Finance minister Nirmala Sitharaman blamed “global factors such as the Russia-Ukraine conflict” and soaring crude oil prices for the weakening of the Indian Rupee against the US dollar.
The Indian rupee has fallen to more than 80 per US dollar for the first time on record, as the greenback extended its rally and foreign capital outflows intensified.
The rupee 80.0600 against the greenback soon after trading started, Bloomberg data showed on Tuesday.
In a written statement to the Indian parliament on Monday, finance minister Nirmala Sitharaman attributed the rupee’s sharp fall to external reasons.
“Global factors such as the Russia-Ukraine conflict, soaring crude oil prices and tightening of global financial conditions are the major reasons for the weakening of the Indian Rupee against the US dollar,” she said.
At the same time, the Indian currency has strengthened against the British pound, the Japanese yen and the euro in 2022 so far, Sitharaman added.
Impact of crude prices on trade
Higher crude prices have resulted in a deteriorating trade balance in a country that imports 80 percent of its oil needs.
India’s merchandise trade deficit widened to a record $26.18 billion in June, official data showed last week, largely because of higher crude and coal import prices.
In its monthly economic review, the Ministry of Finance said costlier imports could widen the current account deficit and cause the rupee to depreciate further.
Consumer price inflation in India, the world’s sixth-largest economy, cooled off slightly to 7.01 percent in June after hitting an eight-year high of 7.79 percent in April.
But price rises have persisted well above the central bank’s two-to-six percent target range despite consecutive interest rate hikes in May and June.
The central bank has also sold more than $34 billion of its foreign currency reserves in an effort to stabilise the rupee.
Tighter US monetary policy
High inflation and rising interest rates in the United States coupled with fears of an impending recession in the world’s biggest economy have fuelled a broad dollar rally in recent weeks as investors turn increasingly risk-averse.
Tighter US monetary policy has exacerbated outflows from emerging markets such as India, where foreign investors have withdrawn a net $30.8 billion in debt and equity this year.
Data released last week showed US consumer price inflation hit a fresh four-decade high in June, exceeding market forecasts and stoking expectations of another large Federal Reserve rate hike next week.
How Ukraine grain shipments process from Black Sea ports to Türkiye
The Turkish-brokered agreement allows millions of tons of grain stuck in Ukrainian ports due to Moscow’s blockade to reach international markets. Here is how it works.
As the armed conflict between Russia and Ukraine raged on for months and Moscow blocked grain exports from the besieged nation, the world stared at a very real possibility of a global food shortage.
Ukraine and Russia are the two biggest wheat and grain producers, often referred to as the world’s ‘bread basket’, and their military conflict has already increased global food prices.
But the Turkish-engineered Black Sea Grain Initiative, a grain export deal signed on July 22 between Kiev and Moscow, finally became a reality, bringing a new dimension to the conflict and calming food prices. With the deal, both sides agreed on a grain shipment arrangement to export Ukrainian grain from the country’s Black Sea ports to international markets.
A newly-inaugurated Istanbul-based Joint Coordination Centre (JCC), set up by the Black Sea Grain Initiative and inclusive of Russian, Ukrainian, Turkish and UN officials, monitors the shipments’ safe journey from Ukraine to Türkiye, from which the exports will move to their next destination.
Last week, the first ship carrying a 26,000-tonne cargo of corn left the Ukrainian port of Odessa to reach Istanbul, where it “was cleared to proceed to Lebanon” on Wednesday after “a scheduled inspection stopover”, according to the JCC.
Since Razoni’s departure, nine other ships have left Ukrainian ports for Istanbul for inspections, according to the Turkish defence ministry.
While Ukraine-Russia negotiations on the grain deal have long been a complicated issue, many people around the world concerned about food security wonder how the shipment process works.
Here is a brief guide to the process:
First step: Ships leave Ukrainian ports
First, the JCC-approved grain-carrying ships like the Sierra Leone-flagged Razoni, which was the first merchant vessel to leave Ukraine, departs from Kiev’s designated ports, according to the deal. There are three designated Ukrainian ports —Odessa, Pivdennyi and Chornomorsk—for the grain shipments.
The grain deal does not allow empty ships and vessels to leave Ukrainian ports. For now, per day, only three or four grain ships can depart from Black Sea ports and Ukraine can export only three million tons of grain each month.
Prior to the grain deal, more than 25 million tons of grain were stuck in Ukrainian ports, according to Turkish Defence Minister Hulusi Akar, due to the Russian blockade, increasing food prices across the globe. After the Ankara-brokered deal, the grain prices decreased sharply.
Second step: Ships sail through JCC corridor
Grain ships are using a JCC-secured maritime humanitarian corridor in the Black Sea until they reach Turkish waters. The corridor, which has been agreed upon by both Ukrainian and Russian sides, alongside Türkiye and the UN, serves to provide a safe journey for ships, protecting them from minefields and other possible dangers.
During their voyage, grain ships will be tracked via satellite and drones. According to the agreement, ships that turn off their signals and do not provide transparent information about port call points will not be admitted to Turkish territorial waters. Russia will also be able to export grain and fertiliser through the corridor.
Third step: JCC-led inspections in Istanbul
After reaching Turkish waters, ships should stop by in Istanbul for the JCC’s inspections. The JCC will proceed with its inspections at entrances and departure from Istanbul ports.
“A joint civilian inspection team comprising officials from the Russian Federation, Türkiye, Ukraine and the United Nations visited the merchant vessel Razoni this morning (Wednesday),” said a statement from the JCC, confirming that the ship’s crew and load are “authorised and consistent” with the information the monitoring centre received before it sailed from Odessa.
“This marks the conclusion of an initial ‘proof of concept’ operation to execute the agreement,” added the statement, meaning that the first mission’s success will be a good measure of assurance for next shipments.
During the inspections, the JCC team asked questions to the Razoni crew about how safe the journey was in order to assess the security level of the JCC-monitored corridor and gain “valuable information”.
“The JCC will use this voyage in its ongoing work on fine-tuning procedures and processes to enable the continuation of safe passage of commercial vessels across the Black Sea under the Initiative,” the statement said.
Fourth step: reaching international markets
After the grain ships departing from Ukraine are inspected in Istanbul, they will sail to their final destination in international markets.
Razoni is set to sailing toward Lebanon, an eastern Mediterranean country hit by a terrible financial crisis. But the ship has not reached Lebanon yet, according to Ukraine’s Lebanon embassy. After going through inspections in Istanbul, the other ships will also be set to their respective destinations.
Right now, Panama-flagged Navistar is going to Ireland and Malta-flagged Rojen is moving to the UK. Türkiye-flagged Polarnet already reached its final destination, Derince, a district in Türkiye’s Izmit, a Turkish Black Sea city.
There will be three other ships to reach Türkiye after Istanbul inspections. The two ships, Mustafa Necati and Sacura, will go to Italy and Star Helena will sail toward China.
Applications open for Allied Community Fund and Education Fund
Allied Insurance Company of the Maldives has introduced funding programmes under its community social responsibility initiative, Premium for Good.
At a press conference held at the company headquarters, the Allied Community Fund and Allied Education Fund were launched by General Manager Ibrahim Firushan. Speaking at the press conference, he said the programmes are an initiative that Allied has been planning with great hope and the aim is to provide a way for people in all parts of the Maldives to remove financial barriers to improve communities.
The Allied Community Fund is a funding programme that empowers people living in the provinces to make community-beneficial ideas a reality in six areas. Allied has opened applications for projects in the fields of health, social services, environmental protection, women’s and children’s rights, education and history. Applications should be submitted by email by August 31 and the four best ideas will be awarded USD3,250.
The second funding programme newly added to the Premium for Good framework; the Allied Education Fund is an addition to Allied’s efforts to strengthen the education system. The insurance company revealed the opportunities to apply for funding through the programme are beneficial ideas for students and teachers and applications should be submitted by August 31.
Launched in 2018, Premium for Good is a framework designed to sustain Allied’s community social responsibility initiatives.
Moolee celebrates three successful years
Moolee, the e-commerce platform of Ooredoo Maldives, has celebrated three successful years of connecting businesses and customers to enable a nationwide online shopping experience.
Moolee was officially launched in August 2019, and since then has belted over 20,000 deliveries across the Maldives including a vast variety of quality products with over 18 categories including consumer electronics, gaming products, books and stationaries, home and kitchen, and lifestyle products from over 50 reputable businesses.
To celebrate the new milestone and to thank its shoppers, Moolee has planned fun and interactive online engagement activities with exciting gifts throughout the month of August. More details of the anniversary activities will be announced on Moolee social media pages, said the telecommunications company.
Since the launch of the platform, Moolee has seen rapid growth and continues to prosper to provide its consumers a seamless digital shopping experience with its services like online payments, free nationwide delivery, easy returns, and genuine product availability for buyers to shop with confidence.
The platform also thrives in facilitating small business owners and online retailers to reach a bigger customer base with free nationwide delivery services. With many more small and medium enterprises (SMEs) coming on board Moolee looks forward to catering to a broader customer base with more products on the platform, Ooredoo Maldives said.
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