Indian farm loan waivers are a risk to fiscal consolidation, says Fitch

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The farm loan-waiver schemes being discussed and rolled out across an increasing number of Indian states could have a significant impact on state government finances, and might undermine efforts to bring down general government debt, Fitch Ratings warned in a note. “The impact on India’s debt dynamics and capital spending will depend on the total […]

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US Fed wants aggressive limit on commodity holdings by banks

Under a proposed rule released last week by the U.S. Federal Reserve, American banks will need to put up much more capital to support investments in physical commodities, restrict involvement with power plants and limit the amount of trading banks can do. “Goldman Sachs Group Inc.’s and Morgan Stanley’s sometimes lucrative romance with metals, coal and oil […]

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China encouraging more private capital participation in infrastructure, says Moody’s

While banks, local capital markets and government will remain the key sources of the more-than-RMB10 trillion in capital needed over the next five years to develop China’ infrastructure, Moody’s Investors Service said the role of private sector capital will also rise. “The government is taking a number of measures to attract more private institutional capital […]

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Most Asia-Pacific banks have buffers against commodity risks – Moody’s

Banks in Asia Pacific (ex-Japan) show moderate loan exposure to borrowers in commodity-related industries, with such loans making up around 7 percent of gross loans on average at end-2015, Moody’s Investors Service said ina report. However, the quality of such loans will likely continue to deteriorate, based on Moody’s assessment that energy and commodity prices […]

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China to unveil plan on ‘zombie companies’ to reduce overcapacity – report

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China is expected to release a detailed plan on “zombie companies” soon to reduce capacity in oversupplied industries, The China Securities News reported. “Zombie companies” are economically unviable businesses, usually in industries with severe overcapacity, such as steel, kept alive only with aid from the government and banks. The plan, which is being drafted by […]

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Indian steel makers seek urgent financial package for survival

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India’s beleaguered steel industry, battling sharp profit falls and financial stress blamed on dumping of steel products by China, japan and South Korea, has urged the government for a moratorium of payment of interest and principal amounts of loans and a revamping of debt to survive. The Indian Steel Association (ISA) said it had written […]

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