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7th Pay Commission allowances: Panel submits report to FM Jaitley; govt employees set to get HRA hike of up to 178%

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7th Pay Commission allowances: Panel submits report to FM Jaitley; govt employees set to get HRA hike of up to 178%

Posted on 28 April 2017 by GGS News

New Delhi : A high-level committee headed by Finance Secretary Ashok Lavasa, tasked with examining the Seventh Central Pay Commission’s (7th CPC) recommendations on allowances, submitted its report to Finance Minister Arun Jaitley on Thursday.

The report will now be examined by an empowered group of secretaries after which it will be taken up by the Union Cabinet, said a senior government official. The outlay for allowances for the 4.7 million central government employees is expected to be around Rs 29,000 crore, as forecast by the pay panel.

In June last year, after implementing the CPC proposals on salary and pension, Jaitley had announced the Lavasa panel to examine the suggestions on allowances. The panel was to submit its report by October.
The decision on allowances was postponed because the CPC wanted a number of these to be abolished or subsumed, which employees’ unions opposed. A deferment on revising of allowances meant that as opposed to a burden of Rs 1.02 lakh crore as envisaged by the CPC, the government provisioned for Rs 84,933 crore in 2016-17 for pay and pension, including Rs 12,000 crore in arrears.

There are other recommendations on allowances which the Lavasa panel has examined. These include a change in the present system of accounting, wherein pay and allowances are clubbed and it is difficult to bifurcate them. The CPC recommended a separate object head for budgeting and accounting be used to record the expenditure.

Financial year change

A senior official said the Modi government was examining the benefits and drawbacks of changing the financial year from April-March to January-December. This comes after the Prime Minister, at the NITI Aayog’s governing council meeting last weekend, told chief ministers of the states that there had been suggestions to follow January-December as the financial year and the proposal should be considered.

“We will now do a cost-benefit analysis of (year ending) March 31 versus December 31,” said the official.

If a change was decided upon, the official added, it would be applicable to the Centre, states and the private sector.

A panel headed by former Chief Economic Advisor Shankar Acharya was entrusted with the task of recommending whether such a switch was feasible. The panel has submitted its report to the government but it was not made public. Jaitley said in Parliament during the last session that the government was studying the recommendations.

BT |

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GST to push Indian growth to over 8 per cent: IMF

GST to push Indian growth to over 8 per cent: IMF

Posted on 28 April 2017 by GGS News

Washington : The ambitious Goods and Services Tax to be implemented from July 1 would help raise India’s medium-term growth to above eight per cent, the International Monetary Fund has said adding that the reforms being done is expected to pay off in terms of higher growth in the future.
“The government has made significant progress on important economic reforms that will support strong and sustainable growth going forward,” Tao Zhang, Deputy Managing Director of the International Monetary Fund, told PTI in an exclusive interview.
“We expect that the goods and services tax (GST), which is targeted to be applied starting in July, will help raise India’s medium-term growth to above 8 per cent, as it will enhance production and the movement of goods and services across Indian states,” the IMF official said.
“We are extremely impressed by the work that is being done and that we expect it will pay off in terms of higher growth in the future,” he said in response to a question on the reforms being undertaken by the Indian Government.
Observing that India is the “fastest growing emerging market economy” in a region that remains the strongest-growing in the world, Zhang said the IMF believes that India is going to continue to grow at a fast pace, with a projected 6.8 per cent rate for Financial Year 2016/17 and 7.2 per cent in 2017/18.
Lower global oil prices have boosted economic activity, and helped lower inflation.
In addition, fiscal and monetary policies have helped foster economic stability, he said. “The currency exchange initiative led to a slowdown in economic activity.
However, there are initial signs of recovery as the currency exchange has been progressing well,” said Zhang, who assumed the role of Deputy Managing Director at the IMF on August 22, 2016.
Zhang, who worked at the World Bank from 1995 to 1997 and at the Asian Development Bank from 1997 to 2004, said a key concern for the IMF in India is the health of the banking system, “which is still dealing with a large amount of bad loans”, as well as “heightened corporate vulnerabilities” in several key sectors of the economy.
“As India persists with its strong reform efforts, labour market reforms should take priority,” he noted.
These would facilitate greater and better quality jobs, raise female labour force participation, and enhance the impact of recent product market reforms, he observed.
“While there has been important progress generally, we see scope to pursue better targeting and greater efficiency of subsidy and social spending programs through greater use of the trio of Aadhaar unique beneficiary identification, direct benefit transfers, and information technology,” Zhao said.
“Finally, more could be done to raise agricultural productivity and enhance market efficiency. This would help increase the supply of high-value foods, enhance returns to farmers, and dampen food inflation pressures,” said the IMF official responding to a question.

PTI |

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More trouble for Indian IT professionals: After US, Singapore tightens visa norms

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More trouble for Indian IT professionals: After US, Singapore tightens visa norms

Posted on 03 April 2017 by GGS News

New Delhi : After the United States, Indian techies are now finding it difficult to procure visas to work in Singapore, following which the government has put on hold the Comprehensive Economic Cooperation Agreement (CECA), the Times of India reported on Monday.
Indian companies have reportedly been advised to hire locally, promoting the firms to mull a move to other countries in the region, the report said.his (visa problem) has been lingering for a while but since early-2016, visas are down to a trickle. All Indian companies have received communication on fair consideration, which basically means hiring local people,” Nasscom president R Chandrashekhar told Times of India.
India is currently engaged with the Donald Trump administration in the US as well as members of the US Congress on concerns regarding the H-1B visa issue.
Trump’s executive order not only strangulates H-1B and L1 visas, but also increases inspector raj and ends employment authorisation cards to spouses on such work visas, which was recently introduced by the previous Obama Administration.
The H-1B is a non-immigrant visa that allows American firms to employ foreign workers in occupations that require theoretical or technical expertise. It is highly popular among Indian techies and the technology companies depend on the programme to hire tens of thousands of employees each year.

News18 |

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ATMs, credit, debit cards set to disappear: Niti Aayog CEO

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ATMs, credit, debit cards set to disappear: Niti Aayog CEO

Posted on 01 April 2017 by GGS News

New Delhi : With India embracing applications of technologies at an accelerated pace, digital transactions will be done through mobile wallets and biometric modes and credit and debit cards as also ATMs were set to disappear, NITI Aayog CEO Amitabh Kant has said.
“Technology will be a key driver of India’s growth,” Kant said while launching the Trade and Investment Facilitation Services (TIFS) of the PHD Chamber of Commerce and Industry (PHDCCI) here on Friday evening.
“Physical banking in India is almost dead and it is adopting pervasive technologies with such an accelerated pace that in next three to four years, the digital transactions would move through mobile wallet and biometric modes,” he said. “Credit cards, debit cards and ATMs will disappear.”
Kant said that India was growing 7.6 per cent annually in the midst of a very barren barren economic landscape across the world.
“The population in America and Europe will keep getting older while that of India will keep getting younger,” he said.
In terms of ease of doing business, he said that in the last year “we scrapped 1200 laws”.
‘INDIA WILL NEVER TALK OF PROTECTIONISM’
Stating that India was larger than 24 European countries, Kant said that states should appear as champions of growth.
He declared that India would continue to globalise and dismantle rules and regulations that adversely affected inbound investments. It would also create conditions for expansion of its economy.
“Despite (US President Donald) Trump talking of protectionism (of US economy), there is no talk of protectionism here,” the NITI Aayog CEO said.
“India believes in globalisation and it will continue to globalise and shall never talk of protectionism. As a result, it will emerge as an economy that would attract investments and growth and make India a hub of economic engagements par excellence.”
Stating that there is energy and dynamism in the young start-up sector, he said that India has become the centre of innovation in many ways.
“Around 1500 companies have located their innovation centres in Hyderabad and Bangalore… India is the centre of frugal engineering.”
Kant also said India would see a lot of urbanisation in the times to come and technology would play a key role in this.
‘COMPETITION BETWEEN STATES HEALTHY’
Speaking on the occasion, Amar Sinha, Secretary (Economic Relations) in the Ministry of External Affairs, said that it was healthy sign that states were competing with each other in terms of growth.
But he advised Indian industries to look outside as there were huge opportunities lying there.
“There are new opportunities in Africa and the Gulf,” he said, adding that India’s focus would be on energy and food security and manufacturing.
Canadian High Commissioner to India Nadir Patel, who was also present, said that India-Canada bilateral ties were at the highest point.
He attributed this to Prime Ministers Narendra Modi and Justin Trudeau “connecting well” with each other.
But he lamented that two-way trade between India and Canada stood at only $8 billion and said that this has to increase.
US Acting Deputy Chief de Mission George N. Sibley said that India-US cooperation would help the whole world.
“We have held two government-to-government strategic commercial dialogues,” Sibley said. “We consider the prosperity of India is in our national interest.”
PHDCCI President Gopal Jiwarajka said that the newly launched TIFS would provide a valuable and qualitative aid to international investment in India.
He said that TIFS would provide a secure and personalised single entry point to all trade and investment related information in the Indian economy, which has the potential to become a $100-billion investment destination by 2022.

IANS |

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ED raids shell companies across 100 locations in 16 states

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ED raids shell companies across 100 locations in 16 states

Posted on 01 April 2017 by GGS News

New Delhi : The Enforcement Directorate (ED) on Saturday launched a country-wide operation and conducted searches at 100 locations in 16 states as part of its crackdown on shell companies.

Officials said multiple teams of the ED on Monday visited these locations and raided the premises of about 300 shell firms in prominent places like Delhi, Chennai, Kolkata, Chandigarh, Patna, Ranchi, Ahmedabad, Bhubaneswar and Bengaluru among others.They said the action is being carried out under the provisions of the Prevention of Money Laundering Act (PMLA) and the Foreign Exchange Management Act (FEMA) to check instances of money laundering and illegal foreign exchange transactions.

The action is part of the mandate given to the ED under a Special Task Force (STF) that was recently created by the government on the directions of the Prime Ministers Office (PMO).

The agency has recently attached assets worth crores of such firms in the last over a week’s time.

Shell companies are defined as those firms, which are set up by nominal paid-up capital, high reserves and surplus on account of receipt of high share premium, investment in unlisted companies, no dividend income, high cash in hand, private companies as majority shareholders, low turnover and operating income, nominal expenses, nominal statutory payments and stock in trade and minimum fixed asset.

PTI |

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Breakiing  Petrol price cut by Rs 3.77 per litre and diesel by Rs 2.91 per litre from midnight tonight

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Breakiing Petrol price cut by Rs 3.77 per litre and diesel by Rs 2.91 per litre from midnight tonight

Posted on 31 March 2017 by GGS News

New Delhi : India’s oil marketing companies today cut petrol price by Rs 3.77/litre and diesel by Rs 2.91/litre following the fluctuations in crude prices which have been swinging between the push and pull from coordinated output cuts by major producers on one side, and rising US stockpiles on the other. The new prices will be effective from midnight tonight.
The three state-run oil marketing firms – Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp review retail fuel prices periodically and usually revise them every fortnight to pass on the impact of global crude oil prices on their purchases.
OPEC (Organisation of Petroleum Exporting Companies) and other major oil producers of the world in November agreed to trim output to help balance the markets and provide a support to falling prices. OPEC, a group of 13 oil producing nations, decided on November 30 to cut global crude oil output by 1.2 million barrels per day. It was first such agreement between these producers since 2008.
Oil has mostly traded above $50 a barrel since OPEC and 11 other countries started trimming supply in January, recently falling to a three-month low as simultaneous revival in US shale drilling offset the OPEC cuts. The rise in prices was recorded after Saudi Arabia said 80% of the agreed cuts have been achieved since the deal became effective on January 1, before falling again in the most recent trading sessions, as the drilling in the US climbing to highest in a year countered OPEC’s efforts to limit the supply.
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Brent crude fell 53 cents to $52.43 a barrel on Wednesday. The price of Indian basket of crude oil has risen to $53.7/bbl for the fortnight of March 16, from $53.05/bbl on January 15, when the last revision was done. Though, the rupee, which has appreciated against the US dollar in recent trading sessions, takes some of the pressure off Indian buyers. The Indian basket of crude oil comprises sour grade (Oman & Dubai average) and sweet grade (Brent dated) of crude oil processed in Indian refineries in the ratio of 71.03:28.97.
Petrol to cost more in Goa from April 1
The petrol price in Goa will go up by almost Rs 5 per litre from midnight tonight. The hike will be on account of an increase in value added tax (VAT) on the fuel announced in the budget presented in the assembly last week by the new BJP-led government. The oil companies, which are selling petrol in Goa at an average price of Rs 60 per litre, will have to hike the rate by Rs 5 per due to an 8 per cent increase in VAT notified by the government. The VAT on petrol has been raised from 7 per cent to 15 per cent from April 1. “The price of petrol in the state would be around Rs 65 per litre,” Paresh Joshi, President, All Goa Petrol Pump Dealers Association, told PTI. There are a total of 110 petrol pumps run by oil PSUs in the coastal state.
With agency inputs
Now, as the global crude oil prices have started sliding on the back of rising output in the US partly offsetting the cuts by OPEC and other major producers, Indian oil refiners may find room to extend the cut in retail fuel prices in the coming fortnight. This may be further aided by the recent rebound in rupee against dollar after Prime Minister Narendra Modi-led BJP’s landslide win in UP state elections. However, inventories stockpiled in recent weeks at higher prices may weigh on the Indian oil companies.

IE/PTI |

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Govt slashes interest rates on small saving schemes

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Govt slashes interest rates on small saving schemes

Posted on 31 March 2017 by GGS News

New Delhi : The government has lowered interest rates on small saving schemes like PPF, Kisan Vikas Patra and Sukanya Samriddhi scheme by 0.1 per cent for the April-June quarter, a move that would prompt banks to cut their deposit rates.

For April-June, these have been lowered by 0.1 per cent across the board compared to January-March. However, interest on savings deposits has been retained at 4 per cent annually.

Since April last year, interest rates of all small saving schemes have been recalibrated on a quarterly basis.

A finance ministry notification said investments in the public provident fund (PPF) scheme will fetch lower annual rate of 7.9 per cent, the same as five-year National Savings Certificate. The existing rate for these two schemes is 8 per cent.

Kisan Vikas Patra (KVP) investments will yield 7.6 per cent and mature in 112 months.

The one for girl child savings, Sukanya Samriddhi Account Scheme, will offer 8.4 per cent annually, from 8.5 per cent at present, while it will be the same at 8.4 per cent for the 5-year Senior Citizens Savings Scheme. The interest rate on the senior citizens scheme is paid quarterly.

Term deposits of 1-5 years will fetch a lower 6.9-7.7 per cent that will be paid quarterly while the 5-year recurring deposit has been pegged lower at 7.2 per cent.

“On the basis of the decision of the government, interest rates for small savings schemes are to be notified on a quarterly basis,” the ministry said while notifying the rates for the fourth quarter of 2016-17 starting from April 1, 2017.

While announcing the quarterly setting of interest rates, the ministry had said the rates of small saving schemes would be linked to government bond yields.

The move is expected to prompt banks to lower the deposit rate in line with the small savings rate as offered by the government.

PTI |

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H-1B visa system needs ‘common sense’ reforms: Congressman Khanna

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H-1B visa system needs ‘common sense’ reforms: Congressman Khanna

Posted on 30 March 2017 by GGS News

Washington : Indian-American Congressman Ro Khanna has said the US needs to “remain open” to immigrants who contribute to creating jobs and help shape the economy, as he called for “common sense” reforms in the H-1B visa system.Khanna, who represents the Silicon Valley where a large number of Indians and other immigrants work, said many Americans believe the H-1B visa programme needs to be reformed.
“Of course, we have to end the abuses. We shouldn’t have companies that have more than 50 per cent H-1B visas and we should make sure that they are paid the prevailing wage,” Khanna, a first-time Congressman, told PTI in an interview.
“These are common sense reforms that even people like Venk Shukla (TiE Silicon Valley leader) and many Americans believe in, let’s fix the system, end the abuses but make sure we recognise the role of immigrants in creating jobs,” he said.
The H-1B is a non-immigrant visa that allows American firms to employ foreign workers in occupations that require theoretical or technical expertise. It is highly popular among Indian techies and the technology companies depend on the programme to hire tens of thousands of employees each year.
Khanna, who was elected to the US House of Representatives last November and was sworn in as a Congressman this January, said, “We have to remain open to immigration, people coming here who can contribute jobs and help the economy.” Khanna also pushed for strong relations between India and the US, in particular the trade ties.
“There’s a strategic partnership in advancing market security interests. India provides a large export market for American products with a large growing middle class. That can help create jobs in the United States,” he said.
“They both share values of democratic pluralism of a respect and tolerance for different faiths, a respect for dissent, a respect for robust journalism, a respect for spirituality. I think that there is the common values also,” Khanna said, adding he looks forward to visit India soon.
Condemning the recent hate crimes against Indian-Americans and Indians, he said the community has tremendously contributed to jobs, innovation, and service to the armed forces.
“There’s been an outpouring of support, both from Democrats and Republicans, to say that hate crimes and hate speech have no place in the United States,” he said.
Khanna is working with other Indian-American lawmakers Pramila Jayapal and Raja Krishnamoorthi, Ami Bera, and with Congressman Joe Crowley to make sure they have a federal task force that deals with hate crimes.
“We’ve had tremendous support in a coalition, republican and Democrat colleagues, from people like John Lewis, and from the Hispanic-American caucus. It’s a broad coalition.From the Jewish-American community, there’s concern about anti-semitism. It’s a broad coalition that believes that this country doesn’t have any place for hate, or hate speech,” he said.
The election of a record number of five Indian-Americans to the Congress for the first time, is giving the community a lot of confidence, he said. “A sense of inspiring young people to seek careers in public service, to go into the military, to go into foreign service. It has really inspired, I think, many young folks to answer the call to service,” Khanna said.

 PT |

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FM Arun Jaitley introduces GST Bill in Lok Sabha

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FM Arun Jaitley introduces GST Bill in Lok Sabha

Posted on 27 March 2017 by GGS News

New Delhi : Finance Minister Arun Jaitley introduced GST bills in the Lok Sabha on Monday. Meanwhile, the Congress party once again opposed the presentation of the bill by FM Arun Jaitley. Parliamentary Affairs Minister Ananth Kumar said that the Goods and Service Tax bill needed to be passed in this session of the parliament. He further informed that the Narendra Modi-led BJP government was hoping to present it very soon and was looking for a consensus on the issue. Earlier it was reported that Central government would table the supplementary goods and services tax bill in the parliament on Monday. The bill, which is being planned to roll out by July 1, 2017, would introduce a new tax regime, which would subsume excise, VAT, service taxes among other levies. This leg of the budget session comes to a conclusion on April 12.
It was reported that the GST bill would be introduced in the parliament as Money Bills as the government has expressed the need to discuss the topic in both the houses. Finance Minister Arun Jaitley has already talked to Maharashtra Finance Minister Sudhir Mungantiwar and the representative of industrialists and bankers about the issues related to the Goods and Service Taxes bill. Representatives of other sectors such as shipping, ports, gems, petroleum etc were also present in the meeting with the Finance minister. If reports are to be believed, the C-GST, the I-GST and the UT-GST, along with the compensation law are to be introduced in the parliament.

Meanwhile, the Business Advisory Committee of the Lok Sabha is to meet today to discuss the duration of the presentation of the bills. The government is said to be aiming at passing the GST bills in Lok Sabha by March 29 or March 30 at best. The bill could then move to Rajya Sabha giving which would provide the government with enough time to make any amendments suggested by the Upper House to the Lok Sabha. These ammendements could then be accepted or rejected by the lower house. Onec these bills are cleared the states would then take take the S-GSt to their respective Vidhan Sabhas.
In the latest developments, the discussion over the GST Bill has been postponed in the Lok Sabha until March 29.

IE |

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CAG to audit fallout of demonetisation

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CAG to audit fallout of demonetisation

Posted on 26 March 2017 by GGS News

New Delhi : The Comptroller and Auditor General of India (CAG) plans to audit the impact of note ban and the affect it has had on government tax revenues, said CAG Shashi Kant Sharma.
In an interview to PTI, he said the auditor is gearing up to audit tax revenues under the new Goods and Services Tax (GST) regime and has started capacity building and reorienting its audit methodology and procedures.Among the special audits, CAG has already completed audit of agricultural crop insurance scheme and flood control and flood forecasting and is now engaged in several important audits like Right to Education, National Rural Health Mission, defence pensions and Ganga Rejuvenation, he said. “These reports should be ready by the end of the current year.”
Sharma asserted that CAG has audit jurisdiction over any body or authority which has any relation to government revenues and expenditure and resistance by some like city development bodies, DISCOMs and metro corporations will wither away.
“We plan to audit certain issues related to fiscal impact of demonetisation, largely its impact on tax revenues,” he said.
The government had withdrawn old 500 and 1,000 rupee notes from circulation on November 8 last year, and announced a new tax amnesty scheme for those holding unaccounted junked currency.
CAG audit may look into expenditure on printing of notes, RBI dividend payout and banking transaction data.
The auditor has also conveyed to the government its stand on the recent move of the GST Council to delete section 65 of the preliminary draft that authorised CAG to audit GST.
“Our mandate covers GST just like the earlier taxation regimes were covered. We have already started work on restructuring of our revenue audit arrangements to meet this likely challenge when GST is introduced.
“This exercise would include issues of capacity building, data access and analysis, reorientation of audit methodology and procedures and developing end-to-end IT solutions,” he said.
Sharma said executive, legislature, judiciary and audit have clearly demarcated roles and responsibilities.
“The framers of our Constitution were fully aware of the concept of checks and balances and hence you find the mention of Judiciary and CAG in the fifth part of the Constitution along with legislature and executive,” he said. “The CAG’s DPC Act of 1971 provides the details of the mandate and scope of audit available to us.”
Stating that there are no lacunae in CAG’s empowerment but with advent of time, the governance models have undergone changes.
The September 2014 judgment of the Supreme Court in the telecom case “reinforced an important principle that wherever public resources are being used by private companies for revenue generation, CAG will have a duty to examine as to whether the government is getting due share of such revenue,” he said.
“So, I can say that the bodies and authorities which have any relation to government revenues and expenditure are under the audit jurisdiction of CAG,” he said.
City development bodies, electricity distribution companies and metro corporations “resist” CAG audit on the ground of being autonomous or on the ground of getting no support of the government although they perform the functions which were earlier being performed by the government departments, he said.
“I believe the situation will settle down with passage of time and such resistance will wither away,” he added.

 PTI |

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