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March 5 Market Rebound: RBI’s Liquidity Injection, Data Protection Regulations Finalized & China’s 5% Growth Target

March 9, 2025
Smart Money

NDTV Profit Pulse: Key Highlights from March 5, 2025

Date: March 5, 2025
Time: 8:00 PM IST
Source: NDTV Profit Desk

In a day marked by significant economic developments and market recoveries, the NDTV Profit Pulse presented a roundup of the top eight stories making headlines across various sectors on March 5. Notably, the Indian stock market rebounded after a prolonged decline, aided by crucial interventions from the Reserve Bank of India (RBI), while China set its fiscal growth targets amid ongoing global trade tensions. Here’s a closer look at today’s key stories.

RBI’s Liquidity Boost

The Reserve Bank of India (RBI) announced plans to infuse additional liquidity into the banking system through a series of open market operation (OMO) purchase auctions. The central bank will purchase government securities worth ₹1 lakh crore, spread over two tranches of ₹50,000 crore each. The first auction is scheduled for March 12, followed by the second on March 18. Moreover, the RBI will hold a dollar-rupee buy/sell swap auction of $10 billion, with a maturity period of 36 months, set for March 24. This decision follows a similar $10 billion swap auction conducted earlier in the week and aims to stabilize liquidity amid market fluctuations.

RBI’s Credit Line Concerns

In related news, the RBI also raised concerns regarding non-banking financial companies (NBFCs) offering perpetual credit lines. Such arrangements allow borrowers to access funds indefinitely without a fixed repayment schedule. The RBI expressed apprehension that these lending practices could lead to the evergreening of loans, wherein new credit is used to repay old debts, potentially destabilizing the financial system.

Digital Data Protection Regulations Finalised

The Indian government completed public consultations on the Digital Personal Data Protection regulations, indicating that no further extensions for comments will be made. These forthcoming regulations are expected to significantly reshape how digital companies in India handle personal data, ensuring greater accountability and protection for users’ information.

Nifty 50 Ends 10-Day Losing Streak

In a much-anticipated turn of events, the Nifty 50 index rose by 1.15%, closing at 22,337, while the Sensex gained 1.01% to close at 73,730. This marks the end of a 10-day losing streak for the Nifty 50, the longest in nearly three decades. All sectoral indices reported gains, with the Nifty Metal and Nifty Media sectors leading the charge.

China’s Growth Target

Looking beyond Indian markets, China has set its GDP growth target for 2025 at approximately 5%, maintaining the same target for the third consecutive year amidst ongoing trade tensions with the United States. Additionally, China’s government announced a fiscal deficit target of around 4% of GDP, representing the highest level of fiscal deficit seen in over three decades.

High Earners’ Tax Strategies

In tax-related news, high-income earners are increasingly utilizing Section 80GGC of the Income Tax Act to claim deductions for donations made to political parties. While this provision has existed for years under the old tax regime, its popularity is surging as individuals seek tax-saving opportunities. Intermediaries have begun to facilitate these transactions, with reports indicating that political parties may return up to 95% of the donation amounts in cash.

Looming Air Conditioner Shortages

As summer approaches, India may be on the verge of an air conditioner (AC) shortage due to delays in the shipment of essential compressors and components. Leading manufacturers, including Voltas and Blue Star, have warned that while they can accommodate a 25-30% increase in demand, any further demand surge could lead to stock shortages. The industry is closely monitoring supply chain disruptions as temperatures rise.

Proposed Tax Bill’s Digital Oversight

A proposed Income Tax Bill aimed at enhancing digital oversight has been introduced, allowing tax officials to access emails and social media accounts if they suspect undisclosed income. The new rules, expected to take effect from April 1, 2026, include a controversial provision that empowers officials to override access codes for digital accounts, including banking and trading platforms, raising concerns among taxpayers about privacy and oversight.

Other Noteworthy Stories

In addition to the top eight stories, several other developments caught attention today, including:

  • The trade setup for March 6, highlighting resistance zones for the Nifty at 22,520 and 22,720.
  • Seizure of gold worth ₹12.56 crore from a Kannada actress at the Bengaluru Airport.
  • Insights from UTI AMC regarding market corrections and sector overheating.
  • Approval of a ₹4,000 crore Kedarnath ropeway project by the government.
  • Oyo’s founder, Ritesh Agarwal, projecting a ₹1,100 crore profit for FY26. Stay tuned for more updates and insights into these evolving stories.