1 November 2023

The NewsWala

November 01, 2023

Newswala aaya, taaza khabre laya! Good morning!
 

Today, Your Newswala Delivers:

  • Fiscal deficit trouble begins

  • Petroleum Games are back

  • L&T Scores Big

Chalo chalein!

The reading time is 5 minutes.
 

BUSINESS

Fiscal Shock: India's FY24 Target in Shambles


What happened

According to government data, in the first six months of this fiscal year through September, India's fiscal deficit stood at ₹7.02 lakh crore. The deficit of the first half of the year alone turned out to be 39.3% of the estimate for the whole year. 


Why it matters

In the Union Budget, the government projected to bring down the fiscal deficit to 5.9% of the gross domestic product (GDP) in the current FY.


The deficit was 6.4% of the GDP in 2022-23 against the earlier estimate of 6.71%.


When a government spends more money than it receives in tax and other revenue, it is said to be in a fiscal deficit . 


A larger budget deficit gives people more money to spend and invest, which can stimulate a slowing economy. However long-term deficits may be harmful to the expansion and stability of the economy.


A large fiscal deficit leads to borrowing more money, which isn't always a good thing. It's like maxing out your credit card – fun at first, but a headache later.

Zoom out


India has a sizable poor population with a low per capita income compared to other economies.

The regular spending of the government on subsidies and aiding the economically backward and the tax rampant is also a cause for the high fiscal deficits.


India's fiscal deficit isn't just a number on a spreadsheet; it's about how the government manages its money.

And when that goes haywire, it can have ripple effects on the economy , your taxes, and even the services you rely on.

 

BIG MONEY MOVES

📉  Twisted Twitter Tale: Musk's X Value Crashes by Half

A year after Elon Musk acquired Twitter for $44 billion , it's now valued at $19 billion, marking a 56% drop in value. Some sources estimate an even steeper decrease, with Fidelity Investments suggesting it's worth around $15.4 billion.

Musk's questionable decisions, including layoffs and removing the verification system, likely contributed to this decline.


💸  Finance with Sharan lands a deal

Zerodha’s Chief Investment Officer, Nikhil Kamath, has invested in ' The 1% Club ,' a start-up founded by Sharan Hegde (Finance with Sharan).

The company secured Rs 10 crore in pre-series A funding from Gruhas, a venture capital firm co-founded by Kamath.

'The 1% Club' is an exclusive platform offering educational resources, mentorship, and entrepreneurial opportunities for financial planning. The funding will support expansion and talent acquisition. 

 

BUSINESS

India Hikes Crude Tax to Rs 9,800/Ton


What Happened


In a recent twist in the ever-evolving drama of petroleum taxation, the Indian government has announced yet another round of changes to its windfall tax policy .

Effective from November 1, the windfall tax on petroleum crude has been increased to 9,800 Indian rupees per ton, up from the previous rate of 9,050 rupees per ton. 


The government has eliminated the windfall tax on aviation turbine fuel, previously set at 1 rupee per litre.

And there's more good news for motorists, as the windfall tax on diesel has been reduced to 2 rupees per litre, down from 4 rupees per litre.


Why it matters 


The increase in windfall tax on petroleum crude means that the government is looking to capture a larger share of the profits from oil production.

This decision might have a cascading effect on fuel prices, which can have a direct impact on your monthly budget. 

  • On the flip side, the removal of the windfall tax on aviation turbine fuel should make air travel a bit more affordable, which could be a welcome relief for those planning a getaway.

  • The reduction in diesel taxes from 4 rupees to 2 rupees per litre could potentially lead to slightly lower prices for a range of goods and services that rely on diesel-powered transportation.



Zoom Out


These tax changes reflect India's challenges in managing its growing economy. The government's ability to balance the need for revenue and ease the financial burden on its citizens is no easy feat. 


As we navigate the twists and turns of these policies, we can only hope that they'll lead to a smoother ride at the fuel pump and for air travellers.

 

BIG PICTURE


💰️  Jio opens India's largest luxury mall



Reliance Industries has unveiled the Jio World Plaza , a 7.50-lakh sq ft retail and entertainment hub in Mumbai's posh Bandra Kurla Complex.

Opening its doors on November 1, it's not just any mall. It's a blend of shopping, culture, and dining spread over four levels. You'll find 66 luxury brands here, making it a hot spot for shoppers.


💳️  Thailand Gifts Indians a Visa “Fee-Break”


Good news for Indian travellers! Thailand is giving Indian tourists a visa waiver from November 10 until May 10, 2024, to boost tourism after the pandemic.

This means you won't have to pay the 2,200 baht (about ₹5,100) visa fee. The Thai government is eager to welcome visitors and revitalize its economy.

 

BUSINESS

L&T Lands a ₹15,000 Crore Marvel in the Middle East!


What Happened


Larsen & Toubro (L&T) hit the jackpot in the Middle East, bagging a whopping Rs 15,000 crore project. It's like finding a treasure chest!


Driving the News


L &T's Managing Director and CEO, SN Subrahmanyan, expressed his enthusiasm for the project, saying, 'This is a huge order that will not only strengthen our balance sheet but also provide impetus to our demonstrated credentials in the Hydrocarbon EPC space.'


The scope of work includes 

  • Designing, acquiring, and building gas compression plants for new onshore facilities. 

  • These plants will be integrated with already-existing gas compression plants and will include produced water handling, propane refrigeration, condensate transfer, utilities, and gas inlet facilities.

  • The Power Transmission & Distribution division of L&T Construction will establish three 230 kV Extra High voltage substations to meet the needs of the Gas Compression Plants for power supply.


Zoom out

L&T recorded a combined net profit of Rs 3,223 crore for the September quarter. This is 45% more than the Rs 2229 crore reported in the same quarter of the previous year. 

The ongoing Israel-Hamas conflict had no negative effect on the earnings, execution, or prospect pipeline. To add to the good news, the Engineering and Infrastructure conglomerate's domestic orders increased in H1 FY24 by 15% YoY.

It's a gas-tastic adventure for L&T that's sure to leave us all breathless (in a good way).

 

MIRCH MASALA