NO GST ON INTEREST-FREE SECURITY DEPOSIT FOR LEASE: AAR
The Authority for Advance
Rulings, Maharashtra has held that the Goods and Services Tax cannot be levied
on the interest-free security deposit given for leasing a commercial property.
However, if at the time of completion of lease tenure, the entire deposit or a
part of it is withheld and not paid, as a charge against damages etc., then
such amount withheld will be liable to GST as per the present GST laws, the AAR
order said. According to the applicant, no GST is applicable on the amount
collected as interest-free security deposit. It argued that the definition of
consideration given under the CGST Act specifically excludes any deposits,
unless the same is applied as consideration for the supply. The security
deposits taken from the occupant does not influence the rent payable for the
commercial properties. The security deposits are only taken to safeguard the
interests of the lessor. Granting relief to the applicant, the authority
observed that the definition of supply requires presence of consideration as an
element for any of the defined transactions to be exigible to tax. Further, the
definition of consideration given under the CGST Act, 2017 requires a direct
link between the payment and supply. Deposits will only classify as
consideration where the supplier appropriates such deposit as consideration for
the said supply. It also laid four parameters for a payment to qualify as
‘security deposit’ — for performance of an obligation, security against return
of hired goods, security against damage to properties rented and it should be
reasonable. It was further held that these parameters apply in the present
case, so it ruled that security deposit taken by the applicant cannot be
treated as consideration for supply and they are not liable to pay any GST on
the same.
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GST EXEMPTION FOR SUB-CONTRACTORS INVOLVED IN CONSTRUCTION OF
INDO-NEPAL BORDER: AAR REFERS MATTER TO APPELLATE AUTHORITY
Owing to the difference in
opinion among the Authority for Advance Ruling, Uttarakhand, the matter,
whether Sub-contractors involved in the construction of Indo-Nepal border road
are entitled to GST exemption was put forward for reference to the Appellate
Authority for hearing and decision. The Assessee M/s NBHPC Ltd. was
subcontracted a road construction work by the PWD, Uttarakhand, which in turn
was contracted to by the Ministry of External Affairs, as a part of ‘AID TO
NEPAL’ Project. The question presented in the application was whether the
notification No. 12/2017- Central Tax (rate) is applicable to the
contractors/sub-contractors involved in the aforementioned project. Authority
Member Amit Gupta had the view,On harmonious reading of Central Tax (rates) in
the light of object behind the GST Council to pass the benefit of tax to the
downstream of the chain, I observe that sub-contractors of supply in question
are exempted from payment of GST in terms of the notification concerned. However,
the other Authority Member Vipin Chandran was of a different view, the activity
of ‘construction of road’ is exempted vide serial no. 9C of the notification No.
12/2017 Central Tax (rate) whereas the entry no. (iv) of serial no. 3 of
notification no. 11/2017 Central Tax (rate) prescribed GST rate of 12 % on the
same work, i.e. ‘construction of road’. In the above view I observe that the
supply in question , i.e. ‘ construction of road’ by sub-contractor is not
exempted therefore the sub-contractor are liable to pay GST.
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ANOTHER DIAMOND FIRM WITH RS 3,000 CRORE DUES DECLARED
BANKRUPT
In yet another shock to
the gems and jewellery industry, Eurostar Diamond Traders, one of the largest
diamond companies in Antwerp has been declared bankrupt by the Antwerp
Corporate Court. The manufacturing company, established in 1978 by Kaushik
Mehta, said to have debts reaching up to half a billion dollars. Industry
sources said that with yet another diamond company going bankrupt, bank finance
in the industry is going to be tougher. Anirudha Lidbide, diamond industry
analyst said, Diamond industry has lost its glitter after the series of
bankruptcy and frauds committed by big diamond company owners. The bankruptcy
process against Indian companies in foreign countries will make bank financing
in diamond companies tougher. Eurostar Diamond Traders, owned by Jain
diamantaire Kaushik Mehta, owes an estimated $500 million (Rs 3,500 crore) to
the banks and financial institutions. Sometime ago, the company lost its
sightholder status with De Beers because of its financial problems. Industry
sources said that Eurostar company owns an office in the Bharat Diamond Bourse
(BDB) in Mumbai and is member of the Gems and Jewellery Export Promotion
Council (GJEPC). The company has close business relations in Surat and Mumbai
and that most of the company’s diamond stocks was manufactured in Surat. Earlier,
the company had admitted in November 2018 that its diamond stocks were only
worth $25 million, despite valuing them at $148 million in September 2018. The
company lost the trust of its most important creditors and is indebted to them
for huge sums of money. A senior official of Bharat Diamond Bourse (BDB)
seeking anonymity said, After the banking fraud worth Rs 13,000 crore involving
Nirav Modi and Mehul Choksi, the bankruptcy proceeding against Indian company
in Antwerp will further tighten the bank advances in the diamond sector. Kirti
Shah, diamond exporter said, Banks have lost confidence in financing the gems
and jewellery companies. We are facing lot of hardships for obtaining finance
from the banks. Nowadays, we have to furnish 100% collaterals against the bank
advance.
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COMMERCE MINISTRY LAYS DOWN PROCEDURE FOR IMPORT OF CERTAIN
PULSES
The commerce ministry has
laid down a procedure for import of a few varieties of pulses for the current
fiscal and has invited applications from millers. According to the ministry's
foreign trade arm DGFT, millers and refiners of these pulses need licence for
imports Procedure for import of 2 lakh tonne pigeon peas/toor dal, 1.5 lakh
tonne urad dal, 1.5 lakh tonne moong dal and 1.5 lakh tonne peas (including
yellow peas, green peas, dun peas, and kaspa peas) is laid down, directorate
general of foreign trade (DGFT) has said in a notice. As per the procedure, for
each refining/processing unit, applicants will have to provide self-certified
copy of a document indicating its refining/ processing capacity. This document
should be issued by a central, state or district authority. The absence of the
document will render the application liable for rejection, it said. The licence
holders shall submit monthly statements indicating the actual arrival of
shipments at the Indian ports, it added. The country has been importing 4-6 MT
(million tonne) pulses every year to meet the domestic demand of about 24 MT. In
view of the bumper output, the government has imposed quantitative cap on the
imports.
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POWER COMPANIES CHALLENGE GST ON GREEN CERTIFICATES
Are renewable energy
certificates, bought by power companies, goods or services? Neither. And so,
must be out of the indirect tax ambit, according to power companies which have
suffered higher costs because of the Goods and Services Tax (GST). The power
companies that buy these certificates to comply with the environmental norms
challenged the levy through a writ petition filed in the Delhi High Court on
Tuesday. Power companies buy these certificates from renewable energy exchanges
to abide by government norms that mandate that a certain percentage of power
generated should be through renewable sources. The certificates are derivatives
based on the power generated in green route. Most power generators buy
renewable energy from their green peers, sometimes based abroad. These
certificates also work as a source to buy the balance quantity of renewable
energy that cannot be bought or generated directly by the power firms. The
taxability of renewable energy certificates has been challenged as these are
securities which are excluded from both goods and services. According to the
power companies, a government circular that came out in June last year added to
their woes. It talked about the applicability of GST on the renewable energy certificates
at 12% It is hereby clarified that Renewable Energy Certificates (RECs) and
Priority Sector Lending Certificates (PSLCs) and other similar documents are
classifiable under heading 4907 and attract 12% GST, it read. Taxing renewable
energy certificates will prove to be fatal for the power consumers by further
increasing the cost of electricity.
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GOVT ALLOWS ONLY DAL MILLERS TO IMPORT PULSES UNDER QUOTA FOR
SECOND YEAR
The government has allowed
only dal millers to import the annual permissible quota of pulses, a restricted
commodity, for the second consecutive year. The industry expects the number of
applications for procuring import licences to increase five-eight times this
year as those who imported the commodity last year booked good profits. The
Union commerce ministry issued a notice regarding restricting pulses imports to
processors on Tuesday, allowing import of 200,000 tonnes of tur and 150,000
tonnes each of moong, urad and yellow peas. We expect that the number of
applications to get import licence for pulses could rise to 1,500-2,000 from
about 300 applications last year, said Bimal Kothari. International prices of
pulses had hit rock bottom as India had put restrictions on import of pulses.
This helped dal millers earn good profits on the processing of imported pulses
in 2018-19, even though domestic prices were subdued. The All India Dal Millers
Association (AIDMA) had demanded that only millers be allowed to import the
restricted quantities of pulses. Multinational companies used to import and
hoard pulses, which led to a speculative price rise. With dal millers importing
their raw material directly, prices of pulses remained stable in the previous
year, said Suresh Agarwal. In 2018-19, even though the government had allowed
import of 800,000 tonnes of pulses, the industry estimates that about two
million tonnes of pulses were imported in the country as traders got a court
stay on the order of the Director General of Foreign Trade allowing only
millers to import pulses. From January 2019, the commerce ministry has issued
notifications in the matter which cannot be challenged in the court since the
ministry has the authority to take the decision. The decision of the government
to restrict pulses imports to dal millers has helped even smaller millers
participate in imports, which were restricted to only MNCs and big traders,
said Agarwal.
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A SINGLE-RATE GST IS NEITHER DOABLE NOR DESIRABLE IN INDIA
The Congress manifesto
promises to work towards a single GST rate. It won’t happen anytime soon. It
has also promised to bring petroleum under goods and services tax. Again, a
non-starter, when petro-taxes are the single biggest flexible revenue source
for the centre and states. The two objectives are contradictory If you want a
single GST rate, bringing petrol and diesel under GST would mean creating yet
another super-high rate. In 2017-18, the sector generated more than ₹5.5
trillion for the centre and states. No one is going to sacrifice this booty for
the sake of simplicity. We need to differentiate between compliance simplicity
and conceptual simplicity (easy to understand). The focus should be on ease of
compliance. Conceptual simplicity —as the one-rate goal suggests—is not worth
the effort When you have a complex and diverse society with huge income
variations, the idea of a tax rate that is the same for every product, whether
consumed by the rich or poor, is bad from the point of view of political optics
and equity. One can, of course, semantically argue that the absolute level of
tax on a ₹20 toothbrush is lower than on an SUV that costs ₹40
lakh even with a single rate, but those who buy this argument should equally be
rooting for a flat rate of income tax, which they don’t. So, the first point to
make about a single GST rate is that it is a bad idea for unequal India The tax
must be progressive, with a core middle rate, and two rates on either side. A
fourth rate could be a very low one—say, 1%—applicable to all items of mass
consumption, where collections can be through a reverse charge mechanism. If
today’s GST structure is complex, the reasons have less to do with political
intent and more with the need to get all to sign up for the shift. The Congress
could never get states on board for a simple reason: it made no mention of
compensation for revenue losses. There was suspicion that the centre may renege
on commitments, as it did with compensation for the removal of consignment tax.
By hard-coding compensation into the GST constitutional amendment, the National
Democratic Alliance (NDA) got states to willingly come on board and this
introduced the first level of complexity and the introduction of a cess above the
top rate on luxury items. The next two levels of complexity came because of the
need to ensure revenue-neutrality Given the lack of knowledge on demand
elasticities for hundreds of products, almost all rates were pegged using a
simple formula: existing state VAT plus central excise. Then, there was the
political need to exempt small businesses from compliance burdens. It is these
exemptions and variations that need fixing first. All special cases (the
composition scheme, and flat rate GST without input tax credit) need to be
eliminated in phases to conform with the core principles of the tax. This could
take 3-5 years. The priority should be ever-improving software and cheap GST
services that can make compliance a breeze even for small and micro units. Not
all taxes are right for every kind of society India is a low-trust society and
its extreme diversity makes tax compliance difficult to enforce without a great
deal of coercion. The reason is obvious: people are reluctant to pay taxes when
they do not know whom they help. In monocultural countries like most parts of
Scandinavia and the rest of Europe, high income taxes are the norm and people
pay them because they know that the redistributive effect of higher taxes go to
people like us, and maybe even come back to them once they get old or are
unwell. In diverse countries like India, no one can assume that the taxes
collected will benefit people like us. Consider the political salience that the
Congress generated by suggesting that the better-off south is paying for the
poor in the north. Two conclusions follow. The taxes that are easiest to
collect are indirect taxes, as they are less visible, and GST is the ideal
vehicle for such taxation, as it has a self-policing mechanism. Buyers are
motivated to get sellers and suppliers into it because that is the only way
they get input tax credits. For the consumer, the tax is invisible, merged into
the final retail price. Second, the taxes that are most resisted are income
taxes, as they bite directly. Given our low-trust society, this is the tax most
Indians will resent if used in redistributive exercises. Already, the
government’s efforts to make Indians more income-tax-compliant have drawn howls
of protest and accusations of tax terrorism. Therefore, the logical way forward
is to make GST reasonably progressive, and yet, easy to comply with. Income tax
could be less progressive. India should aim for high levels of tax exemption ( ₹10
lakh basic exemption in the next two years), and a shift towards a flat tax or dual
rate regime (10% and 20%) over five years. This can be phased to coincide with
GST beginning to deliver higher revenues, so that there is no loss. The
bottomline: a single-rate GST isn’t worth pursuing till India becomes a
middle-income country with per capita gross domestic product of over $5,000
annually. At that stage, a single tax rate will not be resented as inequitous.
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APPAREL EXPORTS DROP 3.46% ON GST EFFECT
Apparel exports dropped
3.46% in 2018-19 compared with the year-earlier period, mainly because exporting
units took time to adjust to the new rates under the Goods and Services Tax
(GST). Apparel exports last financial year were worth $16.13 billion compared
with $16.71 billion in the year-earlier period. However, in rupee terms, the
exports grew 4.66 %. According to A. Sakthivel, under the GST, there was almost
7% reduction in the incentives that the exporters were receiving earlier and
they also had to adjust to the new system. Chandrima Chatterjee, advisor to the
council, said the global apparel market was also stagnant. Yet, leaders in the
segment such as Bangladesh and Vietnam witnessed growth. We need to strategise
to position Indian products in the international market, she said. Export of overall
cotton textiles, including cotton yarn, rose almost 10% last financial year
compared with the year-earlier period. Apparel exports, too, surged 15% in
March after the Centre announced reimbursement of embedded taxes. This should
give a boost to exports this year, says Siddhartha Rajagopal.
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JSW OPEN TO SELL STEEL ON ADVANCE LICENCE TO EXPORTERS
JSW Steel has offered to
supply steel to export-oriented engineering companies at the landed cost of
imports without adding customs duty under the advance licence mechanism. In a
bid to incentivise export, the government allows exporting units to import raw
material duty-free under the advance licence. While steel companies have been
demanding the government to increase duty to prevent cheap imports, the
Engineering Export Promotion Council recently voiced concern against the
protectionist measure. In a presentation made to the Commerce Ministry opposing
any hike in steel import duty, EEPC highlighted how steel prices have shot up
in the past two years. This apart, it said the delivery period has increased to
4-6 months from just a few weeks ago, it claimed. Domestic steel prices are
pegged to the landed cost of imports, including import duty. Refuting the claim
of EEPC, Seshagiri Rao, said there is enough schemes for exporting engineering
companies to import steel without paying duty. Assuming they are facing
difficulty in importing, he said the industry is willing to supply steel at the
landed cost under advance licence, he said. Instead of allowing Indian
engineering companies to import duty free and supporting global steel makers,
the government under deemed export basis can reimburse part of the import duty
to domestic steel companies for selling steel duty-free, said an analyst.
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VIJAY MALLYA EXPRESSES SYMPATHY WITH NARESH GOYAL, SLAMS
CENTRE
Vijay Mallya has once
again attacked the government for discriminating between public sector and
private airlines while extending solidarity with crisis-hit Jet Airways and its
founder Naresh Goyal. In a series of tweets, Mallya said he was sorry that so
many airlines had bitten the dust in the country. Even though Jet was a major
competitor to Kingfisher at the time I feel sorry to see such a large private
airline on the brink of failure when government used (Rs) 35K crore of public
funds to bail out AirIndia. Just being a PSU is no excuse for discrimination,
Mallya tweeted. The controversial billionaire has extended full sympathy to
Naresh Goyal who was recently forced by the public sector lenders to quit the
airline board. Even though we were fierce competitors, my sympathies go out to
Naresh and Neeta Goyal who built Jet Airways that India should be extremely
proud of. Fine airline providing vital connectivity and class service, he
wrote.
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EC APPOINTS SPECIAL OBSERVER FOR WEST BENGAL AHEAD OF SECOND
PHASE
The Election Commission of
India (ECI) on Tuesday appointed special observer for West Bengal ahead of the
second phase of Lok Sabha polls in the state. ECI has appointed 1984 batch IAS
officer Ajay Nayak who was the Chief Electoral Officer (CEO) Bihar. Following
complaints by the Opposition parties after the first phase of polling process
on April 11 was dotted with incidents of violence and booth capturing, EC has
decided to deploy Central forces in 80% of the booths in three Lok Sabha
constituencies of West Bengal which go to poll on April 18, in the second
phase. EC sources said initially it had been decided that there would be
Central forces at 55% of booths in Darjeeling, Raiganj and Jalpaiguri
constituencies. The EC has now decided to press in 194 companies of jawans and
ensure that there are posted at 80 per cent of the booths in north Bengal, an
EC official said. While state armed police will be at the rest of the 20%
booths, there will be CCTV at all booths, and most of them would be covered by
webcasting and videography. The tech intervention would enable ECI officials in
New Delhi and CEO WB, offices to monitor the poll process live at all the
booths.
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ADS MAY NOW GET MORE BANG FOR BUCK IN NEWS CHANNELS
Despite an impressive 21%
increase in viewership of the Indian Premier League (IPL) in the first two
weeks, data suggests news channels are likely to be a more forceful and
cost-effective bet this election season for the advertisers looking for a mass
reach. BARC viewership data sourced from a subscriber showed IPL’s cumulative
reach in the 15+ year demographic at 276.4 million (42.5%) in All India and
171.7 million (38.6%) in the Hindi speaking markets (HSM), respectively across 23
Star India channels. In comparison, the top 20 news channels (five Hindi, three
English and top 12 regional language channels) registered a cumulative reach of
291.4 million (44.8%) for All India and 209.2 million (47.1%) for the HSM,
respectively. Reach is total number of individuals who viewed the event for at
least one minute. The time considered for news channels was between 7 pm and
midnight. While advertising rates for the IPL are at a record Rs 10 lakh per
10-second slot, the same spot on news channels costs a fraction of the amount,
which opens up a potential for advertisers, media experts feel. News channels
are a very costeffective medium during elections, said Ashish Sehgal.
Especially during the general elections, we have seen very high level of
engagement, as well as reach and frequency. Also, the audience for IPL and news
channels is more or less similar with a high skew towards male viewers. Sehgal,
who also looks after the sales for ZEE Group's news channels, added that news
as a genre is still underpriced, making it a lucrative option for the
advertisers. A back-of-the envelop calculation suggests that if an advertiser
puts the same money on top 20 news channels, the gross impressions (or ratings)
generated will be around 41% higher for All India market than the IPL. While
IPL has an advantage of being an annual property that has become a part of
marketing budgets of many companies, news channels, have not been able to cash
in on elections in comparison to the yield one gets in IPL, Sehgal said.
However, some experts also feel that when it comes to engagement, IPL still is
unparalleled.
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TERROR FUNDING: ED ATTACHES KASHMIRI BUSINESSMAN’S PROPERTY
WORTH ₹6.19 CRORE
The Enforcement
Directorate (ED) on Tuesday attached property worth ₹6.19
crore belonging to Kashmiri businessman Zahoor Ahmad Shah Watali under the
Prevention of Money Laundering Act in ongoing investigations into a terror
financing case against Lashkar-e-Toiba chief Hafiz Muhammad Saeed. The
directorate had initiated investigation based on a chargesheet filed by the
National Investigation Agency (NIA) against Hafiz Saeed under the Unlawful
Activities (Prevention) Act (UAPA), 1967. Accused Zahoor Ahmad Shah Watali has
been found to be involved in fundraising and acting as a financial conduit for
Hurriyat leaders. The NIA investigation also revealed that the All Party
Hurriyat Conference (APHC) and other secessionists instigate the general
public, especially the youth, to observe strikes, and issue directives to the
masses to hold anti-India protests, demonstrations and processions through
press releases, newspapers and social media, the ED said in a statement.
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IMRAN KHAN'S STATEMENT ON PM MODI COULD BE CONG'S PLOY:
SITHARAMAN
Nirmala Sitharaman
believes that Pakistan Prime Minister Imran Khan's statement 'that there may be
a better chance of India-Pak peace talks and settling of the Kashmir issue if
the BJP is voted back to power' is a ploy by Congress to oust Prime Minister
Narendra Modi-led government from the Centre. I wouldn't know why such
statements are being made. Every time such statements are made and this is
individually my perception and not my party's or the government's take. There
have been many eminent leaders of the Congress who went there (Pakistan) to
seek help to oust Prime Minister Narendra Modi. They went there saying, Modi
hatane ke liye hamen madad karo (help us to oust Modi). I wonder whether this
is also a part of the scheme of things which have been put by Congress. I don't
know what to make of this honestly, the Defence Minister told. Imran Khan had
said he believes there may be a better chance of peace talks with India and
settling the Kashmir issue if Modi's party BJP wins the general elections. Mehmood
Qureshi's claims that India was going to attack Pakistan between April 16-20,
Sitharaman said, I don't know from where he got these dates from. Good luck to
him god knows (who is his source in India) but it sounded very fanciful and
amusing to me. When asked whether the Supreme Court's decision to look into the
allegedly stolen documents or acquired documents in the Rafale case weakened
government's position, the union minister said, I don't think our position has
become weaker. We are firm on our stand. The Attorney General gave an
explanation the next day. Documents from the Defence Ministry are classified
documents. Every time a document of this nature or even a page comes out, in my
understanding, it is stealing of information. The ministry is looking into the
matter as to how it came out. When questioned if she thought that the
procurement of documents pertaining to the Rafale deal was illegal, the
Minister said, The procurement of the document is illegal. That's what I have
been harping on. There are legitimate ways of obtaining it. There are credible
tools to obtain it. If it has not come out through a legitimate manner then it
is said to be stolen. Now what has come out does not alter the discourse on
Rafale. Even if we include the matter on these illegally obtained pages, it
does not alter the clear process which has been adopted. We are not worried at
all. Sitharaman also hit out at Congress president Rahul Gandhi for his
'chowkidar chor hai' remark against Prime Minister Modi, which he attributed to
the Supreme Court. But then has the Supreme Court said that Modi ji gave this
much money to Anil Ambani? Has Supreme Court said this? When has Supreme Court
said this? Has Supreme court even remotely said that PM Modi is not chowkidar
and chori ki hai? Is this not taking liberty with the institutions? That too
Supreme Court, where every word is well thought out. It is putting words into
the mouth of the court and therefore if the court is looking into the matter it
is only fair, she said. Further underlining the government's dedication towards
equipping the armed forces, the Defence Minister said, Post Rafale too, the
Defence Acquisition Council meets every fortnight. We have been clearing things
which are vital for the armed forces. Nothing has stopped us. The speed during
Manohar Parrikar's time and Arun Jaitley's time continues even now. On giving
emergency powers of up to Rs 300 crore to the services for meeting their
critical requirements, the Defence Minister said, earlier also we had given
emergency powers post-Uri attacks. We had also given them the power to choose
what they want to buy. If they want to quickly purchase some ammunition post
Pulwama, they can go ahead. So, this happens at least under Modi and the NDA
government. Armed forces have the margin of acquiring quickly.
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APPLY MIND BEFORE YOU SPEAK: SITHARAMAN'S ADVISE TO
POLITICIANS ON SEXIST REMARKS
Empathising with BJP
candidate and actor Jaya Prada, Defence Minister Nirmala Sitharaman said
political leaders should apply their minds before they speak about
women-related issues. Sitharaman said, 100 per cent. It is always easy to hit
at a woman when you talk about other things which don't become part of the
conversation or which are not germane to the discussion. You easily pick up on
things which are very personal or are gender specific and not called for at
all. I find that coming very easily without a thought. That is where I think
all of us think before the word comes out of the vocal cord to the lips. There
should be some kind of momentary application of mind at least, said the Defence
Minister on Jaya Prada and other women politicians who have to face sexist
remarks from male counterparts. We have to draw a line. Irrespective of the
party line I think we have all learnt from good public discourse. It should be
in the back of our minds what we talk about in politics as that is the legacy
we leave behind for the next generation and we have a responsibility towards
it, Sitharaman said. An FIR was registered against Khan for making an
objectionable comment against the actor-turned-politician. The SP leader has,
however, clarified that he did not name anyone.
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NORTH KOREA WANTS POMPEO REMOVED FROM NUCLEAR TALKS: KCNA
North Korea on Thursday demanded
the removal of US Secretary of State Mike Pompeo from stalled nuclear talks
between Pyongyang and Washington, accusing him of derailing discussions. I am
afraid that, if Pompeo engages in the talks again, the table will be lousy once
again and the talks will become entangled, Kwon Jong Gun, director general of
the Department of American Affairs at North Korea's Foreign Affairs Ministry
said, according to the official KCNA news agency. Therefore, even in the case
of possible resumption of the dialogue with the US, I wish our dialogue
counterpart would be not Pompeo but (another) person who is more careful and
mature in communicating with us.
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INDIA SHOULD BE WARY OF GETTING TOO COSY WITH SAUDI ARAMCO
Saudi Arabian Oil Co. is
doing its best to make nice with one of its biggest customers. With the ink barely
dry on the takeover of 70 percent of the country’s chemical giant Saudi Basic
Industries Corp. and the issuance of its first-ever corporate bond, Aramco is looking
to buy a stake in the world’s biggest oil refinery Indian billionaire Mukesh
Ambani’s Reliance Industries Ltd. is seeking to sell as much as a quarter of
its refining business for at least $10 billion and is entertaining offers from
Aramco and Abu Dhabi National Oil Co., people with knowledge of the matter told
Bloomberg News this week. That represents quite a prize. Reliance’s Jamnagar
refinery is about twice the size of the biggest U.S. plant, Aramco-owned Port
Arthur, and is so massive that maintenance work occasionally skews India’s
entire trade balance. Trade is also the reason India should be cautious of
Aramco’s embrace. The country has a dangerous addiction to imported crude, and
it should be wary of getting too cozy with its dealer. For more than a century,
the rise of major economic powers has been fueled by petroleum. The U.S. is both
the world’s biggest oil consumer and its biggest producer. The Soviet Union was
built on its oilfields in the Caucasus and Siberia. While China has overtaken
America as the biggest oil importer, it’s also the biggest producer outside the
Middle East after the U.S., Russia and Canada. India is different. The U.S.
produces about 1.8 metric tons of oil a year per capita and even China manages
138 kilograms. India – at a far earlier stage of development than either
country – ekes out just 30 kilograms. Production peaked all the way back in
2010, and shows no sign of recovery. Industrialization is an energy-intensive
process. If India’s development is going to be powered by crude oil, it’s going
to be buying a whole lot more from Aramco and its ilk. Such a future would pose
some profound risks. Balance of payments crises are a recurring danger for
emerging economies, and even at its current stage of development oil typically
accounts for about a quarter of India’s imports. If prices spike higher – as,
inevitably, they will from time to time – that’s good news for Riyadh, but
potentially devastating for New Delhi. When crude is averaging $85 a barrel –
roughly the level at which Saudi Arabia can balance its budget, according to
the International Monetary Fund – oil imports would reduce India’s gross
domestic product by about 3.6 percentage points, according to a study this year
by the Reserve Bank of India. Higher prices will also push up inflation and
weaken the government’s fiscal position, the authors found. At present, that
dynamic is somewhat mitigated by the fact that about a third of India’s oil
imports are re-exported as petroleum products, giving the country a natural
hedge against rising prices. Jamnagar, for instance, produces almost
exclusively for export, meaning that it probably makes a modestly positive
contribution to the trade balance since oil products are more valuable than the
crude they’re made from. India is aware that its dependence on imported crude
risks constraining growth. The government wants 30 percent of new cars and
two-wheelers to be electric by 2030 and is already home to more than 1.5
million electric rickshaws. It’s also adjusted tax policies to encourage that
transition. In a country at grave risk from climate change, whose cities are
already choking on vehicle smog, reducing the reliance on imported fossil fuels
is more than just an issue for the current account. That goal isn’t an
unrealistic one given the rock-bottom local cost of wind and solar. Still, no
country has managed a low-carbon industrialization on this scale before, so it
won’t be easy – and Saudi Arabia will be hoping it proves all but impossible.
By promising to buy a chunk of Reliance and help fund a new $44 billion
Jamnagar-sized refinery in western India, Aramco is counting on the country
being unable to kick its self-destructive oil habit. Indians should hope that
it’s wrong.
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CONGRESS FILES FIR AGAINST NAGALAND DEPUTY CM FOR MCC
VIOLATION
The Congress has filed an
FIR against Nagaland Deputy Chief Minister Y Patton for allegedly violating the
model code of conduct during the April 11 Lok Sabha poll in the state. The
party has demanded repolling at Riphyim Polling Station in Patton's home
constituency -- 37-Tyui in Wokha district. The FIR against Patton is for
serious violation of model code of conduct by entering the polling station
wearing a political party's scarf, and criminal conduct of impersonation and
forgery by indulging in proxy voting, a Nagaland Pradesh Congress Committee
release said. Congress's demand for repolling, however, was not accepted for
recommendation to the Election Commission by Returning Officer M Patton, who
said, No discrepancies were observed after going through the report of the
presiding officer and sector magistrate.
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NARENDRA MODI IS PRIME MINISTER ONLY FOR WEALTHY: NAVJOT SINGH
SIDHU
Navjot Singh Sidhu said on
Tuesday that the prime minister represented only the affluent Modiji, you are
the Prime Minister of only one per cent wealthy people. You are not the PM of
poor citizens. You are asking these locals to vacate their land and go
elsewhere. Almost 80 per cent of locals of this region are working as labourers
in other states, the cricketer-turned-politician said. Sidhu, said that PM Modi
had failed to keep his promise of generating two crore jobs every year. You
promised two crore jobs every year, but, only 8 lakh people got jobs in your
tenure. Though China's GDP is 6 per cent, it gave jobs to 70 lakh people in
five years. While India's GDP growth is 8 per cent, we could create only 8 lakh
jobs, he said. He claimed that even state-run HAL, BSNL and MTNL were
retrenching employees under the current government, and said that there were 25
lakh vacancies in the government. The Congress leader said that his party would
grant loan waiver to farmers after coming to power.
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CHINA GDP GROWTH STEADIES AT 6.4% IN FIRST QUARTER
China’s economy beat
forecasts as growth remained steady in the first quarter despite tepid global
demand, a US trade war and a debt battle, official data showed Wednesday. The
world’s second largest economy expanded by 6.4 percent in the January to March
period, faster than the 6.3 percent forecast by economists in an AFP poll,
according to official gross domestic product figures from the National Bureau
of Statistics. The national economy enjoyed stable performance with growing
positive factors, and stronger market expectation and confidence, said Mao
Shengyong in prepared remarks. Top policymakers huddled in Beijing last month
announced major plans to support the flagging economy, announcing massive tax
cuts, fee reductions, and financing support. Beijing faces a delicate balancing
act as it tries to support private businesses in need of credit, without
further inflating its debt balloon. New credit flooded into the financial
system last month, with the growth of bank loans and total outstanding credit
accelerating, though analysts say it will take about six months to spark an
economic turnaround. Premier Li Keqiang in March laid out a lower growth target
for China this year of 6.0-6.5 percent. China’s steady unemployment rate
dropped to 5.2 percent in March from 5.3 percent in February. Beijing is
counting on consumers and renewed investment to stabilise the economy. The
latest data showed growth in retail sales for March rising 8.7 percent on-year
after stagnating for three months near 15-year lows. But China’s imports fell
in the first quarter, adding to worries about weak demand. All eyes have been
on Beijing’s infrastructure spending which expanded 4.4 percent in the first
three months after plummeting to 3.8 percent growth last year amid a campaign
against debt and financial risk. The broader fixed-asset investment indicator
rose 6.3 percent on-year for the first quarter, from 6.1 percent in
January-February. Output growth at China’s factories and workshops in March
shot up 8.5 percent on-year, from 5.3 percent in the first two months, well
above forecasts.
__ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
EU-INDIA DISCUSSIONS ON RE-TESTING OF STEEL PRODUCT IMPORTS
FAIL TO CUT ICE
The EU has said that its discussions
with Indian authorities on the compulsory re-testing of specified stainless steel
product imported into the country at BIS authorised laboratories has failed to
resolve the issue. It sought to pursue the matter further at the World Trade
Organization’s committee on technical barriers to trade. In a fresh
representation, the EU reiterated its demand that India should accept the tests
carried out in foreign accredited laboratories attesting compliance with ISO
standards (or Indian standards) and stop conducting factory inspections in the
EU steel mills that have quality management systems as defined in ISO 9001.
Given that the intermediate product is a low risk one and that the EU producers
comply with international requirements and specifications, the EU is making
these demands, the representation stated. The EU, however, has not indicated if
it would file a dispute with the WTO over the matter. India already has 50
carbon steel and three stainless steel products under the ambit of its quality
control order. The Indian Steel Ministry recently notified its plans of
including a few more steel items to the list. The EU had alleged that such
controls were a non-tariff barrier, but India argued that the BIS standards
were necessary in order to take into account the manufacturing practices. EU
said that it had already complied with internationally recognised standards, as
well as with safety and quality standards recognised around the world. The EU
would like to ask the Indian authorities to confirm whether these standards are
equivalent to the relevant international standards. If that is the case, those
international standards should be referred to in the text as well, it said.
__ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
300 ARRESTED AS CLIMATE CHANGE PROTESTS BRING LONDON TO A
STANDSTILL
Nearly 300 people have
been arrested in ongoing climate change protests in London that brought parts
of the British capital to a standstill, police said Tuesday. Demonstrators
began blocking off a bridge and major central road junctions on Monday at the
start of a civil disobedience campaign that also saw action in other parts of
Europe. The protests were organised by the campaign group Extinction Rebellion,
which was established last year in Britain by academics and has become one of
the world's fastest-growing environmental movements. The arrest figure includes
three men and two women who were detained at the UK offices of energy giant
Royal Dutch Shell on suspicion of criminal damage. The majority arrested were
seized for breaching public order laws and obstructing a highway. We so far
have 55 bus routes closed and 500,000 people affected as a result, the police
said.
#For Source of Information copy and paste the heading in google.
Thanks & Regards,
CS Meetesh Shiroya
Thanks & Regards,
CS Meetesh Shiroya
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