Core economy --update where ever necessary

IRDA

The Insurance Regulatory and Development Authority (IRDA) is a national agency run by the Government of India. IRDA is based in Hyderabad and was formed by an act of Indian Parliament called as IRDA Act of 1999.

IRDA was formed to protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto. Indian insurance industry is regulated by the terms and conditions of the IRDA.

TRAI REGULATIONS FOR MOBILE BANKING

The new TARI guidelines stipulate that the access service providers need to facilitate the banks to use text messages, unstructured supplementary services sata (USSD) and interactive voice response (IVR) to provide banking services to its customers. The access service providers can also optionally facilitate the bank to use WAP.

The response time for delivery of message for mobile banking services generated by the customer or the bank will be within the prescribed time frame of up to 10 seconds for SMS, IVR, WAP and STK and up to 2 seconds for USSD.

For mobile banking, the service providers will need to meet the quality of service standards laid by Trai for mobile telephone services.

ENFORCEMENT OF SECURITY INTEREST & RECOVERY OF DEBT BILL,2011

The Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Bill, 2011 was introduced by the Minister of Finance, Mr. Pranab Mukherjee in the Lok Sabha on December 12, 2011. This Bill seeks to amend the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Recovery of Debts Due to Banks and Financial Institutions Act,

1993.

The Bill proposes to include multi-state co­operative banks in the definition of banks in the existing Act.

MINES & MINERALS DEVELOPMENT & REGULATION BILL 2011

The new MMDR Bill, 2011, aims at achieving a balance between better legislation and tribal rights by introducing the following steps in new mining policy:

States may call for applications in notified areas of known mineralization for prospecting, based on technical knowledge, value addition, end-use proposed ore -linkage etc and to invite financial bid; States may grant direct mining concessions through bidding based on a prospecting report and feasibility study in notified areas where data of minerals is adequate for the purpose; National Mining Regulatory Authority for major minerals - State Governments may set up similar Authority at State level for minor minerals; Imposition of a Central cess and a State cess, and setting up of Mineral Funds at National and State Level for capacity creation; For the purpose of sharing the benefits of mining with persons or families having occupation or traditional rights in mining areas and for local area infrastructure: creation of an amount equal to royalty in case of mineral other than coal, and 26% of net profits, in the case of coal, has been proposed to be credited each year to district Level Mineral Foundation; Sustainable and scientific mining through provision for a Sustainable Development Framework; Establishment of Special Courts at the State level for speedier disposal of the cases of illegal mining.

MCX-SX

The government has notified MCX Stock Exchange, a part of Jignesh Shah-led group that also owns country's largest commodity bourse MCX, as a "recognized stock exchange", where trading would not be deemed as speculative transactions. MCX Stock Exchange (MCX-SX) was first granted recognition by SEBI in September 2008, but it was allowed to conduct trading only in the currency derivatives segment. After the approval MCX-SX would be able to offer additional asset classes such as equity and equity F&O (Futures and Options), interest rate futures and wholesale debt segments.

DRAFT RED HERRING PROSPECTUS

"Red Herring Prospectus" is a prospectus which does not have details of either price or number of shares being offered or the amount of issue. This means that in case the price is not disclosed, the number of shares and the upper and lower price bands are disclosed. On the other hand, an issuer can state the issue size and the number of shares later. An RHP for and FPO can be filed with the Registrar of Companies (RoC) without the price band and the issuer, in such a case will notify the floor price or a price band by way of an advertisement one day prior to the opening of the issue. In the case of book-built issues, it is a process of price discovery and the price cannot be determined until the bidding process is completed. Hence, such details are not shown in the Red Herring prospectus filed with the RoC in terms of the provisions of the Companies Act.

ROLE OF SPICE PARKS IN PROMOTION OF SPICE EXPORT

Spice Board of India, the nodal organization of Ministry of Commerce, Govt. of India, in an effort to promote exports of spices from India has established spice parks. A full line processing facility with inbuilt facilities for pre-cleaning, grading, colour sorting, grinding and packing are provided. The Spice processing facilities available at Spice Park are at par with the international standards. The Board will also be allotting individual slots for exporters on lease basis for developing their own processing plants in the Parks. Thus spice parks will help in promoting spice quality and quantity, which will in turn increase the spice export.

SEBI'S  REGULATION FOR ALTERNATIVE INVESTMENT FUNDS

An AIF is defined as any "fund established or incorporated in India" which is a "privately pooled investment vehicle which collects funds from investors, whether Indian or foreign, for investing it in accordance with a defined investment policy for the benefit of its investors".

The regulator has classified private pool of capital into three broad categories such as venture capital, private equity and hedge funds.

The new regulations have replaced the former venture capital funds norms. However, the existing venture capital funds will continue to be regulated by the earlier norms till the existing fund or scheme managed by the fund is wound up. SEBI has also mandated that sponsors should contribute at least 2.5% of the initial corpus.