3 November 2023

The NewsWala

Author

Shubhada Mandavi
November 03, 2023

Newswala aaya, taaza khabre laya! Good morning!
 

Today, Your Newswala Delivers:

  • India ready for upgrades

  • CSIR-NIIST and HAL join hands

  • Vedanta seeks $500 million loan

Chalo chalein!

The reading time is 5 minutes.
 

BUSINESS

Massive Rs 23,500 Crore Upgrade for India's Future

What Happened

In a noteworthy development, four infrastructure projects involving roads and railways, with a total value of a staggering Rs 23,500 crore, have been presented for approval as part of the ambitious PM Gati Shakti initiative . 

These projects underwent meticulous evaluation during the 58th Network Planning Group (NPG) meeting held on October 17. The Ministry of Commerce and Industry made it known that these projects are geared towards establishing multimodal connectivity, with a combined project cost exceeding Rs 23,500 crore.


Why It Matters

This development holds immense importance for several reasons. 

  • To begin with, these projects are integral to the PM Gati Shakti initiative, which seeks to create an integrated infrastructure network to significantly slash logistics costs.

  • They are strategically designed to address infrastructural gaps and promote comprehensive development.

Zoom Out

In a broader context, this move reflects a profound commitment to advancing India's transportation and logistics network. By endorsing these projects for approval, the government is actively working to boost economic growth and enhance connectivity. 

FYI: The Gati Shakti mission strives to establish top-notch infrastructure and seamless logistics integration spanning various modes of transportation. Its ultimate objective is to elevate India's competitiveness and foster robust economic growth.

 

BIG MONEY MOVES


Antitrust Heat: Google's $26.3B Default Pact

In 2021, Google reportedly shelled out a whopping $26.3 billion to secure its place as the default search engine on mobile devices and web browsers, a move that's stirred an antitrust dispute.

Google's payments to partners have come under scrutiny for enabling its search monopoly.

Google argues it's all about staying competitive, but the legality of these revenue-sharing agreements is now in the spotlight.

India Sets $800/MT Minimum Onion Export Price till Dec 31

India sets a $800/ metric ton Minimum Export Price (MEP) for onions, effective until December 31, 2023, to ensure ample supply for domestic consumers as stored onion crops decrease.

The MEP is roughly ₹67/kg. Additionally, the government will procure 2 lakh tons of onions to add to the existing 5 lakh tons.

These onions are distributed to consumers at ₹25/kg through mobile vans.

 

BUSINESS

CSIR-NIIST and HAL Join Forces to Fuel India's Aerospace & Defense Ambitions



What Happened

Kerala-based CSIR-(National Institute for Interdisciplinary Science and Technology) made a significant move by signing a Memorandum of Understanding (MoU) with Hindustan Aeronautics Ltd (HAL) on November 2. 

This collaboration is designed to enhance the indigenization and import substitution program in India's aerospace and defence sectors, aligning closely with the Atmanirbhar Bharat initiative. The core focus of the MoU is the development of magnesium and aluminium alloy castings intended for use in aerospace and defence applications.


Why it matters


This partnership carries notable significance for various reasons.

  • Firstly, it actively supports the Atmanirbhar Bharat initiative, which is geared towards bolstering India's self-reliance in key sectors, including aerospace and defence. 

  • Secondly, the development of magnesium and aluminium alloy castings is of paramount importance in the aerospace and defence industries, where the demand for lightweight yet high-strength materials is ever-increasing. 

  • Lastly, this collaboration enables CSIR-NIIST and HAL to combine their resources and expertise, which, in turn, drives advancements in the realm of light alloys for aerospace component design and welding.



Zoom Out

In a broader context, this partnership exemplifies the broader drive towards self-reliance and innovation within India's aerospace and defence sectors. Collaborations of this nature are crucial for several reasons.

They contribute to advancing the development of indigenous technologies, thereby reducing dependence on imports and enhancing national security. 

 

BIG PICTURE



UAE Eyes $50 Billion Investment in India

The United Arab Emirates is mulling over a significant investment of up to $50 billion in India. The potential investment, including stakes in Indian infrastructure projects, could be announced early next year. This reflects a growing partnership between the two nations aiming to boost non-oil bilateral trade to $100 billion. UAE's interest in India aligns with a trend among Gulf state-backed investors to diversify into the rising opportunities offered by the Indian market.


Vanguard Bids a Melancholic Farewell to China 

Vanguard Group, the U.S. investment giant, is closing its main Shanghai office and severing ties with its joint venture with Ant Group, effectively ending its six-year presence in China.This exit comes after Vanguard decided against pursuing a fund management unit, abandoning earlier ambitious expansion plans . While Ant group states that the joint venture and fund advisory service continue as usual, the possibility of Ant acquiring Vanguard's 49% stake is under consideration.

 

BUSINESS

Vedanta Ventures for $500M Loan to Tackle Debt



What Happened


Vedanta Resources (VRL) has entered into negotiations with Cerberus Capital Management and Varde Partners to secure a $500-million loan . This move is a crucial step in VRL's strategy to meet a substantial $1-billion repayment obligation due in January.

  • The interest rate for this new loan is expected to be around 17-18%, considerably higher compared to previous prepayments from Oaktree and Trafigura, which were below 13%.

 Additionally, the company is in talks with Standard Chartered Bank and other credit funds to secure the remaining $500 million-$600 million.

Why it Matters

The significance of these negotiations lies in several key factors:

  • The company's need for a $500-million loan underscores the challenges it faces in meeting its financial obligations.

  • The high-interest rate of 17-18% on this loan highlights the financial pressure on Vedanta, reflecting its financial challenges.

  • The loan will be used to prepay 55% of the 13.875% bonds due in 2024, 5% of the 6.125% bonds maturing in August 2024, and 20% of the 8.95% bonds set to mature in March 2025.

Zoom out

In the larger corporate finance landscape, Vedanta Resources' predicament mirrors common financial challenges. It exemplifies how businesses deal with financial adversity, collaborating with stakeholders to find solutions. 

  • Vedanta plans to back the loan with brand fee receivables. They've offered 55% upfront for January 2024 bonds, 5% for August 2020 bonds, and 20% for March 2025 bonds. 

 

MIRCH MASALA