NDTV Profit Pulse: Key Financial Updates on RBI Actions, Market Rebound, China’s Growth Target, and More
March 5, 2025 | By NDTV Profit Desk
The Indian financial landscape saw significant movements today, marked by decisive actions from the Reserve Bank of India (RBI), a turnaround in the stock markets, and notable developments from global and domestic economic fronts. Here’s a comprehensive look at the top financial news shaping the day.
RBI to Inject Liquidity with Fresh Open Market Operations and Forex Swaps
In a move aimed at stabilizing liquidity in the banking system, the Reserve Bank of India announced plans to conduct Open Market Operation (OMO) purchase auctions totaling Rs 1 lakh crore. The auctions will be split into two tranches of Rs 50,000 crore each, scheduled for March 12 and March 18 respectively.
Additionally, the RBI has planned a long-tenure dollar-rupee buy/sell swap auction for $10 billion with a 36-month maturity, to be held on March 24. This follows a similar $10 billion forex swap conducted earlier in the week, highlighting the central bank’s commitment to ensuring adequate foreign exchange liquidity amid market fluctuations.
RBI Flags Concerns Over Perpetual Credit Lines by Non-Bank Lenders
The RBI has expressed reservations regarding some non-bank lenders offering perpetual credit lines to borrowers, which allow indefinite access to funds without fixed repayment terms. The regulator warns that such lending structures may encourage the ‘evergreening’ of loans — where new credit is used to service existing debt — potentially escalating financial risks in the sector. This caution has led to a noticeable dip in Non-Banking Financial Company (NBFC) stocks, reflecting market sensitivity to regulatory scrutiny.
Government Finalizes Digital Personal Data Protection Regulations
Following extensive public consultations, the government is set to finalize the Digital Personal Data Protection regulations shortly, with no further extensions for comments granted. These regulations are expected to significantly shape India’s data governance framework, enforcing stricter legal obligations on digital companies handling personal data. Stakeholders eagerly await the release of the final rules, which will clarify compliance requirements and enhance data security standards.
Nifty 50 Ends a 10-Day Losing Streak, Markets Rebound Strongly
Indian equity markets witnessed a positive shift as the Nifty 50 index climbed 1.15% to close at 22,337, while the Sensex rose 1.01% to 73,730. This marks the end of the longest losing streak in nearly three decades, injecting renewed optimism. Sectoral indices across the board ended in the green, with Nifty Metal and Nifty Media leading gains. Analysts attribute the rally to improved market sentiment spurred by RBI’s liquidity infusion and robust corporate earnings forecasts.
China Sets Steady GDP Growth Target Amid Global Tensions
China has reaffirmed its GDP growth target of approximately 5% for 2025, maintaining the target for the third consecutive year despite ongoing trade tensions with the United States. The government also announced a fiscal deficit target of around 4% of GDP — the highest in over 30 years — signaling continued fiscal support for economic stability and strategic investments amid complex global dynamics.
High-Income Earners Leverage Tax Deductions via Section 80GGC Donations
An emerging trend among high-income individuals involves using Section 80GGC of the Income Tax Act to claim deductions on donations made to political parties under the old tax regime. Although this provision has been in place for years, it is gaining popularity as a tax-saving tactic. Intermediaries reportedly facilitate these transactions, with political parties returning up to 95% of the donation amount in cash, raising concerns about the integrity of the process and potential regulatory responses.
Potential Air Conditioner Shortages Ahead of Summer Demand Surge
The air conditioning industry in India faces supply challenges as delays in shipments of compressors and other components threaten stock shortages by mid-April. Major manufacturers such as Voltas, Blue Star, and Panasonic have indicated they can manage a 25-30% increase in demand; however, a greater surge could strain inventories amid the approaching intense summer season. Industry watchers remain alert to how supply chain disruptions will impact availability and pricing.
Proposed Income Tax Bill 2025 to Expand Digital Surveillance Powers
The upcoming Income Tax Bill, set to be effective from April 1, 2026, proposes giving tax authorities enhanced access to digital information when investigating undisclosed income. Clause 247 in the bill would empower officials to override access controls for digital accounts, including emails, social media, banking, trading, and cloud storage. This represents a significant expansion in the government’s digital oversight capabilities, with important implications for taxpayer privacy and compliance.
Additional Headlines of the Day
- Nifty’s resistance points for March 6 identified at 22,520 and 22,720.
- Gold worth Rs 12.56 crore seized from Kannada actress at Bengaluru Airport.
- UTI AMC’s Tyagi attributes the market correction to sector-specific factors rather than US influences.
- Tariff wars may impact BFSI tech spending, potentially slowing growth in India’s IT sector.
- Government approves the Rs 4,000 crore Kedarnath ropeway project.
- Oyo projects posting Rs 1,100 crore profit in FY26, according to founder Ritesh Agarwal.
- Rise in buyers for newly launched housing units, with Bengaluru and Chennai leading the surge.
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