Current Affairs November 2016 - Economic

News 1 - Zero-tax rate on 50% of items in CPI basket under GST

Union Finance Minister Arun Jaitley announced that half the items in Consumer Price Index basket like food grains, would not be taxed at all under Goods and Services Tax and 5% tax will be levied on mass consumption items used by common people.

Goods and Services Tax Council finalized fourtier GST rate structure of 5%, 12%, 18% and 28 %. Luxury items like high-end cars and demerit goods including tobacco and aerated drinks, will be taxed at the highest rate.

News 2 - India, Venezuela signed deals to increase oil production

India and Venezuela signed an oil production deal worth about 1.45 billion US dollar to increase oil production. The agreement comes amid a severe economic crisis in Venezuela, and it is seen as a way to boost oil production, pay off debts, obtain funds from other foreign partners, and increase the country’s oil income.

The Indo-Venezuelan partnership, created in 2009, is expected to double the San Cristobal field daily oil production from 20,000 to 40,000 barrels of oil.

News 3 - Centre imposed Rs 10,000 cr penalty on RIL and its partners

Government slapped a nearly 10,000 crore rupee fine on Reliance Industries Limited (RIL) and its partners BP and Niko for pumping out gas that flowed to the Krishna Godavari-D6 Block from an adjoining field owned by ONGC.

After deducting about 72 million dollars royalty paid on the gas produced and adding an interest at the rate of Libor plus 2 per cent, it was decided to demand for 1.55 billion dollars on RIL, BP and Niko.

News 4 - CII launched unique platform ‘Startup Mentorship Circle’

In view of Prime Minister Narendra Modi’s vision of nurturing entrepreneurship, Confederation of Indian Industry (CII) launched a unique platform called ‘Startup Mentorship Circle’ to help in connecting start-ups with the global marketplace.

"Startup Mentorship Circle’ is a strong ecosystem for nurturing innovation and startups to drive sustainable economic growth and generate large scale employment opportunities. CII provides the largest network for start-ups with its 8000 direct and 2 lakh indirect members.

News 5 - Indirect Tax Collections up to October, 2016 register an increase of 26.7% over the net collections

The figures for indirect tax collections (Central Excise, Service Tax and Customs) up to October 2016 show that net revenue collections are at Rs 4.85 lakh crore which is 26.7% more than the net collections for the corresponding period last year.

Till October 2016, 62.4% of the Budget Estimates of indirect taxes for Financial Year 2016-17 has been achieved.

Net Tax collections on account of Customs during April-October 2016 stood at Rs. 1.27 lakh crore as compared to Rs. 1.22 lakh crore during the same period in the previous Financial Year, thereby registering a growth of 4.1%.

News 6 - Direct Tax Collections up to October, 2016 show an increase of 10.6%

The figures for Direct Tax Collections up to October, 2016 show that net collections are at Rs.3.77 lakh crore which is 10.6% more than the net collections for the corresponding period last year.

Till October 2016, 44.5% of the Budget Estimates of direct taxes for FY 2016-17 has been achieved.

As regards the growth rates for Corporate Income Tax (CIT) and Personal Income Tax (PIT), in terms of gross revenue collections, the growth rate under CIT is 11.6% while that under PIT is 18.6%.

News 7 - Quick Estimates of Index of Industrial Production and Use-Based Index for the month of September, 2016

The Quick Estimates of Index of Industrial Production (IIP) with base 2004-05 for the month of September 2016 were released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation.

The General Index for the month of September 2016 stands at 179.5, which is 0.7 percent higher as compared to the level in the month of September 2015.

The cumulative growth for the period AprilSeptember 2016 over the corresponding period of the previous year stands at (-) 0.1 percent.

News 8 - India’s Foreign Trade October, 2016 results revealed

October 2016 exports have shown a positive growth of 12.43% higher in Rupee term and exports were valued at US$ 23512.70 million (Rs.156941.86 crore). Imports during October 2016 were valued at US$ 33673.53 million (Rs.224763.10 crore).

The trade deficit for April-October, 2016-17 was estimated at US$ 53169.95 million which was 32.04% lower than the deficit of US$ 78238.60 million during April-October, 2015-16.

Overall the trade balance has improved. Taking merchandise and services together, overall trade deficit for April- October 2016-17 is estimated at US$ 20811.95 million.

News 9 - Government of India and ADB Sign $500 Million Loan to Help Build Longest River Bridge Across the Ganges River

The Asian Development Bank (ADB) and the Government of India signed a $500 million loan to build a 9.8 km long road bridge across the Ganges River to improve transport connectivity between North and South Bihar and for better link between the State Capital, Patna, and the surrounding areas. This will be India’s longest river bridge.

Along with ADB’s loan and $900,000 in technical assistance to improve bridge operation and management, the state government of Bihar will provide support equivalent to $215 million. The project is expected to be completed by the end of December 2020.

News 10 - ITPO takes measures for cashless transactions at IITF

India Trade Promotion Organization took various measures to facilitate cashless transactions for the participants and exhibitors at the India International Trade Fair. These measures include, increase in number of ATM machines from 2 to 14.

For small artisans and exhibitors, SBI has been tied up to open bank accounts, if needed, on site, to enable them to receive the cashless transactions through swipe machines.

PayTM and Freecharge are working to facilitate cashless transactions through Digital Wallets.

News 11 - Entrepreneurship Assistance and Development Scheme for women

Ministry of Micro, Small and Medium Enterprises (MSME) is operating a scheme titled “Trade Related Entrepreneurship Assistance and Development (TREAD)” to promote women entrepreneurs.

Under the scheme, there is a provision for Government of India grant up to 30% of the loan/ credit maximum up to Rs. 30.00 lakh as appraised by lending institutions/ banks. The lending institutions/ banks would finance loan assistance for a group of women through NGOs for undertaking non- farm activities.

News 12 - Ministry of Micro, Small and Medium Enterprises to implement Central Sector schemes to modernize Khadi units

Ministry of Micro, Small and Medium Enterprises will implement Central Sector schemes to modernize Khadi units. Scheme of Fund for Regeneration of Traditional Industries (SFURTI) is implemented to make the traditional industries clusters including Khadi clusters more productive and competitive facilitating their sustainable development.

KVIC has set up interfaces with leading technological institutes to conduct research work under S&T programme of KVIC for development of tools, implements and processes involved in production of Khadi.

News 13 - Merger of Rail Budget with Union Budget

The Government has decided to merge Rail Budget with the Union Budget from budget year 2017-18. A separate Statement of Budget Estimates and Demand for Grant will be created for Railways.

Merger of Rail Budget with Union Budget would facilitate multimodal transport planning between highways, railways and inland waterways.

The Capital at charge of the Railways on which annual dividend is paid by the Railways will be wiped off. A single Appropriation Bill, including the estimates of Railways, will be prepared and presented by Ministry of Finance to Parliament.

News 14 - India and US launched $ 95 million clean energy projects

The USA announced two financial projects worth USD 95 million in India. The projects will help bring more energy-efficient appliances to rural sector.

The US has committed USD 70 million in Overseas Private Investment Corporation (OPIC) financing for renewable energy projects in India.

The USD 75 million OPIC financing is for a utility-scale PV project in Telangana. It is sponsored by ReNew Power Ventures. OPIC and Indian Government will also launch a USD 20 million distributed solar facility.

News 15 - Launch of online portal for facilitating trade between India and Iran

An Online Portal for facilitating trade between India and Iran was launched in the presence of H.E. Mr. Gholamreza Ansari, Ambassador of Islamic Republic of Iran.

The Hind-Iran portal (hindirantrade.org) is a joint initiative of STC and Douman Queshm, Iran. The objective of the trade portal is to disseminate information relevant to Indo-Iran Trade, and to provide an e-marketplace for the buyers and sellers of the two countries.

The portal is aimed at bridging the communication divide which the business communities face, and which are very interested in trading with each other.

News 16 - Transactions in relation to which quoting PAN is Mandatory

The Income Tax Department prescribes a list of transactions for which quoting of Permanent Account Number (PAN) is mandatory. These are listed in Rule 114B of the Income Tax Rules, 1962.

In addition to the existing requirement of quoting of PAN quoting of PAN will now also be mandatory in respect of cash deposits aggregating to Rupees two lakh fifty thousand or more during the period 09^th November, 2016 to 30^th December, 2016 as per an amendment notified by CBDT on 15-11-2016.

News 17 - PGCIL Seeks US$ 1,000 Million Loan for Green Energy Corridor from ADB

Power Grid Corporation of India Limited (PGCIL) has sought a loan assistance of US$ 1,000 million from the Asian Development Bank (ADB) comprising of Sovereign guaranteed loan of US$ 500 million and NonSovereign loan of US$ 500 million.

The Loan would be utilized for funding of the transmission projects like project under Green Energy Corridor projects in next 3-4 years, Inter State Transmission System, HVDC Bipole link between regions.

News 18 - Nagpur Metro achieved Euro 130 million AFD credit

Nagpur Metro achieved financial closure of the project by securing a credit of Euro 130 million from AFD (French Development Agency).

A Credit Facility Agreement in this regard was signed between the Department of Economic Affairs, Ministry of Finance and AFD, in the presence of French Ambassador Shri Alexandre Ziegler in New Delhi.

The 20-year period credit with a moratorium of five years, will be used for funding Signaling, Telecom, Automatic Fare Collection Systems and Lifts and Escalators. Order for rolling stock has already been placed.

News 19 - Budget of Rs. 5501.15 crore allotted for Pradhan Mantri Fasal Bima Yojana (PMFBY) during 2016-17

A budget provision of Rs. 5501.15 crore has been made for implementation of Pradhan Mantri Fasal Bima Yojana (PMFBY) during 2016-17.

As per provisions of PMFBY, admissible claims are worked out on the basis of yield data generated from Crop Cutting Experiments (CCEs) submitted by concerned State Governments to the insurance companies.

The cut-off date for receipt of yield data for Kharif 2016 season is one month from the final harvest i.e. 15^th December, 2016. Claims are estimated accordingly.

News 20 - CBDT Signs Four Unilateral Advance Pricing Agreements

The Central Board of Direct Taxes entered into four more unilateral Advance Pricing Agreements (APAs) in various sectors of the economy like pharmaceuticals, Information Technology and construction.

The international transactions covered in these agreements include software development Services, IT enabled Services (BPOs), Engineering Design Services, Contract R&D Services and Marketing Support Services.

The progress of the APA Scheme strengthens the Government’s mission of fostering a nonadversarial tax regime.

News 21 - Govt slaps safeguard duty on certain steel imports

Government slapped safeguard duty on import of certain steel products like hot rolled flat sheets and plates of alloy or non-alloy steel to protect domestic manufacturers from cheap inbound shipments.

The effective duty rate would be calculated after deducting the value of the goods and the anti-dumping duty payable when the import price is below 504 US dollars per tonne.

The duty arrived at would be 10 per cent in the first year and will gradually reduce to 6 per cent by 2019.

News 22 - E-commerce firms to deduct TCS under GST

E-commerce firms like Flipkart and Snapdeal will have to deduct 2 per cent TCS (tax collected at source) while making payments to their suppliers and deposit it with the government, according to the new model GST law.

This will not increase the incidence of taxation on consumers as the supplier will get tax credit for the TCS. The model GST law provides for 1 per cent TCS to be deducted by the E-commerce operators.