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India Ratings Downgrades IDBI Bank to IND AA; Outlook Negative
May 19,2017

The downgrade in the Long-Term Issuer Rating reflects the consistent drop in IDBIs share of systemic assets (domestic share of advances - 1HFY16: 3.0%; FY13: 3.5%) and liabilities (domestic share of deposits - 1HFY16: 2.8%; FY13: 3.2%) as the bank struggles with its asset quality challenges. The bank continues to grapple with a weak capital profile and the Reserve bank of Indias invocation of prompt corrective action framework would continue to weigh on its share of systemic assets and liabilities. The Negative Outlook reflects the high possibility of IDBI reporting its common equity tier 1 (9MFY17: 7.24%) below the minimum regulatory requirement (FY17: 6.75%) and continuously struggling with its core capitalisation level, both on an immediate and sustained basis, in the absence of a significant capital infusion from the government of India

The rating downgrade of AT1 bond and upper Tier II subordinated debt reflects the structural weakening of IDBIs standalone profile, likely elevated levels of credit costs, significant erosion of capital, limited visibility on capital infusion and the banks inability to timely garner equity capital by monetisation of its non-core assets. The downgrade of AT1 instrument also factors in weakening of IDBIs distributable reserve position which depleted to around 1.28% at end-December 2016 post accounting for nine-month losses, much lower than peers median of 4.50% for the same period.

For AT1 instruments, the agency considers discretionary component, coupon omission risk and write-down/conversion risk as key parameters to arrive at the rating. The agency recognises the unique going-concern loss absorption features that these bonds carry and differentiates them from the banks senior debt, factoring in a higher probability of an ultimate loss for investors in these bonds. The rating on AT1 bond reflects the banks standalone credit profile, along with its ability to service coupons and manage principal write-down risk over the Basel III transition period. Ind-Ra recognises that government support may be difficult to be relied upon by the holders of AT1 bonds considering loss absorption nature of these instruments.

In case the governments stake in IDBI drops below the majority level through a strategic divestment or otherwise, the credit profile of the bank will be reviewed on the basis of the transformation strategy and the strength of the strategic investors coming on board.

KEY RATING DRIVERS

Corporate Stress Yet to Completely Show Up: Ind-Ra expects IDBIs credit costs (9MFY17 (annualised): 369bp; FY16: 415bp) to remain significantly high over the medium term, on account of higher fresh slippages and provisioning requirements on the current stock of stressed corporates. According to Ind-Ra, the stock of stressed corporates with minimal provisioning remains high for IDBI. A substantially large portion of this exposure could slip to a substandard category over the next few quarters (including unsuccessful cases under strategic debt restructuring) which, along with the ageing impact of NPLs recognised under the asset quality review, would put significant pressure on its profit and loss statement. IDBI reported stressed assets to total loans ratio of 21.45% at end-December 2016 (FY16: 18.96%). IDBIs pre-provision profitability and capitalisation levels remain weak due to muted credit growth and the impact of interest rate reversals on its margins. Ind-Ra expects IDBIs net interest margins to remain under pressure, as more stressed assets start slipping into the non-performing category.

Large Capital Requirement Through FY19: IDBIs capitalisation is modest at 7.24% (prior to adjusting the losses in 9MFY17; FYE16: 7.98%), driven by losses and a substantial increase in risk weighted assets adjusting for nine-month loan growth, indicating accelerated deterioration of its asset quality. The banks risk weighted assets/net advances ratio at around 150% at end-March 2017 is the highest in the system. Ind-Ra believes IDBIs inability to grow at a decent pace would continue to put pressure on its operating buffers, limiting its ability to absorb the expected increase in credit costs and operating expenses. Considering the banks existing capitalisation level and structural weakness, it could remain under pressure on the capital front even after an equity infusion by the government in line with past allocation. IDBI will need to raise fresh equity from capital markets by diluting some of the governments shareholding and plan for significant capital raising under Basel III. Ind-Ra estimates IDBI would need INR91 billion of Tier I capital (assuming CAGR growth of 9% over FY18-FY19) to maintain a Tier I ratio of 10% (including a capital conservation buffer of 2.5%) by FYE19. IDBIs ability to raise sufficient growth capital, along with the governments equity infusion in the short term, will be a key monitorable for its standalone credit profile and instruments linked to it, such as AT1 bonds.

Deteriorating Standalone Profile: IDBIs standalone credit profile is weaker than its peers on account of its bleak operating and capital buffers. In 9MFY17, high credit costs and weak net interest margin continued to impact the banks profitability, while its CET1 ratio was modest at 7.24% (prior to adjusting the losses in 9MFY17). IDBI Banks dependence on bulk deposit remains higher than those of similar rated peers, with a 42% contribution to its total deposits as of December 2016 (December 2015: 45%). On the liquidity front, IDBIs cumulative one-year funding gap as a percentage of assets marginally improved to 22% in FY16 from 24% in FY15. At end-December 2016, IDBIs liquidity coverage ratio was 115.3%, higher than the current regulatory requirement of 80%.

RATING SENSITIVITIES

Negative: IDBIs Long-Term Issuer Rating could be further downgraded to Ind-Ras support floor for public sector banks if its share of systemic assets and liability continues to decline on a sustained basis.

The rating of AT1 instruments could be further downgraded if IDBI fails to raise sufficient equity capital or replenish distributable reserves in a timely manner. The ratings could also be downgraded in case of a significant (more than expected) decline in the asset quality is not buffered by timely support through equity infusions, leading to a consistent dilution in the banks capability to absorb losses.

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EPFO beneficiaries to get payment through electronic or digital fund transfer system
May 19,2017

The Ministry of Labour & Employment vide notification dated 4th May 2017 has provided for electronic or digital fund transfer / payment of EPF benefits, pension disbursement and insurance claim. For this purpose, suitable amendments have been made in all the three social security schemes administered by EPFO.

Such move is likely to benefit 4.5 crores EPF subscribers and around than 54 lakh pensioners. Now, payments will be made to the beneficiaries through electronic or digital fund transfer system only ensuring quick transfer of funds, easier tracking and reconciliation thereof.

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23.5% growth in Foreign Tourist Arrivals in April 2017 over April 2016
May 18,2017

Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) & FTAs on e- Tourist Visa on the basis of Nationality-wise, Port-wise data received from Bureau of Immigration (BOI).

The following are the important highlights regarding FTAs & also FTAs on e-Tourist Visa from tourism during the month of April, 2017.

Foreign Tourist Arrivals (FTAs):

n++ The number of FTAs in April, 2017 were 7.40 lakh as compared to FTAs of 5.99 lakh in April, 2016 and 5.42 lakh in April, 2015.

n++ The growth rate in FTAs in April, 2017 over April, 2016 is 23.5% compared to 10.7% in April, 2016 over April, 2015.

n++ FTAs during the period January- April 2017 were 35.85 lakh with a growth of 15.4%, as compared to the FTAs of 31.08 lakh with a growth of 10.1% in January- April 2016 over January- April 2015.

n++ The percentage share of Foreign Tourist Arrivals (FTAs) in India during April 2017 among the top 15 source countries was highest from Bangladesh (23.07%) followed by USA (10.65%), UK (10.51%), Germany (3.28%), Australia (3.15%), Malaysia (2.98%), China (2.95%), Sri Lanka (2.85%), Russian Fed. (2.78%), Canada (2.43%), France (2.33%), Japan (2.14%), Afghanistan (1.69%), Singapore (1.69%) and Nepal (1.61%).

n++ The percentage share of Foreign Tourist Arrivals (FTAs) in India during April 2017 among the top 15 ports was highest at Delhi Airport (29.20%) followed by Mumbai Airport (15.48%), Haridaspur Land checkpost (12.88%), Chennai Airport (6.56%), Bengaluru Airport (5.67%), Kolkata Airport (5.01%), Cochin Airport (4.06%), Gede Rail Land checkpost (2.89%), Goa Airport (2.86%), Hyderabad Airport (2.60%), Ghojadanga land checkpost (1.69%), Ahmadabad Airport (1.35%), Trivandrum (1.34%), Tiruchirapalli Airport (1.31%) and Amritsar Airport (1.23%),

Foreign Tourist Arrivals on e-Tourist Visa

n++ During the month of April, 2017, total of 1.14 lakh tourist arrived on e-Tourist Visa as compared to 0.7 lakh during the month of April 2016 registering a growth of 63.4%.

n++ During January- April 2017, a total of 5.82 lakh tourist arrived on e-Tourist Visa as compared to 3.91 lakh during January-April 2016, registering a growth of 48.8% .

n++ The percentage shares of top 15 source countries availing e- Tourist Visa facilities during April, 2017 were as follows:-

UK (21.6%), USA (10.2%), China (6.1%), Russian Fed (6.1%), France (5.1%), Germany (4.7%), Australia (4.0%), Canada (2.9%), Spain (2.7%), South Africa (2.7%), Korea (Rep.of) (2.6%), Thailand (2.3%), Malaysia (1.7%), Netherlands (1.7%) and Singapore (1.6%).

The percentage shares of top 15 ports in tourist arrivals on e-Tourist Visa during April, 2017 were as follows:

New Delhi Airport (48.6%), Mumbai Airport (20.4%), Dabolim (Goa) Airport (7.2%), Bengaluru Airport (5.4%), Chennai Airport (5.1%), Kochi Airport (3.2%), Kolkata Airport (2.3%), Amritsar Airport (2.0%),Hyderabad Airport (1.9%), Trivandrum Airport (1.3%), Ahmadabad Airport (1.0%), Tirchy Airport (0.6%), Jaipur Airport (0.5%), Calicut Airport (0.1%)and Pune Airport(0.1%) .

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Bilateral Exercise Between Indian & Republic Of Singapore Navy Simbex-17 Commences
May 18,2017

As part of SIMBEX-17, the ongoing Bilateral Naval Exercise between Navies of the Republic of Singapore and India, lndian Naval Ships Shivalik, Sahyadri, Jyoti and Kamorta and one P8-I Maritime Patrol and Anti-Submarine Warfare Aircraft are participating. While INS Sahyadri and INS Kamorta are at Singapore since 12 May 2017, INS Shivalik and INS Jyoti would be joining directly for the sea phase of the exercise. The ships are under the command of Rear Admiral Biswajit Dasgupta, YSM, VSM, Flag Officer Commanding Eastern Fleet.

SIMBEX is an acronym for n++Singapore-India Maritime Bilateral Exercisesn++. Bilateral cooperation between Singapore and India was first formalised when RSN ships began training with the Indian Navy in 1994. This years edition of SIMBEX-17 being held in the South China Sea would be the 24th in the series and is aimed to increase interoperability between the RSN and IN as well as develop common understanding and procedures for maritime security operations. The scope of the current exercise includes wide-ranging professional interactions during the Harbour Phase scheduled from 18 May to 20 May and a diverse range of operational activities at sea during the Sea Phase to be held from 21 May to 24 May. The thrust of exercises at sea this year would be on Anti-Submarine Warfare (ASW), integrated operations with Surface, Air and Sub-surface forces, Air Defence and Surface Encounter Exercises.

During SlMBEX-17, the Singapore Navy is represented by RSN Ships Supreme, Formidable and Victory and Maritime Patrol Aircraft Fokker F50 in addition to the RSAF F-16 aircraft.

The two navies share a long standing relationship with regular professional interactions that include exchange programs, staff talks and training courses. Singapore Chief of Naval Staff, Admiral Lai Chung Han had earlier visited ENC and participated in lFR-16 held in February last year in the City of Destiny, Visakhapatnam. RSS Formidable and a Fokker F 50 aircraft participated in SlMBEX-16 which was held at Visakhapatnam and in Bay of Bengal.

INS Sahyadri, and INS Shivalik-both multi-role stealth frigates - are commanded by Captain Anil Jaggi and Captain R Vinod Kumar respectively while INS Kamorta, an Anti-Submarine Warfare Corvette is commanded by Commander Vipin Gupta. lNS Jyoti, the fleet replenishment tanker is commanded by Captain S Shyam Sundar.

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Ind-Ra: Impact of Demonetisation Waning on Construction Equipment and Commercial Vehicle Loans, MFI Loans Remain Under Spell
May 18,2017

India Ratings and Research (Ind-Ra) analysed the performance of various asset classes under its rated portfolio as of the collection month of February 2017. Commercial vehicle loans registered a stable performance and were able to weather the impact of demonetisation. Construction equipment loans registered an improved performance, driven by an increase in infrastructure spending and a rise in mining activity. Tractor loans continued to show mixed signals, with higher stress in early delinquency buckets but lower forward roll rate indicating fewer loans moving into greater delinquency buckets relative to the historical trend. Microfinance institutions (MFI) loans witnessed a sharp rise in delinquencies after demonetisation and remained under stress. Moreover, MBS transactions continue to show a stable performance, supported by an adequate credit enhancement (CE) cover.

After demonetisation, Ind-Ras Early Delinquency Index (EDI) for commercial vehicle (CV) loans increased by 153bp to 6.86% in February 2017 from the average for 1HFY17. However, the rise in weighted average (WA) 60+dpd delinquencies is extremely marginal in February 2017 compared with the average for 1HFY17, indicating fewer loans are moving into deeper buckets. 2016 vintage loans experienced slightly higher delinquencies compared with 2015 vintage loans. However, WA 90+dpd delinquencies remained at a low gradient compared with 2012-13 vintages. 2015 vintage outperformed previous vintages, with WA 90+dpd delinquencies falling to a new low of 1.25% in February 2017.

High frequency data on the underlying pools of construction equipment ABS indicates that the stress in the asset class is easing out. This is evident from a continual and significant drop observed in defaults, with WA 90+dpd delinquencies reducing 265bp in February 2017 from a high of 3.88% in November 2015. Also, the Ind-Ra Construction Equipment Gross Loss Index declined to 0.64% in February 2017 from 2.92% in February 2016.

The performance of tractor loans was mixed, considering short-term delinquencies rose and forward roll rate remained low in the last 12 months. 2016 vintage performed better across all vintages; WA 90+ delinquency for 2016 vintage loans stood at 3.26% in February 2017 (vintage with lowest delinquency at similar seasoning levels). However, farm loan waiver and pressure from the farming community may affect the credit discipline of borrowers.

Microfinance loans registered a sharp rise in delinquencies after demonetisation. Ind-Ras 0+days delinquency index increased to 10.82% in February 2017 from 0.45% in October 2016. The rise in delinquencies is expected to have a limited impact on the ratings of significantly amortised transactions that are cushioned by a high CE cover. However, local issues such as political interventions and loan waivers would continue to remain key imponderables for recent vintage loans.

Ind-Ra-rated MBS transactions registered a stable performance on account of an upright pool performance and adequate CE. WA 90+dpd delinquencies hovered at about 0.5% in FY17.

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Ind-Ra: Denim Industry Reels Under Cost Pressure; Credit Negative
May 18,2017

The denim industry which represents below 10% of the textile market is likely to face deterioration in credit profile in the absence of improvements in realisations in FY18, says India Ratings and Research (Ind-Ra). The sectors operating margins are expected to fall to 10%-11% in FY18 (9MFY17; 12.6%) due to cost inflation amid surplus capacity in denim standard products which have low cotton content.

Ind-Ra estimates prices to moderate in 2HFY18, highlighted in the report Stable Input Prices, Fiscal Incentives to Support Textile and Cotton in FY18. However the denim surplus situation and inventory losses are likely to pressurise margins. Moreover, the man-made industry demands a level playing field for the taxation of cotton, which is exempt from indirect taxation. If cotton is brought under the Goods and Services Tax (GST) then cotton fabrics including denim sectors profitability may come under pressure in the transitory period.

The agencies denim peer set average EBITDA margins deteriorated in 9MFY17 to 12.6% from FY16s 13.2%. The fall in margins is on account of players inability to completely pass on the increase in cotton prices, on the back of high competitive pressure, similar to the situation in FY14. Raw cotton prices have increased by 32.8% yoy in March 2017 and Ind-Ra expects it to remain elevated until 1HFY18. For Denim manufacturers cotton forms more than 35%-40% of the total raw material requirement. The agency notes that for many of the basic denim fabric manufacturers catering to domestic consumption average realisations remained steady, despite higher cotton prices in 9MFY17. However, some of them have been able to increase realisations for 4QFY17 partly passing the cost inflation with a lag. Denim garments players are likely to perform better than fabric players, as the retail margins may sustain as fabric prices remain under pressure.

Ind-Ra expects the denim sector to post robust volume growth of over 10%-15% in line with the past trend along with rising disposable incomes, rapid growth of the retail sector, westernisation trend, young population demographics, and versatility of denim as a fabric. However, Ind-Ra views that the capacity addition is growing at a faster rate. Moreover, the existing capacities will face competition from new-age cost efficient plants.

The denim fabric industry is cyclical in nature and is characterised by periods of excess capacity followed by narrowing the demand-supply gap. The apparent short project pay-back has encouraged a number of denim fabric manufacturers to put up additional capacity, higher than the estimated demand growth. Further capacity additions are likely to keep the domestic competitive pressures heightened. As per CMIE data, a moderate level of new capacity ramp-up is underway in FY18. This includes capital expenditure for expansion and backward integration by a few companies namely, Nandan Denim Limited, Raymond Uco Denim Pvt Limited and RSWM Limited (IND A+/Stable).

Overall, the credit profile for most players has come under pressure also due to the stretched working capital cycle and debt-led capacity expansion in the backdrop of operating margin pressure. Aggregate peer set net leverage (Net Debt/EBITDA) increased to 4.59x in 1HFY17 compared to 2.83x in FY16. The working capital cycle has got stretched to 61 days in 1HFY17compared to 54 days in FY16, on account of the high credit period and inventory holding for the new capacity ramp-up. Increased competition in the international arena and higher receivable days will impact the exports profitability. However, Ind-Ra believes the credit profile of value-add export-oriented manufacturers will remain robust. Industry players with diversified revenue lines with a mix of man-made textile products are better placed than the pure denim players. Also, companies with strong liquidity, low leverage and short working capital cycle are better placed to face the challenging times.

Ind-Ras rated portfolio includes Sangam (India) Ltd. (SIL; IND A+/Stable), Aarvee Denims Limited, (IND tA-/Negative), RSWM Limited and Ultra Denim Private Ltd (IND BB-/Stable). Financials of Nandan Denim Ltd, Jindal Worldwide Limited and KG Denim Limited also formed part of the peer set for this study.

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ADB Issues Green Rupee-Linked Bond to Support Renewable Energy in India
May 18,2017

The Asian Development Bank (ADB) has raised 3 billion Indian Rupees (INR), about $47 million, from a new issue of offshore Indian Rupee-linked bonds to help finance climate change mitigation and adaptation projects in India.

n++Todays fundraising represents ADBs maiden Indian Rupee green bond and shows the institutions long term commitment to financial market development in India,n++ said ADB Treasurer Pierre Van Peteghem. n++In todays markets, green bonds are an increasingly important source of financing for climate change projects and given ADBs strong engagement in the capital markets of developing Asia, it is a natural next step for ADB to issue green bonds in local currency.n++

The bond issue carries a 6.00% interest rate with a 3.75-year maturity, falling due in February 2021.

The bonds, which are denominated in Indian rupees but settled in US dollars, were underwritten by JP Morgan and TD Securities as Joint Lead Managers. The bonds were placed 9% in Asia, 70% in Europe, and 21% in the Americas. By investor type, 48% of the bonds were placed with banks, and 52% with fund managers.

Proceeds from the bonds will be mobilized into ADBs first cofinancing with the JICA LEAP Fund for the ReNew Clean Energy Project, a wind and solar power project across six states in India. India is ADBs fourth largest shareholder and its largest borrower, excluding cofinancing. In 2016, ADB approved $2.26 billion in sovereign loans and $795 million in private sector projects in India, its largest market.

ADB is a regular borrower in the mainstream international bond markets but has also led issuance in developing Asian countries as part of efforts to promote domestic bond markets as an alternative to bank lending. ADB plans to raise up to $30 billion from the capital markets in 2017.

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Moodys: Emerging markets ability to adapt to technology crucial as robotics use surges
May 18,2017

The accelerating adoption of robotics in manufacturing in some of the worlds more advanced economies could pose challenges to emerging market exporters that have benefited from their comparative advantage of lower cost, high skilled labor, says Moodys Investors Service in a report.

The US (Aaa stable), Germany (Aaa stable), Japan (A1 stable), Korea (Aa2 stable) and China (Aa3 negative) account for about 75% of spending on global industrial robotics worldwide.

In these five countries, the use of robotics could even bring back some of the processes that have been offshored to lower labor cost destinations. Nonetheless, the number of jobs lost to automation is likely to be higher than those gained by onshoring.

Another impact of robotics is that it could offset labor market pressures in countries with aging populations.

In countries where aging populations are reducing the growth in labor supply, robotics could support growth by lowering the need for labor while also increasing productivity, said Samar Maziad, a Senior Analyst and Vice President at Moodys.

Robotics technology is most commonly used in the highly globalized automotive and electronics industries, and the five main nations that are adopting it are also key trade nodes in their respective regions. This implies that while the adoption of robotics is currently concentrated in only a few countries, it will have implications beyond their borders. In particular, the countries that are linked to them through trade and manufacturing supply chains will be impacted.

These include emerging markets economies, such as Czech Republic (A1 stable), Hungary (Baa3 stable), and Slovenia (Baa3 positive) in Central and Eastern Europe, as well as Malaysia (A3 stable) and Thailand (Baa1 stable) in Asia. These nations are deeply integrated into high technology production chains and export markets due to their comparative advantage of high-skilled, lower cost labor forces. As automation becomes more efficient and cost effective, it could negate the labor cost advantage of some of these emerging markets.

Among these emerging markets, those with a greater capacity to absorb new technology will fare better than their less technology-ready peers.

To adapt to increased automation, these emerging markets will need to integrate their economies into a new production process that relies more heavily on robotics technology, whether as suppliers or competitors said Maziad. In other words, technologically-ready economies will remain relevant even as labor-intensive production methods become obsolete.

Whether the sovereign credit implications of the adoption of robotics are net positive or negative for a particular country will depend on how private sector investment strategies, government policies and labor market dynamics evolve and interact with each other over the next several years.

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Minister of Railways Releases Third Party Audit Report on Station Cleanliness
May 18,2017

Minister of Railways, Shri Suresh Prabhakar Prabhu released Third Party Audit Report on Station Cleanliness and Inaugurated Swachh Rail Portal. Vishakhapatnam in Andhra Pradesh and Beas in Punjab is the Cleanest Station in A1, A Category Stations Respectively. Khammam station Comes 2nd Rank in Station Cleanliness in A Category from 285 Rank previous Year.

Minister of Railways dedicated a SWACHH RAIL PORTAL to showcase rankings of stations and trains, methodology adopted for rankings and stations/trains specific dashboards.n++ This web portal will also be leveraged to seek passenger feedback on cleanliness on a continual basis.

Speaking on the occasion, Minister of Railways Shri Suresh Prabhu said that Indian Railways started third party Cleanliness Index of Stations since last year. Railways have accomplished a significant improvement in cleanliness at station. This index instils competitive spirit among the stations. The biggest challenge for cleanliness at the platforms is visitors along with the passengers, even the toilets are used by large number of visitors who are not Railway travellers. However, Railways have to move forward. The focus is on Platform cleanliness, coach cleanliness, toilets cleanliness in the coach & track cleanliness. Railways have introduced Clean My Coach services which is getting overwhelming response of the passengers, Four green corridors have been marked which are free from discharge of human waste. I urge the municipal corporation of the cities which have encroachments to come forward and cooperate in eliminating human waste from the tracks. He said that Vishakhapatnam has emerged as the winner in Cleanliness Index by securing Ist position in A1 category, Beas has emerged as Ist winner in A category station. Guwahati, Varanasi, Mughalsarai&HazratNizamuddin Station have shown tremendous improvements, He said that lot of NGOs, Students group have come forward to clean and beautify their stations. He also thanked & dedicated this achievement to the people in respective areas,

Background:

Indian Railways is the third largest rail network with 66,000 route kilometre stretch covering more than 8000 stations. Consequent to the launch of Swachh Bharat Abhiyan on 2nd Oct2014 by Honble Prime Minister Shri Narendra Modi, Indian Railways had also launched Swachh Rail Swachh Bharat Abhiyan to achieve the vision of Clean India by 2nd Oct 2019, which shall be the 150th Birthday of father of the Nation Mahatma Gandhi.

In the Rail Budget presented in Feb2015, 2016 and 2017, series of measures to improve the cleanliness of stations were announced to take forward the momentum of Swachh Rail Swachh Bharat. One of the measures given in Feb2016 Budget is ranking of A1 and A category stations based on regular periodic third party audit and feedback from passengers, with a view to identify unclean spots/gaps and to improve cleanliness standards and also to propel healthy competition among railway stations. Ministry of Railway (Environment and Housekeeping Management Directorate, Railway Board) commissioned a passenger feedback survey on cleanliness at major railway stations. The task of survey was entrusted to Indian Railway Catering and Tourism Corporation (IRCTC).

First survey conducted by IRCTC in 2016 by conducting interviews of passengers at the stations on various parameters of cleanliness and rating them on these basis. The second survey has been conducted by Quality Council of India (QCI) who with the help of their partners have conducted the survey of 407 major railway stations (75 A1 category and 332 A category stations) of Indian Railways.

The parameters adopted for conducting the survey are: Evaluation of Process of cleanliness in Parking, main entry area, main platform, waiting room,(33.33%) direct observation by QCI assessors of cleanliness in these areas (33.33%) and passenger feedback(33.33%). A 24x7 control room was set upn++ and images were geo-tagged to monitor progress.

The survey was conducted through interviews with respondents on the questionnaire on cleanliness indicators, which was done face to face by survey teams by visiting each of the 407 stations across 16 Zonal Railways. Every passenger was asked to rate the cleanliness of stations objectively on 40 different cleanliness parameters.

Purely based on the survey on the cleanliness of stations and the analysis thereof, 407 major stations have been given rankings in this Report submitted by the survey agency to Ministry of Railways for scrutiny and further action. Final report is expected to be submitted by QCI shortly, which will include specific actionable items for each division. Ministry of Railways will take further action for improving the cleanliness standards at major stations of Indian Railways thereupon.

RankA1 Category Station
(Out of 75)
A Category Station
(Out of 332)
Railway Zone
(Out of 16)

1

Vishakhapatnam,
East Coast Railway,
Andhra Pradesh

Beas, Northern Railway, Punjab

South East Central Railway

2

Secunderabad, South Central Railway, Telangana

Khammam, South-Central Railway, Telangana

East Coast Railway

3

Jammu Tawi, Northern Railway, Jammu Kashmir

Ahmednagar, Central Railway, Maharashtra

Central Railway

4

Vijayawada, South Central Railway, Andhra Pradesh

Durgapur, Eastern Railway, West Bengal

South Central Railway

5

Anand Vihar Terminal, Northern Railway, Delhi

Mancherial, South Central Railway, Telangana

Western Railway

6

Lucknow, Northern Railway, Uttar Pradesh

Badnera,Central Railway, Maharashtra

South Western Railway

7

Ahmedabad, Western Railway, Gujarat

Rangn++n++ iya Junction, North Frontier Railway, Assam

North Eastern Railway

8

Jaipur, North Western Railway, Rajasthan

Warangal, South Central Railway, Telangana

North Western Railway

9

Pune, Central Railway, Maharashtra

Damoh,West Central Railway. Madhya Pradesh

Southern Railway

Moodys Liquidity-Stress Index set to decline again in May; markets remain favorable to US spec-grade companies
May 18,2017

Moodys Liquidity-Stress Index (LSI) declined again through mid-May, extending its improving trend to just over a year, the rating agency says in its most recent edition of SGL Monitor. The index dipped to 4.6% in mid-May from 4.9% in April as US speculative-grade company liquidity positions continue to be bolstered by earnings and good access to credit markets.

Moodys Liquidity-Stress Index falls when corporate liquidity appears to improve and rises when it appears to weaken.

The LSI is benefiting from fundamental strengths, including steady-to-growing corporate earnings and strong investor appetite for yield, said Senior Vice President John Puchalla. Importantly, despite new issue volume easing in April from the first quarters blistering pace, new issuance continues at a healthy overall clip.

Thus far in May, upgrades of Moodys speculative-grade liquidity (SGL) ratings outpaced downgrades by six to one, Puchalla says. SGL rating activity reflects easing volatility, mainly as energy-related woes continue to ebb. With oil prices and production increasing, the fortunes of companies that supply the industry are also rebounding, including those of frack sand suppliers Fairmount Santrol and Hi-Crush Partners, which both saw their liquidity ratings upgraded to SGL-3 from SGL-4 in May.

Meanwhile, Moodys Covenant-Stress Index slipped to 3.2% in April from 3.5% in March. The index, which has been below its 5.8% long-term average since June last year, indicates that US speculative-grade companies continue to run a very low risk of violating their debt covenants.

Moodys forecasts that the US speculative-grade default rate will decline to 3.0% in April 2018 from 4.5% today, against a long-term average of 6.8%.

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Cabinet approves four laning of Porbandar-Dwarka Section of NH-8E in Gujarat
May 18,2017

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the development of four laning of Porbandar-Dwarka Section of NH-8E in Gujarat.

The cost is estimated to be Rs.1958.88 crore including cost of land acquisition, resettlement and rehabilitation and other pre-construction activities. The total length of the road to be developed is approximately 118 kms.

This work will be done under the National Highways Development Project (NHDP) Phase IV on Hybrid Annuity Mode.

The project will help in expediting the improvement of infrastructure in Gujarat and in reducing the time and cost of travel for traffic, particularly heavy traffic, plying between Porbandar-Dwarka section. The development of this stretch will also help in uplifting the socio-economic condition of this region in the State.

It would also increase employment potential for local labourers for project activities. It has been estimated that a total number of 4,076 mandays are required for construction of one kilometre of highway. As such, employment potential of 4,80,000 (approx.) mandays will be generated locally during the construction period of this stretch.

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Cabinet approves construction of double line with electrification between Guntur-Guntakal in Andhra Pradesh
May 18,2017

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the construction of double line with electrification between Guntur-Guntakal in Andhra Pradesh.

The total length of the line will be 401.47 km. The anticipated cost of the Project will be Rs.3631 crore which will be funded through cost sharing of 50:50 by State Government and Ministry of Railway. The project is likely to be completed in five years.

The project fulfils the commitment given in the Andhra Pradesh Bifurcation Act regarding the increased rail connectivity to the Rayalaseema region to the Amravati, the capital of Andhra Pradesh.

There is significant amount of cross traffic moving on Guntur-Guntakal section besides the scope for further increase in additional originating and terminating traffic once the line is doubled. Besides travelling people. Industries in and around Guntur-Guntakal route will have additional transport capacity to meet their requirements.

Background:

The Guntur-Guntakal section falls in Guntur, Prakasham, Kurnool and Ananthapur districts of Andhra Pradesh. This is most accessible shortest route to Bangaluru from many important cities of Eastern and North Eastern States.

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Cabinet approves construction of electrified doubling line between Phephana-Indara and Mau-Shahganj in Uttar Pradesh
May 18,2017

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the construction of double line with electrification between Phephana-Indara and Mau-Shahganj (excluding Indara-Mau) totaling 150 km approximately in Uttar Pradesh.

The respective length of the Phephana-Indara and Mau-Shahganj lines will be 50.53 km and 99.75 km. The estimated cost of the Project will be Rs.1028.95 crore with expected completion cost of Rs.1190.98 crore. The project is likely to be completed in next five years.

The doubling of these lines will remove the pressure over the congested North Central Railway route by providing an alternative route. Also, more number of goods/passenger trains could be run after doubling. It will lead to economic prosperity and development of the areas.

Background:

The areas served by this route are densely populated and there has been persistent unfulfilled demand of additional trains for the local and metropolitans cities. Shahganj-Mau-Phephna provides an important link between Amritsar-Moradabad-Lucknow-Mughalsarai-Patna section and Gorakhpur-Chhapra-Hajipur-Guwahati section. Thus doubling of this section will provide much needed relief toVaranasi-Mughalsarai and Makama-Barauni section which are highly congested.

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Cabinet approves construction of electrified third line between Manmad-Jalgaon in Maharashtra
May 17,2017

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the construction of electrified third line between Manmad-Jalgaon in Maharashtra.

The total length of the Manmad-Jalgaon line will be 160 km. The estimated cost of the Project will be Rs.1035.16 crore with expected completion cost of Rs.1198.92 crore. The project is likely to be completed in next five years.

Construction of third line will greatly ease the ever increasing passenger and freight traffic on Manmad-Jalgaon route thereby increasing the revenue of Railways. Jalgaon and Nashik districts of Maharashtra will be covered by this route.

Background:

Manmad-Jalgaon section caters to the traffic of Delhi-Mumbai and Kolkata-Mumbai corridors. Two double line tracks from Wardha and Itarsi, respectively, converge at Bhusawal. Work of 3rd and 4th line in Jalgaon-Bhusawal section is already under progress. Operations on the section have already reached to saturation. The third line between Manmad-Jalgaon section is imperative and inescapable.

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Cabinet approves Signing of Fuel Supply Agreement (FSA) with Letter of Assurance (LoA) holders of Thermal Power Plants(TPPs)
May 17,2017

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the signing of Fuel Supply Agreement (FSA) with the Letter of Assurance (LoA) holders. Allocation of linkages for power sector shall be based on auction of linkages or through Power Purchase Agreement (PPA) based on competitive bidding of tariffs except for the State and the Central Power Generating companies and the exceptions provided in Tariff Policy, 2016. Coal drawal will be permitted against valid Long Term PPAs and to be concluded Medium Term PPAs.

The approved framework ensures that all projects with linkages are supplied coal as per their entitlement. This will ensure the rights of coal supplies for FSA holders and signing of FSA with LoA holders.

Allocation of linkages in future will be transparent and bidding based, barring some exceptions as per Tariff Policy. Future allocation/grant of linkages will be based on auction and/or tariff based bidding. It attempts to make optimal allocation of the vital natural resource across the power units.

The salient features of the SHAKTI are as follows:

i. TPPs having LoA shall be eligible to sign FSA after ensuring that the plants are commissioned, respective milestones met, all specified conditions of the LoA fulfilled within specified timeframe and where nothing adverse is detected against the LoA holders and the TPPs are commissioned before 31.03.22.

ii. TPPs, part of 78000 MW, that could not be commissioned by 31.03.15 shall now be eligible for coal drawal if the plants are commissioned before 31.03.22.

iii. Actual coal supplies to all TPPs shall be to the extent of long term PPAs or medium term PPAs to be concluded in future.

iv. Future coal linkages shall be granted as per the following provisions:

a) To Central and State Gencos, on recommendations of Ministry of Power (MoP).

b) Coal linkages shall be granted on auction basis for Independent Power producers (IPPs) with PPA based on domestic coal. The IPPs participating in auction will bid for discount on the existing tariff. The discount on tariff would be adjusted from the gross amount of bill at the time of billing.

c) The future coal linkages for supply of coal to IPPs without PPA shall be on the basis of auction where bidding for linkage shall be done over the Notified Price of Coal Company. The LoA shall be issued to the successful bidders and FSA signed after meeting the terms of LoA.

d) Linkages shall be earmarked to the States where any linkage quantity unutilized for two years shall lapse. States may indicate the earmarked linkages to the DISCOMs/SDAs, who may:

n++ Undertake tariff based competitive bidding on long-term and medium-term PPAs and allot these linkages to the successful bidder; or

n++ Assign these linkages to capacities that are covered under exceptions and proviso clauses of para 5.2 of the Tariff Policy dated 28.01.16.

e) Power requirement of group of States can be aggregated and procurement of power on tariff based bidding shall be made by a designated agency. Coal linkages shall be earmarked for such agency.

f) Linkages, for full normative quantity, shall be granted for setting up Ultra Mega Power Projects (UMPP).

g) Coal linkages, for IPPs having PPA based on imported coal, shall be made available through a transparent bidding process.

Policy directions will be issued by the Ministry of Coal and Ministry of Power and will be implemented by CIL (Coal India Ltd.) / SCCL (Singareni Collieries Company Ltd.) and different power entities of the State and Central Government.

Background:

The coal supply to the TPPs has been made as per the provisions of the New Coal Distribution Policy (NCDP), 2007. Till 2010, CIL had issued LoA for approximately 1,08,000 MW capacity and no new LoAs were issued thereafter due to the prevailing scarcity scenario. The CCEA decision of 21.06.13 directed CIL to sign FSA with TPPs of about 78,000 MW capacity. The coal availability scenario has, now, emerged from scarcity to adequacy. In this adequate coal availability scenario, the present policy proposes a fading away of the old linkage allocation policy and emergence of a new linkage allocation policy based on transparent and objective criteria for the optimal utilisation of the natural resources.

Coal linkage to the power sector is governed by provisions of the NCDP, 2007. Under the NCDP, a system of issuance of LoA was introduced wherein requests for Linkage/LoA are forwarded to MoP for its recommendations. These recommendations are placed before the Standing Linkage Committee (SLCLT) which authorizes issue of LoA.

POLICY HIGHLIGHTS

I. Existing Regime

n++ FSA to be signed with the existing LoA holders

-About 28,000 MW

-Plants have to be commissioned within 31.03.2022

-Respective milestones are met

-All LoA conditions fulfilled in specified time frame

-Nothing adverse is detected

n++ TPPs which are part of 78000 MW, to get coal if commissioned within 31.03.2022

n++ TPPs to get coal at existing rate (@75% of ACQ)

n++ Coal supply to increase on coal availability

II. New Regime (SHAKTI, 2017)

n++ State/Central Gencos & their JVs to get coal linkages as per MoP recommendations

n++ Coal Linkage on auction basis for IPPs:

-Having PPA based on Domestic Coal

n++ Bid for discount in existing tariff (paise/unit)

n++ A minimum discount in tariff to be determined

n++ Discount to be adjusted from gross amount at time of billing

-Without PPA

n++ Bid for linkages over CIL notified price

n++ PPA to be submitted within 2 years

-Having PPA based on Imported Coal

n++ Transparent bidding process of linkages

n++ Methodology to be formulated by MoC & MoP

n++ Future Medium Term PPAs also to be eligible for linkage coal

n++ Coal linkages for full normative quantity of UMPPs on tariff based competitive bidding

n++ Coal linkages to be earmarked to States for

- Tariff based competitive bidding for PPA; OR

-Grant to capacities covered under exceptions in Tariff Policy dated 28.01.16, namely,

n++ One time capacity addition of up to 100% of existing capacity

n++ Plant set up under a notified policy of State Government for investment promotion (maximum 35% can be procured by State Discom)

-State to decide from above two, in public interest and requirement

-Linkage quantity unutilised for 2 years to lapse

n++ Power requirement of group of States can be aggregated

- Linkage to agency designated by MoP/States

-Agency to undertake tariff based competitive bidding

III. Benefits of the Policy

n++ Coal available to all Power Plants in transparent and objective manner

n++ Auction to be made the basis of linkage allocations to IPPs; cheaper and affordable POWER FOR ALL

n++ The Stress on account of non-availability of linkages to Power Sector Projects shall be overcome. Good for the Infrastructure and banking Sector

n++ PPA holders to reduce tariff for linkage; Direct benefit of reduced tariff to Discom/consumers

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