India’s 9-point agenda against fugitive economic offenders
India has presented a nine-point programme to take action against fugitive economic offenders at the ongoing G20 Summit in Argentina.
The agenda includes: Strong and active” cooperation among the G-20 nations. The document highlights the importance of cooperation in legal processes such as “effective freezing of the proceeds of crime; early return of the offenders and efficient repatriation of the proceeds of crime should be enhanced and streamlined”. Joint efforts to be made by the G20 nations to form a mechanism that denies entry and safe havens to all fugitive economic offenders. There is need for the “effective” implementation of the principles of the United Nations Convention Against Corruption (UNCAC) and the United Nations Convention Against Transnational Organised Crime (UNOTC). The Financial Action Task Force (FATF) should be called upon “to assign priority and to focus on establishing international co-operation that leads to a timely and comprehensive exchange of information between the competent authorities”. The FATF should be tasked to formulate a standard definition of fugitive economic offenders. The FATF should also develop a set of commonly agreed and standardised procedures related to identification, extradition and judicial proceedings for dealing with fugitive economic offenders to provide guidance and assistance to G-20 countries, subject to their domestic law”. There is need for setting up of a common platform “for sharing experiences and best practices including successful cases of extradition, gaps in existing systems of extradition and legal assistance.” The G20 forum should consider initiating work on locating properties of economic offenders who have a tax debt in the country of their residence for its recovery. The programme for curbing the menace of fugitive economic offenders comes amid heightened efforts by India to apprehend a number of such offenders, including Vijay Mallya, Nirav Modi and Mehul Choksi.
India will Chair Kimberley Process Certification Scheme (KPCS) from 1st January 2018. It was handed Chairmanship by the European Union during KPCS Plenary 2018, which was held in Brussels, Belgium. India is founding member of KPCS.
What is the Kimberley Process?
The Kimberley Process is an international certification scheme that regulates trade in rough diamonds. It aims to prevent the flow of conflict diamonds, while helping to protect legitimate trade in rough diamonds.
The Kimberley Process Certification Scheme (KPCS) outlines the rules that govern the trade in rough diamonds.
The KP is not, strictly speaking, an international organisation: it has no permanent offices or permanent staff. It relies on the contributions – under the principle of ‘burden-sharing’ – of participants, supported by industry and civil society observers. Neither can the KP be considered as an international agreement from a legal perspective, as it is implemented through the national legislations of its participants.
What are Conflict diamonds?
“Conflict Diamonds” means rough diamonds used by rebel movements or their allies to finance conflict aimed at undermining legitimate governments. It is also described in the United Nations Security Council (UNSC) resolutions.
Who is involved?
The Kimberley Process (KP) is open to all countries that are willing and able to implement its requirements. The KP has 54 participants, representing 81 countries, with the European Union and its Member States counting as a single participant. KP members account for approximately 99.8% of the global production of rough diamonds. In addition, the World Diamond Council, representing the international diamond industry, and civil society organisations, such as Partnership-Africa Canada, participate in the KP and have played a major role since its outset.
How does the Kimberley Process work?
The Kimberley Process Certification Scheme (KPCS) imposes extensive requirements on its members to enable them to certify shipments of rough diamonds as ‘conflict-free’ and prevent conflict diamonds from entering the legitimate trade.
Under the terms of the KPCS, participating states must put in place national legislation and institutions; export, import and internal controls; and also commit to transparency and the exchange of statistical data.
Participants can only legally trade with other participants who have also met the minimum requirements of the scheme, and international shipments of rough diamonds must be accompanied by a KP certificate guaranteeing that they are conflict-free.
Odisha’s Kandhamal Haldi (turmeric), famous for its healing properties, is all set to receive GI tag. The golden yellow spice, named after the district where it is produced, has been cultivated since time immemorial and is known for its medicinal value. Turmeric is the main cash crop of tribal people in Kandhamal. Apart from domestic use, turmeric is also used for cosmetic and medicinal purposes. More than 60,000 families (nearly 50% of Kandhamal population) are engaged in growing the variety. The crop is sustainable in adverse climatic conditions.
What is it? A GI is primarily an agricultural, natural or a manufactured product (handicrafts and industrial goods) originating from a definite geographical territory.
Significance of a GI tag: Typically, such a name conveys an assurance of quality and distinctiveness, which is essentially attributable to the place of its origin.
Security: Once the GI protection is granted, no other producer can misuse the name to market similar products. It also provides comfort to customers about the authenticity of that product.
Provisions in this regard: GI is covered as element of intellectual property rights (IPRs) under Paris Convention for Protection of Industrial Property. At international level, GI is governed by WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). In India, Geographical Indications of Goods (Registration and Protection Act), 1999 governs it.
Norms for payment apps
The Ministry of Electronics and Information Technology (MeitY) has asked the Reserve Bank of India (RBI) to come up with regulations to oversee collection, usage and sharing of data by payment service providers.
Present concerns and the need for norms: Recently National Cyber Security Coordinator (NCSC) had raised concerns over collection and storage of “sensitive personal data” by payment service providers via applications such as Google Tez, WhatsApp and Paytm. The NCSC had pointed out that there was no agreement between the National Payments Corporation of India (NPCI), the banks and the applications that provided payment services. Additionally, there is no liability of NPCI and the payment service providers. There is also no provision to protect the interest of the consumer against the pilferage, leakage and sharing of data, which is of sensitive nature.
Need of the hour- recommendations by NCSC and RBI: There is a need to scrutinise all aspects of a relation – legal, technical and financial, between all the stakeholders in the payments ecosystem. Payments service providers must comply with legal framework as well as regulations prescribed by the regulator. RBI should lay down regulations, that would bind the collection, usage and sharing of data, by participants in the payments arena.
NPCI: National Payments Corporation of India (NPCI) is an umbrella organization for all retail payments system in India. It was set up with the guidance and support of the Reserve Bank of India (RBI) and Indian Banks’ Association (IBA). NPCI has ten promoter banks. Its recent work of developing Unified Payments Interface (UPI) aims to move India to a cashless society with only digital transactions. It has successfully completed the development of a domestic card payment network called RuPay, reducing the dependency on international card schemes.
Rajiv Kumar Committee:
The Union Government has constituted a six-member committee to look at selling of 149 small and marginal oil and gas fields of state-owned Oil and Natural Gas Corporation (ONGC) and Oil India Limited (OIL) to private and foreign companies to boost domestic output. The panel is chaired by the NITI Aayog Vice Chairman Rajiv Kumar.
Government puts imports of gold dore in restricted category
Directorate General of Foreign Trade (DGFT) under Ministry of Commerce and Industry has put imports of gold dore in restricted category. This means, now, importer needs a license to import this commodity.
Gold dore: It is semi-pure alloy of gold and silver which is refined for further purification. Proportions of silver and gold can vary widely. It usually created at site of a mine and then transported to refinery for further purification. Refined gold bars are manufactured from gold dore bar. India imports about 900 tonnes of gold year making it world’s second-biggest gold consumer after China. The imports mainly take care of demand of the jewellery industry.
Wastage and value addition norms for gold religious idols: DGFT also has prescribed wastage and value addition norms for gold religious idols (only gods and goddess) – both plain and studded, of eight carats and up to 24 carats. Under it, percentage of wastage for plain gold idols will be 2.5%, while it will be 5% for studded idols. Similarly, percentage of value addition for plain gold religious idols will be 10% and 14% in case of idols studded with colour gems stones. The percentage for value addition in case of idols studded with diamonds will be 15%.
Train 18: India’s first engine-less train becomes country’s fastest train
India’s first indigenously designed locomotive-less (engine less) train known as Train 18, breached the 180 kmph speed limit during test run in Kota-Sawai Madhopur section. When this train is made operational, it will become the country’s fastest train. It is touted as next generation Shatabdi Express and will connect metros with other important cities. Train 18 was rolled out in October 2018 at Chennai’s Integral Coach Factory (ICF). Earlier in November 2018, Research Designs and Standards Organisation (RDSO) had announced its trial run successfully. During this trail on tracks in Moradabad division of Northern Railway, this train had ran up to 115 km per hour. The trials proved that train has defined track geometry parameters, curved alignments of specific radius and station yard zones. Major trials of this train are now over with just some more remaining. Once Train 18 becomes operational, it will commence its commercial operations from January 2019.
Train 18: It is capable of touching 200 kmph provided the rest of Indian Railways’ system such as tracks and signals permit. It will replacing current 30-year-old Shatabdi Express – a day train. Thus it is touted as next generation Shatabdi Express. It will be first long-distance train without separate locomotive (engine). It has been indigenously developed by Chennai-based Integral Coach Factory (ICF) in just short time span of 18 months. It took investment of nearly Rs 100 crore to build this prototype and subsequent bulk production will bring down the cost. Thus, it will be cheaper compared to imported engine less train. With 16 coaches, it will has same passenger carrying capacity as that of Shatabdi Express. It has aerodynamically designed driver cabins at both ends for quicker turn-around at destinations. It sports advanced regenerative braking system which saves power. It is fully air-conditioned and offers better passenger comfort and safety, as all equipment are fixed under carriage, so that more space is available on board. It has soft lighting, automatic doors, footsteps and GPS-based Passenger Information System (PIS). It also has onboard Wi-Fi and infotainment, and modular toilets with bio-vacuum systems. Footstep in coach’s doorway in this train slides outward when train stops at station, enabling passengers to board or deboard safely with comfort.
Patents granted by India up by 50% in 2017: WIPO
According to World Intellectual Property Indicators 2018 report released by United Nation’s World Intellectual Property Organisation (WIPO), number of patents granted by India shot up by 50% in 2017. The patents granted by India increased from 8,248 in 2016 to 12,387 in 2017, thus keeping up trend of steep increases. Patents granted in 2017 in India were more than double 6,022 patents granted in 2015. Of the patents granted in 2017, 1,712 went to entities and individuals based in India, and 10,675 to foreigners. The steep increase in number was driven by patents granted to foreigners, which accounted for 85% of total increase. The number of patents given to domestic entities also has shown increasing trend. In 2016, 1,115 went to domestic individuals or entities and 7,133 to foreigners and in 2015, 822 were granted to applicants in India and 5,200 to foreigners. Globally, 1.4 million patents were granted in 2017. China led world with 4,20,144 granted patents and was followed by US with 3,18,829.
World Intellectual Property Organisation (WIPO): It is the global body for promotion and protection of intellectual property rights (IPR). It is one of the 15 specialized agencies of United Nations (UN). It was established in 1967 and is headquartered in Geneva, Switzerland. Its mandate is to encourage creative activity, to promote the protection of intellectual property throughout the world. It encourages and provides assistance to all its 188 member countries in formulating national IPR policy however it does not dictate or prescribe any mandatory measures. India is a member of WIPO and party to several treaties administered by WIPO.
RBI to introduce Ombudsman Scheme for Digital Transactions
Reserve Bank of India (RBI) has announced to introduce ‘Ombudsman Scheme for Digital Transactions’ to provide cost-free mechanism to redress grievances of customers related to digital transactions. The scheme will be notified by end of January 2019. It will cover services provided by entities falling under RBI’s regulatory jurisdiction. The scheme is being implemented taking into consideration rise in digital mode for financial transactions which is gaining traction in the country. There is emerging need for dedicated, cost-free and expeditious grievance redressal mechanism for strengthening consumer confidence in this channel.
Framework for limiting customer liability: RBI has also decided to come out with framework for limiting customer liability in respect of unauthorised electronic payment transactions involving prepaid payment instruments (PPI). It already has issued instructions on limiting customer liability in respect of unauthorised electronic transactions involving banks and credit card issuing non-banking financial companies (NBFCs). This framework will bring all customers up to same level with regard to electronic transactions made by them and extend benefit of limiting customer liability for unauthorised electronic transactions involving PPIs issued by other entities not covered by extant guidelines. The guidelines will be issued by end of December 2018.
World Intellectual Property Organisation (WIPO)
World Intellectual Property Indicators 2018 report was recently released in Geneva by the World Intellectual Property Organization (WIPO). Globally, 1.4 million patents were granted in 2017. China’s patent authority led the world in the number of patents granted with 420,144 and was followed by the US with 318,829, according to the WIPO.
Highlights of the report- India related key facts:
The number of patents granted by India shot up by 50% in 2017, keeping up a trend of steep increases. The patents granted by India increased from 8,248 in 2016 to 12,387 last year. Of the patents granted last year, 1,712 went to entities and individuals based in India, and 10,675 to foreigners. While India ranked 10th in the number of patents given last year, no Indian company or university figures in last year’s global list of the top 50 patent applicants.
WIPO: The World Intellectual Property Organization (WIPO) is one of the 17 specialized agencies of the United Nations. It was created in 1967 “to encourage creative activity, to promote the protection of intellectual property throughout the world.” It has currently 188 member states, administers 26 international treaties, and is headquartered in Geneva, Switzerland. Non-members are the states of Marshall Islands, Federated States of Micronesia, Nauru, Palau, Solomon Islands, South Sudan and Timor-Leste. Palestine has observer status. India is a member of WIPO and party to several treaties administered by WIPO.
Distribution of Soil Health Cards (SHC) for optimal utilization of fertilizers
Soil Health Card Scheme has been taken up for the first time in a comprehensive manner across the country. It is provided to all farmers.
Objective: It is to enable the farmers to apply appropriate recommended dosages of nutrients for crop production and improving soil health and its fertility.
Unique Features: Collecting soil samples at a grid of 2.5 ha in irrigated area and 10 ha in un-irrigated areas. Uniform approach in soil testing adopted for 12 parameters primary nutrients (NPK), secondary nutrient (S); micronutrients (B, Zn, Mn. Fe & Cu); and other (pH, EC & OC) for comprehensiveness. GPS enabled soil sampling to create a systematic database and allow monitoring of changes in the soil health over the years.
National Mission for Sustainable Agriculture (NMSA) will be implemented during 12th Plan to make agriculture more productive, sustainable and climate resilient; to conserve natural resources; to adopt comprehensive soil health management practices; to optimize utilization of water resources; etc. Soil Health Management (SHM) is one of the most significant interventions under NMSA.
Aims of SHM: To promote Integrated Nutrient Management (INM) through judicious use of chemical fertilizers including secondary and micro nutrients in conjunction with organic manures and bio-fertilisers for improving soil health and its productivity; To strengthen soil and fertilizer testing facilities to give soil test based recommendations to farmers for improving soil fertility; To ensure quality control requirements of fertilizers, bio-fertilizers under Fertiliser Control Order, 1985; To upgrade skill and knowledge of soil testing laboratory staff, extension staff and farmers through training and demonstrations; To promote organic farming practices, etc.
Citizens to get an option to opt out of Aadhaar
Government is finalising a proposal to amend the Aadhaar Act to give all citizens an option to withdraw their Aadhaar number, including biometrics and the data. This follows the Supreme Court judgment in September that upheld the validity of Aadhaar. In line with the court order, the proposal also seeks to appoint an adjudicating officer to decide whether a person’s Aadhaar-related data need to be disclosed in the interest of national security. A Constitution Bench of the Supreme Court had struck down Section 57 of the Aadhaar Act that allows private entities to use the unique number for verification. The Bench also declared that seeking to link it with bank accounts and SIM cards was unconstitutional. The court had also struck down Section 33(2), which allowed disclosure of Aadhaar information for national security reasons on the orders of an officer not below Joint Secretary. It had said an officer above Joint Secretary should consult a judicial officer and together take a call.
World Bank assisted project SMART launched in Maharashtra
Maharashtra Government has launched World Bank assisted State of Maharashtra’s Agribusiness and Rural Transformation (SMART) Project to transform rural Maharashtra. This project aims to revamp agricultural value chains, with special focus on marginal farmers across 1,000 villages. This initiative is in line with Union Government’s step towards doubling farmers’ income by 2022. The launch of project which was followed by signing of 50 memorandum of understandings (MoUs) between big corporates and farmers producer groups.
State of Maharashtra’s Agribusiness and Rural Transformation (SMART) Project
The objective of project is to create and support value chains in post-harvest segments of agriculture, facilitate agribusiness investment, stimulate SMEs within the value chain. It will also support resilient agriculture production systems, expand access to new and organised markets for producers and enhance private sector participation in the agribusiness. The project will be implemented in 10,000 villages of total 40,913 villages in states with objective to achieve sustainable farming within the next three years. It will cover almost one-fourth of Maharashtra. Its focus is on villages which are reeling under worst agriculture crisis compounded by lack of infrastructure and assured value chains to channelise farm produce. The project will be implemented in 10,000 villages comprising 10,000 gram panchayats which were shortlisted by state government based on multiple parameters of socio-economic backwardness in terms of development and growth. The project is giant step towards transformation of rural economy and empowerment of farmers and also sustainable agriculture through public-private partnership (PPP) model. It seeks to sure higher production of crops and create robust market mechanism to enable farmers to reap higher remunerations for the yield. It unites agriculture-oriented corporates and farmers by providing them common platform.
CCEA approves strategic sale of Rural Electrification Corporation
Cabinet Committee on Economic Affairs (CCEA) has given its in principle approval for strategic sale of Central Government’s existing 52.63% of total paid up equity shareholding in Rural Electrification Corporation (REC) to Power Finance Corporation (PFC) along with transfer of management control. Both REC and PFC are Central Public Sector Enterprises under the Ministry of Power.
The acquisition intends to achieve integration across Power Chain, create economies of scale, obtain better synergies and have enhanced capability to support energy access and energy efficiency by improved capability to finance power sector. It may also allow for cheaper fund raising with increase in bargaining power for combined entity.
Rural Electrification Corporation (REC): It is public Infrastructure finance company in India’s power sector. It finances and promotes rural electrification projects across India. It provides loans to Central/ State Sector Power Utilities, State Electricity Boards, Rural Electric Cooperatives, NGOs and Private Power Developers. It was founded in July 1969 and is headquartered in New Delhi.
Union Cabinet approves Agriculture Export Policy, 2018
Union Cabinet chaired by Prime Minister Narendra Modi has approved Agriculture Export Policy, 2018 with aim to double farmer’s income by 2022. Cabinet has also approved proposal for establishment of Monitoring Framework at Centre with Ministry of Commerce as nodal Department to oversee implementation of Agriculture Export Policy. It will also have representation from various ministries and departments and agencies and representatives of concerned State Governments
Agriculture Export Policy: It is aimed at doubling agricultural exports and integrating Indian farmers and agricultural products with the global value chains. Its vision is to harness export potential of Indian agriculture, through suitable policy instruments and to make India global power in agriculture and raise farmers’ income.
Objectives: Double agricultural exports from present US$ 30+ Billion to US$ 60+ Billion by 2022 and reach US$ 100 Billion in next few years thereafter with stable trade policy regime. Diversify India’s export basket, destinations and also boost high value and value added agricultural exports including perishables. Provide institutional mechanism for pursuing market access, tackling barriers and deal with sanitary and phyto-sanitary issues. Strive to double India’s share in world agri-exports by integrating with global value chain at earliest. Promote indigenous, organic, ethnic, traditional and non-traditional agri products exports. Enable farmers to benefit from export opportunities in overseas market.
Cabinet approves launch of National Mission on Interdisciplinary Cyber-Physical Systems
Union Cabinet has approved launching of National Mission on Interdisciplinary Cyber-Physical Systems (NM-ICPS). It will be implemented by Department of Science &Technology under Ministry of Science and Technology for period of five years. The objective of Mission is to addresses ever increasing technological requirements of the society. It also takes into account international trends and road maps of leading countries for next generation technologies.
Implementation of this mission will develop and bring: Cyber Physical Systems (CPS) and associated technologies within reach in the country, Adoption of CPS technologies to address India specific National / Regional issues, Catalyze Translational Research,
Produce Next Generation skilled manpower in CPS, Accelerate entrepreneurship and start-up ecosystem development in CPS, Place India at par with other advanced countries and derive several direct and indirect benefits. Give impetus to advanced research in CPS, Technology development and higher education in Science, Technology and Engineering disciplines.
NM-ICPS: It is comprehensive mission to address technology development, application development, human resource development & skill enhancement, entrepreneurship and start-up development in CPS and associated technologies. It aims at establishment of 15 numbers of Technology Innovation Hubs (TIH), six numbers of Application Innovation Hubs (AIH) and four numbers of Technology Translation Research Parks (TTRP). These Hubs & TTRPs will connect to Academics, Industry, Central Ministries and State Government in developing solutions at reputed academic, R&D and other organizations across the country in a hub and spoke model. They have four focused areas along which mission implementation will proceed viz. (i) Technology Development; (ii) HRD & Skill Development; (iii) Innovation, Entrepreneurship & Start-ups Ecosystem Development; (iv) International Collaborations. Strategic approach involving a suitable mix of Academic, Industry and Government is proposed to be adopted. Strong Steering and Monitoring Mechanisms in the form of Mission Governing Board (MGB), Inter-Ministerial Coordination Committee (IMCC), Scientific Advisory Committee (SAC) and other Sub-Committees will guide and monitor the Mission implementation.
Freight Village in Varanasi
The Ministry of Shipping has approved the development of Rs. 156 crore freight village in Varanasi adjoining the Inland Waterways Terminal on River Ganga. The Varanasi freight village will be developed by the Inland Waterways Authority of India. It will serve as a cargo hub, and a centre for aggregation and value addition. It will also provide support to stimulate development of a professional logistics industry in Varanasi.
What is a Freight Village?
A freight village is a designated area where facilities for various modes of transportation, distribution of goods and other logistics are available in a synchronized manner on a large scale. Freight villages are cargo aggregators, offers various logistic choices to a shipper/cargo owner; i.e. choice of railroad; rail-waterway; road-waterway. The main function is management and utilization of various modes of transport, synergizing them and decongesting the existing mode of transportation.
World Bank Study: A World Bank pre-feasibility study has found Varanasi to be a suitable site for the freight village. The traffic volume on inland waterway is expected to increase with the commissioning of the multi modal terminal being built under the Jal Marg Vikas project.
Inland Waterways Authority of India: It came into existence on 27th October 1986 for development and regulation of inland waterways for shipping and navigation. The Authority primarily undertakes projects for development and maintenance of IWT infrastructure on national waterways through grant received from Ministry of Shipping.
PCS 1x System
Indian Ports Association (IPA) under the guidance of Ministry of Shipping launched the Port Community System ‘PCS1x’. The platform has the potential to revolutionize maritime trade in India and bring it at par with global best practices and pave the way to improve the Ease of Doing Business world ranking and Logistics Performance Index (LPI) ranks.
PCS 1x: ‘PCS 1x’ is a cloud based new generation technology, with user-friendly interface. This system seamlessly integrates stakeholders from the maritime trade on a single platform. The platform offers value added services such as notification engine, workflow, mobile application, track and trace, better user interface, better security features, improved inclusion by offering dashboard for those with no IT capability. Another major feature is the deployment of a world class state of the art payment aggregator solution which removes dependency on bank specific payment eco system.
Other Features: It is an initiative that supports green initiatives by reducing dependency on paper. It has been developed indigenously and is a part of the ‘Make in India’ and ‘Digital India’
Indian Ports Association (IPA): IPA was constituted in 1966 under Societies Registration Act, with the idea of fostering growth and development of all Major Ports which are under the supervisory control of Ministry of Shipping.
Society for Worldwide Interbank Financial Telecommunication (SWIFT)
SWIFT India has appointed ex-SBI chief Arundhati Bhattacharya as the new chairman of its board. SWIFT India is a joint venture of top Indian public and private sector banks and SWIFT (Society for Worldwide Interbank Financial Telecommunication). The company was created to deliver high quality domestic financial messaging services to the Indian financial community. Bhattacharya said the venture has a huge potential to contribute significantly to the financial community in many domains.
What is SWIFT?
The SWIFT is a global member-owned cooperative that is headquartered in Brussels, Belgium. It was founded in 1973 by a group of 239 banks from 15 countries which formed a co-operative utility to develop a secure electronic messaging service and common standards to facilitate cross-border payments. It carries an average of approximately 26 million financial messages each day. In order to use its messaging services, customers need to connect to the SWIFT environment.
Functions: SWIFT does not facilitate funds transfer: rather, it sends payment orders, which must be settled by correspondent accounts that the institutions have with each other. The SWIFT is a secure financial message carrier — in other words, it transports messages from one bank to its intended bank recipient. Its core role is to provide a secure transmission channel so that Bank A knows that its message to Bank B goes to Bank B and no one else. Bank B, in turn, knows that Bank A, and no one other than Bank A, sent, read or altered the message en route. Banks, of course, need to have checks in place before actually sending messages.
Significance of SWIFT:
Messages sent by SWIFT’s customers are authenticated using its specialised security and identification technology. Encryption is added as the messages leave the customer environment and enter the SWIFT Environment. Messages remain in the protected SWIFT environment, subject to all its confidentiality and integrity commitments, throughout the transmission process while they are transmitted to the operating centres (OPCs) where they are processed — until they are safely delivered to the receiver.
Online portal “ENSURE”
Union Minister of Agriculture and Farmers’ Welfare launched a portal ENSURE – National Livestock Mission-EDEG developed by NABARD and operated under the Department of Animal Husbandry, Dairying & Fisheries. Entrepreneurship Development and Employment Generation (EDEG): Under the Mission’s component EDEG, subsidy payment for activities related to poultry, small ruminants, pigs etc., through Direct Benefit Transfer (DBT) goes directly to the beneficiary’s account. To make it better, simpler and transparent, the NABARD has developed an online portal “ENSURE” which makes the information related to beneficiary and processing of application readily available.
Benefits: The flow of information/funds will be quicker and more accountable. The burden of extra interest due to delay in the disbursal of the subsidy would now be reduced. Accessing the portal will be on real-time basis and list of beneficiaries can be easily prepared.
Vision of a New India – USD 5 Trillion Economy
The Ministry of Commerce & Industry is creating an action-oriented plan which highlights specific sector level interventions to bolster India’s march towards becoming a USD 5 trillion economy before 2025.
Services sector – USD 3 trillion,
Manufacturing sector – USD 1 trillion, and
Agriculture sector – USD 1 trillion.
Impact on Services Sector:
The share of India’s services sector in global services exports was 3.3% in 2015 compared to 3.1% in 2014. Based on this initiative, a goal of 4.2% has been envisaged for 2022. As the Services sector contributes significantly to India’s GDP, exports and job creation, increased productivity and competitiveness of the Champion Services Sectors will further boost exports of various services. Embedded services are substantial part of ‘Goods’ as well. Thus, competitive services sector will add to the competitiveness of the manufacturing sector as well.
Promotion of Trade:
Commerce Ministry is closely working with the Finance Ministry to ease credit flow to the export sector, especially small exporters to ensure adequate availability of funds to them.
The Commerce Minister has identified 15 strategic overseas locations where the Trade Promotion Organizations (TPOs) are proposed to be created.
Trade Infrastructure for Export Scheme (TIES):
TIES aid with setting up and up-gradation of infrastructure projects with overwhelming export linkages like the Border Haats, Land customs stations, etc. The Central and State Agencies, including Export Promotion Councils, Commodities Boards, SEZ authorities and apex trade bodies recognized under the EXIM policy of Government of India, are eligible for financial support under this scheme.
India Improves Ranking in Ease of Doing Business: India had made a leap of 23 ranks in the World Bank’s Ease of Doing Business Ranking this year (2018) to be ranked at 77. India now ranks first in Ease of Doing Business Report among South Asian countries compared to 6th in 2014.
Multi-Modal Logistics Parks Policy (MMLPs): MMLPs is to improve the country’s logistics sector by lowering over freight costs, reducing vehicular pollution and congestion and cutting warehouse costs with a view to promoting moments of goods for domestic and global trade.
Reasons for Improvement in Ease of Doing Business: To support start-ups and lower tax rates for MSMEs quicker environmental clearances from 600 days to 140 days has been implemented, Abolition of inter-state check post after implementation of GST has been done, Enhanced input tax credit and electronic GST network has been put in place and the creation of commercial courts to fast track enforcement of contracts and faster security clearances has lent support to the start-ups in the country. Among BRICS countries, India improved its rank from 5th (in 2010) to 3rd (in 2018). Twenty-One regulatory changes have been made for ease of doing business for start-ups. To optimize resource utilization and enhance the efficiency of the manufacturing sector, DIPP launched the Industrial Information System (IIS), a GIS-enabled database of industrial areas and clusters across the country in May 2017.
National Register of Citizens (NRC)
The Supreme Court on December 12, 2018 extended the deadline for the submission of claims and objections by individuals excluded from the first draft of the Assam National Register of Citizens (NRC) to December 31, 2018. The Assam government released the final draft of NRC on July 30, 2018. The list incorporates names of 2.89 crore people out of 3.29 crore applicants. The names of 40.07 lakh people have been left out.
The National Register of Citizens (NRC) is a list that contains names of Indian citizens of Assam. It was last prepared after Census in 1951. Assam, which had faced an influx of people from Bangladesh since the early 20th century, is the only state having an NRC.
The Assam government on July 30, 2018 released the second and final draft of the state’s National Register of Citizens (NRC). The draft includes the names of Indian citizens who have been residing in Assam before March 25, 1971.
Four Indian PSUs feature in world’s top 100 arms producers: SIPRI Report
The recently released rankings by Stockholm International Peace Research Institute (SIPRI) have placed four Indian Public Sector Undertakings among world’s top 100 arms producers. These companies are as follows:
Indian Ordnance Factories (37th Rank)
Hindustan Aeronautics (38th Rank)
Bharat Electronics (64th Rank)
Bharat Dynamics (94th rank)
This was for the first time that four Indian companies have ranked in top 100 arms producers companies of world. These four companies have sold arms worth USD 7.52 Billion in 2017.
SIPRI: Established in 1966, the Stockholm International Peace Research Institute (SIPRI) is a Swedish think tank dedicated to research into conflict, armaments, arms control and disarmament. SIPRI provides data, analysis and recommendations, based on open sources, to policymakers, researchers, media and the interested public.
India’s share in Global Arms Sale
India’s current share in total global arms sales stands at less than 2%. This indicates that India has been a weak player in international markets. Successive government have tried to turn India into a global defence manufacturing hub and take multiple policy steps to involve private sector in defense production. However, most of such measures have been on papers only till now.
World’s top arms producers
The global arms market is dominated by US companies which have a whopping 57% of the market share, followed by Russia (9.5%), United Kingdom (9%) and France (5.3%). As of 2017, Lockheed Martin is world’s largest arms with arms sales of $ 44.9 billion. Boeing is the second largest arms producer company in the world.
Telecom Disputes Settlement & Appellate Tribunal (TDSAT)
Telecom Disputes Settlement & Appellate Tribunal (TDSAT) has rejected TRAI’s order that had changed the definition of ‘significant market power’ (SMP) to identify predatory pricing, offering substantial relief to India’s older telcos. The Telecom Disputes Settlement & Appellate Tribunal (TDSAT) also set aside a rule in the Telecom Regulatory Authority of India (Trai) predatory pricing regulation that required top telcos to report all tariffs in the interests of transparency and non-discrimination.
TDSAT: In order to bring in functional clarity and strengthen the regulatory framework and the disputes settlement mechanism in the telecommunication sector, the TRAI Act of 1997 was amended in the year 2000 and TDSAT was set up to adjudicate disputes and dispose of appeals with a view to protect the interests of service providers and consumers of the telecom sector.
In January 2004, the Government included broadcasting and cable services also within the purview of TRAI Act. The jurisdiction of TDSAT stands extended to matters that lay before the Cyber Appellate Tribunal and also the Airport Economic Regulatory Authority Appellate Tribunal.
Composition of TDSAT: The Tribunal consists of a Chairperson and two Members appointed by the Central Government. The Chairperson should be or should have been a Judge of the Supreme Court or the Chief Justice of a High Court. A Member should have held the post of Secretary to the Government of India or any equivalent post in the Central Government or the State Government for a period of not less than two years or a person who is well versed in the field of technology, telecommunication, industry, commerce or administration.
Powers and Jurisdiction: The Tribunal exercises jurisdiction over Telecom, Broadcasting, IT and Airport tariff matters under the TRAI Act, 1997 (as amended), the Information Technology Act, 2008 and the Airport Economic Regulatory Authority of India Act, 2008. The Tribunal exercises original as well as appellate jurisdiction in regard to Telecom, Broadcasting and Airport tariff matters. In regard to Cyber matters the Tribunal exercises only the appellate jurisdiction.
National Mission on Government e-Market (GeM) portal
The National Mission on GeM (NMG) was launched on 5th September 2018 to accelerate the adoption and use of Procurement by Major Central Ministries, States and UTs and their agencies (including CPSUs/PSUs, Local Bodies) on the GeM platform.
Objectives of the NMG: Promote inclusiveness by catapulting various categories of sellers and service providers. Highlight and communicate ‘value add’ by way of transparency and efficiency in public procurement, including corruption free governance. Achieve cashless, contactless and paperless transaction, in line with the Digital India objectives. Increase overall efficiency leading to significant cost saving on government expenditure in Procurement. Maximizing ease in availability of all types of products and services bought by Government buyers. GeM is a short form of one stop Government e-Market Place hosted by Directorate General of Supplies and Disposals (DGS&D) where common user goods and services can be procured. GeM has recorded about $1.5 billion worth of transactions since it was launch 18 months ago.
Farm loan waiver
Former Reserve Bank of India governor Raghuram Rajan has stressed on the need to do away with farm loan waivers citing “enormous” problems for state finances and investment. He also said that farm loan waiver should not form part of poll promises and he has written to Election Commission that such issues should be taken off the table.
According to Rajan, loan waivers not only inhibit investment in the farm sector but put pressure on the fiscal of states which undertake farm loan waiver. In every state election during the last five years, loan waiver promise made by one political party or other. The recently concluded assembly election in five states, agriculture loan waiver and increasing minimum support price (MSP) of cereals was again part of manifesto of some of the political parties.
Also, loan waivers, as the RBI has repeatedly argued, vitiate the credit culture, and stress the budgets of the waiving state or central government. According to a 2017 report by the RBI, farm loan waiver amounting to Rs 88,000 crore likely to be released in 2017-18 by seven states, including Uttar Pradesh and Maharashtra, may push inflation on permanent basis by 0.2%.
The ever- rising demand: Agriculture currently contributes just about 15% to the national output and about 50% of the population directly or indirectly depends on it for employment. Farmer distress is a real and pressing problem, as evidenced by the protests currently taking place in various parts of the country. In the recent past, widespread demands have been heard for farm loan waivers amid continuing agrarian distress.
Drawbacks of loan waivers: Firstly, it covers only a tiny fraction of farmers. The loan waiver as a concept excludes most of the farm households in dire need of relief and includes some who do not deserve such relief on economic grounds. Second, it provides only a partial relief to the indebted farmers as about half of the institutional borrowing of a cultivator is for non-farm purposes. Third, in many cases, one household has multiple loans either from different sources or in the name of different family members, which entitles it to multiple loan waiving. Fourth, loan waiving excludes agricultural labourers who are even weaker than cultivators in bearing the consequences of economic distress. Fifth, it severely erodes the credit culture, with dire long-run consequences to the banking business. Sixth, the scheme is prone to serious exclusion and inclusion errors, as evidenced by the Comptroller and Auditor General’s (CAG) findings in the Agricultural Debt Waiver and Debt Relief Scheme, 2008. Lastly, schemes have serious implications for other developmental expenditure, having a much larger multiplier effect on the economy.
What needs to be done?
Proper identification: For providing immediate relief to the needy farmers, a more inclusive alternative approach is to identify the vulnerable farmers based on certain criteria and give an equal amount as financial relief to the vulnerable and distressed families.
Enhance non- farm income: The sustainable solution to indebtedness and agrarian distress is to raise income from agricultural activities and enhance access to non-farm sources of income. The low scale of farms necessitates that some cultivators move from agriculture to non-farm jobs.
Improved technology, expansion of irrigation coverage, and crop diversification towards high-value crops are appropriate measures for raising productivity and farmers’ income. All these require more public funding and support.
India Post ventures into new arena of e-market place.
The Ministry of State for Communications (Independent Charge), launched the e-Commerce Portal of the Department of Posts (DoP). It will provide an e-Market place to sellers especially to rural artisans/self-help groups/ women entrepreneurs/State and Central PSUs/Autonomous Bodies etc. to sell their products to buyers across the Country.
Major Highlights: The small and local sellers (who were left) will now, by leveraging the vast physical and IT network of DoP, be able to maximize their reach and retailing power. The buyers can access the products of their choice displayed by sellers on the portal and place online orders by making digital payments.
Post Office Savings Bank (POSB):
Under Core Banking Solution (CBS), an internet banking facility for Post Office Savings Bank (POSB) customers has been launched. Now, nearly 17 Crore POSB accounts will be intra-operable and customers can also transfer funds online to RD and PPF accounts of Post Offices. It helps to do transactions without physically visiting post offices.
Deen Dayal SPARSH:
The Department of Posts had launched a scholarship program for school children called Deen Dayal SPARSH (i.e., Scholarship for Promotion of Aptitude & Research in Stamps as a Hobby).
Objective of Deen Dayal SPARSH –
To bring philately to the mainstream of the education system and incentivizing it, in 2017.
Meghdoot Award: Shri Sinha (Minister of State for Communications) presented the Meghdoot Awards to the Gramin Dak Sewak (GDS) and employees of the Department in eight categories in recognition of their outstanding contribution.
Saksham (Sanrakshan Kshamta Mahotsav) is an annual flagship event of Petroleum Conservation Research Association (PCRA) under the aegis of Ministry of Petroleum & Natural Gas, Government of India. Saksham actively involves the Oil & Gas PSUs along with other stakeholders like State Governments, To create focused attention on fuel conservation through people centric activities and To sensitize the masses about the conservation and efficient use of petroleum products leading to better health and environment.
PCRA (established in 1978)– Petroleum Conservation Research Association (PCRA) is a registered society set up under the aegis of Ministry of Petroleum & Natural Gas, Government of India. As a non-profit organization, PCRA is a national government agency engaged in promoting energy efficiency in various sectors of economy. PCRA aims at making oil conservation a national movement. As part of its mandate, PCRA is entrusted with the task of creating awareness amongst the masses about the importance, methods and benefits of conserving petroleum products & emission reduction. It sponsors R&D activities for the development of fuel-efficient equipment / devices and organizes multi-media campaigns for creating mass awareness for the conservation of petroleum products. To take the message to the people, PCRA uses all possible and effective media for mass communication. To give impetus to the oil conservation movement, PCRA utilizes various platforms like the World environment day, World energy day, various festivals etc. It functions as a Think Tank to the Govt. of India for proposing policies and strategies on petroleum conservation and environment protection aimed at reducing excessive dependence on oil. For the benefit of various target groups of petroleum products, PCRA has developed literature containing simple ready to implement conservation tips and techniques. Special low cost green leaflets have also been developed to educate the masses on the ill effects of pollution caused due to incomplete combustion and its impact on health.
Know Your Budget series
What is it? It is a fortnight series started by the union Finance Ministry on Twitter which explains the importance of Union Budget and its making. It aims to educate the general public about the budgetary process. The government on February 1 would unveil the interim Budget for 2019-20 as the general elections are due in the next couple of months. The final Budget for the next fiscal would be presented by the new government. The first series of tweets explained what is Union Budget and Vote on Account.
What is Budget? Budget is the most comprehensive report of the government’s finances in which revenues from all sources and outlays for all activities are consolidated. The Budget also contains estimates of the government’s accounts for the next fiscal year called Budget estimates.
Global Risks Report
The Global Risks Report 2019 has been released by the World Economic Forum (WEF).
Global Risks Report and its significance: Based on the work of the Global Risk Network, the report describes changes occurring in the global risks landscape from year to year and identifies global catastrophic risks. The report explores the interconnectedness of risks, and is intended to raise awareness about the need for a multi-stakeholder approach to the mitigation of global risk.
Top 10 risks by likelihood as per the latest report:
1.Extreme weather events.
2.Failure of climate change mitigation and adaption.
3.Major natural disasters.
4.Massive incident of data fraud/theft.
5.Large scale cyberattacks.
6.Man-made environmental damage and disasters.
7.Large-scale involuntary migration.
8.Major biodiversity loss and ecosystem collapse.
10.Asset bubbles in a major economy.
Analysis of the report and key takeaways:
Environmental risks dominate the global risks landscape in terms of impact and likelihood for the third year in a row. This includes extreme weather events and failure of climate mitigation and adaptation. Only 12 years left to stay beneath 1.5C. However, there is a lack of political will to set more stretching targets to cut emissions. The report finds that business leaders are more concerned about climate in the long term. This disconnect will need to be tackled.
Global risks are intensifying, but our capacity to respond to them is declining. Power is moving towards more nationalist, authoritarian states and they are becoming more inwards-looking. With greater geopolitical friction, our ability to cooperate to solve challenges such as cyber risks and climate change has become more challenging.
Geopolitics and geo-economic factors, such as uncertainty and nationalism are fuelling risks. Innovation is also outpacing our ability to manage it and there are growing concerns around technology misuse.
Shorter-term fears are around geopolitical and cyber threats. For top business leaders, cyber risk concern is rising globally and is the highest ranked threat. Other concerns also exist including fiscal crises, unemployment, energy price shocks, national governance failure, interstate conflict and natural disasters.
There is a significant financing gap (US$18 trillion) in infrastructure capital – with only US$79 trillion currently planned between now and 2040. This means 20% more financing is needed than we are putting in today. Furthermore, infrastructure needs to be resilient to extreme weather events. Business, with its reliance on public sector infrastructure, will be impacted and need to work with government on solutions.
The government has notified changes to Section 56 of the Income Tax Act, in a move that brings relief to start-up founders and investors dealing with the issue of “Angel Tax”.
Major Changes introduced: As per the changes, all DIPP-recognised start-ups can apply to the department for approvals requesting exemption from Angel Tax, or Section 56 2 (viib) of the Income Tax Act, which will then be sent to the Central Board of Direct Taxes (CBDT) for approval. The changes are applicable to start-ups, recognised by DIPP, where the amount of paid-up share capital, and share premium of the capital after the proposed issue of share does not exceed Rs. 10 crore. The notification specifies a list of documents that start-ups will have to submit to the DIPP while seeking approval. The CBDT is mandated to either approve or reject the applications within 45 days.
WHAT IS THE LATEST ISSUE?
At least 80 startups have received notices to pay angel tax since last year. Many founders have said they have been asked to pay up as much as 30% of their funding as tax. Angels have also received multiple notices asking them to furnish details on their source of income, their bank account statements and other financial data.
Agri-Vision 2019, a two-day conference on ‘Envisioning Agro Solutions for Smart and Sustainable Agriculture’ was held at Hyderabad. Agriculture sector accounts for 18 per cent of India’s GDP and provides employment to 50 per cent of the workforce of the country. The Gross Value Added by agriculture, forestry and fishing is estimated at Rs 17.67 trillion (US$ 274.23 billion) in FY18. During 2017-18 crop year, food grain production is estimated at record 284.83 million tonnes. The introduction of high yielding varieties, irrigation facilities, increased input flow through fertilizers and pesticides, farm mechanization, credit facilities, price support, and other rural infrastructure facilities ushered the green revolution over the past few decades. Growth of Agricultural sector is important for inclusive growth and poverty alleviation. Need for concerted efforts from all stake holders to find long term solution to various challenges faced by Agricultural sector, Loan waiver is only a temporary relief but proves futile in long run in addressing Farmers concerns. India today is not only self-sufficient in respect of demand for food, but is also a net exporter of agri-products occupying seventh position globally. It is one of the top producers of cereals (wheat & rice), pulses, fruits, vegetables, milk, meat and marine fish. However, we are still facing deficit of pulses and oilseeds. Although, the availability of fruits, vegetables, milk, meat and fish has increased, the most important aspect is to ensure access and affordability to a vast majority of Indians, including farmers.
Food processing industry: Plays a critical role in improving agrarian economy, raising farm incomes, reducing wastages, ensuring value addition, promoting crop diversification and generating employment opportunities as well as export earnings. Vital link between agriculture and industry. The Indian food and grocery market is the world’s sixth largest. The Indian food processing industry accounts for 32 per cent of the country’s total food market, one of the largest industries in India.
Organic Farming: India holds a unique position among 172 countries practicing organic agriculture. India is home to 30 per cent of the total organic producers in the world, but accounts for just 2.59 per cent (1.5 million hectares) of the total organic cultivation area of 57.8 million hectares.
Horticulture: leading horticultural country of the world with a total annual fruits and vegetable production of 306.82 million tonnes during 2017-18. India is the second largest fruit producer in the world.
Livestock: Has been growing faster than crop sector. The contribution of livestock output to the total output of the agriculture sector has significantly increased from 15 per cent in 1981-82 to 29 per cent in 2015-16. acts as cushion and engine for agricultural growth.
Dairy industry: India is also the world’s second largest milk producer and is emerging as a major exporter now. It is contributing around 26 per cent to total agriculture GDP.
Government initiatives: Improve soil fertility on a sustainable basis through the soil health card scheme. Provide improved access to irrigation and enhanced water efficiency through Pradhan Mantri Krishi Sinchai Yojana (PMKSY). Support organic farming through Paramparagat KrishiVikasYojana (PKVY). Creation of a unified national agriculture market to boost the income of farmers. To mitigate risk in agriculture sector, “Pradhan Mantri Fasal BimaYojana (PMFBY) has been launched for implementation from Kharif 2016. Focusing on irrigation with schemes like “Per Drop More Crop”, provision of quality seeds and nutrients based on soil health, setting up warehouses and cold chains to prevent post-harvest crop losses, promoting value addition through food processing, creating a National Farm Market, removing distortions and e-platform across 585 Stations. To achieve the target of doubling farmer income by 2022 increasing investments in agricultural R&D and rolling out efficient institutional reforms are vital to tackle the emerging challenges in agriculture, including food and nutrition security both at national and regional levels.
Small Farmers’ Agri-Business Consortium (SFAC):
Silver Jubilee Celebrations of the Small Farmers’ Agri-Business Consortium (SFAC).
SFAC: The Government established Small Farmers’ Agri-Business Consortium (SFAC) as a Society in January 1994 to facilitate agri-business ventures by catalysing private investment through Venture Capital Assistance (VCA) Scheme in close association with financial institutions. The role of State SFACs is to aggressively promote agribusiness project development in their respective States.
Management: The Society is governed by Board of Management which is chaired, ex-officio, by Hon’ble Union Minister for Agriculture and Farmers Welfare as the President and the Secretary, Department of Agriculture, Cooperation and Farmers Welfare, Government of India, is the ex-officio Vice-President.
The main functions of SFAC are: Promotion of development of small agribusiness through VCA scheme. Helping formation and growth of Farmer Producer Organizations (FPOs) / Farmer Producer Companies (FPCs). Improving availability of working capital and development of business activities of FPOs/FPCs through Equity Grant and Credit Guarantee Fund Scheme. Implementation of National Agriculture Market (e-NAM) Electronic Trading platform.
Reliance Industries Ltd Chairman and Managing Director Mukesh Ambani has come out strongly in favour of storing data locally and not putting it “especially” in the hands of foreigners.
What’s the issue?
Data localization is a sensitive issue the world over and more so in India, given that this is a country of 1.3 billion people with over 1 billion mobile users. With technology developing rapidly, more and more devices becoming smarter and the Internet of Things taking over, a genuine concern around leakage of private data has gained ground.
What does Data Localization mean?
Data localization is the act of storing data on any device that is physically present within the borders of a specific country where the data was generated.
Why data localization is necessary for India?
For securing citizen’s data, data privacy, data sovereignty, national security, and economic development of the country.
Recommendations by the RBI, the committee of experts led by Justice BN Srikrishna, the draft ecommerce policy and the draft report of the cloud policy panel show signs of data localisation. The extensive data collection by technology companies, has allowed them to process and monetize Indian users’ data outside the country. Therefore, to curtail the perils of unregulated and arbitrary use of personal data, data localization is necessary. Digital technologies like machine learning (ML), artificial intelligence (AI) and Internet of Things (IoT) can generate tremendous value out of various data. It can turn disastrous if not contained within certain boundaries. With the advent of cloud computing, Indian users’ data is outside the country’s boundaries, leading to a conflict of jurisdiction in case of any dispute. Data localization is an opportunity for Indian technology companies to evolve an outlook from services to products. International companies will also be looking at the Indian market, and this will benefit the growth of the local ecosystem. More data centres in India could mean new, power-hungry customers for India’s renewable energy market. That means Data localisation could boost India’s renewable energy.
Policies that imply data localization:
The Srikrishna Committee wants to localise data for law enforcement to have easy access to data, to prevent foreign surveillance, to build an artificial intelligence ecosystem in India, and because undersea cables through which data transfers take place are vulnerable to attacks. In April, the Reserve Bank of India imposed a hard data localisation mandate on payment systems providers to store payment systems data only in India. Barring limited exceptions, telecom service providers are not allowed to transfer user information and accounting information outside India. Goals set in the Draft National Digital Communications Policy 2018, and the Guidelines for Government Departments for Contractual Terms related to Cloud Storage 2017, draft e-commerce policy and the draft report of the cloud policy panel show signs of data localization.
TRAI new regulatory framework would make TV choices – ” à la carte “
“à la carte” means: If you eat à la carte, you choose each dish from a separate list instead of eating a fixed combination of dishes at a fixed price
Reasons for new TRAI regulatory guidelines: To address the issue of transparency in cable service and to provide real choice to consumer unrealized since Digitization of cable TV network in March, 2017
Salient Features of TRAI regulatory guidelines:
New guidelines will come into effect from February 1, 2019. Applicable to all Direct to Home (DTH) and Local cable operators. Customers could choose set of channels they want to view rather than pre decided packs provided earlier by service providers. Customer needs to pay only for channels chosen. MRP of channels should be display on TV screen through Electronic Program Guide. Additionally, Distributors and Broadcasters can provide bouquets of channels but with price transparency. Network Capacity Fees with upper ceiling of Rs 130/ 100 channels. High definition channel will be counted as two Standard definition channel for determining network capacity fees. Subscribers with advanced payment could not be charged higher and would be adjusted if they want to switch to new package wrt February 1, 2019
Benefits of TRAI regulatory guidelines:
Provide real choice to consumers by allowing them to choose channels set they want to view. Transparency in cable price through on screen display would reduce monthly cable/DTH bill. Covers all cable operators providing uniform regulatory standard. Some educational channels like Swayam Prabha 32 DTH channels would be get wide viewer base. Provides equal opportunities for all channel for consumer choices
RBI eases norms for external commercial borrowing
Reserve Bank of India has decided to liberalise external commercial borrowing (ECB) norms.
Removed the sector-wise limits: RBI has allowed all eligible borrowers to raise up to $750 million per financial year ECBs under the automatic route, replacing the existing sector-wise limits.
List of borrowers expanded: The list of borrowers has been expanded to include all entities eligible to receive FDI.
List of lenders expanded: Any entity who is a resident of a country which is financial action task force compliant, will be treated as a recognised lender.
Maturity of borrowings: RBI has revised minimum average maturity period at 3 years for all ECBs, irrespective of the amount of borrowing, except for borrowers specifically permitted to borrow for a shorter period. Earlier, the minimum average maturity period was five years.
ECBs: An external commercial borrowing(ECB) is an instrument used in India to facilitate the access to foreign money by Indian corporations and PSUs (public sector undertakings). ECBs include commercial banks loans, buyers’ credit, suppliers’ credit, securitised instruments such as floating rate notes and fixed rate bonds etc., credit from official export credit agencies and commercial borrowings from the private sector window of multilateral financial institutions such as International Finance Corporation (Washington), ADB, AFIC, CDC, etc. ECBs cannot be used for investment in Stock Market or speculation in real estate.
The DEA (Department of Economic Affairs), Ministry of Finance, Government of India along with Reserve Bank of India, monitors and regulates ECB guidelines and policies. For infrastructure and greenfield projects, funding up to 50% (through ECB) is allowed. In telecom sector too, up to 50% funding through ECBs is allowed. Recently Government of India allowed borrowings in Chinese currency yuan. Corporate sectors can mobilize USD 750 million via automatic route, whereas service sectors and NGO’s for microfinance can mobilize USD 200 million and 10 million respectively. Borrowers can use 25 per cent of the ECB to repay rupee debt and the remaining 75 per cent should be used for new projects. A borrower can not refinance its entire existing rupee loan through ECB. The money raised through ECB is cheaper given near-zero interest rates in the US and Europe, Indian companies can repay part of their existing expensive loans from that.
Impact of the decision:
Higher funds availability: The step would increase the funds availability in India as until now RBI had capped funds raised via ECBs at 6.5% of GDP.
Ease of doing business: The move will lead to increase in EoDB in India.
Ease to cash-strapped companies: The move will bring more liquidity to cash strapped sectors and Indian airlines sector like currently struggling Jet Airways.
Skill development and National Skills Qualification Framework (NSQF)
NSQF is an important component of Skill India Programme and improvements in NSQF can realize the aims of Skill India.
NSQF: This organises all qualifications/courses according to a series of levels of knowledge, skills and aptitude, in 10 levels. It is similar to classes in schools, for instance, level 1 corresponds to Class 9 (because vocational education begins in secondary school). Levels 2, 3 and 4 correspond to Classes 10, 11 and 12, respectively. Levels 5-7 correspond to undergraduate education, and so on. The Ministry of Skill Development has mandated all training/educational programmes/courses be NSQF-compliant. It has mandated that all training and educational institutions must define eligibility criteria for admission to various courses in terms of NSQF levels.
India Skills 2018:
It is a national skill competition organized by Ministry of Skill Development and Entrepreneurship (MSDE). Twenty-seven States participated in India Skills 2018, held in Delhi. Maharashtra secured maximum medals, followed by Odisha and Delhi. India Skills was open to government industrial training institutes, engineering colleges, Skill India schemes, corporates, government colleges, and school dropouts.
Five pillars/sources of skill training in India:
The secondary schools/polytechnics.
Industrial training institutes.
NSDC funded private training providers offering short-term training.
16 Ministries providing mostly short-term training.
Employers offering enterprise-based training.
A majority of the participants in India Skills, 2018 were from corporates (offering enterprise-based training) and industrial training institutes. Neither industrial training institutes nor corporates’ courses are aligned with the NSQF. Less than 20% participants were from the short-term courses of the NSDC which are NSQF compliant. If India Skills 2018 was only open for the NSQF-aligned institutions, it would have been a big failure.
Problems facing NSQF:
Unlike general academic education, where certain level of certification is required before further progression is permitted, there is no clear definition of the course curriculum within the NSQF that enables upward mobility. There is no connection of the tertiary level vocational courses to prior real knowledge of theory or practical experience in a vocational field. Efforts to introduce new Bachelor of Vocation and Bachelor of Skills courses were made, but the alignment of these courses was not completed. Lack of alignment between the HRD Ministry (responsible for the school level and Bachelor of Vocation courses) and the Ministry of Skill Development (responsible for non-school/non-university-related vocational courses). There are too many Sector Skill Councils in India and each is not comprehensive, like we have four SSCs for manufacturing but they are treated as one in World Skills courses.
Rupee pact with Iran to aid pharma exports:
India and Iran has signed Rupee Payment Agreement which can boost pharma export to Iran
Rupee Payment Agreement: Under the agreement Indian oil refiners deposits their import bill payment in designated account maintained by UCO bank. 50% of amount credited could be utilized by Iran to pay for imports of goods and services from India
India’s Pharma Sector Opportunities in Iran: Iran meets its total 20% import from european countries which is under concern after US sanctions against Iran. Under US sanctions some countries including India got time bound exemption for importing oil which could be used by India to boost pharma export. India could be source of cost effective products for sanction hit Iran
SEBI Regulations and their attempt to limit Insider Trading
SEBI lays down mechanism to prevent insider trading on the recommendations of the TK Viswanathan committee
What is Insider Trading: Insider trading is the buying or selling of a security by someone who has access to nonpublic information about the security. Insider trading can be illegal or legal depending on when the insider makes the trade. It is illegal when the material information is still nonpublic. The term ‘insider’ has been defined under Regulation 2(e) of SEBI (Prohibition of Insider Trading) Regulations, 1992. Basically, the term ‘insider’ can be classified into three broad categories, which are:
Persons who are connected to the company, Persons who were connected with the company, Persons who are deemed to be connected to the company.
In order to become an insider a person has to fulfil three elements:
The person should be a natural person or legal entity; The person should be connected person or deemed to be connected; Acquisition of the unpublished price sensitive information by virtue of such connection.
Mechanism to prevent insider trading
According to SEBI Promoters will be held responsible for violation of insider trading norms, if they possess unpublished price-sensitive information (UPSI) regarding the company without any “legitimate purpose“.
Legitimate purpose – Sharing of the UPSI by an insider with partners, collaborators, lenders, customers, suppliers, merchant bankers, legal advisors, auditors, insolvency professionals or other advisors or consultants, provided that such sharing has not been carried out to evade or circumvent the prohibitions of these regulations. The board of directors to maintain digital database containing the names of such persons or entities with whom the information is shared. A promoter who does not hold any position on the board will not be considered a person having “Legitimate Purpose” to hold UPSI. Advisors who need access to UPSI, needs to be informed that the information shared with them is insider information and they should apply it only for the purpose meant. Identification data of recipients must be maintained.
Cases under spotlight
Cyrus Mistry, the former Chairman of Tata Sons, had alleged that information related to Tata group companies was being shared with Ratan Tata.
Recommendation of Kotak committee
Committee has recommended flow of unpublished price sensitive information (UPSI) shall be considered for ‘legitimate purpose’, and not an offence under the SEBI (Insider Trading) for those who:
Is part of the promoter group. Has a nominee director on the board. The information should be pursuant to a formal agreement in accordance with the regulations. Communication of information must comply with the Insider Trading Regulations.
Government approves Capital Infusion to the Exim Bank
The Union Cabinet headed by Prime Minister Narendra Modi has approved a capital infusion of Rs 6,000 crore in state-owned Export-Import Bank of India (Exim) to expand its business.
How the capital infusion would be made?
Key facts about the capital infusion proposal are:
The government would issue recapitalisation bonds to the tune of Rs 6,000 crore for capital infusion of Exim Bank.
The capital infusion would take place in two tranches of Rs 4,500 crore in 2018-19 and Rs 1,500 crore in 2019-20 respectively.
The government has also approved an increase in the bank’s authorised capital from Rs 10,000 crore to Rs 20,000 crore.
Authorised capital refers to the maximum amount of capital for which shares can be issued by a company. The Authorised capital would be mentioned in the Memorandum of Association of the Company and can be increased at any time in future. The capital infusion and increase in authorised capital give an impetus to new initiatives such as supporting Indian textile industries, likely changes in the Concessional Finance Scheme, likelihood of new letters of credit in future in view of the country’s active foreign policy and strategic intent. This will have a positive impact on increasing the exports of India.
Export-Import Bank of India (Exim Bank)
Exim Bank is a premier export finance institution of India. It was established in 1982 under the Export-Import Bank of India Act to promote the Indian exports. Exim Bank assists the Industries across wide avenues like import of technology, export product development, export production, export marketing, pre-shipment and post-shipment and overseas investment.
Union Cabinet approves expansion of Numaligarh refinery in Assam
The Cabinet Committee on Economic Affairs has given its approval for the capacity expansion project of Numaligarh Refinery from 3 MMTPA (Million Metric Tonne Per Annum) to 9 MMTPA. The expansion project involves setting up a crude oil pipeline from Paradip in Odisha to Numaligarh and product pipeline from Numaligarh to Siliguri in West Bengal. The expansion is expected to be completed by within a period of 48 months, after approval and receipt of statutory clearances.
Funding the Project
The estimated cost of the project is Rs. 22,594 crore. The Numaligarh Refinery will raise a debt of Rs.15,102 crore and would contribute Rs.2,307 crore from its internal accrual. The promoters of NRL, Bharat Petroleum Corporation Ltd, Oil India Ltd & Government of Assam (GoA) will contribute to equity and the government of India would provide a Viability Gap Funding of Rs.1,020 crore.
Numaligarh Refinery Limited (NRL)
Numaligarh Refinery Limited (NRL) was set up at Numaligarh in the district of Golaghat (Assam) in accordance with the provisions made in the historic Assam Accord. The NRL was conceived as a vehicle for speedy industrial and economic development of the region. The promoters of the NRL are Bharat Petroleum Corporation Ltd, Oil India Ltd & Government of Assam (GoA). The expansion of the NRL will aid in meeting the deficit of petroleum products in the North East and also sustain the operations of all North East refineries by augmenting their crude availability. Together with generating direct and indirect employment in Assam and it is the driver of Government’s Hydrocarbon Vision 2030 for the North East.
Will Goods and Services Tax help in the doubling of farm income?
Article discuss about impact of Goods and Services Tax regime on agriculture sector. The agricultural sector continues to remain the largest contributing sector to the GDP with a share of 16%. The onset of GST has created national market for agricultural goods with a clear and hassle-free supply chain which would lead to the free movement of agri-commodities across India. Further, the promotion of the National Agriculture Market (NAM) by the Centre in accordance with the GST has created scope for increased transparency and impartial trade of agri-commodities without the restrictions of multiple taxation. Implementation of GST and the opening of foreign direct investment (FDI), especially in the food processing, has enabled the growth of the industry and raised market potential to grow over 12-13% percent in 2018. GST has helped the government in moving a step closer towards making the country a unified common market.
Positive impact of GST on Agriculture Sector:
Improved supply chain mechanism – The tax regime has reduced the tax burden on the farming sector with the exemption on GST on storage and warehousing of agricultural produce and created an opportunity for farmers to sell the produce at the best available price and reduced the imminent storage-related food loss.
Input Tax Credit – GST would provide each trader, the input credit for the tax paid on every value addition. This will create a transparent, hassle-free supply chain which would lead to free movement of agri-commodities across India.
Reduced Transportation time – Agricultural goods are perishable in nature and thus are often influenced by the amount of time taken in its transportation. The implementation is expected to boost the agricultural market as taxation under a subsumed single rate would make the movement of agricultural commodities hassle free
Tax Exemption – GST being a consumption-based tax, it will be levied only when food products are sold by the manufacturer and not when they are manufactured unlike the earlier imposed excise duty.
Reduced Interstate Tax – Government to drop the 1% interstate tax on stock transfers has reduced the amount of working capital required by companies.
Easing Interstate Trading – Interstate trading of a particular product often is subjected to various taxes, permission, license required for different states at every point of their transaction which has often created hindrance in trading of products. So implementing GST would be the first step towards liberalizing the marketing of agricultural products and creating a smooth transaction of goods.
Inclusion of more Agri product – GST has included tax related to trading in oilseeds, cereals etc. which previously were outside the tax structure and thus will benefit the consumers and processors by eliminating the negative impact of price on the trade of such products.
Negative Impact of GST on Agriculture Sector:
There are also speculations that implementation of goods and service tax would hike the price of agricultural products to between 0.61% to 1.18%
Doubling tax burden: Food items like meat, fish, poultry, grains, cereals, dairy products and milk, fruits, vegetables etc. were exempted from CENVAT and items like food grains and cereals were taxed at 4 percent under the state Vat. However, in current tax regime these food items are under purview of GST regime and highlighting the doubling of tax burden on the food sector.
For instance, there was no tax to procure milk from farmers. We only used to pay 2% Central Vat on sale of milk powder to a company. However, in GST regime, the tax can be 12.5% or 15% or 18%. There will be a straight cost hike in milk and milk product prices.
Reverse Charge: Most agri warehousing companies rent warehouses from small owners of the property. Such owners are likely to remain unregistered suppliers. However, such renting of warehouses by agencies engaged in providing storage and warehousing services is liable to GST under a reverse charge at the rate of 18 per cent. The tax burden will inevitably be passed on to farmers in the form of higher price for storing goods. This will directly feed into the cost of agricultural produce.
Modern infrastructure: Earlier, imports of project equipment used to create facilities to store agriculture commodities like mechanized handling systems and pallet racking systems attracted only a basic customs duty of 5% and were specifically exempt from countervailing duty. The same exemption has not been extended under GST. These imports now attract 18% IGST coupled with the existing 5% basic customs duty, This will result in a spike in the cost of imported machinery, deterring the creation of modern agri infrastructure.
Rise in cost of warehousing or cold storage construction : Earlier, most services pertaining to the construction of agri-storage infrastructure and food grain handling systems were exempt from service tax. With GST, the exemption list has been minimized.
The construction of warehouses as well as cold storages for agricultural produce are now liable to 18 per cent GST.
Efficiency gap in India’s power sector costs 4% of GDP: World Bank Report
The World Bank recently released a report titled ‘In the Dark: How Much Do Power Sector Distortions Cost South Asia’. As per the report, Efficiency gap in India’s power sector costs the Indian economy 4% every year, which equivalents to $86 billion in 2016FY.
Key Points of the Report:
The rural household’s income in India can be increased by $9.4 billion and business losses worth USD 22.7 billion can be eliminated with 24 hours access to power supply. There was a shortage of 14% in India in meeting coal demand in 2016FY. The average output per labour shift at Coal India’s underground mines was less than one ton in 2016FY, which is very less in contrast to 25 tonnes in the United States. Also, out of total 1o underground mines only one underground coal mine in India is mechanised. As per the World Bank Report, Electricity subsidies provided by the government and inefficient power generation, transmission, and distribution of the power play a major role in power shortages. In 2016, around 20% of electricity generated was lost during transmission and distribution. This rate is the highest loss rate in the world. Industrial electricity tariffs become less affordable and competitive due to power subsidies from to households and farmers. India provides subsidies on electricity for agriculture which has made India the world’s largest user of groundwater. The consumption of groundwater has increased by 700% from 1950 to 2014.
Recommendations in the report:
The report recommends reforms in the electricity sector to restore market pricing and improve efficiency. This will complement traditional investments to increase power supply and expand access to reliable electricity.
Reliable access to electricity will have a positive impact on Gender Equality by increasing women’s employment and girls’ study time. It will lead to lower use of kerosene lamps which would improve health and the environment.
Coal allocation and delivery need to be more efficient and competition in coal and electricity supply needs to be encouraged. Energy prices should be rationalised to reflect the actual cost of supply.
Incentives should be given for the promotion of more efficient power generation and delivery.
Social assistance should be provided to help people deal with higher energy prices.
India has made great progress in expanding access to power in recent years. However, many people still lack access to electricity and power shortages harm the economy and consumer well-being. India was at the 80th spot among 137 economies in the reliability of electricity supply as per the 2018 Global Competitiveness Report.
Packaging of foodgrain in jute bags made mandatory
The Centre has mandated the packaging of 100% of food grain and 20% of sugar in jute bags for 2018-19. The order follows the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act (JPM), which was enacted in 1987 to protect the jute sector from the plastic packaging segment. This is the first time since 2012-13 that 100% reservation had been announced for foodgrain. It was 90% last year. In case of sugar, the government has stipulated that diversified jute bags be used as traditional bags are not being preferred by the user-sector due to contaminants like jute fibre, batching oil moisture pick-up and sugar spillage. West Bengal and Andhra Pradesh are the two largest jute goods producers, Punjab is the largest procuring State. Gunny bags now account for about 63% of raw jute consumption. Initially there was reservation for sugar, cement, fertiliser and food grain packaging over time but certain sectors have been taken out of the ambit due seepage issue through materials.
Centre seeks ₹41,000 crore more to recapitalise banks
The Union government has sought Parliamentary approval to provide Rs 41,000 crore as a recapitalization fund to public sector banks during the current fiscal, 2018-19. The amount will be used for the “recapitalization of Public Sector Banks through issue of Government Securities“, and the details were given in Supplementary Demands for Grants. Once the proposal will be approved this would take the total recapitalization package for the current financial year to ₹1,06,000 crores, of which the government plans to utilise ₹83,000 crore over the remaining portion of the year. The government had announced a ₹2.11 lakh crore capitalization plan in October 2017, of which ₹1.35 lakh was to be raised through recapitalization bonds and the remaining was to be raised by the banks either through the market or the sale of non-core assets. So far, the banks have raised ₹24,400 crores and have received all approvals to raise more from the market.
Recapitalization: Recapitalization is restructuring a company’s debt and equity mixture, often with the aim of making a company’s capital structure more stable or optimal. Recapitalization of banks was necessary because the PSBs are facing financial problems and they need money in the context of rising bad debts. Similarly, they need funds to meet the higher capital requirements under Basel III norms. Altogether, there are following three sound reasons for recapitalization of PSBs.
Rising volume of bad assets has led to erosion of capital.
The Basel III capital norms requires higher capital in banks.
Expanding credit needs in the economy can be made only with higher capital.
Four Broad conditions under which banks are eligible to receive capital.: To meet the regulatory capital norms. The second is aimed at helping banks currently under the Prompt Corrective Action (PCA) framework to come out of it by improving their capital to risk-weighted asset ratios (CRAR) to 9%, their capital conservation buffers to 1.875% and reduce their net NPAs to 6%. The third category of banks to receive capital would be the non-PCA banks that are in danger of crossing the threshold into the PCA framework. The fourth would be to provide regulatory and growth capital to banks that are undergoing mergers, such as Vijaya Bank, Dena Bank, and the Bank of Baroda, which are to be merged into a single entity. The Finance Ministry says this expenditure will not have any impact on fiscal deficit and that the Union government will be able to keep the deficit at 3.3 percent of GDP. In context of recent demand for recapitalization fund the state-run banks are showing tremendous improvements in terms of recognition, provisioning, recovery and reforms. Therefore, it is important that Government empower them and equip them with capital so that banks are ready to support growth of the fastest growing economy
Following are the three modes of fund mobilization under recapitalization effort.
Budgetary allocations: Government buy shares of public sector bank.
Market Borrowings: PSBs mobilise fund from the market through borrowings.
Recapitalization Bonds: Government will issue Bank Recapitalization Bonds
It is time to re-evaluate the benefits of having a banking system dominated by public sector banks and the benefits that greater private ownership can bring about. Impact of recapitalisation could be bad on fiscal deficit of India as it may increase the fiscal deficit gap. The capital infusion will address the problem of stock of NPAs by cleaning up the balance sheet. It is equally important to ensure that the cycle of piling up of NPAs is not repeated. Emphasizes must be laid upon the steps to be taken to ensure governance of banks to follow highest standards. There is also a need for institutional mechanism to ensure the past is not repeated. Banks should not look for easy money like recapitalization. They need to earn and must adopt the differentiated business strategy and exit from non-core businesses and focus on their core competencies. According to the financial services secretary the government would come out with EASE (Enhanced Access & Service Excellence) Index for ranking of banks. This would increase public accountability of PSBs as independent agencies would evaluate and rank PSBs annually on reforms.
The regulatory architecture is globally framed by the Basel Committee on Banking Supervision—a committee of bank supervisors consisting of members from representative countries. Its mandate is to strengthen the regulation, supervision and practices of banks and enhance financial stability.
Category of of Basel Norms.
The Basel I norms were issued in 1988 to provide, for the first time, a global standard on the regulatory capital requirements for banks. The Basel II norms, introduced in 2004, further strengthened the guidelines for risk management and disclosure requirements.
Capital adequacy ratio (CAR)—or, capital to risk-weighted assets ratio (CRAR) as it is the ratio of regulatory capital funds to risk-weighted assets—which all banks with an international presence were to maintain. These norms were revisited again in 2010—known as Basel III norms— Are a comprehensive set of reform measures to strengthen the regulation, supervision, risks and capital management of the banking sector that evolved after the global financial crisis of 2008.
Govt to set up panel to look into tax issues faced by startups
The government to setup an expert committee to look into all the taxation issues being faced by startups and angel investors. The move comes after Income Tax Department issued notices to over 150 startups over the last few weeks asking them to clear taxes on their angel funding, which in some cases were nearly 40 percent of the fundraise. Central Board of Direct Tax recognizes that startups are going to bring a lot of innovation to the country and, therefore, no coercive action related to tax demands would be made till the time an expert panel resolved the issue of taxing startups. The 2012 budget speech prefaced the introduction of angel tax to curb the laundering of black money through private limited companies.
Background of Angel Tax: In May 2018, The tax department exempted angel investors from income tax on their investments in startups. The decision to give investors in start-ups exemption from income tax was aimed at addressing a key issue faced by angel investors who put money during early growth stage, and would also provide level-playing field for all investors. According to the notification, an angel investor with a minimum net worth of Rs 2 crore or an average returned income of over Rs 25 lakh in the preceding three financial years would be eligible for 100 per cent tax exemption on investments made into startups above fair market value. However, recently several startups had raised concerns over taxation of angel funds under Section 56 of the Income Tax Act, which provides for taxation of funds received by an entity.
Function of Expert Committee
The committee will make suggestions for recognition of startups under the “Start Up India” programme and premium paid by investors while investing in such companies. The committee will make recommendations on individual cases of recognised startups to the DIPP on issues pertaining to tax exemptions for such ventures. Committee will make recommendations on individual cases of recognised startups to the DIPP on issues pertaining to tax exemptions for such ventures. Members of angel networks expressed fears that this could kill the startup ecosystem. Industry leaders and startup founders.
Making India a Gas-based Economy
The Indian government is intending to move towards a gas-based economy by increasing the share of natural gas in India’s energy basket from the current 6-7% to 15% by 2022
What is gas-based economy?
Gas-based economy implies gas as the main commercial energy source in the energy mix of an economy
Advantages of Natural Gas for India
Environmentally clean: Natural gas as a fuel source is much “greener” than alternative fossil fuels. According to the Environmental Protection Agency (EPA), natural gas produces roughly half as much CO2 as coal and 32% less than oil.increased gas utilization is also expected to help India meet its intended nationally determined contributions (INDC) commitments under the Paris Agreement
In addition to emitting lower levels of CO2, natural gas emits far fewer pollutants into the air. For example, burning natural gas produces less than 1% of the amount of sulphur dioxide compared to coal or oil.
Economical/ Cost Efficient: Compressed Natural Gas (CNG) is 40%cheaper than Liquefied petroleum gas (LPG), 60% cheaper than gasoline and 45% cheaper than diesel. A 10% replacement of liquid fuel into gas will reduce India’s import bill by nearly $3billion every year.
Convenience: Gas is continuously fed into the system so there are no hassles of refilling. Further, it is piped, thus does not require any space to store, hence handling is easy, safe and secure
Possibility of Energy Independence: A gas-based economy would help India be less reliant on crude oil imports by substituting the use of oil products in industrial and residential applications.
Improved Access: Gas utilization would also help improve access to electricity and clean cooking for India’s growing population with unmet energy needs. According IEA, 2017, A total of 244 million Indians do not have access to electricity and 819 million do not have access to clean cooking fuel.
• Natural gas is a naturally occurring hydrocarbon gas mixture consisting primarily of methane, but commonly including varying amounts of other higher alkanes, and sometimes a small percentage of carbon dioxide, nitrogen, hydrogen sulphide, or helium.
• It is formed when layers of decomposing plant and animal matter are exposed to intense heat and pressure under the surface of the Earth over millions of years.
1. Liquefied Natural Gas (LNG): To overcome the transportation drawback, natural gas shipping takes place from available regions to other countries in liquid form. LNG has volume that is 1/600th of its original volume.
2. Compressed Natural Gas (CNG): Natural gas is compressed to 200 bar pressure so that the volume is almost 1% of the original. Unlike LNG, the plant, machinery, and investment required for CNG production is considerably less.
3. Liquefied Petroleum Gas( LPG): LPG production happens during the refining of crude oil. The composition is predominantly propane, butane, or a mix of these and other gases. In addition, extraction of LPG takes place directly from some of the oil wells. The calorific value is higher than the Natural gas in the range of 95 MJ /kg
Status of Natural Gas in India
India has 26 sedimentary basins covering 3.14 million sq. km of area. About 44 % of India’s total sedimentary basin area is on-land 56% is offshore. Only 22 % of the total area falls under the category “Moderately to well explored”. Exploration efforts have been initiated in 44 % of the area and the balance 34% remains poorly to completely unexplored.
Gas consumption in India is driven by five sectors: fertilizer (34% of total gas demand in fiscal year 2015-16), electric power (23%), refining (11%), city gas distribution, including transport (11%), and petrochemical (8%) industries.
Natural gas consumption varies widely by region across India. For example, the states of Gujarat and Maharashtra in the west and Uttar Pradesh in the north consume more than 65% of the India’s natural gas, while making up only 31% of the population. Gujarat consumes the highest percentage of natural gas.
Gas4India Campaign: It is a multimedia, multi-event campaign to communicate to people, the national, social, economic and ecological benefits of using natural gas as the fuel.
Hydrocarbon Exploration and Licensing Policy (HELP): It is a contractual and fiscal model for award of hydrocarbon acreages towards exploration and production (E&P). It provides a single, or uniform, license for the exploration and production of all conventional and unconventional hydrocarbons from an entire contract area.
NELP: New Exploration Licensing Policy (NELP) was created in 1997 ended the state dominance and created a competitive environment leading to liberalization of oil and gas exploration and production industry. However, it failed to keep the momentum of production growth and attracting the foreign investment and HELP was introduced to replace NELP
Open Acreage Licensing Policy (OALP): OALP, a part of HELP, is aimed at enabling faster survey and assessment of areas with oil and gas potential. It enables companies apply for particular areas they deem to be attractive to invest in, and the Centre then put those areas up for bids.
Discovered Small Field Policy: Launched in 2016, the policy aims at extracting the Oil, Natural gas from the un-monetized small oil/gas discoveries that are available in India
Sustainable Alternative towards Affordable Transportation (SATAT):It aims to promote Compressed Bio-Gas (CBG) as an alternative, green transport fuel. Under the scheme, public sector oil marketing companies will seek expression of interest from potential entrepreneurs to set up compressed bio-gas production plants and make it available in the market for use as auto fuel.
Compressed Biogas (CBG):
CBG is the purified form of biogas, without other gaseous impurities.In CBG production, biogas is cleaned of hydrogen & carbon-dioxide to produce 95% methane gas. This pure gas is compressed and bottled for transportation and usage.
National Seismic Programme of Un-appraised areas: Under the programme, Government has approved the proposal for conducting 2D seismic survey for data Acquisition, Processing and Interpretation (API) of un-appraised areas
Coal bed Methane Policy, 1997: It seeks to offer the blocks for exploitation of Coal Bed Methane (CBM) through open completive bidding system. In 2018, the government approved a framework for Coal Bed Methane extraction under which Coal India and its subsidiaries will be able to extract Coal Bed Methane from its mines without seeking approvals under the Petroleum & Natural Gas Rules 1959 (PNG Rules, 1959).
Pipeline Projects for Natural Gas
National Gas Grid: Since a National Gas Grid (NGG) was conceptualized in 2000, India has built more than 16,000km of gas network. Recent initiatives include:
a) Pradhan Mantri Urja Ganga Project (Jagdishpur – Haldia &Bokaro – Dhamra Pipeline Project (JHBDPL)): It seeks to cater to the energy requirements of Uttar Pradesh, Bihar, Jharkhand, Odisha and West Bengal.
b) Barauni to Guwahati Pipeline: The pipeline will pass through the Bihar, West Bengal, Sikkim & Assam
c) North East Region(NER) Gas Grid: It will pass through Assam, Sikkim, Mizoram, Manipur, Arunachal Pradesh, Tripura, Nagaland and Meghalaya in a phased manner
d) Kochi-Koottanad-Bangalore-Mangalore Pipeline (Phase-II): It will pass through Kerala and Tamil Nadu
e) Ennore-Thiruvallur-Bengluru-Puducherry-Nagapatinam-Madurai-Tuticorin Pipeline (ETBPNMTPL): It will pass through the State of Tamil Nadu, Andhra Pradesh & Karnataka.
International gas pipelines:
Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline,
the Iran-Pakistan-India pipeline (IPI) and
Iran-Oman- Russia and India- pipeline project
City Gas Distribution (CGD) Network:CGD refers to transportationor distribution of natural gas to consumers in domestic, commercial or industrial and transport sectors through a network of pipelines. Recently, the Indian Prime Minister laid Foundation Stones of City Gas Distribution (CGD) Projects in 65 Geographical Areas (GAs) in 129 Districts.
Lok Sabha passed the Consumer Protection Bill, 2018
The Lok Sabha has passed the Consumer Protection Bill, 2018 on 20th December 2018, which will replace the Consumer Protection Act, 1986. The Bill seeks to enforce consumer rights and to offer a mechanism for complaint redressal related to the deficiencies in goods and services.
Key points about the Consumer Protection Bill, 2018
The Consumer Disputes Redressal Commissions will be set up at District, State and National levels as per the bill passed.
The District Commissions will have the mandate to hear complaints having claim worth one crore rupees. In the Consumer Protection Act, 1986 this limit was 20 lakh rupees. The limit of the Commissions’ at the State level enhanced from 1 crore rupees to 15 crore rupees. Complaints above 15 crore rupees worth of claim will be settled by the National Commission. The Consumer Protection Bill, 2018 has provisions for stringent punishments in the matters of food adulterations. The Bill has the provisions to protect those consumers who use new digital technologies likes e-commerce and online shopping. The Bill seeks to establish a central consumer protection authority (CCPA) which will be tasked with promoting, protecting and enforcing consumer rights. The main objective of the said bill is to protect of the interests of consumers and to provide effective administration and timely settle consumer disputes. Now, the bill will move to Rajya Sabha for passage.
New Big Bank likely to emerge next year
It is expected the contours for the amalgamation of Bank of Baroda (BoB), Vijaya Bank and Dena Bank would be finalised soon and it would be placed before the parliament for approval in the ongoing winter session. The decision of amalgamation was taken by the Alternative Mechanism’ (AM) headed by Finance Minister Arun Jaitley, which included Railways Minister Piyush Goyal and Defence Minister Nirmala Sitharaman. The government has already set aside the funds to facilitate the amalgamation.
New Big Bank
The new entity from the amalgamation will have a combined business of Rs 14.82 lakh crore, making it the third largest bank after SBI and ICICI Bank. The net NPA ratio of the new entity will be at 5.71 per cent. This is significantly better than the public sector bank (PSB) average of 12.13 per cent. The Provision Coverage Ratio (PCR) would be better at 67.5 per cent against the average of 63.7 per cent and cost to income ratio would come down to 48.94 per cent as compared to average 53.92 per cent.Capital Adequacy Ratio (CAR) at 12.25 per cent will be significantly above the regulatory requirement of 10.87 per cent.
Net NPA Ratio
Net NPA Ratio is an indicator of the overall quality of the bank’s loan book. Net NPA ratio is the ratio of Net NPA to loans given.
Provision Coverage Ratio (PCR)
Provision Coverage Ratio refers to the prescribed percentage of funds to be set aside by banks for covering prospective losses due to bad loans.
Cost to Income Ratio
Cost to Income Ratio is an important parameter to determine the profitability of the banks. It is calculated by the dividing the operating expenses of the bank by the net income of the bank (Interest Income + other Income).
Capital Adequacy Ratio (CAR)
Capital Adequacy ratio is the measure of the bank’s available capital. It is expressed as a ratio of a percentage of a bank’s risk-weighted credit exposures.
Six IT Firms in race to for setting up Public Credit Registry
The Reserve Bank of India (RBI) has shortlisted six major IT firms to set up a wide-based digital Public Credit Registry (PCR) for capturing details of all borrowers and wilful defaulters. The RBI will now seek request for proposal from the six vendors.
Shortlisted IT Firms
The firms shortlisted by the RBI are TCS, Wipro, IBM India, Capgemini Technology Services India, Dun & Bradstreet Information Services India, and Mindtree Ltd.
Public Credit Registry
Public Credit Registry is a digital registry of authenticated granular credit information and will work as a financial information infrastructure providing access to various stakeholders and enrich the existing credit information ecosystem. It would be mandatory for reporting for all material events for each loan, notwithstanding any threshold in the loan amount or type of borrower to the Public Credit Registry. The public credit Registry will also allow borrowers to access their own credit information and seek corrections to the credit information reported on them.
Why there was a need of Public credit registry?
At present, there are multiple granular credit information repositories in India, with each having somewhat distinct objectives and coverage. Lack of integrated comprehensive information had become a bottleneck in tackling bad loans. Public credit registry will fill this gap.
Credit Management in India
Within RBI, CRILC (Central Repository of Information on Large Credits) is a borrower-level supervisory dataset that keeps the record of loans of Rs 5 crore and above. In India, there are four privately owned credit information companies (CICs). They are CIBIL, Equifax, Experian and High Mark Credit Information Services. The RBI has also mandated all its regulated entities to submit credit information individually to all four CICs.