30 Nov, 2016
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ND has initiated a new section of daily news, where our news desk compiles the latest news on the Indian economy, to keep our readers abreast and updated on daily economic state of affairs.
The economy news compilations bring business news reports that are relevant today and tomorrow, based on the new pattern of current affairs, and for English awareness. This gives vital inputs on the various sectors of the Indian Industry and trade.
Government accident insurance Plan reaches to 98 million policies
Business Standard: November 29, 2016
The number of policies in the Pradhan Mantri Suraksha Bima Yojana, a part of the Jan Suraksha scheme, reached 98 million on November 24.
The insurance policy that can be renewed annually has a premium of Rs 12 and offers a cover of Rs 2 lakh for death by accident. Families of victims of the recent derailment of the Indore-Patna Express who had signed up can make claims.
Although the pace has declined, the number of enrolments in the Jan Suraksha scheme has risen to 132 million. The Jan Suraksha scheme includes a personal accident cover, term insurance, and a pension plan.
Since the policy premium is deducted from an individual’s bank account, the documentation required is considerably reduced.
Of the Rs 12 insurance premium, the insurer keeps Rs 10, pays Rs 1 to intermediaries like business correspondents and agents, and Rs 1 as reimbursement to banks for administrative expenses.
The performance-to-potential ratio shows Indian Bank, State Bank of Bikaner & Jaipur, and Bharatiya Mahila Bank as the top three banks in generating enrolments for the Pradhan Mantri Suraksha Bima Yojana. Others among the top 10 include Andhra Bank, Dena Bank, and State Bank of Patiala.
Public sector banks have outperformed private ones in enrolments.
A scheme namely, ‘Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016’ (PMGKY) proposed
Press Information Bureau: November 29, 2016
Evasion of taxes deprives the nation of critical resources which could enable the Government to undertake anti-poverty and development programmes. It also puts a disproportionate burden on the honest taxpayers who have to bear the brunt of higher taxes to make up for the revenue leakage. As a step forward to curb black money, bank notes of existing series of denomination of the value of Rs.500 and Rs.1000 [Specified Bank Notes(SBN)] have been recently withdrawn the Reserve Bank of India.
Concerns have been raised that some of the existing provisions of the Income-tax Act, 1961 (the Act) can possibly be used for concealing black money. The Taxation Laws (Second Amendment) Bill, 2016 (‘the Bill’) has been introduced in the Parliament to amend the provisions of the Act to ensure that defaulting assessees are subjected to tax at a higher rate and stringent penalty provision.
Further, in the wake of declaring specified bank notes “as not legal tender”, there have been suggestions from experts that instead of allowing people to find illegal ways of converting their black money into black again, the Government should give them an opportunity to pay taxes with heavy penalty and allow them to come clean so that not only the Government gets additional revenue for undertaking activities for the welfare of the poor but also the remaining part of the declared income legitimately comes into the formal economy.
In this backdrop, an alternative Scheme namely, ‘Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016’ (PMGKY) has been proposed in the Bill. The declarant under this regime shall be required to pay tax @ 30% of the undisclosed income, and penalty @10% of the undisclosed income. Further, a surcharge to be called ‘Pradhan Mantri Garib Kalyan Cess’ @33% of tax is also proposed to be levied. In addition to tax, surcharge and penalty (totaling to approximately 50%), the declarant shall have to deposit 25% of undisclosed income in a Deposit Scheme to be notified by the RBI under the ‘Pradhan Mantri Garib Kalyan Deposit Scheme, 2016’. This amount is proposed to be utilised for the schemes of irrigation, housing, toilets, infrastructure, primary education, primary health, livelihood, etc., so that there is justice and equality.
An overview of the amendments proposed in the Bill are placed below;
Overview of Amendments Proposed
|PARTICULARS||EXISTING PROVISIONS||PROPOSED PROVISIONS|
|General provision for penalty||PENALTY (Section 270A)
Under-reporting – @50% of tax
Misreporting – @200% of tax
(Under-reporting/ Misreporting income is normally difference between returned income and assessed income)
|No changes proposed|
|Provisions for taxation & penalty of unexplained credit, investment, cash and other assets||TAX (Section 115BBE)
Flat rate of tax @30% + surcharge + cess
(No expense, deductions, set-off is allowed)
|TAX (Section 115BBE)
Flat rate of tax @60% + surcharge @25% of tax (i.e. 15% of such income). So total incidence of tax is 75% approx.
(No expense, deductions, set-off is allowed)
PENALTY (Section 271AAC)
If Assessing Officer determines income referred to in section 115BBE, penalty @10% of tax payable in addition to tax (including surcharge) of 75%.
|Penalty for search seizure cases||Penalty (271AAB)
(i) 10% of income, if admitted, returned and taxes are paid
(ii) 20% of income, if not admitted but returned and taxes are paid
(iii) 60% of income in any other case
(i) 30% of income, if admitted, returned and taxes are paid
(ii) 60% of income in any other case
|Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016’ (PMGKY)||New Taxation and InvestmentRegime||Undisclosed income in the form of cash & bank deposit can be declared:
(A) Tax, Surcharge, Penalty payable
Tax @30% of income declared
Surcharge @33% of tax
Penalty @10% of income declared
Total @50% of income (approx.)
25% of declared income to be deposited in interest
free Deposit Scheme for four years.
Government removes excise duty on PoS machine manufacturing to ease cash flow
Livemint: November 29, 2016
New Delhi: The government on Monday announced the removal of excise duty on goods for manufacturing point-of-sale (PoS) machines that are in great demand as merchants are compelled to use them in the wake of the currency crisis.
“POS machines will be exempted from 12.5% excise duty and 4% SAD (special additional duty) till 31 March 2017,” said a person aware of the matter, adding that the cost of such devices would come down by 16.5%.
A notification to this effect was tabled by finance minister Arun Jaitley in Lok Sabha on Monday amid uproar over the demonetisation issue. The notification “exempts Central Excise/CV duty on all goods for manufacture of PoS devices subject to actual user condition and these exemptions will be valid till 31 March 2017”.
With most people left scrounging for money after the surprise withdrawal of Rs500 and Rs1,000 notes on 8 November, PoS service providers have registered a record surge in the volume of transactions as well as the number of applications from merchants.
“Removal of excise duty on PoS manufacturing is a big step forward. The country took five years to add last one million terminals. The government now plans to bring one million terminals in the next three months. It would certainly accelerate usage of cards on PoS,” said A. P. Hota, managing director and chief executive, National Payments Corporation of India (NPCI).
The PoS machines are hand-held devices that are being increasingly used by merchants to accept payments for goods sold through credit and debit cards.
“This will give a boost to the cashless economy as more and more PoS machines will be deployed. People find PoS machines any day convenient, because it only needs GPRS connectivity for transactions to be assessed, hence overall it is a positive move,” said Deepak Arora, POS Solutions’ regional head for north and east India.
Abhijit Bose, chief executive of Ezetap, a PoS device-making start-up, said, “The entire ecosystem is working together to ensure that the prime minister’s vision is implemented as quickly and effectively as possible. It is a positive move in the short run resulting in immediate benefits. Since our PoS devices are made-in-India, we have to review the final language to see how much it will benefit us in the long-run.”
Ministry of Petroleum and Natural Gas and Ministry of Skill Development and Entrepreneurship sign MoU to boost to skill initiatives in the Hydrocarbon Sector
Press Information Bureau: November 29, 2016
The Ministry of Petroleum & Natural Gas (MoPNG) and Ministry of Skill Development & Entrepreneurship (MSDE) here today signed a Memorandum of Understanding (MoU) to scale up skill development initiatives in the Hydrocarbon and allied sectors among other areas of cooperation. The MoU was signed by Secretary MSDE Shri Rohit Nandan and Secretary, MoPNG Shri K. D. Tripathi in the presence of Minister of State (Independent Charge), Ministry of Petroleum & Natural Gas Shri Dharmendra Pradhan and Minister of State (Independent Charge) for Skill Development & Entrepreneurship Shri Rajiv Pratap Rudy.
Speaking on the occasion, Shri Pradhan said as his ministry is gearing up for new avenues that Petroleum and Natural Gas sector will open up for the country, there is tremendous focus on sourcing skilled workforce to make all plans successful. The partnership with MSDE through this MoU signing will help MoPNG to develop the ready workforce for Exploration and Production, Pipeline & Transportation, Refinery & Marketing and Service providers going forward. He said, in this way, we are investing back into our sector’s and the country’s brighter future.
Welcoming contribution from the hydrocarbon sector, Shri Rajiv Pratap Rudy said, the hydrocarbon sector has tremendous potential for employment generation, and hence it is vital to develop a skilled workforce to meet both current and future needs. The setting up of the Hydrocarbons SSC is the first step in that direction. He said, with today’s partnership, both Ministries commit to develop globally benchmarked workforce for the sector so that lakhs of youth can aspire for better economic opportunities through skill development programs.
MoPNG has now formally joined hands with MSDE to:
- Develop comprehensive skill development plans for existing and potential workforce in alignment with National Skills Qualification Framework (NSQF)
- Certify existing workforce in the hydrocarbon sector for Recognition of Prior Learning under Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
- Promote and scale-up apprenticeship training under National Apprenticeship Promotion Scheme
- Facilitate the setting-up of Skill Development Institutes/Centres of Excellence for vocational training to meet sectoral needs
MoPNG has setup the Hydrocarbons Sector Skill Council (HSSC) with representatives from the Government, PSUs and private sector to address the skill development needs across the value chain of the sector.
Under the MoU, MoPNG will continue to support the growth of the Hydrocarbon Sector Skill Council and align with the NSQF for skill development programs. Additionally, MoPNG will encourage Oil & Gas Companies and related contractors to hire skilled personnel, incentivize skill training & certification, promote apprenticeship programs, undertake Recognition of Prior Learning (RPL) programs in the sector and setup institutes focused on various sub-sectors and allied trades. MoPNG will catalyse these initiatives in the Hydrocarbon sector, through its various agencies and PSUs, and develop a plan in close alignment with the Skill India mission.
MSDE would primarily discharge its responsibilities through Directorate General of Training (DGT) and National Skill Development Corporation (NSDC).
CH Hotels and Resorts aims for 200 hotels by 2020
Economic Times: November 29, 2016
New Delhi: Nepal-based Chaudhary Group (CG) Hotels and Resorts, which has a 50:50 joint venture with the Taj Hotels Resorts and Palaces for countries like Maldives and Sri Lanka and also for Taj safari lodges is building another hotel under the joint venture in Phuket, Thailand and will take Taj Safari lodges to other overseas markets besides Nepal.
Rahul Chaudhary, executive director at CG Corp said the company will add four to five more Taj Safari lodges in locations like Deodhar, and Sariska besides adding one more in Bandhavgarh. “We have a new Taj Safari lodge in Nepal and will take Taj Safari lodges to other overseas markets as well,” he added.
The company, which also operates through other brands like Zinc, joint venture arrangements like Alila and Jetwing amongst others has 100 plus hotels under development in 65 cities and aims to have 200 hotels operational by 2020, said Chaudhary.
“We want to be the only diversified group with a portfolio from China to New York, having a share in every segment in the hospitality business,” he added.
The company also has investments in Param Kannampilly’s Concept Hospitality which owns the Fern brand. “The company is growing by leaps and bounds. The group has about 45 hotels under operation. We also have our own brand called Zinc which tries to capture all segments. Zinc living is our serviced apartments brand which is operational in Rwanda. Zinc City, is an upscale brand and the first is under development in Nepal. Under Zinc Journey we have two properties operational in China, one in Sri Lanka and four more under development there, three under development in Bhutan and we are pursuing four in Rajasthan. We are also developing the budget hotel space under our brand Zinc Express,” said Chaudhary.
He added that the new hotels under the Taj joint venture would be a mix of management and investment contracts. Under its Alila arrangement, the company has two luxury hotels in Bengaluru and Goa with a third one opening in Jaipur soon.
“The Indian subcontinent, Middle East, East Africa and Southeast Asia are our focus areas and we are also concentrating on the 3-4 star space. There is huge potential in that space because you are also catering to tier 2 tier 3 cities,” Chaudhary added.
India is fastest-growing market for Altair: Brett Chouinard
Economic Times: November 29, 2016
Pune: India, besides China, is the fastest-growing market for Altair, the world’s largest privately held US-based developer of computer-aided software and high-performance computing technology. Brett Chouinard, chief operating officer of Altair, said each contributed about 10 per cent to the overall global revenues of the company. Chouinard recently visited the company’s facilities here which has 600 employees in field as well as development operations.
Altair conducts physics-based simulation testing for the auto and aerospace industry and has been advocating a shift towards simulation-driven design. “If you use simulation to drive the direction of design, you end up reducing the overall development time,” he said. “Simulation is becoming very important to our customers, as the development of products gets more complex. Simulations replace the actual physical testing required and make it more feasible and economical to develop a product in a shorter period of time and at a reduced cost.”
Chouinard said the work the company did was being impacted by a number of factors, mainly the rapid evolution of technology. “Technology is changing very fast and we have to keep up with the big changes. Connected cars, the internet of things, lightweighting and electrification of automobiles are all changing the content of the products we help our customers develop. It is encouraging us to develop new technologies for the customers,” he said. The company has made a few acquisitions globally in recent months to gain the capabilities needed to help customers develop connected products. For instance Winprop, a company it acquired earlier this year, enables communication between a car and stationary things around it, as well as with pedestrians and other cars.
Chouinard said there was a move towards multi-physics simulations globally. “Earlier, the simulations would focus on only one aspect – fluid, electrical or mechanical flow. With multi-physics simulations, you have to concentrate on various aspects simultaneously, which leads to a reduction in development time and an increase in the introduction of technology,” he said.
A significant change Chouinard sees in India is the MNC technical centers here turning decision makers from mere service providers. “With more products being created specifically for India, the amount of decision making and buying happening here has changed,” he said.
The Swedish newspaper was recently asked it to delete the reference made by President Pranab Mukherjee to the Bofors scam in an interview to it, as a claim protested by the Indian Government on 27 May 2015. India has expressed disappointment over the disrespect shown to the President, the newspaper has defended its right to publish what was said during the interview.
Know, who is Vijay Kelkar and what is PPP !
Vijay Kelkar is a renowned economist and a former Finance Secretary. He was appointed head of newly constituted committee to give recommendations to recast the model of Public-Private-Partnership (PPP) model in India. India is one of the largest PPP market with over 900 projects. The Kelkar committee will review the PPP policy, suggest a better risk-sharing mechanism between private developers and the government after analysing such projects.
Know, who is Yaduveer Krishnadatta Chamaraja Wadiyar !
Yaduveer Krishnadatta Chamaraja Wadiyar was crowned as the new Maharaja of of Mysuru (Mysore) royal family. He is the 23-year old grandson of Princess Gayathri Devi, who was the eldest daughter of the last Maharaja of Mysore, Sri Jayachamarajendra Wadiyar. The coronation was held at Mysuru’s famous Amba Vilas Palace, which was decked up for the occasion.
Know about Sepp Blatter!
Swpp Blatter, was re-elected as FIFA president for a fifth term at the 65th Annual Congress of FIFA held at Zurich for four year term.
Prince Ali bin al-Hussein of Jordan stood against Blatter in this election. It is worth mentioning that FIFA is going through a major controversy regarding corruption in the organisation with two FIFA vice presidents and a recently elected FIFA executive committee member still in custody.