INDIAN ECONOMY: OVERVIEW, GROWTH & DEVELOPMENT
25 pc increase in university seats will take years: officials
A day after Union Human Resource Development Minister Prakash Javadekar said the number of seats in higher educational institutions would be increased by 25 percent— to implement the new 10 percent quota for the economically weaker sections (EWS) — sources in the government conceded that this would only be introduced in a phased manner. There can only be a 10-15 percent rise this year, officials in the Ministry said. Javadekar had announced that the new reservation policy would be applicable from the upcoming academic session. “The minister didn’t specify that the entire increase in seats would be implemented in the first year itself. Moreover, provisions for additional infrastructure and faculty cannot be made in a jiffy,” a senior official told this newspaper. “Increasing the number of seats at Central universities and Centrally-funded technical institutes by even 10-15 percent won’t be easy, let alone trying this at state universities.” Another official in the Higher Education Department recalled how implementing the OBC quota had led to “quite some chaos for several years”. The situation will take three-four years to stabilise, he added. The Centre recently prompted an amendment to the Constitution, paving the way for 10 percent reservation for people from EWS in jobs and educational institutes.
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| Indian Economic Review | |||
|---|---|---|---|
| Overview | Last | Reference | Previous |
| GDP Growth Rate (%) | 1.9 | Jun/18 | 2 |
| GDP Annual Growth Rate (%) | 7.1 | Sep/18 | 8.2 |
| Unemployment Rate (%) | 3.52 | Dec/17 | 3.51 |
| Inflation Rate (%) | 2.19 | Dec/18 | 2.33 |
| Interest Rate (%) | 6.5 | Dec/18 | 6.5 |
| Cash Reserve Ratio (%) | 4 | Jan/19 | 4 |
| Balance of Trade (USD Million) | -13080 | Dec/18 | -16670 |
| Current Account (USD Million) | -19100 | Sep/18 | -15807 |
| Current Account to GDP (%) | -1.9 | Dec/17 | -0.6 |
| Government Debt to GDP (%) | 68.7 | Dec/17 | 69.6 |
| Government Budget (% of GDP) | -3.53 | Dec/17 | -3.52 |
| Business Confidence (Index Points) | 64.9 | Jun/18 | 60.1 |
| Manufacturing PMI | 53.2 | Dec/18 | 54 |
| Services PMI (Index Points) | 53.2 | Dec/18 | 53.7 |
| Consumer Confidence (Index Points) | 94 | Dec/18 | 95 |
| Corporate Tax Rate (%) | 34.61 | Dec/18 | 34.61 |
| Personal Income Tax Rate (%) | 35.88 | Dec/18 | 35.54 |
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Union cabinet clears next gen income tax-filing system
IT major Infosys has been selected to implement the next generation system for processing income tax return filings, with the Union Cabinet sanctioning an estimated Rs 4,241.97 crore for the project. The move will help in bringing down the income tax return (ITR) processing time to one day and hence speed up refunds. The Cabinet, chaired by Prime Minister Narendra Modi, gave its “approval to expenditure sanction of Rs 4,241.97 crore for Integrated E-filing and Centralised Processing Centre 2.0 Project of the Income Tax Department”, Union minister Piyush Goyal said. Briefing media about the decision, he said the processing time at present for ITR is 63 days and it will come down to one day after implementation of the project. Goyal said the project is expected to be completed in 18 months and will be launched after three months of testing. Infosys, he said, has been selected to implement the project after the bidding process. The current system, he said, has been a success and new project will be more tax friendly. The e-filing and Centralised Processing Centre (CPC) projects have enabled end-to-end automation of all processes within the Income Tax Department using various innovative methods to provide taxpayer services and to promote voluntary compliance. The Cabinet also sanctioned a consolidated cost of Rs 1,482.44 crore for the existing CPC-ITR 1.0 project up to 2018-19. Goyal also informed that tax refunds worth Rs 1.83 lakh crore have been issued so far in the current fiscal. The decision will ensure transparency and accountability besides faster processing of returns and issue of refunds to the taxpayers’ bank account directly without any interface with the Income Tax Department.
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Cabinet nod for regularising pay of executives in 4 hydro psus
The Union Cabinet on Wednesday gave the green light for the regularisation of pay scales of over 5,000 executives in four state-run hydro power companies— NHPC, NEEPCO, THDC India and SJVNL. According to Union Minister for Coal and Railways Piyush Goyal, the move to regularise pay scales will cost the government around Rs 323 crore. The need to regularise is due to anomalies which existed in the pay scales of executives of the four PSUs since January 1997 due to revision of pay scales of unionised category of workmen/non-executives. The pay scales of workmen and supervisors were higher than the pay scales of executives in the E-1 grade. “Anomalies existed in the pay scales of Executives of NHPC, NEEPCO, THDCIL and SJVNL w.e.f. 01.01.1997 due to revision of pay scales of unionized category of workmen/non-executives in line with the NTPC/Oil sector within the organizations,” the government said in a statement. After the approval, the pay scales adopted by the hydro unit consequent upon the order of the power ministry dated April 4, 2006 and September 1, 2006 would be regularised. About 5,254 below Board level executives in the power units enrolled before January 1, 2007 will benefit by this approval.
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Govt eases process to seek tax exemption on angel fund investments for startups
The government on Wednesday eased the procedure for seeking income tax exemption by startups on investments from angel funds and prescribed a 45-day deadline for a decision on such applications. The move comes against the backdrop of various startup founders claiming that they have received notices under Section 56(2) (viib) of the Income Tax Act from the IT department to pay taxes on angel funds raised by them. Entrepreneurs have raised concerns over these tax notices. “The CBDT, within a period of 45 days from the date of receipt of application from DIPP may grant approval to the Startup for the purposes of clause (viib) of sub-section (2) of section 56 of the Act or decline to grant such approval,” a government notification said. The notification comes after Commerce and Industry Minister Suresh Prabhu raised the matter with the Finance Ministry. The new procedure says that to seek the exemption, a startup will apply, with all the documents, to the Department of Industrial Policy and Promotion (DIPP). The application of the recognised startup shall be moved by the department to the Central Board of Direct Taxes (CBDT) with necessary documents.
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SBI plans to sell essar steel’s NPAs worth over rs 15,000 crores to recover dues
SBI plans to sell over Rs 15,000 crore worth bad loans belonging to Essar Steel to recover its dues from the debt-laden steelmaker. “State Bank of India (SBI) invites expression of interest (EoI) from banks/ARCs/NBFCs/FIs for the proposed sale of its non-performing financial assets with total dues of Rs 15,431.44 crore,” the bank said in an advertisement. The lender has put the reserve price for the recovery of bad loans from Essar Steel India at Rs 9,587.64 crore. SBI said the resolution plan for the recovery of non-performing asset (NPA) has been approved and filed in NCLT Ahmedabad, according to which the minimum recovery to the bank is Rs 11,313. 42 crore. SBI said the reserve price of over Rs 9,587 crore is on the basis of net present value (NPV) of minimum recovery discounted at 18 percent with a time factor of one year. SBI has asked the interested ARCs/ banks/ NBFCs/ financial institutions (FIs) that they can conduct due diligence of the asset with immediate effect, after submitting EoI and executing a Non-Disclosure Agreement (NDA) with the bank. The sale of the NPA account is to happen through e-auction on January 30, as per the bid invitation. “We reserve the right not to go ahead with the proposed sale at any stage, without assigning any reason, subject to the extant RBI guidelines. The decision of the bank in this regard shall be final and binding,” said SBI.
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Relief to Amrapali home buyers as SC may favour allowing registration of flats
To provide relief to hassled home buyers residing in flats built by embattled Amrapali Group, the Supreme Court on Wednesday indicated that it may allow them to register their residences with the authorities concerned. The top court said that flat buyers of Amrapali Group were not able to register their flats with the authorities concerned as they did not have completion certificate and if a need arises it may invoke powers of extraordinary jurisdiction under Article 142 of the Constitution to direct for registration of the flats. “Amrapali home buyers should not suffer due to want of completion certificate and ongoing litigation. We may direct the authorities to register their flats on payment of a proportional amount to Noida and Greater Noida authorities. If the need arises we may invoke Article 142 of the Constitution to issue directions,” a bench of justices Arun Mishra and UU Lalit told counsels appearing for home buyers and Amrapali. It asked the parties to give their legal suggestions on the next date of hearing so that directions could be passed to the authorities. Advocate ML Lahoty, appearing for home buyers said that it will be a big relief to the flat owners and they would submit the legal suggestion on next date of hearing.
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RBI slaps Rs 1 crore fine on bank of Maharashtra
The Reserve Bank of India (RBI) Wednesday imposed a Rs 1-crore penalty on state-owned Bank of Maharashtra (BoM) for non-compliance of ‘Know Your Customer’ guidelines and fraud-classification norms. This penalty has been imposed taking into account the failure of the bank to adhere to directions issued by the RBI, the central bank said in a statement. “This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” it said. Last year, the RBI had imposed a penalty of Rs 1 crore on BoM on account of delay on the part of the bank to detect and report fraud in an account.
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Union minister terms Madhya Pradesh govt’s farm loan waiver as charity
A day after Madhya Pradesh Chief Minister Kamal Nath launched the Rs 50,000 farm loan waiver scheme in the state, union minister of state for agriculture and farmers’ welfare Krishna Raj said whenever Congress comes to power, it doles out khairat (charity). The union minister when queried about whether the Narendra Modi government too was planning to announce national farm loan waiver ahead of Lok Sabha polls on the lines of Congress governments in MP, Rajasthan and Chhattisgarh, told journalists in Bhopal on Wednesday, “Congress ki sarkar jab bhi aayi hai, usne khairat batne ka kaam kiya hai, swavlambi banane ka kaam nahi kiya (whenever Congress has come to power it has only doled out charity and never done anything to make people self-sufficient).” While maintaining that the Congress governments in the country in the past had done nothing for the weaker and deprived sections, except treating them as a vote bank for political capital, the minister, however, couldn’t list five schemes initiated by Narendra Modi government for the uplift of poor and socially deprived sections.