INDIAN ECONOMY: OVERVIEW, GROWTH & DEVELOPMENT
SBI has found fraud worth Rs 7,951.3 crore in Apr-Dec: RTI reply
The State Bank Group has said as much as Rs 7,951.29 crore involving 1,885 cases of fraudulent activities have come to light during the first nine months of the current fiscal year. In an RTI reply, the nation’s largest lender said, the first quarter reported 669 cases of fraudulent activities amounting to Rs 723.06 crore, the second quarter saw 660 cases involving a Rs 4,832.42 crore and the third quarter reported 556 cases amounting to Rs 2,395.81-crore. According to RTI activist Chandrashekhar Gaud, the bank shared the data on February 25. Though he had also sought information about the financial losses to its customers due to these fraudulent activities, SBI refused to share the same saying such information is exempted from disclosure under Section 7 (9) of the RTI Act of 2005.
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With six airports, Adani becomes 3rd largest in one single swoop
The Adani group, which has just won the mandate to run all the six government-owned airports that were put up for privatisation recently, will become the third largest private operator in passenger volume after the GMR group and GVK group. The diversified Adani group is marking its entry into the airport space after bagging a 50-year contract for operation, management and development of the Ahmedabad, Lucknow, Jaipur, Guwahati, Thiruvananthapuram and Mangalore airports after quoting revenue share in the range of Rs 115 to Rs 177 per passenger.
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AirAsia announces launch of new technology centre
Malaysian budget airlines group AirAsia Thursday announced the launch of a new technology centre in Bengaluru to help it design and create custom-built solutions for the group’s airline and digital businesses. The move is a part of the global initiatives that the company is exploring to drive its digital transformation, a release said. India is a source for innovation and cutting-edge technology, and offers us tremendous growth potential when it comes to our mission to develop an all-encompassing travel technology ecosystem,” said Aireen Omar, AirAsia deputy group deputy chief executive officer for technology and digital, at the launch of the new facility. The centre will deploy a team of around 35 AirAsias software engineering and technology (AASET) experts, who would work to streamline the airlines digital assets such as its website and mobile app along with creating and implementing new products and enhancements such as the new artificial intelligence (AI)-powered chatbot, among others, for a seamless journey.
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India- Latin American nations boost trade ties
India and countries of the Latin American and Caribbean region have huge potential to boost economic ties in areas like agriculture, health, energy and information technology, the commerce ministry said on Thursday. Quoting Commerce and Industry Minister Suresh Prabhu who addressed diplomats of the Latin America and Caribbean (LAC) Strategic Economic Cooperation on Wednesday, it said there is a need for a multi-pronged strategy to enhance bilateral trade in merchandise and services. “India, as a fast growing developing economy is experiencing burgeoning food and energy needs, and therefore, deeper ties with partners in the LAC region could prove to be mutually beneficial,” it said. The ministry said that Indian companies could form joint venture projects for cultivation of lentils, oil-seeds and food grains, which are crucial import items, besides conducting joint research in dairy farming, seeds and pulses. Indian companies can also work towards leveraging the opportunities arising from the growth in demand for IT products and services within the region, it added. The LAC region comprises 43 countries and the major economic and trading partners of India are Brazil, Argentina, Peru, Chile, Colombia, Ecuador, Guatemala, Venezuela, Panama and Cuba. India-LAC bilateral trade during 2017-18 stood at USD 29.33 billion as against USD 24.52 billion in 2016-17.
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Mukesh faces data snag as
There’s a wrinkle in plans made by Asia’s richest man to take on Amazon.com Inc and Walmart Inc on his home turf in India: his telecom and retail businesses can’t share data. Billionaire Mukesh Ambani, chairman of Reliance Industries Ltd., has outlined how he will marry the might of his group’s 9,900-plus retail stores and 280-million strong telecom user base to bolster his e-commerce venture. A senior Reliance executive says that any data sharing on customers between the two, could run into a legal wall. “They are different companies so there are data privacy rules,” Ashwin Khasgiwala, Reliance Retail Ltd.’s chief financial officer said at a conference in Mumbai on Tuesday. “They’re different platforms,” he said while declining to elaborate on how the group plans to overcome it. While its brick-and-mortar retail businesses are housed in Reliance Retail, the telecom operations are in a separate legal entity Reliance Jio Infocomm Ltd. Legal hurdles in sharing information can stymie a variety of lucrative uses of that data to sell more products to customers. Ambani, who calls data the ‘new oil’ and has warned of ‘data colonization’by overseas firms in India, can potentially find workarounds for the legal snarl. One option would be to merge the two Reliance units. Data sharing between “two legal entities is going to be very difficult,” said Abheek Singhi, head of Boston Consulting Group’s consumer practice in India. “My view would be at some point in time, at least from a legal entity perspective, it will come together.”
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Fiscal deficit of 19 states worst in past 8-years
THE rising fiscal deficit of state governments has become a matter of great concern as the deficit of 19 states amounted to 25.9 per cent of the budget estimate in the third quarter of this fiscal, which is the worst in eight years. “Aggregate fiscal deficit of 19 states amounted to 25.9 per cent of the budget estimate (BE) in 3QFY19, almost double the average of 13.2 per cent during the last five years,” said the Economy Observer, a report by Motilal Oswal. Consequently, in the first nine months, the aggregate fiscal deficit of the 19 states touched 62.5 per cent of the BE versus an average of 44.3 per cent across the last five years—the worst in at least the past eight years, it said. The Centre’s fiscal deficit, at 112.4 per cent of BE, was also the highest in at least 19 years. The issue was also flagged by Finance Commission chairman N K Singh last week during his visit to Telangana. “What we found so far is varied conformity to the fiscal goals by the states as they are at different stages of disobedience and compliance. Therefore, each state needs to have a separate road map to bring down the fiscal deficit and the debt,” Singh told media persons after his meeting with Telangana Chief Minister K Chandrashekar Rao.
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No direct tax code before May
The Direct Tax Code is unlikely to be presented before May as the task force on new direct tax legislation sought two to three months’ extension from Finance Minister Arun Jaitley on Wednesday, a government official said. According to sources in the Finance Ministry, the task force headed by Central Board of Direct Taxes (CBDT) member Akhilesh Ranjan was expected to submit the report on February 28. However, they have sought more time as they claim more work is required. The finance ministry, on November 22, 2017, constituted a task force comprising six members. The panel apprised Jaitley of the progress made so far on the direct tax code. “We require some more time to present the report as some work is left and have sought time of 2-3 months from the finance minister to draft new legislation,” the official said.
The discussion on reforms in direct taxes started in September 2017, when Prime Minister Narendra Modi said that the more than half a century old Income Tax Act needed to be re-drafted and a new Direct Tax Code introduced.
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GST evasion worth Rs 20,000 crore detected
Increasing GST evasion among businesses has become a matter of concern for the taxmen as they have detected tax evasion worth Rs 20,000 crore this fiscal. “GST evasion is a matter of concern. Between April 2018 and February 2019, GST evasion worth Rs 20,000 crore has been detected,” said John Joseph, member, investigation customs Central Board of Indirect Taxes and Customs. He was speaking in an event organized by Assocham. The department claimed that out of the Rs 20,000 crore tax evasion detected so far, the department had recovered Rs 10,000 crore and was in the process of tracking more evasions. He said the tax officers on Tuesday detected fake invoices worth Rs 1,500 crore which were used to claim illegal GST credit of Rs 75 crore. GST compliance has steadily declined over the past one year as 28.75 per cent of regular taxpayers did not file returns in November 2018 compared to 10.56 per cent in November 2017, which is an almost three-fold increase in non-filers. Among taxpayers under the composite scheme, the non-filers have increased to 25.37 per cent in the July-Sept period of 2018-2019 from 15.03 per cent in the same period of 2017-2018. Fake invoices to claim input tax credit increased from only four cases involving Rs 9.75 crore in 2017-18 to 499 involving Rs 3,894.94 crore in 2018-19.
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Big pharma firms need to mentor and collaborate with Hyderabad’s startups
Many startups in the life science industry still lack the basic mentorship from industry heads of big pharmaceutical companies, noted experts at the 16th edition of Bio Asia on Wednesday. Stating that the future of Life Sciences Industry requires startups and big companies to integrate and converge their systems, they said that Life Sciences 4.0 can only happen if startups helped big companies find specific solutions with technology. “The travel industry saw a disruptive breakthrough when startups came in and collaborated with big companies. The Life Sciences is also slated for a similar breakthrough and growth if the various stakeholders converge in life sciences with the interests of patient in the centre,” an exper t stated at the convention. A recent EY survey titled ‘Life Sciences 4.0: Transforming health care in India’ found that a major chunk (over 69%) of startups in the ecosystem only had 0-3 collaborations with life sciences companies. The survey also found that majority of startups collaborated with smaller companies with revenues less than `1 crore, as they found it challenging to partner with bigger companies.
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India to examine security threat from Chinese telecom gear
The Department of Telecom (DoT) on Wednesday said that with growing concern in many countries about alleged security threats from Chinese telecom equipment manufacturers, it would “carefully” study the issue. Telecom secretary Aruna Sundararajan also said that no decision had been taken on allowing Chinese firms to participate in the highly anticipated 5G trials to be conducted in India. “We have not taken a decision whether they can take part in the trials. Many countries have expressed security concerns, so India will also have to study it very carefully,”Sundararajan told reporters on the sidelines of the launch of India’s first indigenously developed semiconductor chips for 4G, 5G and LTE modems by Bengaluru-based Signalchip. Sundararajan’s comments come amidst growing clamour about security threats from Chinese firms, with the United States and Australia banning Chinese telecom giant Huawei. As for 5G trials, Sundararajan said that a committee had been set up to look into the matter and that it would decide on “what will be the size… duration of the trial”. It will also define parameters like the amount of spectrum to be used and the locations they will roll out in. Meanwhile, regulator TRAI’s chairman R S Sharma said at the World Mobile Congress in Barcelona that it will stand by its spectrum pricing recommendations, including for 5G, even though some operators say the base prices are high.