Morning Buzz: SBI hikes rates on FDs, PLI schemes attract over Rs 95,000 crore till Sept, and more

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PLI schemes attracted over Rs 95,000 crore investment till Sept 2023

The production-linked incentive (PLI) schemes—which were announced by the government in FY22—for 14 sectors have attracted over Rs 95,000 crore in investment till September 2023, a statement from the government said. The government announced an outlay of Rs 1.97 trillion for the schemes. 746 applications were approved and PLI units have been established in 150 districts of 24 states. Import substitution was seen in the telecom sector and a 20 percent value addition was seen in the mobile manufacturing segment, data shows.

(Business Standard, Economic Times, Zee Business)

State Bank of India hikes rates on fixed deposits, as credit growth surges

The State Bank of India (SBI) has hiked interest rates on fixed deposits below a size of Rs 2 crore. The new rates—up by between 25 to 50 basis points—are applicable from December 27. The bank has increased the rates on all tenures except for one year to less than two years, 2 years to less than 3 years, and five years to ten years. Several banks, including Kotak Mahindra Bank, DCB, Federal Bank and others have hiked fixed deposit rates in recent weeks to meet the growing demand for credit/loans. The RBI has, in recent months, constantly warned banks and NBFCs of the concerns of acceleration in credit growth.

(Mint)

Current account deficit falls to 1 percent as merchandise trade deficit narrows

India’s current account deficit (CAD) narrowed sharply to 1 percent of GDP in the second quarter of FY24 against 3.8 percent for the same period a year earlier. This was due to lower merchandise trade deficit. Services exports and improving inflows in non-resident deposits also helped narrow the deficit. One needs to see if the government can continue to improve this disbalance and could go back to the 1.5 percent level soon.