Daily Pulse India: Rajan Is Worried, Free Basics On Hold, Star Wars This Weekend

(This is the last Daily Pulse India edition for 2015. We're back in business on Jan 4. Signing off with a big thank you to all you wonderful readers for your comments, feedback and wishes. Have a wonderful holiday and we'll see you in the new year)

Rajan is a worried man. An RBI report on financial stability highlights more signs of stress on banks’ books. Simply put: their biggest borrowers are at highest risk of default – a worrying sign indeed. Infrastructure, steel and construction companies, the big-ticket borrowers, are in the deepest trouble. The RBI suggests that banks may have been rather indiscreet about lending to these sectors during the boom period, leading to this situation. About 5 percent of bank loans are “non-performing” and about 11 percent of their debt is “distressed.” RBI has done its bit by giving banks more power to recover their money and banks are using it too. Maybe, it’s just a matter of time before it sorts itself out.

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Free Basics on Hold: Reliance Communications has put its launch of Facebook’s Free Basics Service on hold. It was supposed to launch it early next year on its CDMA network, but the telecom regulator has asked it to hold it until it firms its stand on net neutrality. Facebook has been going all out to push Free Basics in India – a key market – holding a town hall meeting with visiting Prime Minister Narendra Modi at its headquarters, following up with another one by Mark Zuckerberg in New Delhi a few weeks later. Net neutrality has become a hot topic this year, starting with Airtel’s zero rating plan, which was scuttled by internet activists, and now Free Basics.

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Parliament Woes: The winter session of Parliament ended yesterday so it’s time for a quick recap of what did and didn’t happen. The much-touted GST bill didn’t make it to law and neither did the bankruptcy code – two of the most important parts of the government’s reform plan. Much of the time was taken up with political protests which led to adjournments and no business done. This is the second session to end on a damp note and has renewed worries about this government’s ability to get any business done in Parliament. The NDa government led by Modi swept into power on promises of reforms, but thus far, those promises have fallen flat.

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Fund Management: Wipro has acquired Viteos , a BPaaS company for $130 million, to allow the IT service to expand its offerings to the capital market. Viteos, based in New Jersey, offers back office automated services to trading companies.

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The latest Star Wars movie releases this weekend and Walt Disney has tied up with five brands for promotion. They are Lifebuoy soap, Duracell battery, Baleno hatchback car and Subway. Be prepared for the marketing overload coming up with the release.

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Cover Image: Merry Christmas! 

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