Economy
Indian crude oil basket falls below $37 as supply glut mounts
The Indian basket of crude oils fell below $37 per barrel on the previous trading day on Wednesday as global prices slid further amid a supply glut, raising visions of the black gold falling to $20 levels.
 
As per data released by India's petroleum ministry, its crude basket fell below the $40 per barrel mark for the second time in a month on Monday, following a decision by the Organisation of Petroleum Exporting Countries (OPEC) last week to keep producing optimally.
 
The Indian basket, comprising 73 percent sour-grade Dubai and Oman crudes, and the balance in sweet-grade Brent, plunged to $36.75 on Wednesday for a barrel of nearly 160 litres, as per data compiled by the state-run Petroleum Planning and Analysis Cell.
 
As per latest OPEC data, its new reference basket of 12 crude oils closed at $34.80 a barrel on Wednesday. With the OPEC strategy designed to choke competition from the American shale gas industry, US light crude dropped on Wednesday to less than $38 a barrel.
 
The West Texas Intermediate for January delivery moved down 35 cents to settle at $37.16 a barrel on the New York Mercantile Exchange, while Brent crude for January delivery decreased 15 cents to close at $40.11 a barrel on the London ICE Futures Exchange.
 
Oil prices have been under pressure for several months due to concerns over oversupply, but the slump has deepened in the recent period.
 
Crude-oil production has remained robust despite the large drop in prices in the last year, as US producers continue to cut costs and OPEC members keep producing at full tilt.
 
Prices have fallen by more than 50 percent in a little over a year from levels of well over $100 a barrel, provoked by the slowdown in China and other emerging market economies and the end of sanctions against Iran.
 
Given the low crude oil prices prevailing for some time, India has been moving ahead on creating a dedicated strategic oil reserve. 
 
The Indian Strategic Petroleum Reserves Ltd (ISPRL) has finished constructing a storage facility at Visakhapatnam, which can hold about 9 million barrels. Two more facilities on the west coast - Mangaluru and Padur with 30 million barrels capacity - are expected to be ready soon. 
 
The ISPRL targets construction of another 90 million barrels of capacity across four different centres.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Hope for India as world's first anti-dengue vaccine approved
At a time when India is struggling with rising number of dengue cases with each passing year, the Mexican government has approved the world's first anti-dengue vaccine which is designed to protect people in the 9-45 age group from nine to 45 years from all four subtypes of the virus.
 
Called Dengvaxia, the vaccine has been developed by France-based Sanofi Pasteur and is the result of an extensive clinical development programme running for almost two decades.
 
Today, with this first marketing authorisation of Dengvaxia, we have achieved our goal of making dengue the next vaccine-preventable disease, said Olivier Brandicourt, Sanofi's managing director and chief executive officer, in a statement on Wednesday.
 
This is a historic milestone for our company, for the global public health community and, most importantly, for half the world's population who lives at risk of dengue," he added.
 
While dengue affects nearly 400 million people in endemic areas, mostly in tropical and subtropical countries in Latin America and Asia, India saw one of the worst outbreak of the deadly disease this year with 32 deaths recorded in New Delhi alone till October.
 
With the total number of dengue cases in the capital reaching over 12,000 in October, Delhi recorded the highest number of patients of the viral disease in 19 years, according to health authorities.
 
Even as Dengvaxia has become the first vaccine to be licensed in the world for the prevention of dengue, the dengue toll in West Bengal has touched 12 with the last death reported on November 5, according to state health officials.
 
The disease is prevalent throughout India in most of the metropolitan cities and towns. 
 
According to the National Vector Borne Disease Control Programme, there were more than 90,000 dengue cases reported in the country till November this year and more than 180 people died of the disease. Outbreaks have also been reported from rural areas of Haryana, Maharashtra and Karnataka.
 
The WHO has called on endemic countries to reduce dengue mortality by 50 percent and morbidity by 25 percent by 2020.
 
Dengvaxia is, therefore, seen "as major innovation and a public health breakthrough".
 
According to a statement issued by the Mexico's health ministry, the new vaccine is 60.5 percent effective against dengue and 93.2 percent effective against severe dengue treatment.
 
The approval of Dengvaxia by Mexico's 's Federal Commission for the Protection against Sanitary Risks (COFEPRIS) is based on results from an extensive clinical development programme involving over 40,000 people of different ages, geographic and epidemiological settings and ethnic and socio-economic backgrounds living in 15 countries.
 
Dengue-endemic regions of Mexico participated in all three phases of the clinical development programmes for the vaccine.
 
This vaccine can prevent more than 8,000 hospitalisations, 104 deaths annually, and save 1.1 billion pesos ($64 million) each year in reduced costs tied to medical attention, the ministry statement added.
 
In Mexico, a total of 32,100 cases were registered last year, including 8,668 cases of severe dengue, which cost the country over 3.2 billion pesos ($187 million).
 
In India, too, a new inexpensive dengue vaccine has been developed by scientists at New Delhi-based International Centre for Genetic Engineering and Biotechnology (ICGEB), which is in animal trial stage. But human trials can start only after its efficacy has been proved.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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RBI extends e-payment facility for imports
RBI's new circular allows authorised dealer category-l banks to offer payment facility for e-commerce players for imports by entering into standing arrangements with the online payment gateway service providers
 
E-commerce world has taken conventional business by a sweep and has become the new age way of doing business. Online aggregation business has re-defined the service segment from bookmybai to departmental store aggregation to online home services aggregator such as Housejoy
 
The ease of carrying out business through these platforms has facilitated the growth of e-commerce transactions at both the national and international level. In order to exercise regulatory control over such transactions, specifically to the cross border transactions, Reserve Bank of India (RBI) vide its circular dated 16 November 16 2010 on “Processing and Settlement of Export related receipts facilitated by Online Payment Gateways” issued a set of guidelines to cover such e-commerce arrangements. Under these guidelines, the Authorised Dealer Category- l (AD Category-l) banks were permitted to offer the facility to repatriate export related remittances only by entering into standing arrangements with online payment gateway service providers (OPGSPs) in respect of export of goods and services
 
However, in order to expand the ambit of e-commerce transactions, RBI has recently come up with the circular dated 24 September 2015 on “Processing and settlement of import and export related payments facilitated by Online Payment Gateway Service Providers” wherein “it has been decided to permit AD Category-l banks to offer similar facility of payment for imports by entering into standing arrangements with the OPGSPs”.
 
This article at length discusses the new set of consolidated guidelines applicable to both the export and import transactions routed standing arrangement between AD Category-l and OPGSPs.
 

Overview:

 
The AD Category-I banks entering into standing arrangements are firstly required to report the details of each such arrangement as and when entered into to the Foreign Exchange Department, Central Office, Reserve Bank of India, Mumbai. In order to operationalise such arrangement/arrangement(s) AD Category-I banks shall ensure the following:
carry out the due diligence of the OPGSP;
maintain separate Export and Import Collection accounts in India for each OPGSP;
satisfy themselves as to the bonafides of the transactions and ensure that the related purpose codes reported to the Reserve Bank are appropriate;
submit all the relevant information relating to any transaction under such arrangements to the Reserve Bank, as and when advised to do so; and
conduct the reconciliation and audit of the collection accounts on a quarterly basis.
 

Mandates for operating as OPGSP

 
Foreign entities:
Before entering into an arrangement with the AD Category-I banks, foreign entities would be required to open liaison office in India with the prior approval of the RBI. In this regard, it will have to adhere with the following:
ensure adherence to the Information Technology Act, 2000 and all other relevant laws / regulations in force;
put in place a mechanism for resolution of disputes and redressal of complaints;
create a Reserve Fund appropriate to its return and refund policy and
onboard sellers, Indian as well as foreign, following appropriate due diligence procedure.
 
Also, resolution of all payment related complaints in India shall remain the responsibility of the OPGSP concerned.
 
Domestic entities:
Indian entities functioning as intermediaries for electronic payment transactions intending to undertake cross border transactions are required to maintain separate accounts for domestic and cross border transactions. 
 

Guidelines for import and export transactions

 
The following table enumerates the salient features of the export and import transactions undertaken through standing arrangement between the AD Category-I banks and OPGSP:
 
 
(Shruti Agarwal works as Research Associate at Vinod Kothari & Co)

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