ECONOMY AFFAIRS FEBRUARY 2016

ECONOMY AFFAIRS FEBRUARY 2016

• PM launched National Rurban Mission
  Indian Prime Minister Mr. Narendra Modi has stressed the need to involve the people in the process of development and reach the fruits of development to the common people. He launched Rurban Mission in the name of Dr. Shyama Prasad Mukherjee National Rurban Mission at Kurrubhath in Dongargarh block of Rajnandgaon district in Chhattisgarh on 21st February.
  
  Four clusters of adjacent villages in Rajnandgaon, Dhamtari, Bastar and Kabirdham district would be developed in the state during the first stage of this mission.
  • According to the Prime Minister Mr.Narendra Modi the National Rurban Mission intends to bridge the rural-urban divide by bringing civic and infrastructural amenities to clusters of villages and making them smarter evolving a new mantra for urbanization.
  • The mission would focus on developing 300 clusters within a span of three years to spur economic, social and infrastructure development in rural areas.
  • The work relating to one hundred such clusters would be taken up this year
  • The soul of villages would be retained while providing urban facilities and after strengthening of villages the rate of migration of people towards the cities could be reduced.
  • With this, the pressure on the basic amenities and resources of the big cities would be lowered and it would automatically promote overall development in different parts of the country.
  • Prime Minister Mr. Modi inaugurated the Jan Aushadhi Medical Store Scheme which includes setting up of one hundred Generic Medicine Stores in the state.
  • He also formally declared the two blocks of Ambagarh-Chouki and Chhuria in the state as open defecation free and felicitated the inspiring workers giving valuable contribution in the Swachta Abhiyan.
  • Earlier, the Prime Minister laid the foundation stone for housing scheme and the electronic manufacturing cluster in Naya Raipur.
  • Under the scheme, 40,000 houses would be constructed for families belonging to the Economically Weaker Sections and Lower Income Groups towards achieving the target of Housing for All by 2022 under Pradhan Mantri Awaas Yojana.
  • The electronic manufacturing cluster would be developed on 70 acres of land in Naya Raipur at an estimated cost of 90 crore rupees.
  • It is expected to garner capital investment of 2,000 crore rupees and create employment opportunities for over 3,800 youths.
  
  
• Govt to sell 5% stake in NTPC to garner Rs 5K cr
  Government will sell five per cent stake in country's largest power producer National Thermal Power Corporation (NTPC) on 23rd February. It will be sold at a floor price of 122 rupees per share to raise over five thousand crore rupees. The stake sale would be spread over two days with institutional bidders getting the first chance to buy shares on 23rd February.
  
  Retails investors, for whom 20 per cent shares have been reserved, will get to bid on 24th of this month. In May last year, the Cabinet had approved the five per cent stake sale in NTPC. The government holds 74.96 per cent in the firm. It had last sold stake in NTPC in February 2013.
  
• India remains world's largest arms importer, with 14% of total share
  India continues to remain the world's largest arms importer, accounting for 14% of the global imports in the 2011-2015 timeframe, in yet another indicator of the country's enduring failure to build a strong domestic defence-industrial base (DIB).
  
  The latest data on international arms transfers released by a global think-tank, Stockholm International Peace Research Institute (SIPRI), also shows India's arms imports remain three times greater than those of its rivals China and Pakistan. Its biggest suppliers are Russia, the US, Israel and France.
  
  After India, China ranks second in the global arms import list with 4.7%, followed by Australia (3.6%), Pakistan (3.3%), Vietnam (2.9%) and South Korea (2.6%). China used to top the imports chart earlier but has gradually built a stronger DIB over the last couple of decades to even emerge as the world's third largest arms exporter after the US and Russia.
  
  Incidentally, Pakistan is the main recipient of Chinese arms exports, notching up 35% of the total, followed by Bangladesh (20%) and Myanmar (16%). Russia, in turn, is China's largest arms supplier with 59%, followed by France (15%) and Ukraine (14%).
  
  Noting that India's arms exports has jumped by 90% between 2006-2010 and 2011-2015, SIPRI reiterated the well-acknowledged fact that "a major reason for the high-level of imports is that the Indian arms industry has so far largely failed to produce competitive indigenously-designed weapons".
  
  India has spent over $120 billion on arms acquisitions over the last 15 years, most of them from foreign suppliers, and will spend much more than that in the coming decade. Since it came to office in May 2014, the Modi government has launched a major "Make in India" drive in the defence sector but it's yet to translate into anything concrete on the ground.
  
  The import bill is further set to zoom upwards with some major deals, without any Make in India component, in the pipeline. This includes the direct purchase of 36 French Rafale fighters for over Rs 60,000 crore and the Rs 39,000-crore acquisition of five advanced Russian S-400 Triumf air defence missile systems.
  
• RBI extends swap arrangement with SAARC nations
  In order to enhance economic cooperation and strengthen financial stability, RBI has extended the USD 2 billion currency swap arrangement to SAARC nations till mid-November 2017.
  
  The Reserve Bank said in a notification today that it has decided to extend the SAARC Currency Swap Arrangement till November 14, 2017. Under the arrangement, RBI is to offer swap arrangement up to an overall amount of USD 2 billion both in foreign currency and Indian rupee.
  
  The SAARC Swap Arrangement was offered by the RBI to SAARC nations on November 15, 2012. The facility will be available to all SAARC member countries -- Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. The swap amount available to various member central banks has been arrived at broadly based on two months import cover subject to a floor of USD 100 million and a maximum of USD 400 million per country.
  
• Promotion of Payments through cards and digital means: Cabinet
  Cabinet has given its approval for introduction of steps for promotion of payments through cards and digital means. The move aims at reducing cash transactions. Under the move no surcharge, service charge, convenience fee will be levied on card and digital payment. Steps will be taken for payments beyond a prescribed threshold mandatory through cards or digital mode.
  
  It will be instrumental in reducing tax avoidance, migration of government payments and collections to cashless mode. The Cabinet also approved establishment of Atal Innovation Mission (AIM) and Self Employment and Talent Utilisation (SETU) in NITI Aayog. The decision would result in implementation of Mission activities in a focused manner.
  
  In an another decision, the Cabinet also gave its nod for the signing of agreement between India and Maldives for avoidance of double taxation of income from International air transport. The Agreement provides for relief from double taxation for airline enterprises between the two countries.
  
  The Cabinet also cleared a proposal for provision and operationalization of credit of 150 million dollar from EXIM Bank for development of Chabahar Port in Iran. The Port lies outside the Persian Gulf in Iran and will help in expanding maritime commerce in the region. India is negotiating this project to facilitate the growing trade and investment with Iran and other countries in the region, notably Afghanistan.
  
• Standing committee on Finance submits report on NPAs of Public Sector Banks
  The Standing committee on Finance on 24th February said the Net Non performing Assets (NPAs) of Public Sector Banks stood at two lakh five thousand twenty four crores till September 2015 and the Gross NPAs during the corresponding period stood at three lakh sixty nine thousand nine hundred ninety crore rupees.
  
  In its twenty seventh report tabled in Parliament, the committee observed the bulk of bad loans of banks may be linked to firms that are struck with over capacity and weak demand.
  
  The report said the prolonged slowdown in the economy has eroded the market for distressed assets so much so that even Asset Reconstruction Companies have found it hard to offload them. The committee suggested that the RBI should consider such a dispensation that allows banks to absorb their written-off losses in a staggered manner and can help them restore their balance sheets.
  
  In its report on Non performing assets of financial institutions, the committee expressed deep concerns about the NPAs despite various measures taken by the government and Reserve Bank of India from time to time. The report said instead of declining, the cumulative net volume of NPAs of all banks and financial institutions are only increasing every year.
  
• No changes in charges: Railway Budget
  Railway Minister Suresh Prabhu on Thursday spared India Inc and passengers from an increase in railway freight and fares, but continued to bet on higher investments and growth in 2016-17, even though the economic slowdown and the impact of the Seventh Pay Commission's award were certain to take a toll on his finances
  
  In his second Railway Budget presented to Parliament, Prabhu pitched for capital expenditure of Rs 1.21 lakh crore in the coming financial year, up from Rs 1 lakh crore this year. Every rupee of investment in the railways has the capacity to increase the economy-wide output by Rs 5, Railway Minister Prabhu said, while presenting the Railway Budget for 2016-17. According to him the impact that this increased investment will have on the economic growth of the country is unprecedented.
  
  Theme of the Budget: Overcoming challenges - Reorganize, Restructure Rejuvenate Indian Railways: 'Chalo, Milkar Kuch Naya Karen'
  
  Three pillars of the strategy: Nav Arjan - New revenues, Nav Manak - New norms, Nav Sanrachna - New Structures
  
  Theme of the Budget: Overcoming challenges - Reorganize, Restructure Rejuvenate Indian Railways: 'Chalo, Milkar Kuch Naya Karen'
  
  Three pillars of the strategy i.e. Nav Arjan - New revenues, Nav Manak - New norms, Nav Sanrachna - New Structures.
  
  Investments and Resources:Process bottlenecks overhauled including delegation of powers to functional levels; average capital expenditure over 2009-14 is Rs. 48,100 crore, average growth of 8% per annum.
  
  2015-16 investment would be close to double of the average of previous 5 years
  
  2016-17 CAPEX pegged at Rs. 1.21 lakh crore; implementation through joint ventures with states, developing new frameworks for PPP, etc.
  
  Vision
  By 2020, long-felt desires of the common man to be fulfilled i.e, reserved accommodation on trains available on demand, time tabled freight trains, high end technology to improve safety record, elimination of all unmanned level crossings, improved punctuality, higher average speed of freight trains, semi high speed trains run
  
  Highlights
  • No hike in passenger fares.
  • Action has been initiated on 139 budget announcements made last year.
  • Eliminate all unmanned level crossings by 2020.
  • Swacch Bharat: 17000 biotoilets and additional toilets in 475 stations before the close of this financial year.
  • Increased quota for senior citizens and women travellers this year.
  • Wifi at 100 stations this year and 400 stations next year.
  • Enhanced capacity of e-ticketing system from 2,000 tickets/min to 7,200/min. Supporting 1.2 lakh concurrent users now, as opposed to 40,000 earlier.
  • All major stations to be brought under CCTV surveillance in a phased manner.
  • Deen Dayal coaches for long distance trains for unreserved passengers. These coaches will include potable water and higher number of mobile charging points.
  • IRCTC to manage catering service in phased manner. Local cuisine of choice will be made available to passengers.
  • Cleaning of toilets by requests through SMS.
  • Children's menu, baby foods, baby boards to be made available for travelling mothers.
  • GPS-based digital display in coaches for showing upcoming stations.
  • Will open cancellation facility through 139 helpline number.
  • Introduce bar-coded tickets on pilot basis to tackle menace of ticketless travel
  
  New projects
  • Overnight double-decker trains to be introduced on business travel routes.
  • 1,600 km of electrification this year and 2,000 km proposed for the next year.
  • Broad Gauge Lumding-Silchar section in Assam, connecting Barak Valley with rest of country.
  • North-East India, especially Mizoram and Manipur, to be connected through broad gauge soon.
  • Special purpose vehicle for the Ahmedabad-Mumbai high speed corridor registered this month.
  
  
• SDR made easier for banks, but provisions rise
  The Reserve Bank of India (RBI) on 25th February made it easier for banks to exit from Strategic Debt Restructuring(SDR) cases but at the cost of increased provisioning.
  
  The central bank also extended the SDR scheme benefit to asset reconstruction companies (ARCs) which are members of any Joint Lenders Forum (JLF) mechanism.
  
  Banks may now maintain the same asset classification on loans under SDR (where lenders take over the assets of an errant borrower and try to get a new promoter), if the banks manage to divest 26 per cent of the shares, down from 51 per cent earlier.
  
  Lenders should, however, grant the new promoters a ‘right of first refusal’ for subsequent divestment of their remaining stake, the central bank said.
  
  Continuing with its earlier rules, RBI said the divestment has to be made within 18 months of taking over the assets. Thereafter, the lenders would have the option to exit their remaining holdings gradually, with an upside as the company turns around, RBI said. Also, the conversion from debt to equity in favour of banks would have to be completed before 210 days. If not, the asset classification would worsen and it would be classified according to the condition of the account and the extant norms.
  
  According to the latter, equity shares held by banks under the scheme were exempted from the requirement of periodic mark-to-market (MTM, recalculating the values of assets at current prices) revision for the 18-month period.
  
  However, RBI said, banks should now periodically value and provide for depreciation of these equity shares to avoid bunching of provisioning requirements if things go wrong. The minimum provisioning required for bad assets was 15 per cent. The idea was this: As long as the project is in the 18-months window, the asset classification remains ‘standard’ and a bank only provides a marginal amount. However, if the banks are not able to sell the project and the classification becomes that of a bad debt, banks should be ready with such provisions.
  
  However, the latter may be spread out. “Banks will, however, have the option of distributing the depreciation on equity shares acquired under SDR over a maximum of four calendar quarters from the date of conversion of debt into equity i.e., the provisioning held for such depreciation should not be less than 25 per cent of this during the first quarter, 50 per cent of the depreciation as per the current valuation during the second quarter, and so on.”
  
  Banks desiring to have a longer period for making provisions could start making prior allocations in anticipation of MTM requirements, from the reference date itself, RBI said.
  
  These revised guidelines will be applicable prospectively. However, it would be prudent if banks follow these guidelines even in cases where a JLF has already decided to undertake SDR,” RBI said.
  
  Accordingly, it is clarified that the SDR framework will also be available to an ARC which is a member of the JLF undertaking SDR of a borrower company.”
  
  While revising the JLF norms, RBI said a corrective action plan (CAP) could be undertaken if 50 per cent of the members with 75 per cent value agree. Earlier, the guideline was that approval of a minimum of 75 per cent of creditors by value and 60 per cent by number in the JLF should agree on a CAP.
  
  The exiting lender will not have the option to continue with their existing exposure and simultaneously not agreeing for rectification or restructuring as CAP. It is therefore reiterated that if the dissenting lender is not able to exit by arranging a buyer within the above prescribed time, it has to necessarily adhere to the agreed CAP and provide additional finance, if the CAP so envisages,” the notification stressed.
  
  The top two banks in the system, State Bank of India (SBI) and ICICI Bank, would continue to be permanent members of a JLF, irrespective of whether or not they are lenders in the particular JLF.
  
  Also, RBI said, banks could give the benefit of restructuring to a company based on its viability, in which a new promoter has no link to the old one who has been accused of and removed because of malfeasance. “Further, such accounts may also be eligible for asset classification benefits available on refinancing after change in ownership,” the notification said.
  
• Survey is grim but hopeful on economy
  Finance Minister Arun Jaitley on 26th February tabled Economic Survey 2015-16 in Parliament. The Economic Survey has termed external environment as challenging but projected a 7-7.5 per cent GDP growth rate in the next fiscal which could accelerate to eight per cent in a couple of years. According to the Economic survey report…
  • Informal sector has created jobs and keeping unemployment low
  • Schemes such as Pradhan Mantri Suraksha Bima Yojana (PMSBY), Pradhan Mantri Jivan Jyoti Bima Yojana (PMJJBY), and the Atal Pension Yojana(APY), – were launched in 2015 in the insurance and pension sectors for creating a universal social security system for all Indians, especially for the poor and the underprivileged
  • India can become the leading investment destination owing to its robust macroeconomic fundamentals Reserve Bank of India will meet 5 per cent inflation target by the end of March 2017
  • Reform package for the fertilizer Sector
  • Rates of 8% or higher possible in next 2 years, given macroeconomic stability
  • Indian Equity market relatively resilient compared to other major emerging market economies
  • Impressive strides made in the power sector in the last two years
  • Economic Survey projects 7.6 per cent economic growth rate in 2015-16
  • Economic Survey highlights the importance and potential of spreading JAM Trinity across the Indian economy
  • India ranks first in milk production, accounting for 18.5% of world production
  • Medium-term growth trajectory at 7-7.75% with downside risk. Downside risk to medium term growth due to global economic condition
  • Economic Survey projects 7.6 per cent economic growth rate in 2015-16
  • Amidst gloomy international economic landscape, India remains a haven of stability
  • Upcoming budget and economic policy will have to contend with an unusually challenging and weak external environment
  • Increase in wages recommended by the 7th Pay Commission not likely to destabilise prices, will have little impact on inflation
  • Growth in the services sector moderated slightly, but still remains robust
  • India’s long run potential GDP Growth is substantial, about 8 to 10%
  • FY17 expected to be challenging from fiscal point of view
  • Foreign exchange reserves have risen to US $ 349.6 (Jan-2016)
  • Fiscal deficit target of 3.9 per cent seen achievable
  • India’s long run potential GDP Growth is substantial, about 8 to 10%
  • Low inflation has taken hold and confidence in price stability has improved
  • Services continues to be key driver; expected to be 9.2% in 2015-16
  • Govt tables Economic Survey 2015-16, FY17 GDP seen at 7-7.75%
  
  
• DIPP panel suggests steps to cut down multiple permissions needed by investors
  A government-constituted expert committee has suggested introduction of credible third-party certification in most areas of regulation and adopting global best practices for emission norms, among other steps to cut down on multiple permissions needed by investors.
  
  It has also recommended that there is a need for a standing institutional mechanism within the government for an independent regulatory impact assessment. The expert committee was constituted by DIPP to examine the possibility of replacing multiple prior permissions with a pre-existing regulatory mechanism with adequate safeguards.
  
  For start-ups, the committee has suggested that steps like earmarking of mixed land use redevelopment or greenfield development, exempting them from the requirement of seeking building plan approvals would give a boost to the ecosystem.
  
  It also said that any inspection of a start-up should be done only with the permission of an officer at a sufficiently higher level and that too, in cases of actionable complaints.
  
  The 11-member committee recommended the way forward for creating an investor friendly pre-existing regulatory framework replacing multiple prior permissions with adequate safeguards for making India one of the most attractive investment destinations.
  
  It has suggested the ministries of environmentally sensitive sectors such as power, petrochemicals, pharma and steel should join with the Ministry of Environment and Forests and prepare a 20 year perspective geographical plan indicating preferred locations in prioritised categories for their anticipated projects, so that the negative impact of environment is minimised. All these recommendations are aimed at promoting ease of doing business in the country.
  
• BRICS bank set to fund green energy projects
  The New Development Bank (NDB) — a multilateral lender with a focus on the Global South of the of the Brazil-Russia-India-China-South Africa (BRICS) grouping — is all set to fund more than a dozen projects this year that will focus on renewable energy.
  
  NDB President K.V. Kamath revealed that the “initial focus” of the bank would on green energy projects. He added that the lending, which will commence in April, would fund a project each from the five member grouping. But he added that 10-15 projects are in the pipeline for the remaining part of the year.
  
  The NDB President — on the eve of the signing of the Headquarters Agreement with the Chinese government that will officially launch the bank for operations — clarified that the lender was not geared to issue soft loans.
  
  Kamath explained that the NDB would include market borrowing to raise capital, but stressed that bonds in local currency, rather than hard currency, would be favoured.
  
  The NDB’s initial capital has been fixed at $50 billion, and the total paid in capital would be $10 billion. Analysts point out that following the 2008 financial crisis, the NDB and the China-led Asian Infrastructure Development Bank (AIIB) — both geared towards infrastructure development in Asia and the Global South — are reshaping the global financial architecture, a field that had been monopolised by western backed International Monetary Fund (IMF), the World Bank and the Asian Development Bank (ADB).
  
  With Africa also one of its focal points, the NDB is set to open an African Regional Centre, headquartered in Johannesburg, by the second half of this year. It would aim to develop a “project pipeline” for the continent, a press statement said.
  
  On the eve of its operational launch, the NDB has bagged a AAA institutional rating from domestic credit rating agencies in China, where the China Development Bank and the Bank of China have been appointed as rating advisers. Standard Chartered and Goldman Sachs are in the saddle as international rating advisors.
  
• India Ranks 1st in Milk Production
  The Economic Survey 2015-16 presented on 26th February in the Parliament by the Union Finance Minister Arun Jaitley emphasizes that the Indian agricultural system is predominantly a mixed crop-livestock farming system, with the livestock segment supplementing farm incomes by providing employment, drought animals and manure
  
  Per Capita Availability of Milk in India has increased from 176 grams per day in 1990-91 to 322 grams per day by 2014-15. Egg and Fish Production has also Registered an Increasing trend over the Years.
  
  Production of Fish during the Last Quarters of 2015-16 has also shown an Increasing Trend and is Estimated at 4.79 MT.
  
  India ranks first in milk production, accounting for 18.5 per cent of world production, achieving an annual output of 146.3 million tones during 2014-15 as compared to 137.69 million tonnes during 2013-14 recording a growth of 6.26 per cent.
  
  Whereas, the Food and Agriculture Organization (FAO) has reported a 3.1 per cent increase in world milk production from 765 million tones in 2013 to 789 million tones in 2014.
  
  The per capita availability of milk in India has increased from 176 grams per day in 1990-91 to 322 grams per day by 2014-15. It is more than the world average of 294 grams per day during 2013.
  
  This represents a sustained growth in availability of milk and milk products for the growing population Dairying has become an important secondary source of income for millions of rural households engaged in agriculture.
  
  The success of the dairy industry has resulted from the integrated co-operative system of milk collection, transportation, processing and distribution, conversion of the same to milk powder and products, to minimize seasonal impact on suppliers and buyers, retail distribution of milk and milk products, sharing of profits with the farmer, which are ploughed back to enhance productivity and needs to be emulated by other farm produce/producers.
  
  In the poultry segment, the Government’s focus, besides framing suitable policies for enhancing commercial poultry production, is for strengthening the family poultry system, which addresses livelihood issues.
  
  Both egg and fish production has also registered an increasing trend over the years. Egg production was around 78.48 billion eggs in 2014-15, while poultry meat production was estimated at 3.04 MT. Fisheries constitute about 1 per cent of the GDP of the country and 5.08 per cent of agriculture GDP.
  
  The total fish production during 2014-15 was 10.16 MT, an production during the last quarters of 2015-16 has also shown an increasing trend and is estimated at 4.79 MT( Provisional).
  
  There is increasing significance of poultry and livestock products in the context of diversifying farm and non-farm activities in the agriculture sector to increase livelihood security.
  
• Scrutinise FDI from Singapore, Mauritius
  A close scrutiny of foreign direct investments from Singapore and Mauritius is needed as both the nations accounted for about 60 per cent of the $30 billion worth of FDI in India during the first three quarters of the current fiscal year, a government statement tabled in the Parliament said.
  
  A detailed examination is needed to find out if they constitute actual investments or whether they are diversions from other sources to avail tax benefits under the Double Taxation Avoidance Agreement (DTAA) that India has with these two countries, according to the Economic Survey released on 26th February.
  
  According to government data, of the $29.5 billion FDI into India during April-December 2015 in 2015-16, around $11 billion was from Singapore, while $6.1 billion was from Mauritius.
  
  Also, of the $278 billion worth FDI India received during April 2000-December 2015, a whopping $93.6 billion (or 34 per cent of the total) was from Mauritius, while $43.2 billion (16 per cent of the total) was from Singapore. These two countries together accounted for half of the total FDI inflows into India during the15-year period.
  
  A recent note on FDI prepared by the New Delhi-based Institute for Studies in Industrial Development (ISID) said though successive governments have put FDI at the centre-stage of India's development priorities for over two decades, detailed and systematic analysis of the nature of FDI inflows and its likely implications, including the differing developmental impacts, have not been made so far.
  
  Analysis of critical operational aspects of FDI companies is often based on small sets of easily available companies ignoring the fact that a majority of FDI companies are unlisted and are registered as private limited companies, according to the institute.
  
  Half of the FDI inflows during 2004-2014 cannot be termed as “realistic FDI,” and inflows into the manufacturing sector accounted for a low proportion of the total reported inflows.
  
  Most of the FDI coming into India through Mauritius, Singapore and Cyprus are actually from the U.S. or from India-related investors, according to K S Chalapathi Rao, professor, ISID. The Mauritius route is used for availing tax benefits and for ensuring anonymity. He said FDI from Mauritius is however sector-agnostic unlike FDI from countries like Japan, Germany and France, which are mostly in manufacturing-related sectors. The Singapore route is used mostly by Indian entities with a regional office there, he said.
  
• Make in India Week: 3 MoUs worth Rs 21000 crore signed on Day 1
  Three MoUs envisaging total investment of 21,000 crore rupees were signed on the first day of the Make in India Week in Mumbai on 13th February.
  
  Sterlite Group company TwinStar Display Technologies inked a memorandum of understanding with Maharashtra Industrial Development Corporation to set up an LCD manufacturing unit in technical collaboration with Autron of Taiwan. According to sources, the project entails investment of 20,000 crore rupees.
  
  The location of the plant will be decided shortly Another MoU was signed between Raymond Industries and MIDC as part of 'Farm to Fabric' initiative. Raymond intends to invest 1,400 crore rupees for manufacturing of linen yarn and fabric and garmenting.
  
  The third MoU was inked between Hindustan Coca Cola Beverages, Jain Irrigation Pvt Ltd and Department of Agriculture and Marketing, Government of Maharashtra for setting up a juice manufacturing facility to support farmers growing oranges in Vidarbha. The MoU was signed in the presence of Prime Minister Mr Modi and Maharashtra Chief Minister Devendra Fadnavis.
  
• RBI issues fresh directions to banks on new Accounting Standards
  The central bank has issued new directives to banks on implementation of International Financial Reporting Standards-converged Indian Accounting Standards (Ind AS).
  
  Directives
  • Banks have been asked to submit pro forma Ind AS financial statements to the RBI from the half year ended September 30, 2016, onwards.
  • The implementation of Ind AS is expected to significantly impact the financial position of banks, including the adequacy of capital, taking into account Basel-III capital requirements.
  • Banks have now been advised to place quarterly progress reports to their boards.
  • Also, each bank will now be required to set up a steering committee — headed by an executive director — comprising members from cross-functional areas of the bank to immediately initiate the implementation process.
  • The RBI also wants the audit committee of the bank’s board to oversee the projects of the Ind AS implementation process.
  
  Ind AS roadmap
  According to the roadmap announced by the Centre, banks have to comply with Ind AS for financial statements for accounting periods beginning from April 1, 2018 onwards. Ind AS will be applicable to both standalone as well as consolidated financial statements.
  
  Banks are permitted to adopt Ind AS only according to the specified timelines and not earlier.
  
  Commenting on the latest RBI directives, Charanjit Attra, Partner in a member firm of EY Global, said this was definitely a positive move.
  
  Stages of preparedness
  Indian banks are at various stages of preparedness in the adoption of Ind AS. “Low-to-medium level” is how Attra described the state of preparedness.
  
  Some private sector banks have already reached out to consultants to enable them to migrate to Ind AS, while public sector banks have so far preferred to go slow on this front.
  
• 80% rural Muslims near poverty in West Bengal
  Nearly eight in 10 Muslim households in rural West Bengal have a monthly family income of Rs 5,000 or less , which is barely above the cut-off level of income for poverty line for a family of five. While Muslims constitute 27 per cent of the state’s population, as much as 38.3 per cent households from the minority community in rural parts of the state earn Rs 2,500 or less per month.
  
  Only 3.8 per cent of these households reported earning Rs 15,000 and above per month, according to a report released Sunday by Nobel laureate Amartya Sen on the status of Muslims in West Bengal
  
  Significantly, 13.2 per cent Muslim adults in the state do not hold voter identity cards, the report has found. According to the study, there are two Muslim-majority districts in the state: Murshidabad (66.3 per cent Muslim population), and Malda (51.3 per cent); and 65 of the 341 blocks in rural Bengal are Muslim-majority. But their large presence notwithstanding, Bengal Muslims stand deprived of basic amenities such as tap water, drainage, equal opportunities in employment and even LPG cylinders, according to the study.
  
  It found their access to tap-water (15.2 per cent) is nearly 40 per cent less than that for the state’s overall population (25.4 per cent, as per Census-2011). This, in a way, displays a “combined community and class exclusion”, the study says.
  
  While there seems to be parity in electrification of Muslim-dominated areas to the rest of the population, only 12.2 per cent minority community households have access to drainage system, against 31.6 per cent overall.
  
  The use of traditional fuel for cooking is much higher among Muslims (85.9 per cent) compared to the average population of the state (68.6 per cent). In rural Bengal, nearly 47 per cent of all Muslims who work are either agricultural workers or ‘daily workers’ in non-agriculture sectors — “they are at the bottom of the economic ladder,” says the study.
  
  A measly 1.55 per cent of the state’s Muslims are school teachers, and 1.54 per cent work in the public sector. The report states: “Regular salaried jobs in the private sector are also a rarity — only 1 per cent of the households surveyed. In the entire sample of 7,880 households only five were found to have a college or university teacher, and there was no household with any of the highest category of professionals as members, such as doctors, engineers and advocates.”
  
  On the social development front, the literacy rate for the community in the state is reported at 68.3 per cent — 4 per cent below the general population. Among literate Muslims, only 2.7 per cent hold graduate degrees.
  
• Govt approves over Rs 4,087 crore aid to seven drought-hit states
  Government on 15th February approved central assistance of over Rs 4,087 crore to seven states affected by drought. A high level committee chaired by Home Minister Rajnath Singh approved the assistance from the National Disaster Relief Fund after examining the proposals based on the report of the Central Team which visited the affected states.
  
  The committee approved over Rs 1177 crore for Rajasthan, 17,73 crore for Tamil Nadu, Rs 280 crore for Andhra Pradesh, 337 crore for Jharkhand, 332 crore for Assam, 170 crore for Himachal Pradesh and Rs 16 crore for Nagaland.
  
• Centre launches Rs. 10,000-cr fund to boost electronics manufacturing
  In a bid to kickstart manufacturing in the electronics sector, the Centre on 15th February launched a Rs. 10,000-crore development fund specifically targeted at the semiconductor industry.
  
  Called Electronic Development Fund (EDF), it will provide risk capital to companies developing new technologies in electronics, nano-electronics and information technology. The Centre will contribute Rs. 2,200 crore, while the balance will be brought in by private entities.
  
  Canbank Venture Capital Fund, a subsidiary of state-run lender Canara Bank, has been appointed the implementation agency for EDF. The Department of Electronics and Information Technology will be the anchor investor.
  
  To start with, the Centre announced the allotment of funds to four VC firms — Karnataka Semiconductor Venture Capital Fund, Exfinity Technology Fund, Forum Synergies EDF Digital India Fund, and Endiya Seed Capital Corporation Fund.
  
  The Centre has provided Rs. 169 crore to the four companies, while the VC firms are investing close to Rs.1,000 crore.
  
  IT Minister Ravi Shankar Prasad said this was one of his dream projects and the government will do everything to protect the intellectual property of the start-ups that use this fund. The fund will also be used to acquire foreign companies and technologies that are required for building hi-tech capabilities within India, he added.
  
  The fund has a commitment period till March 31, 2017, but according to Bansal, it is unlikely that the entire Rs. 10,000 crore will be invested by then.
  
• PF interest revised upwards to 8.8%
  The interim interest rate for the Employees Provident Fund for this year has been fixed at 8.8 per cent, an increase of 0.05 percent over last year. It is expected to benefit over 4 crore subscribers of the fund. The decision for the marginal increase has been arrived at the meeting of the Central Board of Trustees of the Employees Provident Fund Organisation, chaired by the Minister of State for Labour and Employment Bandaru Dattatreya in Chennai on 16th February.
  
  The EPFO has a surplus of Rs 285 crore as of now. 8.6 lakh establishments are registered with the EPFO. A new Compliance Analysis and Monitoring System to oversee the payment of EPF subscription by companies and a simplified pension payment order were also launched by the minister today, as part of the e-governance initiatives.
  
• Position of food grains comfortable
  Foodgrains production in the country is estimated to be higher at 253.16 million tonnes in 2015-16 despite the setback in Kharif crops due to deficient monsoon rainfall and rabi crops because of shortage of water in reservoirs and a relatively warmer winter.
  
  The figure is higher by 1.14 million tonnes than the production of 252.02 milion tonnes during 2014-15.
  
  According to the 2nd Advance Estimates of production of major crops for 2015-16, released by the Department of Agriculture, Cooperation and Farmers Welfare, total production of rice during 2015-16 is estimated at 103.61 million tonnes, which is lower by 1.87 million tonnes than its production of 105.48 million tonnes during 2014-15.
  
  Production of wheat estimated at 93.82 million tonnes is higher by 7.29 million tonnes than the production of 86.53 million tonnes of wheat during 2014-15.
  
  Total production of coarse cereals in 2015-16 is estimated at 38.40 million tones.
  
• CCEA approves railway lines and bridge projects worth over Rs 10,000 cr
  Cabinet Committee on Economic Affairs, CCEA, gave its nod to six railway lines and a railway bridge to cater to increased passenger and freight needs across country at a cost of Rs 10,700 crore. According to the Railways Minister Suresh Prabhu, the CCEA also cleared doubling of 261 kilometres of Katni-Singarauli railway line at a cost of Rs 2084 crore.
  
  The project will be completed in five years. It also approved 165km long 3rd railway line between Anuppur-Katni in Madhya Pradesh at cost of Rs 1595 crore to be completed in five years. Additional bridge and doubling of Rampur Dumra-Tal-Rajendrapul sector in Bihar at a cost of Rs 1700 crore to be by 2019-20 was also cleared.
  
  Cabinet has approved signing of Agreement for collaboration in Traditional Medicine between Ministry of AYUSH and the World Health Organisation.
  
  Government also approved proposal for Notification of Commitments under the Trade Facilitation Agreement, TFA, of the World Trade Organisation. It also approved ratification of Instrument of Acceptance of Protocol of TFA and National Committee on Trade Facilitation.
  
  The Cabinet has given its ex-post facto approval for Memoranda of Understanding, signed between India and various countries for cooperation in the field of agriculture and allied sectors.
  
  The MoU will help in the nature of capacity building, knowledge exchange through visits of scientists and technicians, exchange of genetic resources that aid in the development of appropriate technologies and farm practices for enhancing agriculture productivity at farmers' field. Expertise and technology so developed is applied all over the country as per felt needs.
  
  The Cabinet was apprised of signing of BRICS MoU on cooperation in the fields of Science, Technology and innovation. India signed BRICS MoU on cooperation in the fields of Science, Technology and Innovation in March 2015 at Brasilia in Brazil on the sidelines of 3rd BRICS STI Ministerial meeting.
  
  The MoU envisages promotion of cooperation in the field of science, technology and innovation among BRICS countries by means of mutually agreed Science and Technology events and activities.
  
  The Cabinet also gave its approval for nomination of Chief Executive Officer of NITI Aayog as a part-time Member of the Telecom Commission in place of Secretary, Planning Commission which is Non-existent nowCabinet also gave its nod for amendment of Delimitation Act, Representation of the People Act to allow delimitation of constituencies in West Bengal.
  
  The amendments were necessary after exchanges of enclaves between India and Bangladesh last year. Cabinet also commended sports persons for their performance at South Asian games concluded on 17th September.
  
• Govt cuts interest rate on small post office schemes by 0.25%; PF to earn more
  Government has cut interest rates by 0.25 per cent on short-term post office deposits, Kisan Vikas Patras and other small saving schemes below five years of maturity. However, it left social security schemes such as Sukanya Samriddhi Yojana, the Senior Citizen Savings Scheme, long term Monthly Income Scheme and PPF untouched. The decision was taken to align interest on small savings with market rates and help the economy move to a lower overall interest rate regime eventually.
  
  Post office savings of 1, 2 and 3 year term deposits, Kisan Vikas Patra as well as 5-year Recurring Deposits till now earned 0.25 per cent higher interest than the government securities of similar tenures. Finance Ministry in a statement said this advantage will be withdrawn from 1st of April this year and now the rates would be revised every quarter.
  
  The interim interest rate for the Employees Provident Fund for this year has been fixed at 8.8 per cent, an increase of 0.05 percent over last year. It is expected to benefit over 4 crore subscribers of the fund. The decision for the marginal increase has been arrived at the meeting of the Central Board of Trustees of the Employees Provident Fund Organisation, chaired by the Minister of State for Labour and Employment Bandaru Dattatreya in Chennai.
  
• Govt gives nod for building of 82000 houses for poor in urban areas of 163 cities
  The Centre has sanctioned construction of around eighty two thousand houses for economically weaker sections in urban areas of 163 cities. The cities are in West Bengal, Telangana, Bihar, Mizoram, Rajashtan, Jharkhand and Uttarakhand.
  
  According to the Ministry of Housing and Urban Poverty Alleviation, construction of houses will involve an investment of over four thousand crore rupees. Of the total cost, the Centre will provide an assistance of Rs 1,226 crore.
  
  The construction of nearly 28 thousand houses have been sanctioned in West Bengal followed by around 23 thousand in Telangana and over 13 thousand in Bihar. Of the total houses, 58,456 houses will be built under the ‘Beneficary Led Construction’ component.
  
  The rest of the houses will be built under the Affordable Housing in Partnership’ component under which state governments will provide land and the central government will give an assistance of Rs 1.50 lakh to each beneficiary.
  
  With this decision, the Government has so far sanctioned over five lakh houses in different states. Under the Yojana, the government has targeted assisting construction of 2 crore houses for urban poor in the country.
  
• Make in India Week gets Rs 15 lakh cr investment commitment
  Investment of whopping 15 lakh, 20 thousand crore rupees has been committed during the Make in India week that concluded in Mumbai. According to the Secretary of Department of Industrial Policy and Promotion Amithabh Kant, the business enquiries of one lakh five thousand crore rupees have also been registered.
  
  The host state Maharashtra got lion’s share in the Make in India Week. It attracted investment to the tune of eight lakh crore rupees in diverse areas. AIR correspondent reports that India’s biggest show of manufacturing prowess concluded on a high note.
  
  Make in India Week in Mumbai has successfully brought manufacturing, design and innovation to the centre-stage. More than 8 lakh people visited the Make in India Expo and other events. 102 countries were represented in the mega expo. A total of 150 events were organized under the Make in India Week banner. More than 25 thousand people participated in seminars.
  
  Over 1200 experts from various walks of life from ministers, chief ministers, policymakers, industrialists, academicians and spiritual gurus spoke on wide ranging issues concerning business and society. Make in India Week also provided platform for nearly eight thousand Business-to-Business, Business-to-Government and Government-to-Government meetings.
  
  17 Indian states and three countries - Germany, Sweden and Poland had their pavilions in the Make in India Centre.
  
• Cabinet approval for trade facilitation pact ratification
  The Cabinet has approved a proposal for ratification of the Trade Facilitation Agreement (TFA) of World Trade Organization (WTO), aimed at easing customs rules for expediting global trade flow of goods.
  
  To facilitate domestic coordination and implementation of the TFA, the Cabinet meeting -- chaired by Prime Minister Narendra Modi -- also cleared the proposal to set up a National Committee on Trade Facilitation (NCTF) to be jointly chaired by the commerce and revenue secretaries. These objectives are also in consonance with India’s “Ease of Doing Business” initiative, according to an an official statement.
  
  The WTO member-countries in November 2014 adopted a “protocol of amendment” to incorporate the TFA on goods in the overall WTO Agreement.
  
  For the TFA to be operational, two-thirds (or 108) of the 162 WTO members will have to ratify it. However, only 69 countries have ratified it so far.
  
  The TFA also contains measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues.
  
  Trade experts had said ratifying the agreement so early could lead to India losing a bargaining chip to secure its interests.
  
  That includes finding a permanent solution to the issue of public stockholding for food security purposes and a mechanism to safeguard poor farmers from sudden import surge of farm products.
  
• Cyient to set up tech facility in Telangana
  Cyient, formerly Infotech Enterprises, is going to set up a facility in Warangal, the second biggest city in Telangana. Chief Minister K Chandrasekhara Rao will lay the foundation for the facility that will seat 1,000 employees in the next two months.
  
  The facility will come up at the Madikonda Special Economic Zone (SEZ) developed by of the Telangana State Industrial Infrastructure Corporation (TSIIC). The company, however, will start operations soon from Warangal, with the government agreeing to give it some space at the Incubation Facility developed by the TSIIC.
  
• SEZs: New norms for power generation announced
  The commerce ministry has notified guidelines for power generation, transmission and distribution in special economic zones (SEZs), almost modelled after the 2009 norms, and reiterated that a power plant, as part of the infrastructure facility, be set up only in the non-processing area of an SEZ. It said no fiscal benefits would be extended towards the power plant’s operation and maintenance.
  
  The latest guidelines, however, made its focus on power generation for IT/ITeS units clearer than earlier. The power plants set up in IT/ITeS zones that require uninterrupted power supply at a stable frequency will get fiscal incentives for establishing and maintenance of generating units.
  
  In such cases, generation of power will be carried out as a unit within the processing area, and such a power plant including non-conventional energy power plant, will be entitled to all the fiscal benefits covered under Section 26 of the SEZ Act, including the benefits for initial setting up, maintenance and the duty free import of raw materials and consumables for the generation of the power.
  
  Such duty-free imports of capital goods, raw material and consumables would be counted towards the net foreign exchange (NFE) obligation of the unit.
  
  The latest guidelines were issued after SEZ developers operating power plants requested the government to restore some of the operation and maintenance benefits. The guidelines were initially declared in February 2009 and revised in 2012. The latest notification said the present guidelines would replace the earlier ones.
  
  The commerce ministry has been actively pursuing the case of SEZs, reeling as they are under a minimum alternate tax (MAT) and a dividend distribution tax regime imposed in the 2011-12 Budget.
  
  Recently, according to sources, the commerce ministry had convinced the finance ministry to reinstate MAT exemption, which may be announced in the coming Budget. Currently, MAT is levied at 18.5% on the book profit of companies, with the effective rate touching 20%, factoring in surcharges.
  
  According to the latest guidelines, setting up of captive power plants — including non-conventional energy ones — could be permitted in processing areas as units, subject to NFE obligations.
  
  SEZs, which are connected to state/national grid, will be allowed to create a back-up power facility.
  
• In Telangana KTR unveils incubation centre
  Telangana IT Minister K T Rama Rao inaugurated an incubation centre in Warangal and also laid the foundation stone of Cyient's new facility in the same city on 19th February.
  
  The IT Incubation Centre is funded by the State government and constructed by Telangana State Industrial Infrastructure Corporation (TSIIC) over an area of two acres with a total built up area of 15,000 sq ft to enable startups and micro, small and medium IT companies to operate in a 'plug-and-play' and hassle-free environment. Cyient will be establishing a state-of-the-art Software Development Centre in Madikonda IT SEZ of TSIIC.
  
  The facility will support Cyient's worldwide digital technology initiatives, including those in Internet of Things, big data, analytics and smart cities.
  
• One in every three rural households living in debt
  The ticket size may be different but more households in rural areas are taking loans than urban areas. The incidence of indebtedness in rural areas stands at 31 per cent, compared with 22 per cent in urban areas, according to the latest data on assets and liabilities of households released by National Sample Survey Organisation (NSSO). In 1991, rural and urban indebtedness stood at 23 per cent and 19 per cent, respectively.
  
  While the overall rise in incidence of indebtedness has been identical at four percentage points in both rural and urban areas between 2002 and 2012, the pace of growth in villages of Karnataka, Andhra Pradesh, Kerala, Tamil Nadu, Uttar Pradesh and Bihar has been sharp in recent years.
  
  There are significant differences in the rate and pattern of change between rural and urban areas. In most cases, IOI (incidence of indebtedness) is lower in urban areas; the increase is also smaller overall. This generalised feature coexists with considerable inter-state variation. In southern states, the increase is markedly higher, the NSSO report says.
  
  The same set of states reported very high debt-asset ratio in rural areas. Debt-asset ratio stands at 14.1 per cent in Andhra Pradesh, 6.5 per cent in Karnataka, 6.8 per cent in Tamil Nadu and 5.4 per cent in Kerala. Rural Haryana, on the other hand, has debt-asset ratio of just one per cent.
  
  Among large states, debt-asset ratio rose sharply in Andhra Pradesh, Karnataka and Tamil Nadu between 2002 and 2012. However, it fell in Maharashtra during the same period.
  
  Karnataka, Andhra Pradesh and Kerala, three states with high level of rural indebtedness and high debt-asset ratio, account for bulk of farmer suicides in the country. According to National Crime Record Bureau (NCRB) data, in 2013, nearly 64 per cent of all farmer suicides in the country took place in four states of Maharashtra, Andhra Pradesh, Karnataka and Kerala.
  
  Not only has the incidence of indebtedness increased, the average amount of debt has almost doubled between 2002 and 2012. During the same period, the average share of deposits in total assets has fallen from 2.3 per cent to 1.7 per cent. The fall in share of deposits in urban areas has been much sharper, from 9.7 per cent to 4.3 per cent.
  
  For the first time, the NSSO collected data on ownership of bullion and ornaments. Not surprisingly, the fascination for bullion and ornaments cuts across state boundaries and ownership is evenly distributed in rural and urban areas.
  
  According to the NSSO report, in rural area, 82 per cent households reported ownership of bullion and ornaments, whereas in urban area 81 per cent reported the same.
  
  While in rural sector, six states had less proportion of bullion and ornaments than national average, in urban sector, seven states fell in the same category. Bihar, Jharkhand, Punjab and West Bengal are common for both the list.
  
  Among rural households, ownership of bullion and ornaments is highest in Karnataka (94 per cent), followed by Tamil Nadu, Kerala and Uttar Pradesh. On the contrary, only little more than 50 per cent households in Bihar own bullion. Other than bullion, households in rural areas own very little and the contribution of land and building constitute nearly 90 per cent of their assets.
  
• China's foreign exchange reserves dip to lowest level
  China's foreign exchange reserves have fallen to their lowest level in more than three years, the central bank said on 7^th February, as Beijing sells dollars to stop the yuan from depreciating further.
  
  The world's largest currency hoard shrank by 99.5 billion US Dollar in January to some 3.2 trillion US Dollar, the People's Bank of China said on its website, the lowest since May 2012.
  
  Worries about China's economy have pushed the yuan to a five-year low. The country saw its first-ever annual decline in foreign exchange reserves last year as Beijing tried to prevent a more drastic devaluation.
  
  The pace of decline in the reserves in January was slower than December, which at some 108 billion US Dollar was the largest monthly drop on record.
  
  Global investors are closely watching the slowdown in the world's second largest economy, which has created turbulence in world markets.
   
• Unified insurance package for farmers to cover life
  For a premium of Rs 5,145 a year, farmers will be able to avail of minimum insurance cover for their crop, tractors, pump-sets, self and accidents under a package being readied along with the Pradhan Mantri Fasal Bima Yojana(Prime Minister's Crop Insurance Scheme).
  
  This package of seven products will be first tried in 45 districts. Expansion will be decided after the response. The Fasal Bima Yojana has officially already been launched for the entire country.
  
  The Centre and state governments plan to subsidise up to 90 per cent of the total premium a farmer has to pay under the new crop insurance scheme.
  
  The seven insurance components apart from Fasal Bima Yojana in the united package are fire insurance; a personal accident coverage of Rs 2 lakh under the Pradhan Mantri Suraksha Bima Yojana; agriculture pump-set insurance; agriculture tractor insurance provided by a third party; life insurance through the Pradhan Mantri Jeevan Jyoti Bima Yojana, and student safety insurance.
  
  The entire package will be offered by the state-run Agriculture Insurance Company or any other general insurance company. Officials said a minimum annual insurance premium of Rs 5,145 has been calculated, presuming an average holding of 1.5 hectares and a tentative insurance cover of Rs 20,000 a hectare.
  
  The accident coverage and the life coverage will be as provided by the already existing Pradhan Mantri Suraksha Bima Yojana and Jeevan Jyoti Bima Yojana. That apart, officials said the existing weather-based crop insurance scheme (WBCIS) launched by the earlier government would also be in circulation and is not being withdrawn.
  
  The only difference is that the premium under WBCIS would have to be at par with the Fasal Bima Yojana, which is 1.5 per cent for all rabi crops and a flat two per cent for all kharif crops.
   
• TRAI rules against differential pricing for data services giving big boost to Net Neutrality
  Telecom Regulatory Authority of India (TRAI) has barred service providers from offering or charging discriminatory tariffs for data services on the basis of content being accessed by a consumer. The Authority on 8^thFebruary issued regulations in this regard prohibiting them from entering into any arrangement, agreement or contract, with any person that may cause discriminatory tariffs. It has provided for a penalty of 50 thousand rupees for each day on service providers if they flout the order.
  
  The move is being seen as a boost to net neutrality and a blow to Facebook and other operators offering differential data tariffs. Unveiling the details of the regulations, TRAI Chairman R S Sharma said if a service provider contravenes these regulations the regulator may ask them to withdraw tariff.
  
  He said the regulation, however, permits reduced tariff for accessing or providing emergency services, or at times of public emergency. Mr. Sharma said anything on Internet cannot be differently priced and this is the broad point that the TRAI has highlighted in the regulations.
  
  The Chairman also said the new regulations are effective from today and active plans which are in contravention of the regulations should cease to exist in six months. The regulation essentially means that no telecom service operator can discriminate on the basis of platform, application, website and source. All things that are on internet will be subject to this regulation. The regulation provides for one-off exceptions in emergencies like the one that was in Chennai recently from unprecedented rains.
  
  While formulating the regulations, the TRAI has largely been guided by the principles of Net Neutrality to ensure that consumers get unhindered and non-discriminatory access to the internet. The new rules come amid a long-running debate on net neutrality wherein Facebook has been facing flak for its 'Free Basics' platform, while operators like Airtel have been at the receiving end for similar plans announced earlier.
  
  Facebook had planned to roll out Free Basics, providing access to a limited set of websites for free which could have affected the equal-access precepts of net neutrality. The TRAI will keep a close watch on the implementation of the regulation by the service providers and may review it after two years or even before that if necessary.
   
• India GDP to grow 7.6% in current fiscal
  Growth in the country's GDP is forecast to accelerate to 7.6 per cent in the current fiscal, on improved performance in the manufacturing and farm sectors. This will be the fastest rate of growth in the last five years. The Central Statistics Office has also estimated the October to December 2015 quarter GDP growth at 7.3 percent.
  
  The manufacturing sector is forecast to grow at 9.5 per cent in the current fiscal, up from 5.5 per cent a year ago. Agricultural sector growth has been projected at 1.1 per cent, against a decline of 0.2 percent a year ago.
  
  The Finance Ministry said the projected 7.6 per cent growth rate for current fiscal is satisfactory and is a reflection of the policies and reform measures considered by the government in previous 19 months.
   
• Maharashtra tops in internet readiness index
  At a time when the Centre is pushing for Digital India, Maharashtra, Karnataka, Gujarat, Telangana and Tamil Nadu score well, but eastern States fare quite poorly, according to a new report "Index of Internet Readiness of Indian States" by the Internet and Mobile Association of India (IAMAI).
  
  The Internet index has been arrived at by looking at four things — e-infrastructure, e-participation, IT services and e-governance. A key differentiating measure in this report is that it not only looks at digitisation of services but also their usage by citizens.
  
  For instance, Madhya Pradesh scores very high in terms of citizen participation, but ranks low in other components; hence, its overall ranking is a poor 14th.
  
  Interestingly, Kerala scores highest in terms of e-infrastructure which includes mobile subscribers, Internet access, teledensity, percentage of households using Internet connection, and how well equipped schools and post offices are with Internet and email facilities. In Kerala, more than 90 per cent of the schools have computer facilities.
  
  Among the smaller States, Delhi emerges on top in terms of Internet readiness, followed by Puducherry and Goa. Among the Union Territories, Chandigarh ranks top.
   
• Tatas to help build 2BHK houses
  Famous industrial house Tata Group came forward to lend its hand to the Telangana government in the construction of double bedroom houses for the poor in the State. This was disclosed by group's chairman Cyrus Mistry to Telangana Information Technology and Panchayat Raj Minister KT Rama Rao. The minister was in Mumbai to meet Mistry along with another big industrialist Mukesh Ambani in his bid to attract investments to the State.
  
  The minister explained the avenues of investment available in Telangana to Mukesh and Mistry. He said that Tata Group which already has its presence in Hyderabad has shown interest in expanding the activities. KTR informed the Tata Group chairman about the comments of Chief Minister K Chandrasekhar Rao that Tatas were Telangana's brand ambassadors. The minister was told by Mistry that they would participate in the housing programme.
  
  He was also informed that Tata – AIG Technology Development Centre would be established in Hyderabad. Tata Group also decided to support T-Hub through Tata Capital. Rama Rao, in his meeting with Mukesh Ambani, explained about the prestigious projects of Telangana like Mission Kakatiya, Mission Bhagiratha, 2BHK houses and power plants extension. He informed that the government has been going forward with a time bound schedule in implementing the programmes.
  
  The minister mentioned the Chief Minister's pledge that they would not go election if Mission Bhagiratha was not accomplished successfully. He was told by Ambani that the Telangana government has a vision and taking it forward with an action plan.
   
• Milk production increased to 146.31 million tonnes in 2014-15: Govt
  According to the union Agriculture Minister Radha Mohan Singh has said that India's milk production has increased to 146.31 million tonnes in 2014-15.
  
  Addressing a function at National Dairy Research Institute in Karnal, Haryana, he said the per capita availability of milk has also increased to 302 gm, more than the minimum quantity recommended by the World Health Organisation.
  
  Mr Singh said milk production has registered a growth of record 6.3 per cent for the first time, while at the international level; it grew only at a rate 2.2 per cent in 2014-15.
   
• India to spend 65 lakh cr on power in 15 years
  India is expected to spend a whopping $1 trillion (about Rs 65 lakh crore) by 2030 on ramping up its power infrastructure as one of the world's largest energy consumers aims to provide 24/7 electricity to its citizens.
  
  The power sector in the country is at an inflection point and the focus is on developing an integrated outlook with transparent policies on tariffs and fuel pricing which enhance the ease of doing business, according to the Power Minister Piyush Goyal.
  
  Minister in Australia and proposed that India and Australia should come together and invest in several fields, with energy being an important dimension. India's focus is on LNG for power plants, coal mining, clean coal technologies, renewable energy, R&D as well as tie-ups with premier research institutes
  
  Goyal is leading a high-level government delegation to deliberate with Australian government and businesses on ways to increase their participation in India's power sector. An industry delegation, led by business chamber CII, is also accompanying the minister.
  
  India has set an ambitious plan to add 175 GW of renewable energy generation capacity by 2022. The country aims to have 100 GW of solar power by 2022 along with 260 GW of thermal and nuclear generation and 62 GW of hydro generation capacity.
  
  As per International Energy Agency (IEA) estimates, India would invest about $845 billion in T&D (transmission and distribution) networks between 2015 and 2040 to ensure universal access to power for customers. Explaining the steps taken by his ministry to provide clean energy, the minister said India has one of the toughest regulations on thermal power.
  
  Citing an example, he said that the price of an LED bulb has come down by as much as 40% in India as there is bulk procurement. It has already distributed almost six crore LED bulbs. The minister said that India will concentrate on expanding R&D and is willing to invest on cutting edge technology.
   
• Industrial growth in FY14 was higher in poorer states
  Industrial growth in the traditionally weaker states of Bihar, Odisha and Chattisgarh in 2013-14 dwarfed that of their more developed counterparts, in a year when the economy had to cope with the euro crisis and its effects on Indian industry.
  
  Data released as part of the Annual Survey of Industries (ASI) on 9^th February showed the three states had grown the most industrially. Overall industrial growth, measured in gross value addition, was 7.2 per cent in FY14 as compared to 11.3 per cent in FY13.
  
  Bihar at 97.5 per cent had the highest growth but measured from the country's steepest decline the previous year. Odisha grew 61 per cent and Chhattisgarh by 55 per cent. In comparison, it was 5.9 per cent in Gujarat and in Karnataka and 1.1 per cent in Rajasthan, all three being outside the top 10 in industrial growth.
  
  Overall, the measure showed a fall in eight states, Goa's being the steepest at 26 per cent. Andhra Pradesh and Madhya Pradesh's declined by 13.5 per cent and 12.1 per cent, respectively. Nagaland (-10.2 per cent), Haryana (-1.8 per cent), Delhi (-1 per cent), Tamil Nadu (-0.9 per cent) and Tripura (-0.4 per cent) also contracted. As for industrial investments, 17 states reported a decline.
  
  As measured by gross capital formation, Assam's was the highest at 145 per cent, followed by Kerala at 117 per cent. Tripura was third at 48 per cent. Meghalaya had the sharpest drop at minus 66 per cent, followed by Sikkim (-58), Haryana (-46.8) and UP (-45.4). Karnataka, Punjab and Rajasthan also reported a dip.
   
• India ranks second-last in US Chamber's international IP index
  India continued its dismal run on the International IP Index, placed 37 among the 38 economies studied for their intellectual property (IP) environment and commitment to innovation by the US Chamber of Commerce.
  
  Patent protection in India remains outside of international best practices, and Indian law does not provide adequate enforcement mechanisms to effectively combat online piracy according to the latest report, it is explaining India's score of 7.05 (out of 30). Produced by the chamber's Global Intellectual Property Centre (GIPC), the study – in its fourth edition – found India's score was largely unchanged from previous editions of the study. Venezuela finished last, while the United States was the top-ranked country.
  
  India's overall score decreased to 7.05 from 7.23 in the previous edition. The report noted that this decrease was driven by the introduction of the Global Measure of Physical Counterfeiting in the current edition, in which India was ranked 7.
  
  Among the weaknesses cited in India's IP environment are lack of specific IP rights for the life sciences sector, a challenging enforcement environment and that the country is not a contracting party to any of the international treaties that are included in the Index. That India is yet to conclude a free trade agreement with substantial IP provisions did not find favour with the GIPC.
  
  India scored 14.29 (out of 100) for IP environment-related to patents, related rights, and limitations; 24.5 for copyrights; 56 for trademarks; trade secrets and market access (25); enforcement (22.17); and zero for membership and ratification of international treaties.
  
  The government is currently in the process of drawing up the contours of a national intellectual property rights policy. The Department of Industrial Policy and Promotion (DIPP) had in 2014 circulated a draft IPR Policy seeking public comments.
   
• Centre extends Beti Bachao, Beti Padhao scheme in 61 districts
  Centre has extended its flagship scheme Beti Bachao, Beti Padhao in additional 61 district, across eleven states. The scheme was launched by Prime Minister Narendra Modi in Haryana last year, seeks to improve the declining trend of child sex ratio in selected districts. It is a tri-ministerial effort of Ministries of Women and Child Development, Health and Family Welfare and Human Resource Development.
  
  In the first phase, the programme was launched in 100 districts with poor sex ratio across the country. Women and Child Development Ministry said, during the last one year, the Beti Bachao, Beti Padhao Scheme is being implemented under the overall guidance and supervision of concerned District Magistrate and Deputy Commissioners. It said, seeing the overwhelming response by stakeholders in the form of various initiatives and innovations at the local level to the scheme, the Ministry has approved the expansion of the Beti Bachao Beti Padhao scheme in additional 61 districts.'
   
• Railway Minister launches 3 IT enabled apps for railways
  Railway Minister Suresh Prabhu has launched the Pilot Project of hand Held Terminals for train ticket examiners (TTEs) in Northern Railway. According to Mr Prabhu said that the Indian Railways is heading towards Digital India to bring transparency in Indian Railways. He said, Hand Held Terminals (HHT) for TTEs will help in updating status of passenger list of the whole train.
  
  He stated that with the help of Hand held Terminals for TTEs, after all allotments, remaining vacant berths will be sent back to HHT Application Servers and can be viewed on Passenger Reservation System terminal as well as Indian railway web site. Occupancy chart can be viewed on HHT device to dispense with the manual preparation of food-chart and occupancy chart.
  
  The Minister also launched two another IT enabled projects through Video-Conferencing which included Paperless unreserved ticketing through mobile phone in suburban section of South Central Railway and E-booking of disposable linen on trains at New Delhi Railway Station and Nizamuddin Railway Station.
   
• RBI meets its first inflation target
  The Reserve Bank of India (RBI)'s new monetary policy framework received a shot in the arm on 12^thFebruary, after the January 2016 target for Consumer Price Index (CPI)-based inflation came within the central bank's September 2014 predictions - below six per cent.
  
  The January reading for retail inflation came at 5.69 per cent, higher than December's 5.61 per cent, but well within what the central bank's monetary policy framework had envisaged. This was the first target of the framework that was met.
  
  The next informal target is five per cent by January 2017. The eventual target is to maintain retail inflation at four per cent from 2016-17, within a band of +/- 2 per cent. If the target is missed for three consecutive quarters, RBI will have to give an explanation to the government.
  
  This and the new liquidity framework that targets a price-based regime are the new exercises the central bank has embarked upon. These steps indicate a major shift in the philosophy of RBI, which used to mostly take steps that were reactionary.
  
  Under its new liquidity framework, it no longer matters how much liquidity RBI pumps into the system. What matters now is whether that liquidity has kept the overnight call money rate firmly anchored in and around the operative policy rate - in this case, repurchase, or repo rate of 6.75 per cent.
  
  Banks might not have to struggle for liquidity, but would have to be disciplined with their liquidity balance so that they can raise or deposit money through the three liquidity auctions every day at a rate close to the policy rates. This would ensure banks focus more carefully on their asset-liability mismatch.
  
  Under this liquidity regime, the central bank is conducting auctions under OMOs for secondary market bond purchases, but at the same time, going beyond public OMOs to buy bonds directly from the market, as reported by Business Standard on February 1.
   
• PM inaugurates 'Make in India' Week in Mumbai
  Indian Prime Minister Narendra Modi has said that India is blessed with 3 Ds that is Democracy, Demography and Demand; and the Government is adding 4th D of Deregulation.
  
  He was speaking after the formal inauguration of the Make in India Week in Mumbai. He said that the government wants to make India a global manufacturing hub with the share of manufacturing in GDP to go up to 25%. In a year's time Make in India has become the biggest brand India has ever created because of the collective desire of people to engage in productive activities at minimal cost.
  
  Addressing the gathering of industry captains, Modi said that India is the most open country for FDI even in the time of global slowdown. He reiterated India's commitment not to resort to retrospective taxation. The Prime Minister said that the government aims to create a cleaner, simpler, proactive and business friendly environment for investors.
  
  Modi said the focus sectors for development are roads, ports, railways, airports, telecom, and digital network.
  
• PM wants 50% farmers to join insurance scheme in two years
  Highlighting benefits of the just-announced crop insurance scheme, Prime Minister Narendra Modi on 31st January said awareness about it should be spread across the country so that at least 50 per cent of the farmers join it within two years.
  
  In his monthly radio programme ‘Mann Ki Baat’, he also pitched for continued efforts to popularise Khadi and awarness to save girl child, mentioned about the recently launched ‘Startup India’ programme and talked about the upcoming International Fleet Review to be held in Visakhapatnam.
  
  Modi said he needs “maximum help” from people about spreading awareness regarding the Pradhan Mantri Crop Insurance Scheme which was launched earlier this month.
  
  The prime minister said that for so many years, there has been a talk regarding crop insurance but "not more than 20-25 per cent" of the country's farmers had been been able to benefit from such schemes. The prime minister also referred to the 'Startup India' scheme rolled out on January 16 and said it had infused new energy among the youth.
  
  Talking about popularising of Khadi regarding which he had issued an appeal in his first 'Mann Ki Baat' programme in October 2014, the Prime Minister said more and more youths are now using Khadi products.
  
• Panel suggests more freedom for India Inc
  To make it easier for companies to do business, a panel constituted to suggest amendments in the Companies Act, 2013 has recommended, among other things, doing away with any kind of government intervention in managerial remuneration and allowing start-ups to issue more sweat equity and employee stock options (ESOPs).
  
  The panel, headed by corporate affairs secretary Tapan Ray, has said that for managerial remuneration shareholders' approval should suffice and no government nod should be needed. Further, only ordinary resolution, nod from 50 per cent of shareholders, would be enough. At present, approval from 75 per cent shareholders is required. The committee also suggested relaxing norms for start-ups to issue sweat equity. Now, 50 per cent of the paid up capital could be issued as sweat equity, against the existing norm of 25 per cent.
  
  The ten-member panel recommended the removal of provision under Section 2(87), which prohibited the companies to not have more than two levels of subsidiaries.
  
  The panel found that Section 447 - which lays down the punishment for any person found guilty of fraud to minimum six months imprisonment - has a potential of being misused and may also have a negative impact on attracting professionals in the post of directors etc. It has recommended that only those frauds which involve Rs 10 lakh or above, or one per cent of the company's turnover, whichever is lower, may be punishable under Section 447.
  
  In order to bring the Companies Act in harmony with the Sebi regulations, the panel said that independent director should not have any kind of pecuniary relationship with the company. It has recommended there should be a test of materiality so that a 'pecuniary relationship' can be established and, subsequently, prohibited if it is affecting the director's independence.
  
  Sections 194 and 195 of the Companies Act - which restrict forward dealing and insider trading by directors and key managerial professionals (KMPs) of any company - have also been recommended to be removed. These issues are already covered under Sebi regulations.
  
  In a major jolt to the Institute of Chartered Accountants of India (ICAI), the panel has recommended formation of National Financial Reporting Authority (NFRA) under Section 132 of the Act. The Committee said, "in view of the critical nature of responsibilities wherein lapses have been seen to cause serious repercussions, the need for an independent body to oversee the profession is a requirement of the day."
  
  MAJOR CHANGES SUGGESTED IN COMPANIES ACT
  • A firm to be called associate company only when the parent firm owns 20 per cent of voting power in it
  • Insider trading and forward dealing provisions to be removed from the Act as Sebi regulations already exist
  • Institute of Chartered Accountants of India's regulatory powers to be taken away; National Financial Reporting Authority would be formed
  • Independent directors should not have any pecuniary relationship - where it is getting material benefits - with the company
  • Small frauds of less than Rs 10 lakh not to be considered under harsh provisions
  • Private placement process to be simplified, doing away with separate offer letter, making valuation details public
  • Incorporation process to be made easier, allowing greater flexibility to companies
  • Self-declarations to replace affidavits from subscribers to memorandum and first directors
  • Managerial remuneration to need only shareholders' approval. No need for government approval
  
  
• RBI keeps key rates unchanged
  The Reserve Bank of India (RBI) maintained a status quo in its sixth bi-monthly monetary review policy for year 2016 announced on 2nd February. Keeping the rates unchanged, the apex bank has kept its stance on the credit policy accommodative.
  
  The Repo rate is the same at 6.75 per cent as in the last credit policy so is the cash reserve rate (CRR) at 4 per cent and the reverse repo rate at 5.75 percent. The RBI sees FY 16 growth at 7.4 per cent with downward bias and FY17 growth at 7.6 percent despite headwinds.
  
  The bank sees inflation around 5 percent for FY 16-17 as a good monsoon next year could pull the inflation down. Inflation has evolved closely along the trajectory set by the monetary policy stance.
  
  With unfavourable base effects on the ebb and benign prices of fruits and vegetables and crude oil, the January 2016 target of 6 per cent should be met. Going forward, under the assumption of a normal monsoon and the current level of international crude oil prices and exchange rates, inflation is expected to be inertial and be around 5 per cent by the end of fiscal 2016-17.
  
  Vagaries in the spatial and temporal distribution of the monsoon and the impact of adverse geo-political events on commodity prices and financial markets add additional uncertainty to the baseline. The RBI will also create a special eco-system for start-up funding.
  
  Reserve Bank of India Governor Raghuram Rajan said today that current momentum of growth is reasonable, though below what should be expected over the medium term.
  
  The RBI Governor said this while addressing a press conference after announcing the sixth bimonthly monetary policy for 2015-16 in Mumbai. He stated that structural reforms in the forthcoming Budget will create more space for monetary policy to support growth.
  
  The RBI Governor said that the RBI is working with the government and banks to ensure that the stressed assets are identified.
  
  The Reserve Bank of India (RBI) has kept the rates unchanged and taken an accommodative stance on the credit policy. The Repo rate is the same at 6.75 per cent as in the last credit policy so is the cash reserve ratio (CRR) at 4 per cent and the reverse repo rate at 5.75 pc. The RBI sees growth in FY 16 at 7.4 per cent with downward bias and growth in FY17 at 7.6 percent despite headwinds. The bank sees inflation around 5 percent by the end of FY 16-17.
  
  Reserve Bank of India kept it policy rates unchanged on inflation concerns. Repo rate that is the interest rate at which the RBI provides liquidity to banks to tide over short-term liquidity mismatches is kept at 6.75 per cent.
  
  The reverse repo rate under the Liquidity Adjustment Facility will remain unchanged at 5.75 per cent. Reverse repo rate is the rate at which RBI borrows money from commercial banks within the country.
  
  It has also left the cash reserve ratio of scheduled banks unchanged at 4.0 per cent. Cash Reserve Ratio (CRR) is a specified minimum fraction of the total deposits of customers, which commercial banks have to hold as reserves either in cash or as deposits with the central bank. Marginal standing facility (MSF) rate and the Bank Rate that is rate at which RBI lends money to dometic banks kept at 7.75 per cent.
  
• Govt sets up two panels to ensure consistency in tax policies
  Government on 2nd February set up two new committees namely Tax Policy Research Unit (TPRU) and Tax Policy Council ( TPC ) to streamline the taxation policy and administration.
  
  The TPRU to be headed by Revenue Secretary will carry out studies on various topics of fiscal and tax policies. The Research Unit will also assist the TPC in taking appropriate policy decisions.
  
  It will be a multi disciplinary body comprising of officers from both the Central Board of Direct Taxes and Central Board of Excise and Customs as well as economists, statisticians, operational researchers and legal experts. The Tax Policy Council will help the government identifying key policy decisions for taxation.
  The council under the Finance Minister will look into all the research findings coming from TPRU and suggests broad policy measures for taxation. The decision to set up Committees has been taken in view of the reports of Tax Administration Reform Commission on taxation reform.
  
• RBI relaxes FDI norms to boost start-ups
  The Reserve Bank of India (RBI) on 2nd February relaxed several rules including foreign direct investment norms to boost start-up activity in the country.
  
  To begin with, start-ups are allowed to receive foreign venture capital investment irrespective of the sector in which they operate. The new norms will enable transfer of shares from foreign venture capital investors to other residents or non-residents.
  
  The central bank also permitted, in case of transfer of ownership of a start-up enterprises, receipt of the consideration amount on a deferred basis as also enabling escrow arrangement or indemnity arrangement up to a period of 18 months.
  
  The central bank simplified the process of dealing with delayed reporting of foreign direct investment (FDI)-related transaction by building a penalty structure into the regulations itself. RBI also said certain proposals are been considered and consulted with the government.
  
  These proposals include, permitting start-up enterprises to access rupee loans under External Commercial Borrowing (ECB) framework with relaxations in respect of eligible lenders, issuance of innovative FDI instruments like convertible notes by start-up enterprises and streamlining of overseas investment operations for start-up enterprises.
  
  RBI also said certain issues that are permissible under the existing regime shall be clarified like issue of shares without cash payment through sweat equity or against any legitimate payment owed by the company remittance of which does not require any permission under FEMA and collection of payments by start-up enterprises on behalf of their subsidiaries abroad.
  
• Govt to infuse about Rs 5,000 cr in PSU banks this quarter
  The Government will infuse about 5,000 crore rupees capital in the public sector banks in the current fiscal to strengthen their balance sheet. Last year, the government had announced a revamp plan Indradhanush to infuse 70,000 crore rupees in state-owned banks over four years. Of the 25,000 crore rupees earmarked for 2015-16, the government has pumped in about 20,000 crore rupees in 13 public sector banks so far.
  
• Railways to form joint venture companies with state Govts
  The Union Cabinet on 3rd February approved a proposal to allow Railways to form Joint Venture Companies with State Govts to mobilize resources for rail projects in States.
  
  The Joint Venture Companies would be formed with equity participation of Ministry of Railways and concerned State Governments. Each Joint Venture will have initial paid-up capital of Rs. 100 crores based on quantum of projects to be undertaken.
  
  The minimum support price (MSP) of milling copra for 2016 season has been hiked by Rs 400 per quintal to Rs 5,950 to boost coconut cultivation. The Cabinet Committee on Economic Affairs (CCEA) approved a proposal in this regard.
  
• SEBI forms task force to review risk management norms for commixes
  Capital market regulator Sebi has set up a task force to review the risk management norms for national-level commodity bourses following the suspension of futures trading for castor seed on NCDEX.
  
  After recent developments witnessed in castor seed futures contracts, Sebi has established a task force to relook at the existing norms related to risk management, delivery mechanism, and other related issues. The task force has been asked to submit the report in three weeks. Based on the report, the risk management norms for national-level commodity derivatives exchanges will be further tightened. Meanwhile, Sebi has sought explanation from the exchange for suspending futures trade in castor seeds.
  
• RBI updates norms of Foreign Exchange Management Act
  With an aim to promote ease of doing business, the Reserve Bank of India (RBI) on 4th February came out with nine updated rules under the Foreign Exchange Management Act (Fema), 1999.
  
  RBI said that respective original notifications and amendments had been cancelled. "Keeping in view the objective of promoting 'ease of doing business', a need was felt to consolidate the regulations and rationalise them in the light of evolving business environment and changing practices in cross-border transactions relating to external trade and payments," RBI said.
  
  Fema, enacted in 1999 with 25 original notifications, came into force with effect from June 1, 2000. Over the years, the regulations framed under the Act have had over 330 changes.
  
• Forensic audit must for all bad loans: Parliament panel to RBI
  Cautioning that the rising trend of non-performing assets (NPAs) with banks had “the potential to damage the growth story”, the Finance Standing Committee of Parliament has called for an immediate forensic audit of all restructured loans that had turned into bad debts.
  
  A forensic audit is also required for wilful defaults, and the Reserve Bank of India (RBI) has been asked to prepare guidelines for the process. The analytical reports of the forensic audit should be submitted to the panel in six months, the panel said in its report, which was adopted on 5th February. The panel has asked the central bank to form empowered committees at the level of the RBI, banks and borrowers to monitor large loans.
  
  As of September 2015, net NPAs of public sector banks stood at Rs. 2,05,024 crore; they may reach Rs. 4 lakh crore by the end of this fiscal year, the panel said. Such a huge figure, it added, “raises questions” on the credibility of mechanisms to deal with non-performing assets.
  
  The report said wilful defaulters owe public sector banks Rs. 64,335 crore, which constitutes about 21 per cent of total NPAs. It called for making public the names of the top 30 stressed accounts of each bank. There is no justification for keeping the names secret, the Parliamentary panel observed, asking the RBI to amend its guidelines.
  
  The RBI, as a regulator, did not implement its own guidelines, the committee said, and asked the central bank to be proactive and monitor the issue on a regular basis.
  The panel also recommended the development of a “vibrant bond market” to finance infrastructure projects. Batting for large infrastructure projects, it said the Centre should revive Development Financial Institutions for long-term financing of such projects.
  
  It also urged the Centre to allow Infrastructure Finance Companies to buy infrastructure projects turning into NPAs and keep them as standard assets.
  
  
  The report noted that in most cases, corporate debt restructuring (CDR) mechanisms had failed to achieve the desired objectives, adding that there should be a definite timeline of six months to settle CDR cases. In 2014-15, most of the slippages came from restructured debt.
  
  On strategic debt restructuring, the report said it could empower banks to take control of the defaulting entity, and recommended that a change in management must be made mandatory in cases involving wilful default.
  
  The prolonged slowdown in the economy has eroded the market for distressed assets so much that even Asset Reconstruction Companies found it hard to offload these, the committee observed, adding that the RBI should consider creating a dispensation that allows banks to write off losses in a staggered manner.
  
• Petrochemical project dedicated to nation
  Indian Prime Minister Narendra Modi has said the development of north eastern states is a core priority of his Government. He dedicated a major Petrochemical Project in Dibrugarh to the nation. The PM pitched for timely completion of developmental projects in the North Eastern states.
  
  To take the development agenda in North-eastern states forward. PM Modi inaugurated two major projects. The Prime Minister dedicated to the nation, India's highest wax producing unit using indigenous technology in Numaligarh Refinery Ltd.
  PM Modi also inaugurated the Rs 9,965-crore mega gas cracker project of Brahmaputra Cracker & Polymers Ltd at Lepetkota. PM Modi said development of the north-east is a core priority to ensure all-round development.
  
• Government imposes minimum import price on 173 steel items
  The government has imposed a minimum import price (MIP) ranging from $341 to $752 per tonne on 173 steel products to provide relief to local steel makers hurt by an increase in cheap imports of these items. A notification of the Directorate General of Foreign Trade (DGFT) said, “MIP is introduced against 173 HS Codes (iron and steel products).”
  
  The MIP conditions are valid for six months from the date of the notification (February five) or until further orders, whichever is earlier, it said. However, the MIP will not be applicable on imports under the advance authorisation scheme and high-grade pipes used for pipeline transportation systems in the petroleum and natural gas industry. The notification said imports/shipment contracts (under Letter of Credit) entered into before February five are also exempted from the MIP conditions.
  
  However, the user industry objected to this decision. Engineering goods exporters’ body EEPC India said the MIP will lead to further erosion in engineering exports. It sought from the government a compensatory mechanism to make up for the increased raw material price which the distressed exporters, mostly in the SME segments, will be made to bear following the protection given to the large steel manufacturers.
  
  The Advance Authorisation route is not used by the MSME sector and unless a price reimbursement mechanism is worked out for engineering exporters, there will be no revival of exports in the next six months.
  
  Indian Stainless Steel Development Association welcomed the move but said stainless steel products should also have been given the benefit of the MIP.