Weekly Compendium of Economic and Business Developments
By PHD Research Bureau –Period ending December 24, 2021
The Government has constituted Empowered Group of Secretaries (EGoS) headed by Cabinet Secretary with Secretaries of 20 Infrastructure and Economic User Ministries as members of EGoS to monitor implementation of PM Gati Shakti, which aims to reduce the logistics cost. Department for Promotion of Industry and Internal Trade (DPIIT), being the nodal department for PM GatiShatki informed about the administrative arrangements made for monitoring and coordination of PM GatiShakti.
The Union Cabinet approved Memorandum of Understanding between Institute of Chartered Accountants of India (ICAI) and The Polish Chamber of Statutory Auditors (PIBR), Cabinet approved Memorandum of Understanding between Competition Commission of India and Competition Commission of Mauritius, Cabinet approves Minimum Support Price (MSP) for Copra for 2022 season.
Union Agriculture Minister, Narendra Singh Tomar releases the book “Spices Statistics at a Glance 2021”
Union Minister for Agriculture and Farmers Welfare, Shri. Narendra Singh Tomar released the book ‘Spices Statistics at a Glance 2021’on 21st December, 2021. The book is a compendium of all the spices statistics like, area, production, productivity, export, import, price and value of output of various spices produced in the country. The book is published by the Directorate of Arecanut and Spices Development (DASD), Ministry of Agriculture & Farmers Welfare, the nodal agency for collection and compilation of area and production estimates of spices at National level. The book highlights the growth achieved in spices sector during the last seven years from 2014-15 to 2020-21 in the country.
Economy needs continued hand holding to mitigate the uncertainty caused by omicron variant
There is a need for continuous hand holding of the economy as the uncertainty caused by looming impact of new coronavirus variant has impacted the performance of some of the lead economic and business indicators in the month of November 2021.
Although the resilience of Indian Economy is very strong and we expect a double digit GDP growth in 2021-22 on the back of effective policy measures undertaken by the government, still we have to mitigate the uncertainty caused by the looming impact of omicron variant.
Out of the 9 lead economic and business indicators (November 2021 data for railway freight is not available yet) of QET (Quick Economic Trends), tracked by the industry body PHDCCI, 6 have shown uptick for the month of November 2021 as compared with 7 out of 10 indicators showing the uptrend in October 2021.
Unemployment, Exchange rate, Manufacturing PMI, GST Collections, Exports and E-way Bill registered a positive growth in November 2021.
Exports registered a positive growth of 27% in November 2021, increasing from US$ 23.6 billion in November 2020 to US$ 30 billion. GST collections registered the y-o-y growth of 25% from Rs 1,04,963 crore in November 2020 to Rs 1,31,526 crore in November 2021. E-way Bills have shown y-o-y growth 5.9%, in November 2021, increasing from 57.7 million in November 2020 to 61.1 million in November 2021.
Unemployment declined sequentially by 9.7% in November 2021 from 7.8% in October 2021 to 7% in November 2021. Exchange rate appreciated by 0.6% from average of 74.9 INR/USD in October 2021 to 74.45 INR/USD in November 2021. The sequential growth of Manufacturing PMI increased by 3.0% in November 2021, from 55.9 points in October 2021 to 57.6 points in November 2021.
However, forex reserves registered the decline of (-)1%, decreasing from US$ 642 billion in October 2021 to US$ 638 billion in November 2021. The SENSEX (monthly average) declined by (-)2% in November 2021 from 60422 in October 2021 to 59416 in November 2021. Passenger vehicle sales registered decline of (-)19% in November 2021 from 2,64,898 units in November 2020 to 2,15,626 in November 2021.
Supply side issues such as high input prices, shortages of raw materials, among others are impacting the production possibilities and reducing the price cost margins of the producers.
At this juncture, there is a need to address the high commodity prices and shortages of raw material to support the consumption and private investments in the country.
The drivers of household consumption need to be further strengthened to enhance the aggregate demand as it will have an accelerated effect on expansion of capital investments.
More and more direct benefit transfers needs to be enhanced for the urban and rural poor under the various welfare schemes of the Government to strengthen and sustain the recovery in the economic growth.
10 economic and business indicators of QET include demand and supply indicators along with external and financial sectors indicators.
Economy so far Union Budget 2022: Experts seek fiscal consolidation path, capex to aid growth
A gradual fiscal consolidation path, capital expenditure to pursue growth and steps to rein in inflation were some of the key suggestions made by economists for the FY23 Budget to the Finance minister Nirmala Sitharaman on 22nd December. The government must aim to provide a credible fiscal consolidation path, the year-on-year projection of fiscal deficit should not be significantly large,” said one of the economists who attended the meeting.
Piyush Goyal pitches for simplicity while formulating measures to improve ease of living
Commerce and Industry Minister Piyush Goyal on Wednesday pitched for simplicity while formulating measures to improve ease of living, doing business and reduce the compliance burden. He also called for the creation of a single identification number for businesses and individuals by merging several identification numbers that exist presently, such as Aadhaar, PAN and TAN, so that delivery of services becomes smoother and faster.
Winter Session of Parliament concludes: Key economic Bills given a miss
The government deviated from its planned legislative agenda for the Winter session of Parliament, which concluded on Wednesday, by not introducing key economic Bills, including the one on privatisation of two public sector banks (PSBs), even though it withdrew three pro-reform laws governing agriculture marketing in the face of prolonged protests by farmers. It, however, introduced and passed a Bill, otherwise not listed in the initial business agenda, to link voter rolls with Aadhaar to weed out duplicate voters.
Pre-Budget meet: Focus on growth, bold reforms, say economists
Economists on Wednesday asked the government to continue with bold reforms and keep up the focus on growth and reconstruction, as it prepares for a Budget to build on the recent growth momentum and bring the Covid-hit economy back on track fast, sources told FE.In a pre-Budget consultation meeting with finance minister Nirmala Sitharaman, some of the economists impressed upon the government not to unduly worry about the fiscal trajectory for FY23 and continue to bolster expenditure.
CPI could rise 100-125 bps if GST rates raised as suggested by the finance commission
Report Indian Consumer Price Index could rise 100-125 basis points putting pressure on the central bank, if the GST council chooses to raise rates for many goods in line with the recommendations of the finance commission, forecasts Standard Chartered Bank. Food and beverages are likely to be the major drivers since they have 45% weighting in the index.We estimate that headline consumer price index (CPI) would rise by 100-125bps in the event of an effective 1percentage point(ppt) in Goods and Services Tax (GST) rates in a single move.
Government Panel for amendments to Insolvency and Bankruptcy Code:- A key government panel has suggested amendments to the Insolvency and Bankruptcy Code including provisions related to time period taken for approval of resolution plans, avoidable transactions and wrongful trading. To ensure swift approvals for resolution plans, the committee sought to make it mandatory for the National Company Law Tribunal (NCLT) to approve the plan within 30 days or else record its reasons for delay in writing.
RBI extends tokenisation deadline to June 30 next year:- The Reserve Bank of India (RBI) late Thursday deferred the implementation of mandatory tokenisation of card transactions after the industry sought more time to comply with the latest data safety rules.Merchants will now be allowed to store data until June next year. The earlier tokenisation deadline was January 1.
Cash support to Covid-hit economy with fiscal consolidation in focus: Government
The government has initiated various measures to provide relief and financial support to various sectors of the Covid-19 hit economy, at the same time, fiscal consolidation is also under focus, the Finance Ministry said in a report. Increasing the buoyancy of tax revenue through improved compliance, mobilisation of resources through monetisation of assets, improving efficiency and effectiveness of public expenditure etc. are the important measures directed towards this goal, it said.
FMCG players expect better growth, lesser inflationary pressure in 2022 – With a revival in demand and consumption, FMCG companies are looking forward to 2022 with positivity and hopes of sustaining a healthy growth trend across both rural and urban markets while gearing up to cater to the ever-increasing digitally active consumers and tackle the challenge of higher commodity prices.
Input tax credit should be available for construction of plant and machinery, says ruling – A recent tax ruling has said that plants and machinery are an exception to the rule and a tax credit should be available for their construction, providing much needed clarity to companies incurring new capital expenditure.
RBI Governor for continued policy support to nurture economic revival: MPC minutes – Uncertainty is emerging as the only certainty, said Hon’ble RBI Governor Shri Shaktikanta Das as he emphasised on continued policy support at the December MPC meet during which members expressed concerns over spread of the Omicron variant of coronavirus, as per the minutes of the rate-setting panel released yesterday.
Centre in Rajya Sabha lists steps taken to improve flow of credit to MSME sector – Union Minister of State for Finance Dr Bhagwat Kisanrao Karad has said that the Centre has announced Emergency Credit Line Guarantee Scheme as part of the Aatma Nirbhar Bharat Package with the objective to help MSMEs and business enterprises to meet their operational liabilities and resume business in view of the distress caused by the COVID-19 crisis by providing Lending Institutions 100 per cent guarantee against any losses suffered by them due to non-repayment by borrowers.
Industry bodies urge RBI to extend card tokenisation deadline of Dec 31 The Merchant Payments Alliance of India (MPAI) and the Alliance of Digital India Foundation (ADIF) recently urged the Reserve Bank of India (RBI) to extend the card-on-file (CoF) tokenisation deadline of December 31 for merchants.
Commerce and industry minister Shri Piyush Goyal called for single identification number for businesses, individuals Commerce and industry minister Shri Piyush Goyal yesterday called for the creation of a single identification number for businesses and individuals by merging several identification numbers that exist at present, such as Aadhaar, PAN and TAN, for smoother and faster delivery of services.
Duty cut could lift India’s refined palm oil imports, dent CPO purchases – Higher imports of refined palm oil by India, the world’s biggest buyer of vegetable oils, could help producers in Indonesia and Malaysia but hurt refiners in India. New Delhi recently slashed the basic import tax on refined, bleached and deodorized (RBD) palm oil to 12.5% from 17.5% until March 2022 and allowed imports until December 2022 to cool near-record prices.
Global Shortage of Containers – The Government has adopted a multi-pronged strategy to address the problem of shortage of containers and high freight rates. The efforts are spearheaded by an inter disciplinary task force consisting of representatives from the Ministry of Commerce and Industry, Ministry of Ports Shipping and Waterways, Ministry of Railways, Central Board of Indirect Taxes and Customs (CBIC) and stakeholders like the Federation of Indian Export Organisations (FIEO), Container Shipping Lines Association (CSLA), etc.
India’s curb on futures trade threatens food supply chain – India’s year-long suspension of futures trading in key farm commodities is crimping the use of risk management tools such as hedging across its food supply chain, spurring inventory cuts as forward purchases get scaled back.
Over 25,000 compliances reduced so far: DPIIT Secretary – Over 25,000 compliances have been reduced by Union ministries, states and UTs so far to further improve ease of living and doing business, a top government official said recently. These compliances were reduced during the last phase of an initiative that ended on August 15 this year.
With FTA between India and UK on the horizon, 2021 winds up on a promising note – A comprehensive strategic partnership backed up by an ambitious Roadmap 2030 for closer cooperation over the next 10 years were the highlights for India-UK relations this year, which closes with the promise of free trade agreement (FTA) talks scheduled to kick-start in January 2022.
Power ministry working on resource adequacy plan guidelines – The Union Power ministry was working on resource adequacy plan guidelines to ensure 24×7 power supply to the consumers, a senior official said recently. The ministry was also discussing some bigger reforms to make discoms viable and was working on steps like de-regulating the sector or making regulation adaptability more industry friendly, the official said.
Chief Minister of Uttar Pradesh Shri Yogi Adityanath proposes drone manufacturing unit in state – Uttar Pradesh Chief Minister Yogi Adityanath has directed the officials concerned to prepare a concrete action plan for setting up a drone manufacturing unit in the state. The chief minister proposed the drone manufacturing unit, given the importance of unmanned aircraft in various fields such as disaster relief, agriculture, and law and order, the spokesperson said
Profitability of sugar, fertiliser, dairy sectors to remain stable in FY22: ICRA – With only three months left to close the financial year 21-22, rating agency ICRA recently said that profitability of sugar, fertiliser and dairy sectors will remain stable in FY22. Sabyasachi Majumdar, Senior Vice President & Group Head, ICRA said that the sugar industry ended SY2021 with a production of 31.2 million metric tonnes of sugar, exports of 7.1 million metric tonnes and a closing stock of 8.3 million metric tonnes equivalent to 3.7 months of sugar consumption.
Auto industry hopes for smooth ride in New Year after a bumpy 2021 – The Indian automotive industry is driving into 2022 with a positive mindset in its quest to reach the pre-pandemic levels of sales volume, having built a solid foundation in 2021 amid semiconductor shortage hampering production.
Year-End- Review of Ministry of Heavy Industries – 2021 – The Ministry of Heavy Industries (MHI) has been continuously working towards making the auto sector in India ‘Aatmanirbhar’ by augmenting ’Make in India’ efforts of the Government and to position India as an alternative manufacturing hub for automobiles and its components.
· Government’s new PPP port guidelines link tariffs to market-determined rates – Hon’ble Union Ports, Shipping & Waterways Minister Shri Sarbananda Sonowal yesterday announced Tariff Guidelines, 2021, for public-private partnership (PPP) projects at major ports. The new guidelines allow concessionaires at major ports to set tariffs in line with market dynamics.
Karnataka government reduces VAT on aviation turbine fuel to 18% – Karnataka government has reduced value added tax (VAT) on aviation turbine fuel to 18 per cent from existing 28 per cent. The decision will bring relief to airlines and help airlines reduce their fuel expenses. While seven states have reduced VAT to under four per cent. Karnataka’s move is significant as Bangalore airport is the third busiest in the country and main operating base for airlines.
Jammu and Kashmir received investment proposals worth Rs 31,000 crore, Centre told Rajya Sabha – Jammu and Kashmir has received investment proposals worth Rs 31,000 crore and has notified a new central sector scheme worth Rs 28,400 crore which is likely to provide employment to over 4.5 lakh people, the Rajya Sabha was informed yesterday. MoS Home Nityanand Rai said Union Home Minister Amit Shah met several delegations, families of martyrs, members of civil society and panchayati raj institutions, the public in general besides interacting with about 50,000 members of 4,500 youth clubs during his visit to Jammu and Kashmir in October.
Cabinet approves Memorandum of Understanding between Institute of Chartered Accountants of India (ICAI) and The Polish Chamber of Statutory Auditors (PIBR) – The Union Cabinet, chaired by the Hon’ble Prime Minister Shri Narendra Modi, yesterday has approved the signing of Memorandum of Understanding (MoU) between the Institute of Chartered Accountants of India(ICAI) and the Polish Chamber of Statutory Auditors (PIBR) to establish mutual co-operation in the areas of Member Management, Professional Ethics, Technical Research, CPD, Professional Accountancy Training, Audit Quality Monitoring, Advancement of Accounting Knowledge, Professional and Intellectual Development.
Cabinet approves Memorandum of Understanding between Competition Commission of India and Competition Commission of Mauritius – The Union Cabinet chaired by the Hon’ble Prime Minister Shri Narendra Modi has approved the signing of Memorandum of Understanding (MoU) between Competition Commission of India (CCI) and Competition Commission of Mauritius (CCM) for promotion and strengthening of co-operation in competition law and policy.
13.2 million candidates trained, oriented till Nov 21 under PMKVY – As many as 1.32 crore candidates were trained and oriented across the country as on November 21 this year under Pradhan Mantri Kaushal Vikas Yojana (PMKVY), Parliament was informed recently.
Monthly Production Report for November 2021- Crude oil production during November 2021 was2431.44TMT, which is 6.89% lower than target for the monthand2.22% lower than the production of November2020.Cumulative crude oil production during April-November, 2021 was 19868.42TMT, which is 4.38% and 2.74% lower than target for the period and production during corresponding period of last year respectively. Unit-wise and State-wise crude oil production is given at Annexure-I.
· India, France push blue economy & investment partnership- François Delattre, Secretary-General, Ministry for Europe and Foreign Affairs of France, is on an official visit to India from December 20-22. The visit comes on the heels of the Annual Defence Dialogue held on December 17 in New Delhi between Shri Rajnath Singh, Hon’ble Defence Minister and Florence Parly, French Minister for Armed Forces. Both sides took stock of the bilateral relationship and discussed the potential for cooperation in sectors such as defence and security, space, cybersecurity and the digital economy, blue economy, education and people-to-people contacts, energy, health and climate change.
· No recommendation by GST Council to bring petroleum products under new tax regime- The GST Council has not recommended bringing petroleum products under the reformed taxation regime even as certain representations have been made to the government to include petrol and diesel in GST. Excise duty on petroleum products is calibrated time to time for generating resources for infrastructure and other developmental items of expenditure, Minister of State for Finance Pankaj Chaudhary said in a written reply to the Rajya Sabha.
· Centre disburses loans amounting to Rs 2,714 cr to 27.06 lakh beneficiaries under PM SVANidhi scheme- The Centre has disbursed 27.06 lakh loans amounting to Rs 2,714 crore under PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi Scheme) so far. According to the Ministry of Housing and Urban Affairs, as of December 13, 2021, 30.75 lakh loans amounting to Rs 3,095 crore have been sanctioned and 27.06 lakh loans amounting to Rs 2,714 crore have been disbursed.
· RBI empanells CSB Bank to undertake banking biz of central, state governments– Private sector lender CSB Bank on Tuesday said it has been empanelled as an ‘agency bank’ by the Reserve Bank of India (RBI) to undertake general banking business of central and state governments. This appointment will allow CSB Bank to undertake general banking business of the central and state governments which may be entrusted by the RBI, the bank said in a statement.
PSBs recover more than Rs 5.49 lakh crore over last 7 fiscal years: Government in Lok Sabha- The government has taken comprehensive steps to reduce NPAs and to effect recovery, enabling public sector banks to recover more than Rs 5.49 lakh crore over the last seven fiscal years, the Lok Sabha was informed on Monday. In a written reply, Minister of State for Finance Bhagwat Karad said that with regard to the details of the recovery rate of non-performing assets (NPAs), the RBI has informed that it has not formally defined ‘recovery rate’ in the context of NPAs in the banking industry
NHAI toll revenue will jump to Rs 1.40 lakh crore in three years, says Hon’ble Union Minister Shri Gadkari- Toll revenue of the NHAI will soar to Rs 1.40 lakh crore per annum in the next three years from Rs 40,000 crore per annum currently, Hon’ble Union minister Shri Nitin Gadkari said. Addressing an event here, the Road Transport and Highways Minister said that there is a huge opportunity for investors in India’s infrastructure sector as the traffic density is rising every year.
Government allows import of moong, urad and tur to continue without quantitative restrictions- The government on Tuesday allowed the import of moong (green gram), urad (black gram) and tur (red gram) to continue without quantitative restrictions under “free” category until March 31 next year. Besides, importers can continue to take physical delivery until June 30, 2022 if bill of lading is issued by March, the Commerce Ministry said in separate notifications.
Seafood exporters seek revision in incentive scheme– In a representation sent to the Secretary of the Ministry of Food Processing, a group of major marine products exporters have termed the ministry’s production-linked incentive scheme (PLISFPI) for the food processing industry as grossly inequitable and the threshold limits as arbitrary. The eligibility threshold under the marine segment is ₹600 crore sales across all food products (2019-20) and a minimum investment of Rs 75 crore.
Government slashes import duty on refined palm oil to 12.5% to cool retail prices– Concerned over high prices of cooking oils, the government has reduced the basic customs duty on refined palm oil to 12.5 % from 17.5 % till March next year to boost domestic supplies and bring down rates in the domestic retail markets.
Government cuts customs duty on RBD palmolein; will affect Aatmanirbharta, says SEA– The government’s decision to reduce basic customs duty on RBD palmolein with effect from December 21 may affect India’s principle of ‘Aatmanirbharta’, according to the Solvent Extractors’ Association (SEA) of India.
PM Gati Shakti plan, single window clearance to further push FDI inflows in new year- A series of steps taken by the government to promote ease of doing business and liberalisation of foreign direct investment norms have helped India receive record FDI inflows so far this year, and implementation of measures like PM Gati Shakti, single window clearance and GIS-mapped land bank are expected to further push investments in 2022.
Mustardseed, soyabean contracts trade lower on NCDEX- Contracts of commodities such as mustardseed and soyabean traded lower on the National Commodities and Derivatives Exchange (NCDEX) on Tuesday afternoon, following market regulator SEBI’s decision to suspend futures and options trading for one year in chana, mustardseed, CPO, moong, paddy (Basmati), wheat and soyabean and its derivatives.
Lithium prices likely to rise next year, too- Lithium, the best performer among commodities this year with a whopping increase of over 410 per cent, will average higher next year too, though the rise may not be as phenomenal. Currently, lithium carbonate — the main source for lithium, which is in demand for batteries in electric vehicles (EVs) — is quoted at 2.35 lakh Chinese yuan ($36,959) a tonne, which is 411 per cent higher year-to-date. The metal’s prices have skyrocketed this year due to an imbalance in global supply amid huge demand.
Auto component industry optimistic for growth in FY22 despite Covid woes- The auto component industry remains ‘cautiously optimistic’ for the growth of the industry in the current fiscal year despite concerns of another wave of the pandemic, industry body ACMA said on Tuesday.
Consumer durables industry: Double digit growth hopes brighten 2022 horizon despite chip shortage concerns- With demand for premium and technologically advanced products on the rise, India’s Rs 75,000 crore appliances and consumer electronics industry will be switching on to 2022 with hopes of double-digit growth despite anxiety over semiconductor shortage and the impact of the spreading Omicron variant on business
Renew Power adds 300 MW; total capacity addition at 1.5 GW in FY22- Renew Power, which is traded on the Nasdaq exchange, has commissioned a 300 megawatt SECI solar project in Rajasthan, taking its total operating asset to a record 7.4 gigawatt till date.
NITI Aayog enters into agreement with UN WFP to diversify food basket in programmes- Aiming at a more diversified food basket under its free food distribution programme with focus on coarse grains and millets, NITI Aayog has entered into an agreement with United Nations World Food Program (WFP) to address issues related to inclusion of millets in government programmes.
Indian IT services firms set for robust growth, attrition a concern- Driven by an uptick in key verticals such as BFSI, telecom, manufacturing, retail and distribution, the revenue growth of domestic IT services companies is expected to be around 9-12 per cent (in dollar terms) in FY2022, a report said on Tuesday. Despite the growth, concerns have emanated from elevated attrition levels for the industry due to strong demand for digital technologies and lack of adequate skilled manpower to service the same.
Natural gas futures: Short below ₹275- The price of natural gas has been steadily declining since the final week of October. As a result, the January futures on natural gas on the Multi Commodity Exchange (MCX) have fallen from the high of ₹466. The contract broke below the key support at ₹350 in November, accelerating the downfall and making a low of ₹274.9 in early December.
AIM, NITI Aayog & UNCDF announce first AgriTech cohort under South-South Innovation platform- Atal Innovation Mission (AIM), NITI Aayog and the United Nations Capital Development Fund (UNCDF) rolled out their first AgriTech Challenge cohort for its ambitious innovative Agri-tech program that aims to help smallholder farmers across Asia and Africa to address their challenges in the aftermath of the pandemic. The event was held on 21st December, 2021.
Non-food credit growth perks up to 7.51% during fortnight to December 3 – The pace of growth in non-food credit perked up to 7.51% year-on-year (y-o-y) during the fortnight ended December 3, according to data released by the Reserve Bank of India (RBI), showing that the credit growth held strong a month after Diwali. Outstanding non-food credit as on December 3 stood at Rs 111.82 lakh crore, higher than Rs 110.8 lakh crore at the end of the previous fortnight. Deposits grew 9.4% YoY to Rs 159.52 lakh crore.
In FY 2022, India will grow the fastest in the world: Amit Shah – Union Home Minister Amit Shah recently said that India is likely to become the fastest-growing economy in the world in the current financial year. We are reaching the pre-COVID levels. July to September GDP number has been at 8.4 per cent and I think in the year 2021-22, India is likely to become the fastest-growing economy in the world. I will not be surprised if we touch double-digit growth, Amit Shah said.
Contribution of FPI to the GDP – During the last 5 years ending 2019-20, Gross Value Added (GVA) in Food Processing Industries (FPI) sector has been growing at an Average Annual Growth Rate (AAGR) of around 11.18 per cent. Ministry of Statistics and Programme Implementation publishes data for registered manufacturing sector including food processing. As per the latest Annual Survey of Industries (ASI) 2018-19, there were 40,579 food processing units in the registered sector. The ASI data do not give segregated data for big, medium, small, tiny units or details of multi-national corporations (MNCs).
RBI central board discusses CBDC, crypto – The central board of directors of the Reserve Bank of India (RBI) on 17th December 2021 discussed central bank digital currencies (CBDCs) and cryptocurrencies, among other issues, at its 592nd meeting held in Lucknow. The regulation of private cryptocurrencies has become an area of focus of late, with the central bank warning the government against allowing them even as the latter introduces legislation to regulate cryptos.
Many equipment used for carrying Covid shots to attract 18% GST – The unless products and equipment are specifically manufactured for the sole purpose of Covid vaccination, they should attract additional taxation. Tax experts say this is set to increase Goods and Services Tax (GST) on equipment used for Covid vaccination programmes. The manufacturing of cold chain equipment, which is used in vaccination and immunisation programmes for transporting vaccines, specimens, and blood samples, should attract 18% GST.
Withdraw plan to hike GST rate on textile, apparel items: Telangana Minister to Centre – Hon’ble Telangana Industries Minister Shri KT Rama Rao on Sunday urged the Centre to withdraw its proposed plan to increase GST rates from 5 per cent to 12 per cent on garments and fabrics from January 1, 2022. In a letter to Union Textiles Minister Piyush Goyal, Rama Rao said for the past two years, the handlooms sector has been going through a difficult phase due to coronavirus pandemic.
India, Taiwan holding talks on free-trade agreement, looking at setting up semiconductor hub – India and Taiwan have started negotiations for a free-trade agreement and the setting up of a semiconductor manufacturing facility by a Taiwanese firm in India, in a significant step signalling their resolve to broad-base the overall bilateral economic engagement. If the move to set up the semiconductor manufacturing plant succeeds, then it will be the second such facility to be set up by a Taiwanese company in a foreign country after a similar hub in the United States.
·With PLI schemes & global demand recovery, India exports likely to fly high in New Year – After staging a strong recovery from COVID-induced slowdown in 2021, India’s exports are likely to extend the growth story to the New Year also on increased demand in the global markets, boost in domestic manufacturing due to production-linked incentive schemes and implementation of some interim trade pacts. Expectations of positive growth in the country’s exports are also backed up by the outlook of the World Trade Organisation (WTO) which predicts a 4.7 per cent expansion in the global merchandise trade volume in 2022.
India’s coal import declines 27% to 16 million tonnes in October – India’s coal import registered a decline of 26.8 per cent to 15.75 million tonnes (MT) in October over the same month a year ago. The country had imported 21.50 MT of coal in October 2020, according to data compiled by mjunction services. India’s coal and coke imports in October 2021 through the major and non-major ports are estimated to have decreased by 26.8 per cent over October 2020.
India- Vietnam signs “Letter of Intent” for enhanced cooperation in the Postal Sector – The Minister of State for Communications, Devusinh Chauhan held a bilateral meeting with the delegation from Viet Nam on 17th December 2021 at Sanchar Bhawan. The Viet Nam delegation was led by HE Mr Nguyen Manh Hung, Minister of Information and Communications. In line with the comprehensive strategic and economic partnership and growing relations between the Republic of India and Socialist Republic of Viet Nam, the Ministers of the two countries signed a “Letter of Intent” for enhanced cooperation in the Postal Sector. The Letter of Intent recognises the joint objectives of both the countries to facilitate cooperation in the field of Posts and Telecom, promote sharing of information and experience, cooperate to implement projects in Human Resource Development and to promote enhanced cooperation of postal designated operators and service providers of both the countries.
Union Commerce Minister Piyush Goyal interacts with Indian exporters and businesses to Enhance Market Access for India in UAE – Hon’ble Union Minister for Commerce & Industry, Consumer Affairs, Food & Public Distribution and Textiles Piyush Goyal chaired an interaction with the captains of Indian industry and heads of Export Promotion Councils in Mumbai today, to discuss certain opportunities for Indian businesses to expand their global footprint by leveraging the business platforms and infrastructure offered by UAE.
Labour-intensive exports may gain as rupee hits 20-month low – The rupee weakening to a 20-month low against the dollar has come as a mixed blessing for exporters. While there is an improvement in realisations as they hasten to bring payments back into the country, some have begun to witness calls from buyers to cut prices for fresh orders. Exports dependent on imported inputs will see limited gains, but exporters in labour-intensive sectors such as textiles and leather could see an improvement in margins.
Import and Export of Agricultural Products – During 2020-21, import of agricultural produces was Rs. 141448.05 crore as against export of Rs. 210093.40 crore, bearing a ratio of 0.67 to 1. India is self-reliant in most of the agri commodities. However, vegetable oils, pulses, cashew nuts, fresh fruits and spices are major agri commodities which are imported. To ensure self-reliance in pulses, the Government has been implementing National Food Security Mission (NFSM) to improve the production of pulses. Besides, under Rashtriya Krishi Vikas Yojna (RKVY), funds are being provided to States for improving the production of pulses. To meet the growing demand of raw cashew nuts in the country, the Government seeks to increase the area with high yielding varieties, high density planting, rejuvenation of senile orchards and canopy management etc.
Expansion of Organic Farming – Government has been promoting organic farming through dedicated schemes of Paramparagat Krishi Vikas Yojana (PKVY) and Mission Organic Value Chain Development in North East Region (MOVCDNER) since 2015-16. Both the schemes provide end to end support to organic farmers from organic production to certification and marketing including post-harvest management support like processing, packaging, storage etc.
Central Share in Premium Subsidy under PMFBY – Government has recently revamped the Pradhan Mantri Fasal Bima Yojana (PMFBY) with effect from Kharif 2020 and interalia revised the premium subsidy sharing pattern for North Eastern States from 50:50 to 90 : 10 between Central and State Government. The premium sharing pattern of remaining States/UTs is 50:50 subject to other provisions of the scheme.
Majority of consumers have strong intent to buy vehicle in next 12 months, finds survey – There is a strong intent to purchase a vehicle among a majority of consumers in the next 12 months, in what would be a good news for the auto industry, according to a survey by Mobility Outlook. As many as 83 per cent of respondents confirmed the intent to purchase a vehicle in the next 12 months, while another 13 per cent indicated they may buy and just 4 per cent said no to buying a vehicle, as per the survey by Mobility Outlook — a brand of CarTrade Tech — which sought responses from nearly 2.7 lakh customers across India.
Rs 80,000 crore investment as 430 bids pour in for city gas licensing round – As much as Rs 80,000 crore investment is envisaged in setting up city gas infrastructure in 61 geographical areas (GAs), including Jammu, Nagpur, Pathankot and Madurai, that were put on bid in the latest licensing round, oil regulator PNGRB said. Bids for the 65 GAs offered in the 11th city gas licensing round came in on December 15, Petroleum and Natural Gas Regulatory Board (PNGRB) said in a statement.
Power Minister urges states to be financially viable in view of high outstanding dues of gencos – Hon’ble Union Minister Shri R K Singh has urged states to be financially viable in view of the mounting outstanding dues of power generation companies. This will help attract investments in the power sector and also benefit the consumers through reduced cost of electricity and improved consumer services, he said. The suggestion came on 17th December 2021 during a review meeting chaired by Singh with Additional Chief Secretaries and Principal Secretaries of Power/Energy Departments of states and UTs and CMDs/ MDs of power sector CPSUs.
4 labour codes likely to be implemented by FY23 as many states ready draft rules – The four labour codes on wages, social security, industrial relations and occupation safety, health and working conditions are likely to be implemented by the next fiscal year as at least 13 states have pre-published draft rules on these laws, a senior official said. The Centre has already finalised the rules under these codes and now states are required to frame regulations on their part as labour is a concurrent subject.
Economic Advisory Council to the PM calls for unified labour law – The Economic Advisory Council to the PM (EAC-PM) has backed a unified labour code, much on the lines of the Bangladesh Labour Act of 2006, saying that the labour reforms undertaken in form of four Codes did not take a comprehensive view of all labour laws and had only standardised and streamlined the existing statutes without addressing definitional inconsistencies.
Nitin Gadkari hardsells InvIT model to small depositors
Union Minister for Road Transport and Highways Nitin Gadkari on 17th Dcember 2021 said that ministry is going to hold talks with SEBI for an invIT model whereby small depositors, like senior citizens, retired government officials can invest their savings in infrastructure projects helmed by the Union government. Nitin Gadkari said that the investors can benefit as they would be getting 2 to 3 per cent higher returns than banks.
Centre working on policy to encourage research in pharma sector, says Shri Mansukh Mandaviya; stresses use of generic drugs – The central Government is formulating a policy to encourage research in pharmaceutical sector for patented drugs, and is also trying to widen the reach of generic medicines, Hon’ble Union Health Minister Shri Mansukh Mandaviya said here on18th December 2021. He lamented that although India is making generic medicines available to the world on a large scale, people of the country are consuming branded medicines, which is increasing the cost.
Budget 2022-23: Centre may not target sharp fiscal correction:- While presenting her 2021-22 Hon’ble Union Budget, Finance Minister Smt. Nirmala Sitharaman had set a fiscal deficit target of 6.8 per cent of nominal gross domestic product (GDP) against the 2020-21 Revised Estimate of 9.5 per cent. The fiscal correction in the upcoming 2022-23 Union Budget is unlikely to be that steep. Even as discussions among top Budget-makers are ongoing, the fiscal deficit target for 2022-23 may likely be in the range of 6.5-6.8 per cent. This draws from two factors. First, the Centre is unlikely to meet this year’s fiscal deficit target due to a higher expenditure.
Central schemes likely to be rationalized:- The upcoming budget is likely to continue with the capex push to prop up growth and could rationalise centrally sponsored schemes and central sector schemes to make government spending more effective.The government has budgeted Rs 5.54 lakh crore capital expenditure in FY22, nearly 46% of which had been spent by October.
Government will focus on reducing compliance burden -PM Modi assures India Inc during pre-Budget meet.
Prime Minister Narendra Modi on Monday met top business leaders as part of a series of such pre-budget interactions with industry that is aimed at boosting the country’s investment climate. Finance minister Nirmala Sitharaman, who is scheduled to present the Union budget for 2022-23 on February 1, and commerce and industry minister Piyush Goyal were also present at the meeting.
Omicron, inflation risks to business resumption, Nomura index at a record high:- The Nomura India Business Resumption Index rose to a record high of 117.8 for the week ended December 19 from 116.6 in the prior week. The Japanese financial services firm, in its weekly report on Monday, said that even though supply-side bottlenecks persist, energy shortages are slowly improving but there is downside risk to consumption demand as the prices of white goods are set to rise amid already high core inflation.
India may be heading towards stagflation: Former State Finance Minister Amit Mitra:- Mr. Amit Mitra, West Bengal’s former finance minister and current chief advisor to Chief Minister Mamata Banerjee on Monday said he fears India may be heading towards “stagflation”. Mitra, an economist by training said, India is already suffering from rising inflation and unemployment simultaneously.
PSBs recover more than Rs 5.49 lakh crore over last 7 fiscal years: Government in Lok Sabha:-The government has taken comprehensive steps to reduce NPAs and to effect recovery, enabling public sector banks to recover more than Rs 5.49 lakh crore over the last seven fiscal years, the Lok Sabha was informed on 20th December.In a written reply, Minister of State for Finance Bhagwat Karad said that with regard to the details of the recovery rate of non-performing assets (NPAs), the RBI has informed that it has not formally defined ‘recovery rate’ in the context of NPAs in the banking industry.
EPFO adds 12.73 lakh subscribers in Oct:- Retirement fund body EPFO has added 12.73 lakh net subscribers in October, registering an increase of 10.22 per cent compared to the same month last year, according to the latest payroll data. “The provisional payroll data of EPFO released on 20th December 2021 highlights that EPFO has added 12.73 lakh net subscribers during the month of October 2021,” a labour ministry statement said.
OECD paves way for new global tax regime roll-out:-The Organisation for Economic Co-operation and Development (OECD) Monday released the model rules, paving the way for the roll out of the new global tax regime that will subject multinational corporations to a minimum tax of 15% from 2023. The rules set out the mechanism for implementation of the regime adopted by 136 countries.
CCI approves acquisition of shareholding in Air India Limited, Air India Express Limited and Air India SATS Airport Services Private Limited by Talace Private Limited: The Competition Commission of India (CCI) approves acquisition of shareholding in Air India Limited, Air India Express Limited and Air India SATS Airport Services Private Limited by Talace Private Limited.The proposed combination envisages acquisition of 100% equity share capital of Air India Limited (Air India) and Air India Express Limited (AIXL), and 50% equity share capital of Air India SATS Airport Services Private Limited (AISATS) by Talace Private Limited (Talace).
UP-RERA appoints REPL to monitor construction of three stuck projects in Greater Noida:-The Uttar Pradesh Real Estate Regulatory Authority (UP-RERA) has appointed Delhi-based consultancy company, REPL (Rudrabhishek Enterprises Ltd.) as third party consultant to monitor physical and financial progress of three stuck projects in Greater Noida. These projects were stuck and construction was resumed after the intervention of UP RERA who brought developers and homebuyers together to complete the project.
Noida airport project: Centre says UP Government has acquired 52 hectares land for Rs 716 crore to rehabilitate displaced farmers:- The Uttar Pradesh government has acquired approximately 52 hectares of land for around Rs 716 crore for the rehabilitation of families that have been displaced due to the Noida international airport project in Jewar, Minister of State for Civil Aviation V K Singh said on Monday. Prime Minister Narendra Modi had on November 25 laid the foundation stone of the airport in Jewar in Uttar Pradesh.
AAI has embarked upon a CAPEX plan for development/ upgradation/ modernization of various airports: Ministry of Civil Aviation, with a view to promote the growth of Indian Aviation sector released the National Civil Aviation Policy (NCAP) 2016 on 15.06.2016. The aim of the Government is to provide an ecosystem for the harmonised growth of various aviation sub-sectors, i.e Airlines, Airports, Cargo, Maintenance Repairs and Overhaul services (MRO), General Aviation, Aerospace Manufacturing, Skill Development, etc. Expansion and development of infrastructure facilities at the airports is a continuous process and is undertaken on the operational requirements for safety of aircraft operation and demand from airlines, depending upon availability of land and viability, as well as other facilities with reference to intended aircraft operations.
India, Taiwan holding talks on free-trade agreement, looking at setting up semiconductor hub – India and Taiwan have started negotiations for a free-trade agreement and the setting up of a semiconductor manufacturing facility by a Taiwanese firm in India, in a significant step signalling their resolve to broad-base the overall bilateral economic engagement. If the move to set up the semiconductor manufacturing plant succeeds, then it will be the second such facility to be set up by a Taiwanese company in a foreign country after a similar hub in the United States.
Union Commerce Minister Piyush Goyal interacts with Indian exporters and businesses to Enhance Market Access for India in UAE – Hon’ble Union Minister for Commerce & Industry, Consumer Affairs, Food & Public Distribution and Textiles Shri Piyush Goyal chaired an interaction with the captains of Indian industry and heads of Export Promotion Councils in Mumbai today, to discuss certain opportunities for Indian businesses to expand their global footprint by leveraging the business platforms and infrastructure offered by UAE.
Labour-intensive exports may gain as rupee hits 20-month low – The rupee weakening to a 20-month low against the dollar has come as a mixed blessing for exporters. While there is an improvement in realisations as they hasten to bring payments back into the country, some have begun to witness calls from buyers to cut prices for fresh orders. Exports dependent on imported inputs will see limited gains, but exporters in labour-intensive sectors such as textiles and leather could see an improvement in margins.
Import of Low –ash- Coal- Demand of coal is higher than the current level of domestic supply of coal in the country. The entire demand of coal is not met from domestic production as the supply of high quality coal /coking coal (low-ash-coal) in the country is limited and thus no option is left but to resort to import of coking coal. Further, coal imported by power plants designed on imported coal and high grade coal required for blending purposes cannot be substituted by domestic coal.
Agri tech firm AgNext to assess Lakadong turmeric using curcumin testing technology:-Agri tech firm AgNext Technologies, in partnership with Spices Board of India has deployed its innovative curcumin testing technology for assessment of Lakadong turmeric, which is grown in the Jaintia Hills, Meghalaya. This is the first time in Meghalaya that AI-based technology is being used for rapid quality assessment of Lakadong turmeric, a media release issued by the company said
Odisha bags proposals worth Rs 2.48 trillion from steel sector in 6 months:- In the last six months, Odhisa has seen a rush of investment proposals from the steel sector reminiscent of the boom during 2004-2006 as companies push the growth pedal.