Daily Financial News Analysis – 8th July’20

Table of Contents

Boost capex

FinMin has asked CPSEs to boost their Capex.
Of course, the government’s plan to accelerate economic growth.
Better performance from the CPSEs can substantially improve the recovery prospects of the economy.
Sitharaman asked the concerned secretaries to ensure the CPSEs achieved capex of at least 50% of their capital outlay for the fiscal by the second quarter itself.
She directed the ministries and CPSEs to flag any unresolved issues to the departments of economic affairs or public enterprises for an immediate solution.
These 23 CPSEs surpassed their capex target for the previous fiscal, achieving 101% at Rs 1.66 lakh crore against the target of Rs 1.65 lakh crore.
This year’s capex target is Rs 1.66 lakh crore.
Sitharaman said that an extraordinary situation requires extraordinary efforts and with collective efforts, adding that we will not only perform better but also help the Indian economy to achieve better results, according to the release.

Amitabh Kant: India will bounce back with a vengeance with green shoots in the economy already being visible.
India must identify 12-13 sunrise sectors in which it can leapfrog to become global champions to achieve sustainable high growth and create jobs.
Kant said Atma Nirbhar Bharat is not about protectionism.
Atma Nirbhar Bharat is the ability of Indian companies to develop world-class products to cater to the domestic market and eventually hit the global markets by becoming global champions.
Atma Nirbhar Bharat is also about collaborating partnership between Government and Private Players.
140 million downloads
Indian has traditionally focussed on sunset sectors where it is difficult to get the size and scale.
Media and entertainment industry is poised to cross $30 billion by 2021.

Intelligence Bureau: remote access and data storage
IB is reportedly against data going outside the country during the trials and it also does not want remote access to be granted to the Chinese vendors.
If the government doesn’t alter its stance, Chinese vendors like Huawei and ZTE will not be able to participate in the trials.
Experts said no vendor would be willing to relocate the hub within the country, for remote location, and that too for trial purposes.
Indian government currently has no plans to auction 5G spectrum
The handsets too are not available.

Globally, the financial services industry has proved to be an enthusiastic adopter of Artificial Intelligence (AI) driven by the availability of data and investment appetite.
Creative implementation of AI by start-ups and fintechs has helped further this trend.

AI has helped banks gain better control and predictability.
Today, customers expect faster, personal, and meaningful services and interactions with their banks.
Banks must leverage AI to balance the need for privacy and security with personalisation and engagement.
Indian banks are using AI primarily for improving customer exprience.
AI implementation requires banks to operate outside of the traditional privacy framework.
We dont have a robust data protection and privacy policy.
RBI should frame rules on emerging technologies, data privacy and ensuring the business interests of the banks.

2019 RBI annual report: losses due to banking frauds have risen by a whopping 8% despite the Government’s efforts to curb them.
Average: banks took an average of 22 months between the occurrence of fraud and its detection, as per RBI data.
Real-time payments and rapid innovation in fraud landscape.

Proliferation of mobile devices and the internet
Spending patterns and provide recommendations on investment and risk profiles.
Digitising the KYC process to eliminate the need for physical document submission and verification is something that traditional banks still do not offer.

AI is a great fit in areas where decisions are based on available structured and unstructured data.
For example, it can help predict potential loan defaulters and offer loss mitigation strategies that will work for them.
It can help determine the best time to approach a customer to sell a new product.