court judge and will have three to four members,” Union minister Parshottam Rupala said, according to PTI.

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8) Sports

Satwiksairaj Rankireddy-Chirag Shetty Win French Open Men’s Doubles Title

The star Indian pair of Satwiksairaj Rankireddy and Chirag Shetty won the French Open Super 750 crown with a straight-game demolition of Chinese Taipei’s Lu Ching Yao and Yang Po Han in the men’s doubles final in Paris on Sunday. The world number 8 pair, who had finished runners-up in the 2019 edition, rode on their formidable attack to outwit the 25th-ranked Lu and Yang 21-13 21-19 in the summit clash that lasted 48 minutes. The Indian pair thus continued their dream run this year, which saw them win the Indian Open Super 500 titles, Commonwealth Games gold, Thomas Cup crown, and an unprecedented bronze at the World Championships in August.

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T20 World Cup: Pakistan’s semi-final chances take a hit as India loses to South Africa

Pakistan’s chances to reach the semi-final of the T20 World Cup have taken a major hit after India was defeated by South Africa in the Super-12 stage of the tournament. Pakistan, who lost their first two matches of the T20 World Cup was dependent on India to defeat South Africa in Sunday’s match. Pakistan had lost their first match against India by a narrow margin of one. They were expected to shake off the defeat and win their next match against Zimbabwe, but things went horribly wrong for the Babar Azam-led team. With 0 points from the first two matches, Pakistan was put in a precarious position in their group.

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9) Opinion

Dunzo, Blinkit, Swiggy, Zepto & The Quick Commerce Bubble

In the past few weeks, we have seen reports about government and tax probes into BharatPe, Trell, Infra.Market, Zetwerk, and at least 11 crypto exchanges. Further, cases such as the lack of due diligence and corporate governance issues at BharatPe and Zepto have dampened the spirits of the VC ecosystem. According to a partner at one Mumbai-based early-stage VC, while in late 2020 and throughout 2021, the money was flowing unchecked and cheques were being written blindly, there’s a lot more caution now. And particularly for businesses where there is more likelihood of growth pressure on founders because of cash burn. While some of the bigger players mentioned above will raise mega-rounds, the pressure on profitability and revenue growth will force many pivots away from quick commerce. The high cost of sustaining the quick commerce model in India and around the world makes us wonder whether it is a fad. A founder who runs an e-commerce roll-up pointed out that eventually, the hype will die down because it is not solving a need.

For details visit here.

10) Weekly special

Drone startups dream of IPOs after winning multi-crore government tenders

Drone startup Aereo, formerly known as Aarav Unmanned Systems, was founded by IIT Kanpur students in 2013. For the first eight years of its existence, it had to fight tooth and nail to drive commercial growth. However, since August 2021, Aereo has experienced an 800% increase in orders. This sudden jump can be largely attributed to policies promoted by the government. From clarifying the rules for private contracts with the release of the Drone Rules last year to providing financial support via the (production-linked incentive) PLI scheme, the Centre has been supporting drone startups. The biggest push has come from the government’s decision to start issuing multiple tenders worth tens of crores of rupees each for drone services. For the tender-winning startups, these contracts have led to big dreams coming true. Bengaluru-based Aereo has seen its company grow from 50 to 240 employees in the last year and a half. Currently, it is in the process of becoming a global entity, with aim of replicating its work in India abroad.

For details visit here.

11) Did you know?

What is ‘moron risk premium’?

The ‘moron risk premium’ is a term for our times. The pithy phraseology, a contribution of British analyst Dario Perkins to punditry, eloquently characterizes the economic costs of political blunders. In the current context, it is often used to explain the state of the bond market in the United Kingdom

For details visit here.

With that, we come to the end of our Weekly Current Affairs October 2022 -Week 5. We hope you have liked it. Write your feedback in the comments below and let us know if there is anything else you would like us to cover.

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