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July 2017 Economic Affairs

  • Only 7% rise in transactions via cards after demonetisation: Govt officials
    Transactions through debit and credit cards rose by merely 7% post-demonetisation, as against a surge of over 23% in overall digital transactions, top government officials told a parliamentary panel. 

    Officials from various ministries gave a presentation to the Parliamentary Standing Committee on Finance on 'Demonetisation and Transformation towards Digital Economy'. 

    The digital transactions in all modes increased by 23% to 27.5 million in May 2017 from 22.4 million in November 2016, according to the presentation

    The highest jump was witnessed in transactions through Unified Payments Interface (UPI), from one million per day in November 2016 to 30 million in May 2017. 

    UPI is a system that powers multiple bank accounts into a single mobile application for seamless fund routing and merchant payments into one hood. 

    Transactions through IMPS (Immediate Payment Service), which is an electronic fund transfer service, almost doubled to 2.2 million from 1.2 million during the period under purview, according to the data shared by government officials. The least rise in digital transactions was witnessed in the case of plastic cards, as the rise was only 7% — from 6.8 million in November 2016 to 7.3 million in May this year. 

    The Narendra Modi government had on November 8, 2016, announced the demonetisation of Rs 500 and Rs 1,000 bank notes in a bid to curtail black money. Following the move, the government pushed for digital transactions. 

  • RBI to increase lending to agriculture and small enterprises
    As lending to the priority sector is a good business, the Reserve Bank of India is set to revamp the State-Level Bankers' Committees (SLBC) to enable more lending to agriculture and small and micro enterprises

    Noting that many agencies were involved in the priority sector lending, RBI Deputy Governor Mundra said in the SLBC structure, the lead bank offices at district level prepare ae District Credit Plan and then, National Bank for Agriculture and Rural Development (NABARD) prepares the Potential Linked Credit Plan, which the SLBC adopts and distributes among all banks. 

    Noting that in public sector banks, the priority sector's responsibility is spread across the rural credit, MSMEs and affordable housing verticals, Mundra noted that he was not sure whether they make any coordinated effort for a comprehensive strategy. 

    He called for verticals to come together as a cohesive group, prepare strategy and take it to the board for broader discussion and guidance, he said, stressing priority sector activity should not remain confined to being mere data collection. 

  • Matunga becomes India's first railway station run by women
    Matunga suburban railway station in Mumbai has become the first station in India to be run by an all-women staff. A total of 30 women staffers, including eleven booking clerks, five Railway Protection Force (RPF) personnel and seven ticket checkers are working under station manager Mamta Kulkarni, who was the first female station master in Central Railway's Mumbai division. 

  • India foodgrain output up 8.7% at record 273.38 MT in 2016-17
    Foodgrain production in the country has been estimated at a record level of over 273 million tonnes during 2016-17. This was stated by Minister of State for Agriculture SS Ahluwalia in reply to a question in the Lok Sabha on 18th July. 
    According to Minister….
    • The earlier record production of foodgrain was in 2013-14 with an output of over 265 million tonnes.
    • The production of rice, wheat, coarse cereals and pulses touched new record levels in the last fiscal.
    • Ruled out any proposal to impose higher import duty on wheat

  • India's GDP could rise to $8 trillion in 15 yrs: NITI Aayog vice-chairman
    NITI Aayog Vice Chairman Arvind Panagariya has said, India's GDP could rise to about 8 trillion dollars over the next 15 years if the country registers an economic growth of 8 per cent annually. 

    He said, with that level of economic growth, living standards and amenities that are taken for granted in the west will become accessible to a very large part of the population in India in the coming 15 years. 

    Listing the big-item and big ticket reforms such as the Goods and Services Tax, Insolvency and Bankruptcy Act and the Aadhar Act implemented by the government, Mr Panagariya said, the benefits of these reforms are just beginning to happen. 

  • CAD to widen to 1.3% of GDP in 2017: Nomura
    India’s current account deficit (CAD) is likely to widen to 1.3 per cent of GDP in 2017 from 0.6 per cent in 2016, largely owing to stronger domestic growth in the second half of this year, says a Nomura report. 

    According to the Japanese financial services major, import demand is expected to resume once GST disruptions settle down after July. It said export growth moderated sharply to 4.4 per cent in June from 8.3 per cent in the previous month, while import growth eased to 19 per cent from 33.1 per cent in May. 

    The report said lower commodity prices and adverse base effects will continue to cap the year-on-year growth rates in second half of 2017, partly offsetting the continued recovery in advanced economies. 

    On imports, some moderation was expected given the slowdown in production ahead of GST, but import demand may resume once GST disruptions settle down after July, it said. 

    According to Reserve Bank data, the current account deficit soared to USD 3.4 billion, or 0.6 per cent of gross domestic product (GDP), in the fourth quarter of 2016-17 fiscal, from USD 0.3 billion a year ago

  • India to grow at 7.2% in FY17, up from 6.8% in 2016: World Bank
    Indian economy is expected to grow at 7.2 per cent this financial year, up from 6.8 per cent in 2016, says a World Bank report. According to the report, though the anxiety about the festering twin-balance sheet problem persists, the economy may grow at an even higher 7.5 per cent the year after. 

    The World Bank has, however, revised its forecasts for growth downwards from what was projected in its January update. 

    On the other hand, China’s economic growth is projected to slow at 6.5 per cent in 2017, down from 6.7 per cent the year before. But given the strong second quarter growth, China’s GDP grew at 6.9 per cent belying expectations, overall growth for the year may well end up being higher. 

    The report titled - Global Economic Prospects - A fragile recovery - finds that global activity is firming up with manufacturing and trade picking up, confidence improving, and international financing conditions remaining benign. It pegs world GDP to grow at 2.7 percent in 2017 and 2.9 percent in 2018-19. 

    But with advanced economies expected to grow at only 1.9 per cent in 2017, emerging and developing economies are expected to drive global growth. 

    Emerging market and developing economies (EMDEs) are expected to grow at 4.1 percent in 2017 and reach an average of 4.6 percent in 2018-19. 

  • Gujarat most competitive state, finds NCAER study
    Gujarat, Delhi, Andhra Pradesh, Haryana, Telangana and Tamil Nadu are the top six states in India for business investment potential, finds a new study by the National Council for Applied Economic Research (NCAER). 

    The study, which estimates statewise investment potential, ranks their competitiveness on six pillars, namely — land, labour, infrastructure, economic climate, political stability and governance, and business perception. 

    Among these six states, Haryana and Telangana have made the most gains on the index over the past year, moving up 12 and 8 spots, respectively. On the other hand, West Bengal, Chhattisgarh, Rajasthan and Uttarakhand have fallen the most, finds the study. 

    Despite West Bengal ranks last on the index, followed by Uttar Pradesh and Bihar, these states do fare better on sub-indices. Bihar, for example, does better on labour; Uttar Pradesh on land and West Bengal on economic climate. 

    Surprisingly, economic power house Maharashtra ranks eighth on the index, down three ranks from last year. Karnataka, the start-up hub, ranks ninth on the index. Delhi fares poorly on governance and political stability

    On the infrastructure pillar, Maharashtra, Karnataka and Odisha moved closer to the frontier, while Uttarakhand and Assam moved further away. West Bengal made the most gains on the economic climate and governance pillars, while Telangana, Punjab, Haryana and Kerala made significant gains under the perception pillar,” says the report. 

    While corruption continues to be a sore area for businesses, the report finds perceptions of corruption seem to be improving, indicating change. The percentage of respondents citing corruption as a constraint for conducting business has fallen from 79 per cent in 2016 to 57 per cent in 2017. 

    Getting approvals also continue to be a constraint. But, an improvement is seen on this parameter, too, with the percentage of firms reporting it as a constraint having fallen from 72 per cent to 53 per cent. 

  • Cabinet clears GST in J&K
    Union Cabinet on 19th July approved a draft bill to replace ordinances that were promulgated to introduce the Goods and Services Tax (GST) in Jammu and Kashmir. Earlier this month, the Centre had promulgated ordinances to make the Central GST and Integrated GST, which deals with inter-state commerce, applicable to the state. The bill will be introduced in the current session of Parliament. 

  • Cabinet approves sale stake in Hindustan Petroleum to ONGC
    Union Cabinet on 19th July approved sale of government's stake in Hindustan Petroleum Corpration Ltd (HPCL) to Oil and Natural Gas Corporation (ONGC). It will fetch 30 thousand crore rupees. 

    The ONGC will buy government's 51.11 per cent stake in HPCL but will not have to make an open offer as the government's holding is being transferred to another state-run firm and the ownership is not changing. The HPCL will become a subsidiary of ONGC and will remain a listed company post acquisition. The the board of the refining and marketing company will continue to remain in place. 

    The Cabinet also approved a draft bill to replace ordinances that were promulgated to introduce the Goods and Services Tax (GST) in Jammu and Kashmir. 

    Earlier this month, the Centre had promulgated ordinances to make the Central GST and Integrated GST, which deals with inter-state commerce, applicable to the state. The bill will be introduced in the current session of Parliament. 

  • ISRO earned 6.1 mn euros through launch of 29 foreign nano satellites
    The government on 19th July said Antrix Corporation Limited (Antrix), the commercial arm of ISRO has earned foreign exchange of about 6.1 million Euro through launching of 29 Nano satellites. Replying to questions in the Lok Sabha, minister of state in the Prime Minister’s office, Dr Jitendra Singh said 29 Nano satellites were from 14 foreign countries and were launched under commercial arrangement. 

    ISRO has taken measures to protect its operational satellites from space debris by carrying out collision avoidance studies for all launch vehicles of ISRO to clear lift off time. 

    Dr Singh said ISRO has successfully launched an Indian earth observation satellite Cartosat2 series weighing 712 kg as primary payload on board its Polar Satellite Launch Vehicle on June 23rd along with 30 Nano satellites in a single launch from Satish Dhawan Space Centre, Sriharikota. The Cartosat2 series satellite provides high resolution images of earth’s surface at sub-meter resolution. 

  • ADB to carry out feasibility study for East-Coast Economic Corridor
    The Centre will engage Asian Development Bank (ADB) to for a feasibility study and to prepare a conceptual development plan (CDP) for the East-Coast Economic Corridor (ECEC) to link Kolkata in the east to Tuticorin in the south through Chennai in a phased manner. 

    In the first phase, Visakhapatnam-Chennai Industrial Corridor (VCIC) segment of ECEC is being taken up. The Andhra Pradesh government is implementing the project. 

    In September 2016, ADB approved $631 million (loans and grants) for VCIC. The Andhra government will provide counterpart funding of $215 million. 

    ECEC, which runs along the entire east coast from Kolkata to Kanyakumari, is a multi-modal, regional maritime corridor that can play a vital role in unifying the large domestic market, as well as integrating the economy with the global value chains of southeast and east Asia. 

    Aside from an ambitious infrastructure programme, ECEC involves developing of skills, and creating an attractive regulatory environment, bringing in new investments, and getting existing businesses to grow and innovate, and create much needed jobs. In the first phase, ECEC covers 11 districts in Andhra Pradesh and Tamil Nadu. ADB helped prepare the Conceptual Development Plan and Regional Perspective Plan for VCIC, which served as the bases for the VCIC programme, which was approved by the ADB Board in September, 2016. 

    The programme comprises a multi-tranche financing facility (MFF), a grant, and a policy-based loan (PBL) for a total investment of $631 million. The MFF and grant will support priority infrastructure investments in the VCIC region and the PBL will support policy reforms and institutional development in Andhra Pradesh. 

  • India new global growth pole, to keep lead over China: Harvard study
    A new study by the Harvard University has said, India has emerged as the economic pole of global growth by surpassing China and is expected to maintain its lead over the coming decade. According to the University's Center for International Development growth projections, India will feature on top of the list of the fastest growing economies till 2025 with an average annual growth of 7.7 per cent, for a variety of reasons. 

    The study attributed India's rapid growth prospects to the fact that it is particularly well positioned to continue diversifying into new areas, given the capabilities accumulated to date. 

    The Center for International Development is a university-wide center that works to advance the understanding of development challenges and offer viable solutions to problems of global poverty. 

  • House panel asks govt for details on Air India disinvestment
    A parliamentary panel has sought details from the government on giving in-principal approval to its divest stake in Air India even as modalities are being worked out for the proposed divestment to revive the debt-laden national carrier. 

    Officials from the ministries of finance and civil aviation as well as from Air India are expected to provide views this week to the Parliamentary Standing Committee on Transport, Tourism and Culture. 

    On June 28, the Cabinet Committee on Economic Affairs gave in-principle approval for considering strategic disinvestment of Air India and five of its subsidiaries. 

    The committee will hear the views of the Ministry of Civil Aviation, Department of Investment and Public Asset Management (Ministry of Finance) and Air India on the disinvestment of the airline on July 12, according to the panel’s schedule. 

    The 31-member panel is headed by Trinamool Congress member Mukul Roy and has 21 members of Parliament from the Lok Sabha. The members include those from the Congress, Bharatiya Janata Party, Biju Janata Dal, Samajwadi Party Communist Party of India (Marxist) and Telugu Desam Party. 

    A group of ministers, headed by Finance Minister Arun Jaitley, would be looking into various aspects related to Air India. It would look into the treatment of unsustainable debts of the national carrier, hiving off certain assets to a shell company and de-merger and strategic disinvestment of three profit-making subsidiaries, among others. 

    Air India, which has a debt burden of more than Rs 52,000 crore, is staying afloat on taxpayers’ money. The previous UPA government had extended bailout package worth little over Rs 30,000 crore to the national carrier for a 10-year period starting from 2012. 

  • Finance Minister Arun Jaitley launches new tax payer service module 'Aaykar Setu'
    Finance Minister Arun Jaitley on 10th July launched a new tax payer service module called Aaykar Setu. It compiles various tax tools, live chat facility, dynamic updates, and important links to various processes within the Income Tax Department in a single module. 
    According to Jaitley…
    • This e-initiative would not only provide better taxpayer services but would also help in reducing the direct physical interface between assesses and tax assessing authorities.
    • The new step is an effort by the Income Tax Department to directly communicate with the taxpayers on a range of multiple informative and useful tax services.
    • The tax payers will also be able to receive regular updates regarding important tax dates, forms and notifications on mobile numbers registered with the IT Department.
    • All taxpayers who wish to receive such SMS alerts are advised to register their mobile numbers in the Aaykar Setu module.

  • India to import crude oil from US for first time
    India, the world's third-largest oil importer, will import crude oil from the United States for the first time after Indian Oil Corp bought a cargo that will be delivered in October. The purchase comes after Prime Minister Narendra Modi's visit to the US in June when President Donald Trump said his country looked forward to exporting more energy products to India. 

    IOC bought 1.6 million barrels of US Mars crude, a heavy, high-sulphur grade, and 400,000 barrels of Western Canadian Select that will be delivered onboard a Very Large Crude Carrier, IOC's head of finance, A K Sharma

    PetroChina was awarded the tender to sell the cargoes and is expected to load the oil off the US Gulf Coast. The cargo was priced on a delivered ex-ship basis, which is "very competitive” to that of Basra Light

    IOC had to obtain special permission from the shipping ministry to buy the cargo on a delivered basis as local regulations favour the use of Indian flagged carriers for imports

    India is the latest Asian country to buy US crude after South Korea, Japan, China, Thailand, Australia and Taiwan as the countries seek to diversify oil imports from other regions after the OPEC cuts drove up prices of Middle East heavy-sour crude, or grades with a high sulphur content. 

    Indian refiners are seeking these heavy, high-sulphur grades as feedstocks after modifications at their plants make it easier to process these types of crudes, which typically sell at a lower cost relative to other oil types. The US could become an alternative source for the Indian companies for these grades. 

    A second Indian refiner Bharat Petroleum Corp Ltd also planned to buy its first ever US crude oil cargo and has issued a purchase tender. 

  • Nod for Dhirubhai Ambani Aerospace Park
    Construction activity at the Dhirubhai Ambani Aerospace Park at Mihan, Nagpur, is set to kick start by the end of this month, with the Commerce Ministry giving its approval for developing the park. Reliance Defence is looking to invest Rs. 6,500 crore in the park. 

    The facility is set to host the first ‘Make in India’ defence project, since it will be home to the Dassault-Reliance Aerospace joint venture. 

    France’s Dassault Aviation and Reliance Defence have teamed up in a 49:51 stake joint venture, to carry out the obligations and execute the Rs. 30,000-crore offset programme related to the sale of 36 Rafale fighter jets. 

    The park will also be home to the largest defence sector foreign direct investment (FDI) in the country, with the French aircraft manufacturer slated to bring in the first tranche of FDI amounting to Rs. 200 crore by the month-end. 

    On July 3, the Ministry of Commerce granted approval to the Anil Ambani-led Reliance Infrastructure arm Reliance Aerostructure as a co-developer of the park, confirmed a senior executive. The Maharashtra Airport Development Company is the nodal agency for developing the aerospace park. 

    Phase I of the project is expected to result in the generation of more than 700 highly skilled direct jobs and 2,800 indirect jobs. The aerospace park will eventually generate more than 10,000 jobs, promoting the ‘Make in India’ and ‘Skill India’ initiatives of the government. The park is spread over 289 acres, and is set to become the largest greenfield aerospace park in the country. 

  • NITI Aayog to set up Expert Group to strengthen cooperative banks
    NITI Aayog has decided in principle to set up an Expert Group for evolving ways to strengthen the cooperative banks in the country. 

    The issue relating to providing financial support to District Central Cooperative Banks came up during the meeting of NITI Aayog Vice Chairman Arvind Panagariya with Chief Secretary of Punjab in New Delhi on 11th July. The Expert Group will be headed by NITI Aayog member Prof. Ramesh Chand. The group will also discuss regulatory issues for cooperative banks. 

    On inclusion of livestock and dairy farming in crop diversification plan (CDP) under Rashtriya Krishi Vikas Yojana, Agriculture Ministry representative indicated that there is flexibility for States under the scheme. It was also indicated that state can include green fodder as a crop for replacing area under paddy. 

    On clearance of Project for Extension, Renovation and Modernisation of Canals being fed from river Sutlej, during the meeting, it was agreed that approval will be provided within a week of receipt of revised proposal from Punjab. 

  • 5 States, a UT sign pact with Centre on e-Marketplace
    In a spirit of cooperative federalism, 5 States and a Union Territory (UT) on 11th July formally adopted the Centre’s initiative called the Government e-Marketplace (GeM) that aims to ensure that public procurement of goods and services in India worth more than Rs. 5 lakh crore annually is carried out through the online platform for transparency and to eliminate corruption. 

    The States and the UT that signed an MoU with the Centre include Andhra Pradesh, Assam, Gujarat, Telangana, Puducherry and Arunachal Pradesh. Four more, including Uttar Pradesh, Jharkhand, Tamil Nadu and Haryana, will ink such an MoU soon. 

  • Retail inflation hits "historically low" level 
    Retail inflation hit a "historically low" level of 1.54 per cent in June this year. Inflation had stood at 2.18 per cent in May this year, and at 5.77 per cent in June last year. According to the Chief Economic Adviser Arvind Subramanian the inflation rate of 1.54 per cent for June is historically low and reflects the firm and ongoing consolidation of macro economic stability. 

    He said the last time that such inflation was seen-- although according to a slightly different Consumer Price Index --was in 1999 and before that in 1978. 

    According to Central Statistics Office data, overall food inflation fell to minus 2.12 per cent in June. Retail inflation in vegetables stood at minus 16.53 percent. Similarly, prices of pulses and products declined, with retail inflation in this segment at minus 21.92 percent in June. 

  • India to become largest milk producer in 2026: report
    According to recently released the Organisation for Economic Co-operation and Development (OECD)-FAO Agricultural Outlook 2017-2026, India will be the world’s largest milk producer by 2026 and will account for the biggest increase in wheat production globally. India’s population will grow to 1.5 billion from 1.3 billion, an increase of almost 150 million every year. India will overtake China to be the most populous country in the world by 2026. 

  • Panel formed on cyber-security framework 
    The central government has formed a panel of experts to suggest how to strengthen the cyber security framework of information technology (IT) support systems operated by the rural development ministry. 

    The background is concern over reports on 'public disclosure' of sensitive data through various portals and payment gateways

    The panel has had its first meeting. It will also explore methods through which synergy could be had in the various IT applications of the ministry — the latter gets a little over 15 million entries daily on its various IT platforms. 

    Ensuring cyber security has become all the more necessary after last month's notification for all bank accounts to be seeded with Aadhaar numbers by December 31 — else, they'd cease to be operational. 

    It is estimated that about 50 million who work in the rural jobs guarantee programme, MGNREGS, do not have bank accounts seeded with Aadhaar. To complete the process by December, the ministry has planned camps in villages from now till September. 

    Officials says the panel, headed by Kiran Karnik, former head of Nassom, the IT sector's apex association, is expected to give a report soon. The panel also has the chief executive of the National Institute of Smart Governance and cyber security specialists. 

    A recent study by Amber Sinha and Srinivas Kodali from the Centre for Internet and Society (CIS) found details on individuals, including sensitive personally identifiable information such as Aadhaar number, caste, religion, address, photographs and financial information, are only a few clicks away through government schemes' dashboard and portals. 

    It specifically studied two major schemes of the rural ministry, the National Social Assistance Programme and MGNREGS, along with some state schemes. 

  • India’s first TISC to come up in Punjab
    The Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry signed an Institutional agreement with the Punjab State Council of Science and Technology in New Delhi to establish India’s first Technology and Innovation Support Center (TISC) at Patent Information Centre, Punjab, under the World Intellectual Property Organization’s (WIPO) TISC program. The objective of the TISC is to stimulate a dynamic, vibrant and balanced Intellectual Property Rights (IPRs) system in India to promote entrepreneurship and enhancing social, economic and cultural development by establishing a network of TISCs in India. 

  • No GST on second hand goods 
    The buying and selling of second-hand goods will not attract Goods and Services Tax (GST) if sold at a price cheaper than the purchase price, the government said on 14th July. 

    Rule 32(5) of the Central Goods and Services Tax (CGST) Rules, 2017, provides that where a taxable supply is provided by a person dealing in buying and selling of second hand goods or used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored. This is known as the margin scheme. 

    The clarification comes after doubts were raised regarding the applicability of the Margin Scheme under the GST for dealers in second hand goods in general and for dealers in old and used empty bottles in particular. 

    Thus, Margin Scheme can be availed of by any registered person dealing in buying and selling of second hand goods (including old and used empty bottles) and who satisfies the conditions as laid down in Rule 32(5) of the Central Goods and Services Tax Rules, 2017. 

    Rule 32(5) of the CGST Rules is a special sub-rule for person buying and selling second hand goods (for instance used cars, television and mobiles). 

    Further, the government notification exempts Central Tax leviable on intra-state supplies of second hand goods received by a registered person dealing in buying and selling of second hand goods (who pays the central tax on the value of outward supply of such second hand goods) from any supplier, who is not registered. 

  • President Pranab Mukherjee last visit to Jangipur for free LPG to poor
    On his last visit to Jangipur as President, Pranab Mukherjee handed over free LPG connections under Pradhan Mantri Ujjwala Yojana as the scheme for BPL families touched the 2.5-crore mark. 

    Sefina Bewa and Shanti Majhi were the first recipients of the scheme. 

  • GST to boost GDP; positive for rating: Moody's
    Moody's Investors Service has said, Implementation of the GST will be positive for India's rating as it will lead to higher GDP growth and increased tax revenues. 

    In a statement on 2nd JUly, Moody's Vice-President, Sovereign Risk Group, William Foster said, over the medium term, GST is likely to contribute to productivity gains and higher GDP growth by improving the ease of doing business, unifying the national market and enhancing India's attractiveness as a foreign investment destination. 

    Foster said, the GST will also support higher government revenue generation through improved tax compliance and administration. 

  • India in 88th place in money hoarded in Swiss banks
    India has slipped to the 88th place in terms of money parked by its citizens with Swiss banks, while the U.K. remains on the top. 

    Also, the money officially held by Indians with banks in Switzerland now accounts for a meagre 0.04 per cent of the total funds kept by all foreign clients in the Swiss banking system, as per an analysis of the latest figures compiled by the Swiss National Bank as on 2016-end. 

    India was placed at 75th position in 2015 and at 61st in the year before that, though it used to be among top-50 countries in terms of holdings in Swiss banks till 2007. The country was ranked highest at 37th place in 2004. 

  • Telangana to have separate agriculture budget from next year
    Telengana will have a separate budget for Agriculture from next year. This was decided after Chief Minister, K. Chandrasekhar Rao met the Ministers and officials on Agriculture in Hyderabad. He said it has also been decided to enhance fund for agriculture sector. 

    Mr. Rao said the State will provide training of modern and scientific methods of farming to increase the farm output. He urged the farmers associations at various levels to organize cultivators. 

  • "President Pranab Mukherjee- A statesman: Prime Minister Narendra Modi released a book based on President Pranab Mukherjee during a launch event at the Rashtrapati Bhavan on 2nd July. 

    The Prime Minister said that the book will offer people a perspective into the human being that President Mukherjee is and will enable people to understand that beyond politics, a politician is also a human being. Book titled "President Pranab Mukhejee - A Statesman" is a comprehensive photographic record of India's 13th Head of State Pranab Mukherjee. 

  • India's digital Payments rise by 55% 
    Digital payments recorded 55 per cent increase in 2016-17 and the trend is likely to continue in the coming years indicating that India is at 'the cusp of revolution' in this area, Niti Aayog Principal Advisor Ratan P Watal said. The spurt, over 2015-16, came in the financial year during which the government demonetised high-value currency. 

    The volume of overall digital payments, Watal further said, recorded a compounded average annual growth rate of 28 per cent from 2011-12 to 2015-16. 

    Watal said the value of overall payments was around 13 to 14 times of GDP during this period (2016-17). In contrast, the outstanding stock of currency in circulation, which hovered around 12 per cent of GDP during 2011-12 to 2015-16, declined to 8.8 per cent during 2016-17, reflecting the impact of demonetisation partially offset by the ongoing re-monetisation process.

    The government had demonetised high value currency (Rs 500 and Rs 1,000 notes) last November and has been promoting a less cash economy through greater push on digital payments. Watal further pointed out that retail payments accounted for as much as 98-99 per cent of the total volumes. 

  • Centre, Asian Development Bank sign 220 million dollar loan for Rajasthan State Highways
    The Centre and Asian Development Bank, ADB on 3rd July signed a 220 million dollar loan for improving connectivity as well as transport efficiency and safety on State Highways of Rajasthan. 

    The loan is the first tranche of the 500 million dollar Rajasthan State Highways Investment Program, approved by ADB Board in May this year. The first tranche loan will improve about one thousand kilometers of State Highways and major district roads. 

  • Centre abolishes 13 cesses along with GST rollout
    Starting July 1, as many as 13 cesses have ceased to exist with the rollout of the Goods and Services Tax (GST). The cesses that have been abolished from July 1 by the Taxation Laws (Amendment) Act include the Krishi Kalyan Cess and Swachh Bharat Cess that were levied along with service tax, as well as education cess on excisable goods and also little known cesses such as those on tea, sugar and jute. 

    However, according to officials, seven cesses will continue as they relate to customs or goods that are not included in the GST. These include education cess secondary and higher education cess on imported goods. 

    Similarly, cesses on petroleum products will also continue as these are outside GST. These include the cess on crude petroleum oil under the Oil Industry Development Act, 1974, the road cess or additional duty of excise on motor spirits and high speed diesel oil, special additional duty of excise on motor spirit and the NCCD on tobacco and tobacco products and crude petroleum oil. 

    As many as 26 cesses levied by the Centre along with excise duty and service tax have been abolished since 2015 to pave way for this indirect tax levy. 

    GST, which now is a single tax, has subsumed central excise duty and service tax, as well as State value added tax, local levies such as octroi and also cesses. For consumers, this means that their bills from purchases have a single tax rate inclusive of all levies and cesses. The Clean Energy Cess, which was levied on coal, was also abolished starting this month. 

    Under GST, a clean energy cess is levied on coal, lignite and peat production at the rate of Rs. 400 per tonne, which will be used to fund the compensation to States for revenue losses. The Finance Ministry has also removed the additional excise duty on tobacco, pan masala and cigarettes from this month. 

    Additionally, the Research and Development Cess was also abolished from April 1 this year following the Union Budget and Finance Act 2017-18. Education, secondary and higher education cesses on taxable services were repealed in 2015. 

    The Finance Ministry has also abolished other cesses such as that on salt and another for cine workers last year by amending acts relating to these. 

  • India's central bank set to launch new 200 rupee notes
    The Reserve Bank of India has started printing new 200 rupee banknotes in a step towards speeding up the remonetization process in the economy. The move comes eight months after the government of Prime Minister Narendra Modi canceled high-denomination notes in a bid to tackle counterfeiting and the black economy. 

    The new 200 notes will carry advanced security features. The authorities are taking extra precautions to prevent counterfeiting. The notes are going through different levels of security and quality checks at the government's press unit at Hoshangabad in the central Indian state of Madhya Pradesh. 

    The new banknotes will be the first 200 rupee notes to enter circulation in the country, and equate to about $3. The demonetization move, announced in November, sucked out 86% of the cash in circulation in India, leaving people in Asia's third largest economy severely out of pocket. The 500 and 1,000 rupee demonetized notes were later replaced by redesigned 500 and fresh 2,000 rupee notes. 

  • India scores well on FSB reform report card to G20
    The Financial Stability Board (FSB), an international body for global financial system, has placed India in the league of countries that are ‘compliant or largely compliant’ on implementation of priority area reforms. The FSB submitted its status report on progress in financial regulatory reforms in various jurisdictions, including India. 

    The report listed India as a ‘compliant’ jurisdiction with regard to Basel III reforms in risk-based capital and as ’largely compliant’ on liquidity coverage ratio. 

    Other countries that have been found to be ‘compliant or largely compliant’ on these metrics include Argentina, Australia, Brazil, Canada, China, Hong Kong, Indonesia, Japan, Mexico, South Korea, Russia, Singapore, South Africa, Switzerland, Turkey and the US. 

    At the same time, France, Germany, Italy, the Netherlands, Spain and the UK have been found to be ’materially non-compliant’ on at least one parameter. 

    With regard to the Net Stable Funding Ratio (NSFR), India figured among the countries where “final rule published but not in force, or draft regulation published“.

    On compensation-related reforms, India is among the jurisdictions where “all except a few (three or less) FSB Principles and Standards implemented”, as per the FSB report. 

    On trade reporting in the over-the-counter derivatives market, India was among the countries where necessary regulatory framework was being implemented. 

  • J and K Assembly passes GST resolution for implementation
    Jammu and Kashmir Assembly on 5th July adopted the resolution extending the GST to the state, amid protests by opposition parties. The resolution seeks to incorporate safeguards to the special constitutional position of state especially Article 370 of Indian Constitution and Article 5 of J&K Constitution. 

  • AIIB clears $329-mn loan for building roads in Gujarat villages
    China-led Asian Infrastructure Investment Bank (AIIB) on 5th July said that its board has approved $329 million loan to build access roads to 4,000 villages in Gujarat. 

    Insufficient road connectivity into these villages limits their ability to access healthcare services, bring their goods to market and access transportation for their children to attend schools This project will construct and upgrade district and farm-to-market roads for the villagers and provide approaches to educational institutions, schools and hospitals. 

    The upgraded road access is expected to have a positive impact on women and girls by improving school attendance rates as the latter drop out due to lack of access to all weather roads. 

    The project will also better integrate rural population, tribal villages, business and industries with the national and state economy through better transport connectivity. 

    This is a standalone project by AIIB and part of phase one of the multi-phase Gujarat's 'Chief Minister's Rural Roads Programme' that complements the Centre's 'Prime Minister's Rural Roads Programme'. 

  • India's growth prospects improve: IMF
    India's economic growth outlook has improved as impact of demonetisation is fading and some key reforms are paying off, but concerns are growing on corporate debt and banking system vulnerabilities, the IMF said on 5th July. 

    In its 'Surveillance Note' prepared for the G20 leaders ahead of their two-day summit on July 7-8 in Hamburg, Germany, the International Monetary Fund (IMF) said there is 'cautious optimism' about the global economy but policy efforts are still needed to strengthen the recovery. 

    Even though global growth momentum remains on track, the IMF said some of the forces driving the recovery are adding to already high vulnerabilities and external imbalances. 

    Touching upon the situation in emerging economies, including India and China, the IMF said the outlook remains for a pick-up in growth. As part of efforts to curb black money and corruption, the government demonetised old Rs 500 and 1,000 currency notes in November 2016. However, the IMF has flagged vulnerabilities in the country's banking system. 

  • Modi adopts third village Kakrahia in UP 
    Indian Prime Minister Narendra Modi adopts Kakrahia as the third village after Jayapur and Nagpur, as his first and second villages in his Lok Sabha Constituency. It is under Saansad Adarsh Gram Yojana (SAGY) scheme for developing it as a model village in 2017-18. Saansad Adarsh Gram Yojana scheme has been launched for developing model villages through the implementation of existing schemes and certain new initiatives to be done at local context, depending from village to village. 

  • Employment Provident Fund Organisation (EPFO) signs agreement with Five Banks
    The Employees’ Provident Fund Organisation (EPFO) inked an agreement with four private banks and Bank of Baroda for the purpose of collection of provident fund dues from the employees and payments to its subscribers. 

    EPFO joined with the private banks, namely, ICICI Bank, HDFC Bank, Axis Bank and Kotak Mahindra Bank. The Employee Provident Fund (EPF) is a retirement benefit applies only to salaried employees. 

  • G20 Summit: IMF, World Bank call for removing trade barriers
    IMF, World Bank and WTO on 7th July called for removing trade barriers and expediting economic reforms to boost global growth and employment even as they blamed technology as a prime reason for job losses in some regions. 

    In a joint statement on the occasion of G20 Summit, heads of the three multilateral organisations said deeper trade integration and supportive domestic policies requires decisive action by the leaders of the grouping. 

    The statement was signed by International Monetary Fund (IMF) Managing Director Christine Lagarde, World Bank President Jim Yong Kim and World Trade Organization (WTO) Secretary General Roberto Azevedo. They also acknowledged that when it comes to trade, it is not required to choose between inclusiveness and economic growth. 

    Such policies can cause a chain reaction, as other countries adopt similar measures with the effect of lowering overall growth, reducing output, and harming workers, the multilateral institutions said. Further, they said that re-invigorating trade, packaged with domestic policies to share gains from trade widely, needs to be a key priority. 

    Even though job losses in certain sectors or regions have resulted to a larger extent from technology than from trade, the multilateral institutions said thinking in advance about the policy package that shares trade gains widely is critical for the success of trade reforms. 

    Stressing that governments must find better ways of supporting workers, they said each country needs to find its own mix of policies that is right for their circumstances. 

  • Union Finance Ministry launches GST App
    Finance Ministry launch of special app - GST Rates Finder on 8th July. Through this app, user can determine GST rate for a good or a service by entering the name or chapter heading of the commodity or service. 

    The search result will list all the Goods and Services containing the name which was typed in the search box. This will empower not only the taxpayers, but every citizen of the nation, to ascertain the correct GST rate on goods and services. 

    The Central Board of Excise and Customs has taken these initiatives for ease of doing business under the GST regime. The application, aimed to serve as a ready reckoner on GST rates, has been launched on Android platform. The app would also work in offline mode. 

  • Defence Acquisition Council approves for Rs. 2,806-crore army upgrades
    The Defence Acquisition Council (DAC), headed by Defence Minister Arun Jaitley, on 8th July accorded approval to upgrades worth Rs. 2,806 crore for the Army. 

    Of this, the upgrades of armoured fighting vehicles is expected to cost about Rs. 2,400 crore, while the Carrier Command Posts of the artillery will need Rs. 400 crore. 

    The upgrades will be carried out by the ordnance factory in Medak, a Defence Ministry official said. The Carrier Command Posts on tracked vehicles will be for technical control of artillery fire. The Medak factory will manufacture the command posts, equipped with latest communication systems and computers, to enable the commander to direct fire at targets. 

    The posts will also have unmanned aerial vehicles to assist the commander to gather precise information about the battlefield scenario in real time, sources said. 

  • India's forex reserves at record-high of USD 386.53 billion
    India's foreign exchange reserves have increased by 4.007 billion US dollars to touch a record high of 386.539 billion US dollars in the week ended 30th June. A RBI press release has informed that foreign currency assets, a major part of the overall reserves rose by 3.724 billion US dollars to 362.388 billion US dollars. India's special drawing rights with the International Monetary Fund went up by 11.8 million US dollars to 1.479 billion US dollars, while the country's reserve position also increased by 18.9 million US dollars to 2.322 billion US dollars.


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