Economy Issue June 2013

Economy
Economy
1083 Crore Rupees Revival Plan for HMT company to profit-making one over five years by increasing production. The cash component of the package will be used for modernization, working capital needs and wage revision. The company also aims to hike production to 30000 units from the current 4500 units over five years. Workshop on Green National Accounting for India expert group under Ministry of Statistics and Programme Implementation (MOSPI) in August 2011. The aim of this expert group was development of framework for green national accounts, identification of data gaps and preparation of a road map to implement the framework. The expert group conducted in-depth deliberations on these issues over past one and half years. The report was submitted in the international workshop. The report called, Green National Accounts in India A Framework was released by the Prime Minister of India, Manmohan Singh on 5 April 2013. The Green National Accounts in India A Framework report reflected the state of economy. It also formed the raw material for assessment and policy formulation. This report consisted of six chapters and includes conceptual foundations of economic evaluation. The report also deals with not only the conceptual building up of the system of Green National Accounts, but also deals with the
The Cabinet Committee on Economic Affairs (CCEA) under Union Government on 18 April 2013 approved a 1083-crore Rupees renewal package for watch and tractor maker company HMT. The approval of the revival Plan Directly aims to modernise the company and help it turn around in five years. The package approved basically includes a cash infusion of 450 crore rupees and a non-cash assistance of 630 crore Rupees. Significance of the Package Approved The package is aimed at turning the loss making
http://upscportal.com
39
http://www.civilservicesmentor.com
Click Here to Subscribe PRINT COPY of Civil Services Mentor Magazine http://civilservicesmentor.com/mag/subscribe
JUNE 2013
Two-day International Workshop on Green National Accounting for India finished in New Delhi on 6 April 2013. The Government of India established the
Economy
implementation ability aspects based on the conceptual framework of Green Accounting Framework. Changes in FTP 2009-14 to Enhance Trade and SEZs set up additional units sector specific SEZs Policy to provide duty benefits to pre-existing structures and activities being undertaken Salient Features of the Zero Duty EPCG includes Authorization holders will have export obligation of 6 times the duty saved amount. The export obligation has to be completed in a period of 6 years The period for import under the Scheme would be 18 months The discharge of Export Obligation by export of alternate products and the accounting of group companies has been barred The benefits of the Zero Duty EPCG Scheme can be availed by the exporters who have availed benefits under Technology Upgradation Fund Scheme (TUFS) administered by Ministry of Textiles Under the new Zero Duty EPCG Scheme, import of motor cars, SUVs, all purpose vehicles for hotels, travel agents, or tour transport operators and companies owning/operating golf resorts will not allowed Reduced EO for Domestic Sourcing of Capital Goods The quantum of specific Export Obligation (EO) in the case of domestic sourcing of capital goods under EPCG authorizations has been reduced by 10%. This would promote domestic manufacturing of capital goods. Reduced EO for units in the State of Jammu & Kashmir To encourage manufacturing activity in the State of Jammu & Kashmir the specific export obligation (EO) is reduced to 25% of the normal export obligation. Earlier, this benefit was announced on 5 June
Union Minister for Commerce, Industry and Textiles, Anand Sharma released the Annual Supplement 2013-14 to Foreign Trade Policy (FTP) 2009-14 18 April 2013 at Vigyan Bhawan, New Delhi. During the fiscal year 2012-13, the export of India grew to 300.60 US Billion Dollar from 300 US Billion Dollar, but it fell by 1.76 percent previous year. The trade deficit which was 183.4 US Billion Dollar last year has increased to 190.91 US Billion Dollar. On this occasion of releasing the Annual Supplement 2013-14 to Foreign Trade Policy 2009-14 the government introduced many strategic Changes to policies to revive the interest of the investors in Social Economic Zones (SEZs) as well as to boost exports. Few of the important changes introduced Changes in SEZs Size of total area of land required for development of SEZs have been reduced Graded Scale for Minimum Land Criteria has been introduced Flexibilities are introduced to
after notification have been introduced In IT SEZs, the criterion of minimum land area of 10 hectares has been done away Zero Duty Export Promotion Capital Goods (EPCG) Scheme
JUNE 2013
Foreign Trade Policy has two variants under this scheme, Zero Duty EPCG for few sectors and 3% Duty EPCG for all sectors. On 5 June 2012, a new Post Export EPCG Scheme was also announced which was notified on 18 February 2013 by the CBEC. Now the Union Government has decided to merge the Zero Duty EPCG and 3% EPCG Scheme into one scheme and make it a Zero Duty EPCG Scheme covering all sectors. 40
Economy
2012 in respect of units located in North Eastern Region and Sikkim and the same provision is now being extended to J&K. Widening of Interest Subvention Scheme Presently there exists availability of 2% interest subvention scheme to certain specific sectors like Handicrafts, Handlooms, Carpets, Readymade Garments, Processed Agricultural Products, Sports Goods and Toys. The scheme had been further widened to include 134 sub-sectors of engineering sector. Government had also announced that the benefit of this scheme of 2% interest subvention could be available up to 31 March 2014 Items covered under the Chapter 63 of ITC (HS) (other made up textile articles, sets, rags) and additional specified tariff lines of engineering sector items under the scheme have also been included in the scheme by widening its provisions Widening the Scope of Utilization of Duty Credit Scrip Duty Credit Scrips issued under Focus Market Schemes, Focus Product Scheme and Vishesh Krishi Gramin Udyog Yojana (VKGUY) can be used for payment of service tax on procurement of services within the legal framework of service tax exemption notifications under the Finance Act, 1994. Holder of the scrip shall be entitled to avail drawback or CENVAT credit of the service tax debited in the scrips as per Department of Revenue rules. All duty credit scrips issued under Chapter 3 can be utilized for payment of application fee to DGFT for obtaining any authorization under Foreign Trade Policy. This benefit shall be available only to the original duty credit scrip holders. Duty credit scrip can also be paid for payment of composition fee and for payment of value shortfalls in EO under para 4.28 (b) of Hand Book of Procedure Vol. 1. Market and Product Diversification Norway has been added under Focus Market Scheme and Venezuela has been added under Special Focus Market Scheme. The total number of countries under Focus Market Scheme and Special Focus Market Scheme becomes 125 and 50 respectively. Approximately, 126 new products have been added under Focus Product Scheme. These products include items from engineering, electronics, chemicals, pharmaceuticals and textiles sector. About 47 new products have been added under Market Linked Focus Product Scheme (MLFPS). These products are from engineering, auto components and textiles sector. 2 new countries i.e., Brunei and Yemen have been added as new markets under MLFPS. MLFPS is being extended from 01.04.2013 to 31.03.2014 for exports to USA and EU in respect of items falling in Chapter 61 and Chapter 62 of ITC (HS). Exports of High Tech products would be incentived 41 and it would be separately notified by 30th June, 2013. The towns of Morbi (Gujarat) and Gurgaon (Haryana) have been added to the existing list of towns of export excellence for ceramic tiles and apparel exports respectively. These towns shall be eligible to get benefit under ASIDE Scheme. Incremental Exports Incentivisation Scheme Government has announced Incremental Export Incentivisation Scheme on 26 December 2012 for the exports made during January 2013 to March 2013. This scheme is available for exports made to USA, EU and Asia. It has been agreed to extend this scheme for the year 2013-14. The calculation of the benefit shall be on annual basis under the extended scheme. The Government has also agreed to include additional countries under Incremental Exports Incentivisation Scheme. 53 countries of Latin America and Africa have been added with the objective to increase Indias share in these markets. The present exports to each of these markets are less than US $ 100 million. Changes have been introduced in many other schemes and they are Facility to close cases of default in Export Obligation Served from India Scheme (SFIS) VKGUY Scheme Status Holder Incentive Scheme (SHIS) Re-credit of 4% SAD Duty Free Import Authorization Scheme (DFIA) Import of Cars Improvement in quality and
JUNE 2013
Economy
timeliness of Foreign Trade Data Second Task Force on Transaction Cost in International Trade Electronic Data Interchange Initiatives Ease of Documentation and procedural simplification Widening of items eligible for import for Handloom/Made ups and Sports Goods Trade Forecast 2013: The WTO made a forecast of 2.1 percent growth in world output and it depends upon the sovereign debt crisis in Europe In 2012 the World Growth Rate was measured to be 2 percent but have gone down from 5.2 percent that was recorded in 2011. IMF Slashed World Growth Forecast to 3.3 percent for the Year 2013 International Monetary Fund (IMF) in its latest assessment of the United States. Slow growth in countries like Russia, Brazil, China and India is also a reason for economic weakness. The global economy survived from the crash after defuse of the two largest short term threats to the recovery and they were disintegration of the eurozone and extreme budget cuts and tax hikes in United States. The U.S growth forecasted for the year 2013 is 1.9 percent and for Eurozone it is 0.3 percent. The measures adopted by the world to get out of the financial crisis have been failing due to the bad debt and weak capital hobbled by the banks. Due to Bank of Japans ambitious plan launched to reflate the economy, the IMF upped its forecast for the country to 1.6 percent from initial 1.2 percent. Statement from World Economic Outlook Report of IMF IMF in its WEO Report suggested that the Global prospects have improved again but the road to recovery in the advanced economies will remain bumpy. ITPO Signed a MoU with Government of India
WTO Slashed Trade Growth Forecast for 2013 to 3.3 Percent
JUNE 2013
The World Trade Organization (WTO) on 10 April 2013 slashed the forecast of global trade by 1.2 percent to 3.3 percent from previous 4.5 percent. The WTO called up for strengthening the trade via multilateral system to ensure trade emerges as the engine of growth. WTO also informed that the trade growth of the world slowed to 2 percent in the year 2012 from the previous year 2011 rate of 5.2 percent. As per the details provided, the trade growth rate of the world is likely to remain low in 2013 as the economic slowdown of the European Countries was suppressing the global import. Merchand is e Trad e: The forecast of merchandise trade for 2013 is 3.3 percent and this is below the average of 20 years from 1992 to 2012, i.e. 5.3 percent
global economy released on 16 April 2013 revised its world growth forecast for 2013 and slashed it to 3.3 percent from previous forecast of 3.5 percent predicted in January 2013. IMF revised its forecast because of the continued recession in the Eurozone. The IMF also forecasted that the economic growth will be on its pick by the second half of the year. The slow growth rate of the United States region is also a region behind the downgrade of the forecast. The Chief Economist of IMF, Olivier Blanchard warned that the fresh bailout of Cyprus and weakness of Italy could spark setbacks for the international economy. IMF in its assessment also expressed concerns over the global fragmentation of the dynamism of the emerging economies and the 42
India Trade Promotion Organisation (ITPO) signed a Memorandum of Understanding (MoU) with Government of India for the year 2013-14 on 20 March 2013. The MoU was signed between Rita Menon, Chairperson and Managing Director of ITPO and S R Rao, Secretary, Ministry of Commerce & Industry.
Economy
Highlights of the MoU The major highlight of the MoU is the projected surplus of Rs. 100 Crore by ITPO during 2013-14. The MoU laid down target for investment proposal to be submitted for the redevelopment of Pragati Maidan into a modern and state-of-the-art integrated Exhibition-cum-Convention Centre, to the Union Cabinet for approval. Certain other targets were also included in the MoU and these included 850 man-days of training to its both senior and other employees during 201314 and reduction of electricity water consumption by 5 percent and 10 percent respectively. To Revive Interest in SEZs of Investors Government announced Changes in FTP The Annual Supplement 201314 to Foreign Trade Policy (FTP) 2009-14 was announced on 18 April 2013 by the Union Minister for Commerce, Industry and Textiles, Anand Sharma at Vigyan Bhawan, New Delhi. In the latest Annual Supplement 2013-14 the Union Government has tried to implement measures to revive the interest of the investors in Social Economic Zones (SEZs) as well as to boost exports. Important features of the Package are The Government has reduced the size of total land area required for development of SEZs to its half from its initial requirement of minimum Land Area of 100 hectares for allowing the development of SEZs. Now an investor needs to have 50 hectares of land to develop a SEZ. This has been done in response to end the difficulties being faced by the investors in gaining collective large area of uncultivable land for setting up of the SEZ. Graded Scale for Minimum Land Criteria has been introduced to permit the SEZ an additional sector for each contiguous 50 hectare parcel of land. This has been done to ensure flexibility in utilization of the land tracts that falls between the 50 to 450 hectares. Flexibility is granted for setting-up additional units in a sector specific SEZ. This will be done by introducing sectoral broad-banding to encompass similar/related areas under the same sector. In context of Vacancy of Land: the government has revised the policy in existence that allowed a parcel of land with pre-existing structures but not in commercial use to be considered as a vacant land and this was used with the purpose of notifying it for a SEZ. The new policy being introduced is that pre-existing structures and activities being undertaken after notification would be eligible for duty benefits similar to any other activity in the SEZ. IT Exports constitute a very significant part of Indias exports and IT SEZs have a major contribution in it. Exports from IT SEZs during financial year 2012-13 have exceeded 1.40 lakh crore rupees and it registered a growth of over 70 percent, over the previous years exports. The Government has brought in new changes to boost growth in the IT SEZ sector and to encourage the employment opportunities in Tier-II and Tier-III cities. 43 Changes Implemented in IT Exports For development of IT SEZs, the Government has done away the criterion on minimum land area of 10 hectares, making it to no minimum land requirement for setting up an IT/ITES SEZ. The SEZ developers will have to meet up with the minimum built in area requirement. The criteria of requiring a minimum build-up land area has also been relaxed to a greater extent. The requirement of one lakh square meters is applicable in 7 major cities namely Mumbai, Delhi (NCR), Chennai, Hyderabad, Bangalore, Pune and Kolkata. For the other Category B cities 50000 square meters and for remaining cities only 25000 square meters built up area norm will be applicable. The SEZ policy Framework in existence at present doesnt include a policy of exit but now the Government permits, the transfer of ownership of SEZ units, including sale. The Government has also introduced several schemes and modified different policies as per the requirements. 4065.81 Crore Rupees for Water Pollution Control The Union Government of India on 5 April 2013 sanctioned 4065.81 crore rupees for pollution abatement schemes of rivers and lakes in different states. Of all the states, Uttar Pradesh received 1385.95 crore rupees. The sanction cost of projects and expenditure includes the State Governments share under the National River Conservation Programme (NRCP) and the National Lake Conservation Programme (NLCP).
JUNE 2013
Economy
National Lake Conservation Plan (NLCP) National Lake Conservation Plan (NLCP) started in June 2001 with a funding scheme of 70:30 fund sharing between centre and state. The main objective of the scheme is to restore and conserve the urban and semi-urban lakes of the country degraded due to waste water discharge into the lake and other unique freshwater eco systems, through an integrated ecosystem approach. National River Conservation Programme (NRCP) Indias economy is expected to grow 6.4 percent in the new financial year that began on 1 April 2013. PMEAC pegged the WPI inflation at around 6 percent and food inflation, at 8 percent. FY13 bank credit growth at 14.1% vs 17% in the year-ago period. Bank credit growth lower due to weak credit demand & tight liquidity. Net FDI at 18 billion dollars in FY13. FII inflows at 24 billion dollar in FY13 We expect net FDI inflow at 24 billion dollars and FII at 18 billion dollars for FY14 The fiscal deficit of the Centre for 2012-13 is estimated to be 5.2% of GDP. It was 520924 crores Rupees in 2012-13 as per revised estimates, and is expected to be 542499 crores Rupees in 2013-14 as per budget estimates. Current Account Deficit is estimated to be 94 billion dollars (5.1% of GDP) in 201213 and is projected to be 100 billion dollars (4.7% of GDP) in 2013-14. Merchandise trade deficit is estimated to be 200 billion dollars (10.9% of the GDP) in 2012-13 and is projected to be 213 billion dollars (9.9% of GDP) in 2013-14. Net invisibles earnings are estimated to be 105.8 billion dollars (5.7 % of GDP) in 201213 and are projected to be 113 billion dollars (5.3 % of GDP) in 2013-14. It is estimated that for 201213 the net inflow of FDI was 18 billion dollars (26 billion inbound and 8 billion dollars outbound). For 2013-14 EAC has projected higher inbound flows of the order of 36 billion 44 dollars. Outbound FDI is also expected to increase, resulting in net FDI inflow of 24 billion dollars. FII inflows were weak in the first quarter of 2012-13, but picked up in the second and third quarters. For the year as a whole, portfolio inflows are estimated to be close to $24 billion. Portfolio capital flows are projected to be 18 billion dollars in 2013-14. The total inflows under the head of loans are estimated to be about 30 billion dollars in 2012-13. This comprises mostly of external commercial borrowings (ECBs) and shortterm loans. The projected figure for 2013-14 is $36 billion. The total banking capital inflows for 2012-13 are estimated to be $24 billion and are projected to be at 22 billion dollars for 2013-14. Reserve Bank of India to Start Plastic Money Project on Trial Basis
National River Conservation Programme (NRCP) is the centrally sponsored Scheme implemented by the central Government jointly with the State Government on a costsharing basis. The pollution abatement works under NRCP presently cover identified polluted stretches of 39 major rivers in 185 towns spread over 20 States in the country. Highlights of PMEAC Economic Review 2012-13 The Prime Ministers Economic Advisory Council (PMEAC) under the Chairmanship of C Rangarajan on 23 April 2013 presented the Economic review 2012-13. Find here the highlights of the Economic Policy Review presented by the Prime Ministers Economic Advisory Council:
The Reserve Bank of India on 16 April 2013 announced that it would start the introduction of Plastic Notes in the market on trial basis. The announcement was made by the Deputy Governor of RBI, K.C. Chakrabarty in Mangalore. The Deputy Governor in his announcement informed that the Central Bank would launch the plastic notes the denomination of 10 rupees and will continue with other
JUNE 2013
Economy
small denominations depending upon the success of these notes. The introduction of the scheme would start on a trial basis following the mandate of the Union Government to introduce plastic/polymer currency notes of 10 rupees on a field trial in five cities of India. The date for launch of the Plastic Notes was not cleared by the Bank. NEEPCO granted Miniratna Category1 Status North Eastern Electric Power Corporation (NEEPCO) was conferred with the Miniratna Category 1 status by the President of India, Pranab Mukherjee on 8 April 2013. NEEPCO was earlier the schedule A Corporation. Status of Category-I Miniratna Firms Category-I Miniratna firms can incur the capital expenditure on modernization, new projects as well as equipment purchase without the approval of the Government, up to 500 crore Rupees. The Category-II Miniratna firms, on the other hand, have the financial freedom of spending up to 300 crore Rupees or 50 percent of total net worth, whichever out of these is lower. NEEPCOs status after being conferred with Miniratna Category 1 NEEPCO was initially the schedule A Corporation. After being elevated to Miniratna Category 1 status, NEEPCO will have autonomy to take the investment decisions freely without the consent of Ministry of Power. About NEEPCO NEEPCO plays a crucial role in the power sector of North East region. it serves around 50 percent power requirement of this region. By 2018, NEEPCO has plans to add 2300 MW of power through the thermal and hydro projects. At present, NEEPCO executes 5 projects in North East region with total installed capacity of 917 MW. List of Maharatna, Navratna and Miniratna CPSEs Maharatna CPSEs 1. Bharat Heavy Electricals Limited 2. Coal India Limited 3. GAIL (India) Limited 4. Indian Oil Corporation Limited 5. NTPC Limited 6. Oil & Natural Gas Corporation Limited 7. Steel Authority of India Limited Navratna CPSEs 1. Bharat Electronics Limited 2. Bharat Petroleum Corporation Limited 3. Hindustan Aeronautics Limited 4. Hindustan Petroleum Corporation Limited 5. Mahanagar Telephone Nigam Limited 6. National Aluminium Company Limited 7. NMDC Limited 8. Neyveli Lignite Corporation Limited 9. Oil India Limited 10. Power Finance Corporation Limited 11. Power Grid Corporation of India Limited 12. Rashtriya Ispat Nigam Limited 13. Rural Electrification Corporation Limited 14. Shipping Corporation of India Limited Miniratna Category - I CPSEs 1. 2. 3. 4. Airports Authority of India Antrix Corporation Limited Balmer Lawrie & Co. Limited Bharat Dynamics Limited 45 5. BEML Limited 6. Bharat Sanchar Nigam Limited 7. Bridge & Roof Company (India) Limited 8. Central Warehousing Corporation 9. Central Coalfields Limited 10. Chennai Petroleum Corporation Limited 11. Cochin Shipyard Limited 12. Container Corporation of India Limited 13. Dredging Corporation of India Limited 14. Engineers India Limited 15. Ennore Port Limited 16. Garden Reach Shipbuilders & Engineers Limited 17. Goa Shipyard Limited 18. Hindustan Copper Limited 19. HLL Lifecare Limited 20. Hindustan Newsprint Limited 21. Hindustan Paper Corporation Limited 22. Housing & Urban Development Corporation Limited 23. India Tourism Development Corporation Limited 24. Indian Railway Catering & Tourism Corporation Limited 25. IRCON International Limited 26. KIOCL Limited 27. Mazagaon Dock Limited 28. Mahanadi Coalfields Limited 29. Manganese Ore (India) Limited 30. Mangalore Refinery & Petrochemical Limited 31. Mishra Dhatu Nigam Limited 32. MMTC Limited 33. MSTC Limited 34. National Fertilizers Limited 35. National Seeds Corporation Limited 36. NHPC Limited 37. Northern Coalfields Limited 38. Numaligarh Refinery Limited 39. ONGC Videsh Limited 40. Pawan Hans Helicopters Limited 41. Projects & Development India Limited
JUNE 2013
Economy
42. Railtel Corporation of India Limited 43. Rashtriya Chemicals & Fertilizers Limited 44. RITES Limited 45. SJVN Limited 46. Security Printing and Minting Corporation of India Limited 47. South Eastern Coalfields Limited 48. State Trading Corporation of India Limited 49. T e l e c o m m u n i c a t i o n s Consultants India Limited 50. THDC India Limited 51. Western Coalfields Limited 52. WAPCOS Limited Miniratna Category-II CPSEs 53. Bharat Pumps & Compressors Limited 54. Broadcast Engineering Consultants (I) Limited 55. Central Mine Planning & Design Institute Limited 56. Ed.CIL (India) Limited 57. Engineering Projects (India) Limited 58. FCI Aravali Gypsum & Minerals India Limited 59. Ferro Scrap Nigam Limited 60. HMT (International) Limited 61. HSCC (India) Limited 62. India Trade Promotion Organisation 63. Indian Medicines & Pharmaceuticals Corporation Limited 64. M E C O N Limited 65. National Film Development Corporation Limited 66. National Small Industries Corporation Limited 67. P E C Limited 68. Rajasthan Electronics & Instruments Limited FCI Raised 5000 Crore Rupees by Issuing Taxable Bonds The Food Corporation of India (FCI) raised 5000 crore Rupees by issuing taxable bonds backed by Government of India Guarantee in order to meet the additional working capital requirement. The issue of bonds was opened on 21 March 2013 and closed on 22 March 2013. These bonds are of two tenures- 10 years (300 crore Rupees) and 15 years (4700 crore Rupees). The coupon rate for 10 years was 8.62 percent per annum and 8.80 percent per annum for 15 years. Food Corporation of India (FCI) has the Cash Credit Limit with Consortium of 62 banks. activities. The total length of road will be 80 kilometres approximately. The project will expedite the improvement of infrastructure in the state of Assam and also reduce the time and cost of travel for traffic, particularly heavy traffic, plying between Guwahati to Dibrugarh and Nagaon to Dibrugarh. It will also increase employment potential for local labourers for project activities. The project is covered in the districts of Golaghat, Jorhat, Sivsagar and Dibrugarh and passes through the towns of Numaligarh, Dergaon, Jorhat, Jhanji, Gorisagar, Sivsagar, Demow, Sapan, Maran and Dibrugarh. CCI slapped fine of 8000 Crore rupees in 19 Cases
At present, the Cash Credit Limit is 54495 crore Rupees which is secured by mortgaging entire stock of FCI and guaranteed by Government of India. At present, the interest rate on Cash Credit Limit is 10.79 percent monthly which eventually translates into 11.34 on annual basis. Annual interest saving through issue of this bond will be 127.54 crore Rupees. CCEA approved Four Laning of Jorhat to Demow section of NH-37 The Cabinet Committee on Economic Affairs gave its approval for the four laning of the JorhatDemow section of National Highway-37 in the state of Assam under the Special Accelerated Road Development Programme in North Eastern Region (SARDP-NE) Phase A on Design, Build, Finance, Operate and Transfer (DBFOT) basis in Build-Operate-Transfer (BOT) (Annuity) mode of delivery. The cost is estimated to be 874.69 crore rupees excluding land acquisition and other pre-construction 46
Competition Commission of India (CCI) penalised 19 business entities for anti-competitive practices collectively for around 8000 crore Rupees by the end of financial year 2012-13. It was figured out as on 31 March 2013 that CCCI had received 347 cases regarding violations of anti-competitive practices. Out of the 347 registered cases , the Commission had closed 262 cases, while in 28 cases cease and desist orders have been passed, also in other 19 cases, total penalties of 8013 crore rupees was imposed along with cease and desist orders. In view of the Competition Act, the CCI has got the authority to issue cease and desist order to abstain the company from pursuing any anticompetitive practices. Also in
JUNE 2013
Economy
another major upshot a total of 55.67 crore rupees of undisbursed funds in the last fiscal have been credited to Consolidated Fund of India. It was calculated that during the 20012012, a sum of 637.17 crore rupees had been credited to the Consolidated Fund of India. To deal with the issue of credit in an effective way, the Union government has established Investor Education and Protection Funds (IEPF) by which unclaimed funds on account of dividends, matured deposits, matured debentures and share application money are transferred to the government by the company on completion of seven years. National Workshop on Grid Integration smart grids for enabling more efficient, resilient, and safe distribution of power is another area of action. There are certain highlights under the 21st Century Power Partnership initiative, which are as follows: Developing & sharing knowledge on topic relating to expansion of electricity sector Strengthening and disseminating these tools to accelerate this transformation Improving the capacity of experts and building expertis Leveraging all threeknowledge tools and expertise to improve our policies CCEA Approved de-control of Sugar The Cabinet Committee on Economic Affairs (CCEA) on 4 April 2013 decided to de-control sugar and did away the levy on sugar mills and regulated release mechanism. This de-control will raise the subsidy burden to 5300 crore rupees from previous 2700 crore rupees. Decontrol on sugar will not have an impact on the sugar made available in the Public Distribution System. The de-control of sugar will abolish the rule for sugar mills that makes it mandatory for sugar millers to sell sugar to the Government at a discounted price as well as the limitation on the amount they choose to sell in the open market . 13 Power Projects and 25 Oil & Gas Blocks approved The Cabinet Committee on Investment on 22 April 2013 cleared 13 power projects that involves investment of 33000 crore rupees. The projects on which the investments will be made include one hydro and two thermal project as well as ten transmission projects. 25 oil and gas blocks with 47 investment commitment of about seven billion US dollars also got approval during the same meet. Of these 16 blocks were given conditional clearances, while nine blocks were approved without any condition.
Approval of these projects was pending due to the objections raised by the Ministry of Defence over national security. During the meet of Cabinet Committee on Investment in New Delhi twenty different power projects that await clearances from the Union Environment and Forest Ministry were also reviewed. The meet was headed by the Prime Minister of India, Dr. Manmohan Singh. Core Sector Growth Slumped by 2.5 Percent in February 2013 The production of eight core sector industries decreased by 2.5 percent in the month of February 2013, for the first time in 2012-13 financial year. This happened because of a decrease in the output of natural gas. The biggest decline happened in the natural gas sector with more than 20 percent in February. This was followed by coal (-8 percent), electricity generation (-4.1 percent) and crude oil (-4 percent). The overall output growth of the core sector industries was witnessed at 7.7 percent in February 2012. Negative performance in February 2013 diminished cumulative growth in 11 months of 2012-13 FY ending February to 2.6 percent in comparison to 5.2
The Minister for New & Renewable Energy, Farooq Abdullah inaugurated the National Workshop on Grid Integration of Renewable Energy Sources and Energy Efficiency on 8 April 2013. The workshop discussed the important areas of clean energy development which are grid integration of renewable energy and energy efficiency. The National Workshop on Grid Integration of Renewable Energy Sources and Energy Efficiency was organised in collaboration with United State Department of Energy under the United States 21st Century Power Partnership initiative. Grid planning in the high-renewable energy penetration scenario is of strategic importance. Also, development of
JUNE 2013
Economy
percent during same period in 201112 FY. Eight core industries include electricity, cement, crude oil, finished steel, petroleum refinery products, fertiliser, coal and electricity. These industries have weight of 37.9 percent in Index of Industrial Production (IIP). During February 2013, fertiliser output decreased by 4 percent in comparison to 4.1 percent growth in February 2012. Cement output increased by 3.9 percent in comparison to 9.8 percent in February 2012. Petroleum refinery output increased by 4.3 percent in comparison to 6 percent in February 2012. Steel production increased by 0.5 percent in comparison to 8.7 percent in February 2012. In January 2013, these core industries increased by 3.1 percent. Indian Railways Carried 1009.73 Million Tonnes of Freight during Fiscal 2012-13 There is an increase of 4.35 million tonnes over the actual freight traffic of 93.85 million tonnes carried by the Indian Railways during the same period last year, showing an increase of 4.64 per cent. Foreign Tourist Arrivals in India Increased by About 3 Percent Foreign Exchange Earnings (FEEs) from Tourism in rupee terms and US dollar terms FEEs during the month of March 2013 were Rs. 9,491 crore as compared to 7843 crore rupees in March 2012 and 5522 crore rupees in March 2011. The growth rate in FEEs in rupee terms in March 2013 over March 2012 was 21.0 percent as compared to 42.0 percent in March 2012 over March 2011. FEEs from tourism in rupee terms during January-March 2013 were 30075 crore rupees with a growth of 20.5 percent, as compared to the FEE of 24968 crore rupees with a growth of 31.7 percent during January-March 2012 over the corresponding period of 2011. FEEs in US dollar terms during the month of March 2013 were 1.75 billion US dollars as compared to FEEs of 1.56 billion US dollars during the month of March 2012 and 1.23 billion US dollars in March 2011. The growth rate in FEEs in US dollar terms in March 2013 over March 2012 was 11.9 percent as compared to the growth of 27.1 percent in March 2012 over March 2011. FEE from tourism in terms of US dollar during JanuaryMarch 2013 were 5.55 billion US dollar with a growth of 11.6 percent, as compared to 4.97 billion US dollar with a growth of 18.9 percent during January-March 2012 over the corresponding period of 2011. Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) on the basis of data received from major ports and Foreign Exchange Earnings (FEEs)
JUNE 2013
Indian Railways carried 1009.73 million tonnes of revenue earning freight traffic during the financial year 2012-13 as per the data released by Ministry of Railways. The freight carried shows an increase of 39.95 million tonnes over the freight traffic of 969.78 million tonnes actually carried during the corresponding period last year, registering an increase of 4.12 per cent. During the month of March 2013, the revenue earning freight traffic carried by Indian Railways was 98.20 million tonnes.
Foreign Tourist Arrivals (FTAs) showed a growth of 2.8 percent in March 2013 over March 2012. The growth rate in Foreign Exchange Earnings (FEEs) from tourism in Rupee terms in March 2013 over March 2012 was 21percent. The following are the important highlights regarding FTAs and FEEs from tourism during the month of March, 2013. Foreign Tourist Arrivals (FTAs): FTAs during the Month of March 2013 were 6.40 lakh as compared to FTAs of 6.23 lakh during the month of March 2012 and 5.36 lakh in March 2011. There has been a growth of 2.8 percent in March 2013 over March 2012 as compared to a growth of 16.3 percent registered in March 2012 over March 2011. FTAs during the period January-March 2013 were 20.27 lakh with a growth of 2.3 percent, as compared to the FTAs of 19.81 lakh with a growth of 10.9percent during January-March 2012 over the corresponding period of 2011.
48
Economy
from tourism on the basis of data received from Reserve Bank of India. Union Government achieved FY13 Revised Tax Collection Target On 31March 2013 as many as 7.5 lakh tax returns were filed. The government was trying its best to implement the Goods and Services Tax (GST) as early as possible. What is Direct tax? Ministry of Home Affairs for continuation of the Scheme for Special Infrastructure (SIS) in Left Wing Extremism (LWE) affected states during the 12th Plan period. The proposal includes an added objective of upgradation and critical gap filling of training infrastructure, residential infrastructure, weaponry, vehicles and any other related items pertaining to Special Forces of LWE affected states. The total cost would be 373 crore rupees comprising 280 crore rupees as central government share and 93 crore rupees as state government share on a 75 (central): 25 (state) funding pattern.The scheme will enhance the security in the region which would provide an enabling environment for development. The scheme was being implemented from the year 2008-09 with the broad objective to adequately provide for critical infrastructure requirements that are critical to the policing and security needs in the field, but are not adequately or otherwise provided for in any other scheme. During the 11th Plan period 100 percent funding was provided by the Central Government to the 9 LWE affected states for implementing various projects under the scheme. The total funds were released under the scheme by the central government to the 9 LWE affected states during the 11th Plan period is 445.82 crore rupees. Government permitted Railways to use its Land for Metro Networks
The Cabinet Committee on Economic Affairs(CCEA) on 2 April 2013 approved the proposal of the 49
JUNE 2013
Union government in the Month of March 2013 announced that it has met its revised tax collection target for 2012-13. With this there is also possibility that the tax collection may even exceed the estimates because of better-thanexpected indirect tax collections. Combining (direct and indirect tax collections) the government met the revised estimates. From the revenue side a bit for fiscal consolidation was done. However the final numbers for direct taxes will be known only after 20 April 2013. For the year 2012-13, the Union government had revised its direct tax collections target to 5.65 lakh crore Rupees from budget estimates of 5.70 lakh crore Rupees. The target for indirect taxes was revised to 4.69 lakh crore rupees from budget estimates of 5.05 lakh crore Rupees. It is also important here to note that the fiscal deficit target for 201213 of 5.2% of the gross domestic product (GDP) has also been achieved. For 2013-14, budget estimates for direct taxes and indirect taxes are 6.68 lakh crore Rupees and 5.65 lakh crore Rupees, respectively.The number of tax returns filed in 2012-13 was estimated around 2.15 crore compared to 1.64 crore a year ago.
Direct tax is a tax paid directly to the government by the persons on whom it is imposed. Direct taxes mainly comprise of corporate tax and income tax. It is imposed upon an individual person (juristic or natural) or on property, as distinct from a tax imposed upon a transaction. What is Indirect tax?
An indirect tax can be referred to taxes such as sales tax, a specific tax, value added tax (VAT), or goods and services tax (GST). It is a tax collected by an intermediary (such as a retail store) from the person who bears the ultimate economic burden of the tax (such as the consumer). CCEA approved Special Infrastructure Scheme in LWE affected States
Economy
The Union Cabinet of India on 18 April 2013 gave its approval to the proposal of the Indian Railways for permitting use of its land for crossing metro networks under ground, on the surface as well as elevated/over ground. The Indian Railways will also allow opening of Kendriya Vidyalayas on its land in order to provide adequate educational facilities to children of railway staff/officials placed in remote areas, and where educational institutions are not adequate. Exchange of railway land with central/state governments, department/local bodies for setting up public utilities shall also be entered into by the Indian Railways, wherever considered mutually beneficial.
for
JUNE 2013
50
http://www.flipkart.com
http://upscportal.com/civilservices/books

Economy Issue June 2013

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Economy Issue June 2013

Uploaded by

Copyright:

Available Formats

Economy

WTO Slashed Trade Growth Forecast for 2013 to 3.3 Percent

You might also like