In this week's wrapup, we talk about oil purchase programs, gift cards, Greensill capital, monetary policy report and restaurants.
But before we get there, a note on this week's Finshots Markets. About a year or so ago, we wrote a rather elaborate article explaining the rise of the Indian Specialty Chemical Industry. Unfortunately, at the time, we didn't have an audience as large as this one. So we thought we could perhaps rehash the old illustrative guide once again for the benefit of our new readers. And if you're the kind of person that appreciates visuals, this is just the kind of story that'll thrill you. Link here.
Is India weaponizing it's oil purchase program?
Most of the world’s oil is controlled by a very small group of people - the Middle Eastern Cartel called OPEC, US, and Russia. The cartel, dominated by Saudi Arabia is the kingpin here. They hold vast influence over the market and they are one of our biggest suppliers. But for a while now, fuel prices have been increasing disproportionately and the Saudis have continued to artificially curtail supply.
And while many people believed India would simply toe the line and continue to import oil at exorbitant prices, that isn't a very accurate description. So on Monday, we talked about this program (basing it off a Reuter's report) and explained how things might pan out in the future. Link here.
The absurd exercise of taxing gift cards.
Gift vouchers are weird. In fact, they are not even thought of as vouchers for the most part. Instead, they are classified as pre-paid instruments that facilitate the buying of goods and services including the transfer of funds, against the value stored within the instrument. And while the RBI has elaborate guidelines regulating the use and supply of these things, taxing gift cards has always been a complicated affair. Why? you ask. Well, that's what we discussed in this story right here.
The Greensill debacle
Supply Chain Financing has witnessed a boom in the past few years and there's been a new wave of players trying to occupy the top spot. But no one has probably been as prolific as Greensill Capital - one of the leading players within the supply chain financing domain.
So when the company recently filed for bankruptcy it sent shockwaves the world over. What happened at Greensill? How did it capitulate so quickly? And what are the long lasting consequences of this epic demise? If you're thinking about these things, then maybe it's time to read our simplified explainer on this matter. Link here.
A review of the monetary policy report
The Monetary Policy Committee (good folks responsible for setting interest rates in the country) decided to leave them as-is yesterday (at 4%) after deliberating on the matter for three days. And while that might not be as interesting in itself, the monetary policy report published the same day, had a lot of new insights on the current state of the economy. So on Thursday, we talked about all the juicy bits from the report and more. Link here.
The Fault in Our Restaurants 2.0
A couple days ago, the restaurant association noted that new lockdown measures could put 90% of restaurants out of business in Maharashtra. And while the number does seem a bit exaggerated, it's still pertinent to ask - What's the impact of the new lockdown measures going to look like for the food and beverages industry. If you want an answer to this question and more, read about it here.