Economy Current Affairs July 5th Week 2017

1. NPCI gets RBI nod to operate Bharat Bill Payment System.

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The National Payments Corporation of India (NPCI) has received final nod from the Reserve Bank of India (RBI) to function as the Bharat Bill Payment Central Unit (BBPCU) and operate the Bharat Bill Payment System (BBPS).

The final clearance from RBI comes almost a year after NPCI launched the BBPS pilot project to make payment of utility bills easier. The pilot started in August 2016 with eight BBPS operating units that had received in-principle approval from RBI.

The total number of Bharat Bill Payment Operating Units certified by NPCI now stands at 24. The certified units include 10 private sector banks, 3 public sector banks (Bank of Baroda, Union Bank of India and Indian Overseas Bank), five cooperative banks and six non-bank biller aggregators. About Bharat Bill Payment System (BBPS)

BBPS is an integrated bill payment system offering interoperable and accessible bill payment service to customers through a network of agents, enabling multiple payment modes and providing instant confirmation of payment. The BBPS initiative aims to provide a major push to digital payments as it is a big step forward in formalizing the bill payment system in the country.

Under the BBPS framework, a customer will be able to pay several bills such as electricity, telephone, water, gas, and DTH television at a single location—physical or electronic—and receive instant confirmation once the payment is made. Nearly 45 crore bills are permitted under BBPS.

Payments through BBPS can be made using cash, transfer cheques and electronic modes. Bill aggregators and banks, who will function as operating units, will carry out these transactions for the customers. At present the bulk of transactions on BBPS are of electricity bills. It contributes to about 180 million bills per month out of which only 10% is digital.

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Economy Current Affairs July 3rd Week 2017

1. India’s forex reserves at record-high of $386.53 billion.

According to RBI, India’s foreign exchange (Forex) reserves have increased by $4.007 billion to touch a record high of $386.539 billion in the week that ended 30th June 2017. The components of India’s Foreign Exchange Reserves include Foreign currency assets (FCAs), Special Drawing Rights (SDRs), Gold and RBI’s Reserve position with International Monetary Fund (IMF).

The increase forex in the reporting week was due to increase FCAs. It rose by $3.724 billion to $362.388 billion. Gold reserves also increased by $252.8 million to $20.348 billion. India’s special drawing rights (SDRs) with the International Monetary Fund (IMF) also rose by $11.8 million to $1.479 billion. The RBI’s reserve position with IMF also increased by $18.9 million to $2.322 billion.

FCAs forms major part of the overall reserves. It consists of US dollar and other major non-US global currencies. It also comprises of investments in US Treasury bonds, bonds of other selected governments, deposits with foreign central and commercial banks. FCAs also include with them the effects of appreciation or depreciation of non-US currencies like the euro, pound, and yen and is expressed in terms of dollars.

2. India to import crude oil from US for first time.

India, the world’s third-largest oil importer, for the first time will import crude oil from the United States. The purchase comes after Prime Minister Narendra Modi’s visit to the US in June 2017 when President Donald Trump had assured that US looks forward to export more energy products to India.

Indian Oil Corp (IOC) has bought 1.6 million barrels of US Mars crude (a heavy, high-sulphur grade) and 400,000 barrels of Western Canadian Select that will be delivered onboard a Very Large Crude Carrier. The import will take place after IOC gets the carrier in October 2017 from PetroChina. The oil will be loaded off the US Gulf Coast, The import of crude from US could become an alternative source for the Indian companies for the supply of heavy, high-sulphur grades as feedstocks, which typically sell at a lower cost relative to other oil types. Besides IOC, Bharat Petroleum Corp Ltd (BPCL) is second Indian refiner which also has planned to buy its first ever US crude oil cargo and has issued a purchase tender.

India will be the latest Asian country to buy US crude after Japan, South Korea, Thailand, Australia, China and Taiwan as they seek to diversify oil imports from other regions after the OPEC production cuts raised prices of Middle East heavy-sour crude ( grades with a high sulphur content).

3. Government launches new tax payer service module.

The Union Finance Ministry has launched Aaykar Setu, a new tax payer service module. The new e-initiative literally means taxpayer’s bridge and will be available in android phones. It compiles various tax tools, dynamic updates, live chat facility and important links to various processes within the Income Tax Department (ITD) in a single module.

Aaykar Setu has been launched in mobile responsive android application and also in desktop version to enhance mobile access as well as desktop access. This e-initiative aims provide better taxpayer services and also help in reducing the direct physical interface between assesses and tax assessing authorities.

It will allow IDT to directly communicate with the taxpayers on a range of multiple informative and useful tax services. The tax payers will also be able to receive regular updates regarding important tax dates, forms and notifications on mobile numbers registered with the ITD.

The mobile app will allow entities track TDS, pay taxes and apply for permanent account number (PAN). It will also help people link their 12-digit biometric identifier Aadhaar with PAN card. To avail this service, all taxpayers will have to register their mobile numbers in the Aaykar Setu module in order to receive such SMS alerts.

4. Over Rs 57,000 crore saved through DBT: Government.

The Union Government has saved around Rs 57,000 crore in 2016-17 through Direct Benefit Transfer (DBT) scheme under which subsidies are given directly to beneficiaries. In 2017-18, the beneficiary base rose from 10.71 crore in 2013-14 to 35.62 crore. A total of 485 schemes have been identified from 60 ministries for the DBT.

According to government data, of the Rs 57,029 crore saved under DBT in 2016-17, the LPG subsidy scheme ‘Pahal’ alone accounted for Rs 29,769 crore savings. Besides, about Rs 14,000 crore were saved in providing subsidies directly to beneficiaries under the Public Distribution System (PDS).

The Mahatma Gandhi National Rural Employment Guarantee (MNREGA) Scheme saved Rs 11,741 crore. Rs 399 crore were saved in DBT transfers for the National Social Assistance Programme (NSAP), which deals with old age and widow pensions and among other things.

The DBT Scheme, a major reform initiative to check graft in welfare funds was launched by then UPA Government on 1 January 2013. It aims at transferring benefits of various central government-run social welfare schemes directly to the bank accounts of beneficiaries.

Its objective is to reform Government delivery system by re-engineering the existing process in welfare schemes for simpler and faster flow of funds/information and ensure accurate targeting of the beneficiaries, reduce duplication and fraud.

DBT functions under the Cabinet Secretariat and its implementation is directly monitored by the Prime Minister’s Office (PMO). JAM Trinity i.e. Jan Dhan, Aadhaar and Mobile are DBT enablers. However, Aadhaar is not mandatory in DBT schemes. DBT scheme has been high priority and focus area of the government to bring efficiency, effectiveness, transparency and accountability in the Government system and infuse confidence of citizen in the governance.

5. 5 States, 1 UT ink MoU with Centre on Government e-Marketplace.

5 States and a Union Territory (UT) have formally adopted the Centre’s Government e-Marketplace (GeM) initiative. They are Andhra Pradesh, Assam, Gujarat, Telangana, Arunachal Pradesh and Puducherry (UT).

In this regard, these states/UT have signed memorandum of understanding (MoU) to join GeM initiative. Four more states including Uttar Pradesh, Tamil Nadu, Jharkhand and Haryana, will ink such MoU soon.

GeM is an Online Market platform to facilitate procurement of goods and services by various Ministries and agencies of the Government. It aims to enhance transparency, efficiency and speed in public procurement of goods and services and eliminate corruption. It functions under Directorate General of Supplies and Disposals (DGS&D), Union Ministry of Commerce and Industries.

GeM is a completely paperless, cashless and system driven e-market place that enables procurement of common use goods and services with minimal human interface. Presently more than 40000 products in about 150 categories and hiring of transport service are available on GeM POC portal.

Transparency: GeM to a great extent eliminates human interface in order placement, vendor registration and payment processing. It is open platform and does not offer no entry barriers to bonafide suppliers who wish to do business with the Government. For procurements of higher value, GeM has bidding facility.

Efficiency: GeM allows direct purchase on it in a matter of minutes. The entire process in online, end to end integrated. It has online tools for assessing price reasonability.

Secure and safe: GeM platform is a completely secure. The antecedents of the suppliers are verified online and automatically through Aadhar, PAN databases. Besides, all the documents on GeM are e-signed at various stages by the buyers and sellers.

Support to Make in India: GeM has filters which are Preferential Market Access (PMA) compliant for selecting goods which are manufactured by Small Scale Industries (SSI). Thus, it will enable Government buyers to easily procure Make in India and SSI goods.

Savings to the Government: Transparency, efficiency under GeM initiative will result in a substantial reduction in prices of procuring goods, in comparison to the direct purchase rates and purchases by tender and rate contract.

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6. Government sets up new wing to provide intelligence inputs.

The Union Government has set up Directorate General of Analytics and Risk Management (DGARM), a new wing to provide intelligence inputs taking action against tax evaders.

It has been has been set up will be under the Central Board of Excise and Customs (CBEC). It will also do big data analytics for taxmen for better policy formulation.

The DGARM was set up on 1 July 2017, coinciding with rollout of Goods and Services Tax (GST). It will function as an apex body of CBEC for data analytics and risk management and will report to the chairman of CBEC. It will utilize internal and external data sources for detailed data mining and analysis to generate outputs for focused and targeted action by field formations and investigation wings of the CBEC.

The field formations of CBEC are also expected to gainfully and effectively utilise the data and other inputs shared by the DGARM. The data analytics and processing coupled with intelligence inputs by DGRAM will provide the CBEC the national and sub-national perspective for policy formulation.

7. Cabinet approves MOC in respect of tax matters between India and BRICS countries.

cabinet approves moc in respect of tax matters between india and brics countries

The Union Cabinet has approved signing of Memorandum of Cooperation (MOC) in respect of tax matters between India and the BRICS countries namely, Brazil, Russia, China and South Africa Decision in this regard was taken at the Union Cabinet meeting chaired by Prime Minister Narendra Modi in New Delhi.

The MoC aims to promote cooperation amongst BRICS Revenue administrations on common areas of interest in tax matters and capacity building and knowledge sharing. It envisages regular interaction amongst the heads of Revenue administration of BRICS countries to continue discussion on common areas of interest.

It also strive towards convergence of views and meeting of the experts on tax matters to discuss the contemporary issues in areas of international tax. MoC will also accord confidentiality and protection to information exchanged under it.

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Economy Current Affairs July 2nd Week 2017

1. EPFO signs Agreement with Five Banks.

The Employees’ Provident Fund Organisation (EPFO) has inked an agreement with four private banks and Bank of Baroda for the purpose of collection of provident fund dues from the employers and payments to its subscribers.

This is the first time the EPFO has roped in private banks, namely, ICICI Bank, HDFC Bank, Axis Bank and Kotak Mahindra Bank. Earlier, the EPFO was making use of the services of only the state-run banks. This move of the EPFO will help the organisation to save nearly Rs 300 crore per year as the five banks have agreed to zero transaction charges.

Already the EPFO had tied up with five other banks. The five other banks are State Bank of India (SBI), Punjab National Bank, Allahabad Bank, Indian Bank and Union Bank of India. The latest agreement will now authorise 10 banks to collect provident fund contribution and make payment to the employees. Every year, the EPFO settles around 1.16 crore claims and collects ?75,000 crores from establishments under the EPF Act.

The Employee Provident Fund (EPF) is a retirement benefit applicable only to salaried employees. It is a fund to which both the employee and employer contribute fixed amount (percent) of the former’s basic salary amount each month. This percentage is pre-set by the government. At present, the entire EPF amount is tax-free at the time of withdrawal if the employee has completed five years of continuous service.

2.China-backed AIIB approves USD 329 million loan for Gujarat rural roads.

The China-backed Asian Infrastructure Investment Bank (AIIB) in Beijing has approved a USD 329 million loan to build access roads to 4,000 villages in 33 Gujarat districts, the bank announced on Wednesday.

The roads will focus on last mile connectivity to schools and tribal areas, as well as introduce a first-of-its-kind digitised map that would link on-going rural roads projects in Gujarat to enable real-time monitoring, the bank said.

This follows the bank last month announcing a USD 150 million investment in an India infrastructure fund, aimed at attracting private investment capital to India.

China is the bank`s biggest shareholder, contributing around USD $30 billion to its USD 100 billion capital, and India is the second-biggest shareholder with an $8 billion contribution.

The AIIB`s Vice President and Chief Investment Officer D J Pandian, who happens to be a former Gujarat chief secretary and IAS officer, said the USD 329 million loan to Gujarat would "directly contribute to the economic development" by "improving the mobility of the rural population".

3. Union Ministry of Commerce & Industry inaugurated 10th Session of the India- Jordan Trade and Economic Joint Committee.

06 July 2017 Current Affairs: The 10TH India-Jordan Trade and Economic Joint Committee (TEJC) Meeting was held in New Delhi under the co-chairs of Smt. Nirmala Sitharaman, Minister of State (Independent Charge) for Commerce and Industry, Government of India, and H.E Eng. Mr. Yarub Qudah, Minister of Industry, Trade and Supply, the Government of the Hashemite Kingdom of Jordan.

The roadmap for cooperation in various fields such as Fertilizer Sector, Customs, Double Taxation Avoidance Agreement, Visa and Consular issues, Health and Pharmaceuticals, Micro, Small and Medium Enterprises, Maritime Transport, Rail Transport, and Air Transport, Renewable Energy, Energy Efficiency, and Smart Grid development, Information Technology, Higher Education and Vocational Training, Agriculture sector.

4. India to be base to economic pole of global growth: Harvard University.

According to the research conducted by the Centre for International Development at Harvard University (CID), India will be the base to the economic pole of global growth over the coming decade. The study has stated that over the years, the economic pole of global growth has moved from China to neighbouring India and it is likely to remain over India in the coming decade.

India :

The study has attributed India’s rapid growth prospects to the diversification of the country’s export base which now includes more complex sectors such as chemicals, vehicles and certain electronics. The study further states that India is also particularly well-positioned to continue diversifying into new areas.

World :

The research study has warned of a continued slowdown in global growth over the coming decade. With 7.7% annual growth, India and Uganda top the list of the fastest growing economies. The growth projections indicate that the growth in emerging markets to continue to outpace that of advanced economies, though not uniformly. The study is also optimistic about new growth hubs in East Africa and new segments of South-East Asia, led by Indonesia and Vietnam. The major oil economies of the world are experiencing the pitfalls of their reliance on one resource. On the other hand, India, Indonesia, and Vietnam have accumulated new capabilities that permit more diverse and complex production will have faster growth in the coming years.

China :

The study has found a decline in China’s exports. Its economic complexity ranking has also declined four spots for the first time since the global financial crisis. However, the growth projections for China is still above the world average. China is expected to grow at 4.4% annually in the coming decade.

5. BMI Research: India to have a GDP Growth of 6.9% in this Fiscal.

According to BMI Research, a Fitch group company, India is expected to register a growth of 6.9% in this financial year. BMI Research was founded in 1984 by Business Monitor International and later in 2014, it was acquired by Fitch Group. The firm performs industry and financial market analysis in 24 industries and 200 global markets.

The report has observed that the Real GDP growth has slowed to 6.1 % year-on-year in the fourth quarter of 2016-17. The growth rate is expected to pick up following the demonetisation drive in November 2016 but the weak public banks are expected to cap the economic recovery. The Public-Sector Banks are still plagued with mounting non-performing assets, which is expected to take a toll on India’s growth potential. Though the RBI has taken efforts to clean up the NPAs, the study observes that it will take some more time for credit allocation to the productive sectors of the economy.

The report, however, expects the economy to continue to recover in the coming quarters as the negative ramifications of the demonetisation measure have already started wearing off. India is also expected to get benefits from positive demographic trends, greater external stability arising out of improved terms of trade from low oil prices, and continued reforms improving the business environment of the country.

Asia The report expects a slowdown in economic growth in North Asia in 2017 and 2018. The slowdown will be driven by the structural slowdown in China, poor policy initiatives in Japan, and policy uncertainty in South Korea.

In Asia, India and ASEAN are likely to remain as the bright spots in the region owing to their positive demographics and improvements in the business environments.

6. India becomes Fourth Largest Foreign Investor into UK.

As per the official figures published by the UK’s Department for International Trade, India has become the fourth largest foreign investor into the UK in 2016-17. India has lost its position as the third largest investor to France.

In 2016-17, India had set up 127 new projects and safeguarded 7,645 existing jobs and created 3,999 new jobs in the UK. India is sharing the fourth spot with Australia and New Zeland, which had also set up 127 projects collectively.

The US remains the top most investor in the UK by setting up of 577 projects in 2016-17. China (including Hong Kong) with 160 projects and France with 131 projects have been placed in the second and third positions respectively.

The UK continues to be a great inward investment destination and remains extremely attractive to foreign investors even after its decision to exit the EU. The UK attributes open, liberal economy, world-class talent and business-friendly taxation as a reason for remaining extremely attractive to foreign investors. The UK had managed to attract more Foreign Direct Investment (FDI) projects than ever before for 2016-17. In a sum, UK claims itself as the number one destination for inward investment in Europe with the sectors such as technology, renewable energy, life sciences and creative industries all witnessing an increase in the number of projects and investments.

7. South Indian Bank ties up with PFG Forex.

South Indian Bank has tied up with PFG Forex for remittance facility for the benefit of Indian expatriates from Australia. The new facility will leverage the bank to reach the Indian diaspora.

Under this arrangement, NRIs can enjoy cost-effective and fast remittance services using SIB`s Express facility. NRIs can visit the PFG Forex outlets across Australia for remittances to India. SIB is already having correspondent banking arrangement with National Australia Bank and Fly World Money Exchange for remittances to India.

Recently SIB’s international banking division has been awarded the ISO 9001: 2015 certification for Quality Management Systems. The certification was awarded for implementing systems and procedures as per the standards laid down by the International Organization for Standardisation.

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8. RBI limits Customer liability in Online Banking Services.

Reserve Bank Of India (RBI) issued directions on ‘Customer Protection – Limiting Liability of Customers in unauthorized Electronic Banking Transactions’.

If the customers report to the banks regarding the loss they suffer through online banking transactions within three days, then the amount involved will be credited to their accounts within a time period of 10 days.

The banks should ask its customers to mandatorily register for SMS alerts and e-mail for email alerts for electronic banking transactions.

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