ECONOMY AFFAIRS MAY 2016

ECONOMY AFFAIRS MAY 2016

• CSR rules amended to widen canvas for India Inc
  The Centre has broad-based the entities available for carrying out corporate social responsibility (CSR) activities.
  
  India Inc can now get CSR implemented through a foundation or trust or society set up by the Centre, State government or any entity established under the Act of Parliament or State legislature.
  
  This could be done without having to worry about existence of three year track record in undertaking similar projects or programmes.
  
  According to corporate affairs ministry officials, government had widened the canvas for corporates. They need not bother about floating their own foundations or trusts or society for undertaking CSR. They can now use the vehicles set up by the Central, State governments or entities set up by an Act of Parliament or State legislatures to carry out CSR
  
  There are many States, which have floated charitable foundations pursuing objects enshrined in the CSR legal framework, and these vehicles could now be utilised by companies for CSR implementation.
  
  The latest rule change may also be helpful for corporate houses to reach out to remote areas where government floated society or trust or foundations are already working.
  
• Govt recommends to extend tax holiday for Startups to 7 years
  Commerce and Industry Minister Nirmala Sitharaman has said, her Ministry has recommended to Finance Ministry to raise tax holiday for start-ups to 7 years from the present 3 years. She also informed that FDI equity flow has grown by 53 per cent.
  
  On WTO, she said, India stood by the Bali Declaration at the talks and the Doha developmental agenda has been completely reinforced by the Government.
  
  The Finance Ministry had asked the iPhone maker to meet rules that mandate foreign retailers to sell at least 30 per cent locally-sourced goods if it wished to open stores in the country.
  
  The Minister, however, said she is not in favour of relaxing rules for Apple to sell refurbished second-hand phones in India. She said, her Ministry is ready to waive local sourcing requirement in retail for high-end tech companies like Apple, if they comply with conditions.
  
• SEBI favours linking spot markets with e-NAM for fair price discovery
  To bring in more efficiency and transparency in agriculture commodities futures, market regulator SEBI has asked the Agriculture Ministry to connect the physical markets – from which it obtains information on spot prices to derive futures prices – to the online trading platform ‘e-National Agriculture Market’ (e-NAM).
  
  The Securities and Exchange Board of India (SEBI) has already sent a letter to the Ministry asking it to consider online integration of those basis centres and additional delivery centres on the basis of which spot prices are being polled and futures contracts are being settled.
  
  e-NAM was launched by the Prime Minister this April with the objective of integrating 585 wholesale markets through the online platform in the next two years for transparent determination of prices.
  
• Telecom Minister launches E-Sampark for ease of communication
  Telecom Minister Ravi Shankar Prasad on 30^th May launched ESampark website, a messaging platform for the government of India. The website will improve government's communications with citizens, adding that currently, complaints are being addressed on social media.
  
• Indian economy grows at 7.6% in FY'16, 7.9% in Q4
  The Indian economy recorded a strong growth of 7.9 percent in the fourth quarter of the 2015-16 fiscal. Growth was lifted mainly by a good performance by the manufacturing and farm sectors. Consequently, GDP growth for the full 2015-16 fiscal improved to a five-year high of 7.6 per cent.
  
  According to data released by the Central Statistics Office, the manufacturing sector grew 9.3 percent during the fourth quarter, and the farm sector grew 2.3 per cent. The mining and quarrying sector grew 8.6 per cent in the fourth quarter, while electricity, gas, water supply and other utility services recorded a growth rate of 9.3 per cent.
  
• Cabinet Secretary to head search panel for RBI deputy governor
  The government has formed a search-cum-selection panel headed by Cabinet Secretary, Pradeep Kumar Sinha, to choose a deputy governor of the Reserve Bank of India – a departure from the past when such a panel was headed by the central bank governor.
  
  RBI Governor Raghuram Rajan will be a member in the panel. The search panel will include a representative from the Prime Minister’s Office, one from the Finance Ministry, an economist and a professor from Gujarat National Law University, sources with direct knowledge of the development said.
  
  The move comes at a time when there is a controversy regarding an extension for Mr. Rajan, who completes his three year term in September.
  
  In 2015, when the term of Urjit Patel, one of the deputy governors, was nearing an end, a search committee headed by the RBI governor was formed. However, when Chairman of Securities and Exchange Board of India (Sebi), U.K. Sinha’s term was ending, the search panel was headed by the Cabinet Secretary. Both Mr Patel’s and Mr Sinha’s terms were extended.
  
  The term of Harun Rashid Khan - one of the four deputy governors of the RBI — will end in first week of July, which necessitated the formation of the search panel to find a successor. All the eleven executive directors have been called for interviews, which are scheduled for June 6.
  
• Five-year term
  Deepak Mohanty is the senior most among the executive directors, followed by Deepali Pant Joshi. A deputy governor can be appointed for a maximum of five years.
  
  Out of the four deputy governors, two are appointed from outside – of which, one is an economist and the other a commercial banker.
  
  The remaining two deputy governors are appointed from within the ranks of the RBI. Mr Khan, who was promoted from within the ranks was appointed as deputy governor in July 2011, and then reappointed in 2014 for two years.
  
• Cabinet hikes paddy MSP by Rs 60 to Rs 1470/qtl for 2016-17
  Cabinet Committee on Economic Affairs - CCEA has approved hike in the minimum support price, MSP of paddy by Rs 60 to Rs 1,470 per quintal for kharif season 2016-17.
  
  MSP is the rate at which the government buys the grain from farmers. Sowing of kharif crops will shortly begin with the onset of southwest monsoon. Paddy is the main crop grown in the season.
  
  Barring pulses and oilseeds, the CCEA has approved the MSP of other crops as per the recommendation of government's advisory body on farm pricing, Commission for Agricultural Costs and Prices, CACP.
  
  In case of pulses, government has hiked MSP substantially for 2016-17 kharif season to boost domestic production and reduce the country's dependence on imports.
  
  Government has given its approval for additional monthly allocation of 41,800 tonnes of foodgrains for the BPL families and 20,507 tonnes of foodgrains for APL families at 2/3rd of MSP rates to three non-National Food Security Act states. These states are Tamil Nadu, Kerala and Nagaland.
  
  CCEA has also given its nod to a new broad gauge line between Mau Station of North Eastern Railway and Tarighat Terminal station of East Central Railway.
  
• Centre cracks down on food prices
  The central government on 21st May announced a slew of measures to keep prices of essential commodities under check during the festival months of July to December.
  
  These included recommending delisting of chana from the futures market, favouring a lower import duty on sugar, directing states to rationalise stock holding limits on pulses for millers, producers and importers, and exempting them from value-added tax.
  
  The government would also consider increasing the size of the pulses buffer stock to 900,000 tonnes from 150,000 tonnes as recommended by a departmental committee.
  
  The meeting also adopted a five-point action plan to contain prices of essential commodities that includes a price stabilisation fund in states.
  
  India's annual wholesale price index (WPI) for April entered the positive terrain after staying in negative zone for 17 straight months, mainly because of high prices of pulses, sugar, eggs, meat, fish and milk, official data showed. Consumer Price Inflation also rose to a stronger-than-expected 5.39 per cent from 4.83 per cent in the previous month.
  
  A persistent increase in inflation, particularly consumer prices, could refrain the Reserve Bank of India from cutting key policy rates next month.
  
  Pulses production is around 17 million tonnes while demand is for 23.6 million tonnes. Although India imported 5.5 million tonnes of pulses in 2015-16, there was still a shortfall of around 1 million tonnes, putting upward pressure on prices
  
  The minister said pulses importers should display their stock positions on public platforms to bring in more transparency. For this Paswan will approach Commerce Minister Nirmala Sitharaman.
  
  CENTRE’S ACTION ON PRICE RISE
  Pulses
  • Recommending delisting chana from futures market
  • Direct states to rationalise vat on pulses, rationalise stock holding limits
  • Pulses importers may get 45-day window to dispose off imported stock without any limit
  • Centre to hire independent private agency to monitor price of essential commodities from over 600 districts
  • Pulses importers to be encouraged to enter into long-term contracts to cut down on shipment delays
  • Pulses importers might be asked to display all details of contracts entered, shipment arrived, quantity arrived, quantity in transit etc, on a transparent platform
  
  Sugar
  • Open to lowering import duty from 40 per cent to boost supplies
  • Food minister has asked Maharashtra, Uttar Pradesh, Karnataka and Tamil Nadu to keep a close watch on sugar stocks held by millers to ensure availability in the domestic market
  • States directed to effectively implement stock holding limits on sugar
  • Centre, along with states, to work out a five-point action plan to keep prices of essential commodities under check
  • The action plan includes state having their own price stabilisation funds, quick notification of rules under the National Food Security Act
  
  
• G-7 pledges to clamp down on financial support for terrorist network
  The G7 on 21st May pledged to clamp down on financial support for terrorist networks, with a plan to step up intelligence-sharing, freeze assets and tighten reporting rules on international transfers.
  
  After two days of talks in northern Japan, they said, countering violent extremism and bringing perpetrators to justice remain top priorities for the whole international community.
  
  An action plan said, the G7 is committed to work together to strengthen the global fight against terrorist financing. The action plan will be adopted by the G-7 leaders who will meet in Japan next week.
  
  French Finance Minister Michel Sapin, whose country suffered devastating attacks in January and November last year, said the Group of Seven was now in the operational phase of its efforts. He said, another key tool is to counter the cover provided by prepaid but anonymous phone cards, movements of cash that allow anonymous access to finances.
  
  The G7 action plan identified targeted financial sanctions as critical to hindering terrorist support networks. It also said it would provide continued strong leadership to the Financial Action Task Force, which sets international standards to combat money laundering and terrorism finance. The G7 consists of Britain, Canada, France, Germany, Italy, Japan and the United States.
  
• World economy is an 'urgent priority'
  The Group of Seven leaders has said that pumping up the world economy is an urgent priority. Wrapping up a two-day summit, in Ise-Shima, Japan, the G-7 left the door open for a go-your-own-way approach. The final communique also noted that growth remains moderate and below potential.
  
  The summit reiterated the members' commitments to using all policy tools, individually and collectively, to strengthen global demand and address supply constraints.
  
  The G7 is an informal bloc of industrialized economies comprising the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom.
  
• Postal Payment Bank from March 2017
  The Payment Bank proposed by the Department of Posts (DoP) will become operational from March 2017. The Centre is investing Rs. 800 crore, including Rs. 400 crore from the Department, to set up the bank. The Department is running pilots in a few States to test the model.
  
  According to the Union IT, Telecom and Communications Minister Ravi Shankar as many as 50 global banking and financial institutions have shown interest to take part in the DoP’s payment bank, to offer third party services. The list includes the World Bank, Citi (the US), Deutsche Bank and Barclays of the UK.
  
  The bank will act as a big platform for offering financial inclusion services. The DoP board will take a call on the tie-ups. They will offer insurance and other financial products, using the vast DoP’s network in the country.
  
• Government electrifies 108 villages, total now at 7,874
  A total number of 7,874 villages out of those without power have been electrified till 2nd week of May with an addition of 108 to the network, the power ministry said on 23rd May. 108 villages have been electrified across the country during week of from 16th to 22nd May 2016 under the Deen Dayal Upadhyaya Gram Jyoti Yojna
  
  Of the villages that were electrified, 31 are located in Jharkhand, 26 each in Odisha and Assam, eight in Madhya Pradesh, six in Arunachal Pradesh, three each in Uttar Pradesh and Chhattisgarh, two each in Rajasthan and Bihar and one in Himachal Pradesh
  
  In view of Prime Minister Narendra Modi's address to the nation on the Independence Day, the government has decided to electrify the remaining 18,452 non-electrified villages within 1,000 days, that is, by May 1, 2018.
  
  The project has been put in a mission mode and the strategy for electrification consists of squeezing the implementation schedule to 12 months and dividing village electrification process into 12-stage milestones with defined timelines for monitoring.
  
• World Bank assistance for Karnataka urban water project
  The World Bank will provide assistance of $100 million to the Karnataka Urban Water Supply Modernisation project. An agreement was signed between the Government of India and World Bank on 24th May.
  
  The objective of the project is to provide city-wide access to a continuous piped water supply in the eligible cities in Karnataka and to strengthen the service delivery arrangements at the city level. The Karnataka Urban Infrastructure Development & Finance Corporation will implement the project.
  
• World Bank group launches Pandemic Emergency Finance Facility
  The World Bank Group has launched the much anticipated Pandemic Emergency Finance Facility (PEF) — a new financing mechanism to quickly mobilise funds to tackle global disease outbreaks and create a new insurance market for pandemic risk.
  
  PEF is expected to bring the much needed coordination and speed for future global disease outbreak response efforts.
  
  The PEF facility launch announcement came few days ahead of the May 26-27 Summit of Group of Seven Leaders in Ise-Shima, Japan. G7 leaders had urged the World Bank Group to develop the initiative during their May 2015 summit in Schloss-Elmau, Germany.
  
  Japan — which holds the G7 Presidency -- became the first donor to the PEF initiative and committed $ 50 million.
  
• Govt approves Capital Goods Policy, aims 21 million new jobs by 2025
  The government has approved first ever policy for the country's capital goods sector envisaging creation of over 21 million new jobs by 2025.
  
  The National Capital Goods Policy was approved at a Cabinet meeting chaired by Prime Minister Narendra Modi in New Delhi.
  
  According to the Railway Minister Suresh Prabhu, the objectives of the new policy are to create an ecosystem for a globally competitive capital goods sector to achieve total production in excess of Rs 7.5 lakh crore by 2025 from the current level of Rs 2.3 lakh crore. The policy.. 
  • Aims at raising direct and indirect employment from the current 8.4 million to 30 million
  • Envisages increasing exports from the current 27 percent to 40 percent of production.
  • Help increase the share of domestic production in India’s demand from 60 percent to 80 percent thus making India a net exporter of capital goods.
  • Help realising the vision of Building India as the World class hub for Capital Goods
  • Play a pivotal role in overall manufacturing as the pillar of strength to the vision of Make in India.
  
  The objectives of the policy will be met by the Department of Heavy Industry in a time bound manner through obtaining approval for schemes as per the roadmap of policy interventions.
  
  In an another decision, the Cabinet gave ex-post facto approval to the Memorandum of Understanding, MoU signed between India and Maldives for strengthening cooperation in the field of tourism.
  
  An official release said, the MoU aims at encouraging cooperation between tourism stakeholders, including hotels and tour operators, establishing exchange programme for cooperation in Human Resources Development and making investment in the Tourism and Hospitality sectors.
  
  The Cabinet also gave its nod for financial restructuring of Hindustan Steel Works Construction Limited (HSCL) and its takeover by National Buildings Construction Corporation Limited (NBCC).
  
  NBCC and HSCL are Government of India enterprises with similar lines of business activities. The decision will benefit in economies of scale for NBCC and would assist in better manpower utilization.
  
  Besides, Cabinet gives ex-post facto approval to the Amendments in the Constitution (Scheduled Tribes) Order, 1950 to modify the list of Scheduled Tribes in Assam, Chhattisgarh, Jharkhand, Tamil Nadu, Tripura and Puducherry.
  
• Cabinet clears Railway projects worth Rs 11,000 crore
  The Cabinet Committee on Economic Affairs, CCEA on 25th May gave its approval for Railway projects worth Rs 11,000 crore. These include Bina-Katni 3rd line project at an estimated cost of nearly 2,500 crore.
  
  The 279 km long railway line is expected to be completed in five years. Another project is Vizianagaram and Titlagarh 3rd line project, costing nearly 2,335 crore.
  
  The length will be 265 kilometre and will be completed in 5 years. It also included doubling of Surendranagar-Rajkot project, Pune-Miraj-Londa railway line and Roza -Sitapur Cantt.- Burhwal Broad Gauge single line.
  
  CCEA also approved ex-post facto proposal of Yes Bank Limited for increase in foreign investment limit to 75 per cent from existing 41.87 per cent.
  
• India global 5th in green energy jobs, China on top
  India ranks fifth in the world in renewable energy (RE) job creation, with 416,000 employed in the sector during 2015. In the world, 8.1 million persons are employed in the clean energy space. China tops the list with 3.5 million, followed by Brazil with 918,000.
  
  According to the International Renewable Energy Agency’s (Irena) Annual Review 2016, there was a five per cent increase over a year before in the sector, with new jobs being created even as employment in the broader energy sector falls.
  
  The report, titled Renewable Energy & Jobs, also provides a global estimate of the number of jobs supported by large hydropower, with a conservative estimate of an additional 1.3 million direct jobs worldwide.
  
  Countries with the most RE jobs in 2015 were China, Brazil, America, India, Japan and Germany.
  
  The solar PV sector remains the largest RE employer worldwide, with 2.8 million jobs, with jobs in manufacturing, installation and operations & maintenance. Liquid biofuels was the second largest global employer with 1.7 million jobs, followed by wind power, which grew five per cent to reach 1.1 million global jobs.
  
• New committee swipes towards cashless society
  The government and the Reserve Bank of India (RBI) have been working on how to reduce cash transactions in the economy. In this regard, they formed a committee in April, 2016, of seven members, chaired by a ministry official, Neeraj Kumar Gupta.
  
  This group is looking at how to ensure the acceptance of card payments is increased. This will require more of point-of-sales (PoS) machines.
  
  RBI data at end-March shows 24.5 million credit cards and 661.8 million debit cards in the country, compared to 1.3 million PoS terminals.
  
  The committee that was formed in 2015 on the same issue; the new panel is to also see that the former’s suggestions are implemented. These include reducing the interchange fee charged on credit cards and bringing these at par with debit cards. Currently, 1.98 per cent in the case of credit card spending and 0.5-1 per cent in debit card spending of the total amount is interchange fee by the bank and the card players.
  
  This amount is paid by the merchant and is split between the bank that issued the card, the lender whose PoS machine is being used and the payment system — RuPay, Visa or MasterCard.
  
  The taskforce is also working at ways in which cardpayers needn’t pay a surcharge for fuel, utility bills and railway bookings, a move approved earlier by the government.
  
  India’s cash-to-gross domestic product proportion was a little over 12 per cent in 2014, higher than several other economies. According to a 2015 report, RBI and commercial banks annually spend around Rs 21,000 crore in currency operation costs.
  
• ATMs to have chip-and-pin based infra: RBI
  RBI has directed all banks and white-label ATM operators to have chip-and-pin based card infrastructure. Earlier, the regulator had directed banks to issue only chip-and-pin based cards and migrate old cardholders to these new cards.
  
  RBI said though the cards comply with the new norms, ATMs continue to process card transactions based on data from the magnetic stripe, the old system. As a result, cards being used in ATMs are more prone to skimming frauds.
  
  It has, therefore, become necessary to mandate EMV chip and pin card acceptance and processing at ATMs also. Contact chip processing of EMV chip and pin cards at ATMs would not only enhance the safety and security of transactions at ATMs, but also facilitate preparedness of the banks for the proposed ‘EMV Liability Shift’ for ATM transactions, as and when it comes into effect
  
  As a result, banks and white-label ATM operators have been manadated to ensure all existing ATMs installed/operated by them can process of chip and pin cards by September 30, 2017. Also, the new ATMs being set up have to necessarily comply with these rules.
  
• FDI inflows rise 29 %
  Foreign Direct Investment (FDI) inflows into India increased by 29 per cent to a record $40 billion during in the financial year ended March.
  
  If re-invested earnings ($10 billion), other capital ($4.4 billion) and equity capital of unincorporated bodies ($1 billion) are taken into account along with $40 billion worth equity inflows, the total FDI flows in FY'16 is the highest-ever at $55.4 billion.
  
  The FDI equity inflows in March 2016 went up by 16.5 per cent to $2.46 billion, according to data released by the Department of Industrial Policy and Promotion (DIPP).
  
  Of the FDI inflows (equity) in FY'16, services sector (including financial, banking, insurance, non-financial / business, outsourcing, R&D, courier, technology testing and analysis) attracted maximum investments of $6.88 billion followed by computer hardware and software ($5.90 billion), trading business ($3.84 billion) and automobile industry ($2.52 billion).
  
  Maximum inflows (equity) were from Singapore ($13.69 billion), followed by Mauritius ($8.35 billion), the US ($4.19 billion), the Netherlands ($2.64 billion) and Japan ($2.61 billion). The previous highest FDI inflow was in FY12 when the country received $46.55 billion, which was a 34 per cent increase over $34.8 billion it got in FY11.
  
  However, India recorded its largest-ever percentage increase in FDI when it received $22.8 billion in FY07, representing a 155 per cent increase over the $8.9 billion in FY06. This includes equity, re-invested earnings and other capital.
  
• RBI mandates ATMs also to have chip and pin-based infrastructure
  As a step further towards protecting customers from theft of data or money, RBI has asked all banks and ATM operators to ensure that their ATMs are able to process EMV chip and PIN transactions by September 30, 2017. Unlike the magnetic stripe technology, the EMV chip and PIN technology enables dynamic authentication and thereby mitigates the risk of data theft.
  
  In May last year RBI had issued a notification asking banks to make sure that all cards issued on or after September 1, 2015 are EMV chip and PIN cards.
  
  In response, many banks asked for an extension of time, and were given time till January 31, 2016. For accounts under Pradhan Mantri Jan Dhan Yojana, time limit has been extended to September 30, 2016.
  
• Finance ministry eases reporting rules for FATCA
  The finance ministry has eased certain rules in reporting by financial institutions to comply with an agreement between India and the US for implementing the Foreign Account Tax Compliance Act (FATCA). Financial institutions had told the government it was difficult to take physical self-certification from the subscribers. Heeding to the complaint, the ministry allowed obtaining of self-certification through internet banking platform.
  
  The ministry also did away with the requirement of TIN number if a person is in a country where that number is not provided.
  
  There were also queries from financial institutions about valuation of custodial accounts maintained with depositories. The ministry clarified that valuation of securities might be done at the values regularly communicated by depositories to the depository participants and brokers.
  
  FATCA requires foreign financial institutions (FFI) to report information about financial accounts held by US taxpayers. If the FFI does not comply, the IRS can impose a 30 per cent withholding penalty on US payments made to the FFI.
  
• Income Declaration Scheme for domestic black money to commence from June 01
  The 'Income Declaration Scheme' or four month window for declaration of domestic black money will commence from 1st of June. It will remain in force till 30th of September.
  
  In a statement, Finance Ministry said, declarations can be filed online or with the Principal Commissioners of Income-tax. It said, surcharge and penalty must be made latest by 30th November, 2016. Assets specified in the declaration will be exempted from Wealth tax. Non-payment of total taxes, surcharge and penalty in time or declaration by misrepresentation or suppression of facts shall render the declaration void. It also said, other penal consequences will also follow accordingly.
  
  The scheme is part of Finance Act, 2016 which seeks to provide an opportunity to all persons who have not declared their income correctly in previous years to come forward and declare their undisclosed incomes.
  
  Under this scheme, the declared income would be taxed at the rate of 30 per cent plus 'Krishi Kalyan' cess of 25 per cent on taxes payable and a penalty at the rate of 25 per cent of the taxes payable.
  
• Govt launches 2nd phase of Ujjwala scheme
  Government launches 2nd phase of Pradhanmantri Ujjwala Yojana from tribal dominated Dahod district of Gujarat. Prime Minister Narendra Modi had launched the scheme from Balliya of Uttar Pradesh on May 1st to provide LPG connections to 5 crore women beneficiaries from BPL families
  
  Union Oil Minister Dharmendra Pradhan launched the second phase of Pradhanmantri Ujjwala Yojana in Gujarat's Dahod district. The first phase of Ujjwala Yojna was launched by Prime Minister Narendra Modi at Ballia in Uttar Pradesh on May 1. The minister further added that 25 Lakh gas connections in rural areas and 15 lakh connections in urban areas will be provided in Gujarat alone.
  
• NTPC, Coal India to revive Fertiliser Corporation plants
  NTPC and Coal India Ltd signed a joint venture agreement to form a new company for revival of the fertilizer plants of Fertiliser Corporation of India Ltd at Sindri, Bihar and Gorakhpur, Uttar Pradesh.
  
  The joint venture company will set up an ammonia urea plant at each location with a 50:50 equity holding from NTPC and Coal India. Subsequently, strategic partners can be inducted
  
  This is the second time in two years the Coal India Ltd is entering into a joint venture to revive plants in the fertiliser sector. Last year, Coal India Ltd had signed an agreement with GAIL (India) Ltd, Rashtriya Chemicals and Fertilisers Ltd and Fertiliser Corporation of India Ltd to incorporate a firm to set up and operate new ammonia urea complex in Talcher, Odisha.
  
• World Bank approves $625 m loan to support rooftop solar programme in India
  The board of World Bank has approved a $625 million loan to support the central government’s programme to generate electricity from rooftop solar power plants.
  
  The board also approved a co-financing loan of $120 million on concessional terms and a $5 million grant from the Climate Investment Fund’s Clean Technology Fund, the global development bank said in a statement on 16th May.
  
  The statement added that the sanctions will help finance installation of at least 400 MW of grid connected rooftop solar photovoltaic projects across India. These installations will provide clean, renewable energy and reduce greenhouse gas emissions by displacing thermal generation. The project will also strengthen the capacity of key institutions and support the development of overall solar photovoltaic market.
  
  State Bank of India will on-lend funds to solar photovoltaic developers and end-users who wish to invest in mainly commercial and industrial rooftop solar power systems. The financing will be provided to those with sound technical capacity, relevant experience and creditworthiness as per State Bank of India’s standards.
  
• RBI allows FPIs to invest in unlisted bonds
  The Reserve Bank of India (RBI) on 16th May allowed foreign portfolio investors (FPIs) to invest in unlisted bonds of a public company and securitised debt instruments. The measures, aimed at expanding the investment basket for FPIs, were announced in the Union Budget for 2016-17.
  
  According to the extant guidelines, FPIs were only permitted to invest in listed or to-be-listed debt securities. Investment in unlisted debt securities was permitted only in case of companies in the infrastructure sector. The FPIs were earlier not allowed to invest in any kind of securitised debt instruments.
  
• NK Singh to head panel on review of FRBM roadmap
  The Finance Ministry on 17th May set up a new committee to review the Centre’s fiscal roadmap and review the working of the related Fiscal Responsibility and Budget Management (FRBM) Act that was enacted in 2003.
  
  The panel will be headed by former Member of Parliament and former Revenue and Expenditure Secretary NK Singh.
  
  Chief Economic Advisor to the Finance Ministry Arvind Subramanian, former Finance Secretary Sumit Bose, Deputy Governor of the Reserve Bank of India Urjit Patel and NIPFP Director Rathin Roy will be its members.
  
  The Committee will make its assessment and provide its views on the expected impact of the expected impact of its recommendations on the general government deficit and other FRBM parameters
  
  Finance Minister Arun Jaitley had in the Union Budget 2016-17 announced that the government would set up a committee to review and give recommendations on the FRBM roadmap for the future and whether it should move from a fixed target to a range and aligned with credit contraction or expansion.
  
  Accordingly, the committee would be expected to look into various aspects, factors and considerations for determining the FRBM target.
  
  It will also determining the need and feasibility of having a ‘fiscal deficit range’ as the target in place of the existing fiscal deficit numbers…and aligning the ‘fiscal expansion or contraction’ with ‘credit contraction of expansion’ respectively in the economy.
  
• SBI seeks Centre’s nod to absorb associate banks
  The country’s largest lender, State Bank of India, said it is seeking the Centre’s nod to merge its five associate banks and the newly created Bharatiya Mahila Bank with itself.
  
  This follows the boards of the associate banks — State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore — on 17th May approving resolutions to pave the way for their acquisition by SBI.
  
  It added that no decision had been taken approving any of the acquisitions and that the same would be taken by the Bank’s Board after evaluation. The move, has, however, not gone down well with employees of the SBI arms, and they have decided to go on strike on May 20.
  
• Installed solar capacity touches 7,000 MW by April
  Despite this the Ministry of New & Renewable Energy is confident of meeting its targets of adding 12,000 MW of capacity in 2016-17 and 15,000 MW of capacity in 2017-18. India’s total installed solar power capacity stands at around 6,998 MW as on April 30.
  
  Government has doubt about starting of SunEdison’s projects. SunEdison has 450 MW of solar projects already operational, but uncertainty is more over the yet to be commissioned 1000 MW. The company on its part has been maintaining that it is committed to India projects but is open to selling some stake in them.
  
  Since the tendering process has been completed for more than the targeted capacity addition for 2016-17, the developments at SunEdison will not impact the Ministry’s targets. Overall in the country, tendering is already complete for 15,500 MW of solar power capacity and another 5,500 MW of tenders are expected to come in the next couple of months.
  
  The States leading the way in solar capacity addition are Andhra Pradesh and Telangana, which has helped raise the solar power capacity in the country. Both these States have seen a three-fold and five-fold increase respectively in solar power capacity in the last six months, according to the Ministry data.
  
  In Telangana, installed solar power capacity stood at 527 MW on April 30, up from around 91 MW on November 30, 2015. In Andhra Pradesh the capacity stood at 792 MW on April 30, up from about 283 MW on November 30, 2015.
  
  Punjab has also doubled its solar power capacity over the last six months. On April 30, the State had 405 MW of installed solar power capacity as compared with 200.32 MW on November 30, 2015. Solar power consultancy firm Bridge to India expects the country to be the fourth largest market for solar power globally with installed capacity expected to cross 10,000 MW.
  
• Cabinet gives its approval for leasing out of Airports Authority of India land
  The Cabinet on 18th May gave its approval for leasing out of Airports Authority of India land measuring 1500 square metre to M.P. Warehousing Logistics Corporation for establishing the Centre for Perishable Cargo at Indore airport as per the resolution made by AAI Board.
  
  It will provide a world class facility under one roof to cater to all requirements of the traders and maintain the quality of produce. This will be under PPP mode.
  
  The Cabinet was apprised of the decision taken by the Empowered Apex Steering Committee that Princess Park Complex will be the suitable site for construction of the National War Museum. As regards the National War Memorial the same would be constructed at C Hexagon of India Gate as approved by the Cabinet in its meeting held in October last year.
  
  The Cabinet was also apprised of the joint issue of UN Women HeForShe postage stamp. A Memorandum of Understanding has been signed between Department of Posts and United Nations Postal Administration in February this year for this purpose. In this Joint issue, the stamps were printed in the form of sheetlet of 20 se-tenants and Miniature Sheet of two stamps on the occasion of International Women’s Day.
  
• GE inks pact with IIT-Madras to set up Industrial Internet Centre of Excellence
  GE and IIT-Madras have signed an agreement to build an Industrial Internet Centre of Excellence at the Institute for research into manufacturing analytics in aluminum smelting plants. Industrial Internet helps people and machines interact with each other using data and analytics to improve plant’s efficiency, productivity and operational excellence.
  
  It will be a multi-year agreement with GE initially providing ?3 crore for the first six months and increasing it to ?30 crore in the next five years
  
  To begin with, 15 members, including students and faculty, will be part of the Centre, which will work closely with GE Global Research, GE Power Services Engineering and GE Digital teams at GE’s John F Welch Technology Centre in Bengaluru. GE will provide domain experts and Predix, a Cloud-based operating system
  
  Every day, nearly 20 terabytes of data is generated from a single asset, which could be a turbine or a pot where aluminum is melted. These data can be used for predictive analysis on issues like power failure or repair of a machinery to help enhance the productivity of the smelter, which is used to extract aluminum from aluminum oxide.
  
• Structural reforms must for 8% growth: S&P
  Structural reforms remain key to ensuring a steady eight per cent growth in the medium term for the Indian economy, Standard and Poor’s Global Ratings said on 18th May, even as it saw India remaining largely insulated from ups and downs of the Chinese economy.
  
  Appreciating the passage of the bankruptcy law by Parliament, S&P said GST is the next item on the “to do” list as the government pushes for structural reforms.
  
  It said India's growth rate will improve to 7.9 per cent in 2016-17 and 8 per cent a year later. Growth in 2015-16 has been estimated at 7.6 per cent.
  
• RBI allows up to 100% FDI in credit information firms
  The Reserve Bank of India has allowed higher limits for foreign direct investment (FDI) in credit information companies. In a notification on 19th May, the RBI said investors whose ownership is well diversified (shareholding not concentrated in the hands of a select few) may pick up to 100 per cent stake in a credit information company. Such investors should have an established track record of running a credit information bureau in a well regulated environment, the RBI added.
  
  Investors not well diversified in terms of ownership get to own a maximum of 49 per cent in a credit information company.
  
  A credit information company aggregates and analyses data of individuals and businesses and puts out a credit score which is an indicator of creditworthiness of that individual or business. Higher the credit score, lower is the chance of default by that individual or business. Currently, India has four credit information companies — CIBIL, Experian, Equifax and CRIF High Mark. Investment by foreign portfolio investors has been limited to a maximum of 10 per cent.
  
  Currently, investments by a person in a credit bureau are limited to 10 per cent of its equity capital. However, investments under FDI are permitted up to 100 per cent under automatic route, subject to certain conditions.
  
• SEBI tightens norms to curb black money inflow
  Tightening the rules governing issuance of participatory notes (P-Notes) by foreign portfolio investors (FPIs), markets regulator Sebi on 19th May introduced Know Your Client (KYC) compliance for holders of these instruments to bring them on a par with domestic investors. It has also sought information on the ultimate beneficiaries of these products. These moves seek to restrict entry of black money into the Indian market.
  
  P-Notes are derivative products issued by FPIs in foreign markets which give their holders the right to have a share of the profit and loss from underlying Indian stocks but at the same time help maintain anonymity about the actual owners of those notes.
  
  In another decision, SEBI also said that the top 500 listed companies by market capitalization will formulate a dividend policy, which will help investors take a better decision while investing in the stocks of these companies.
  
  These changes came within two weeks of the government changing the tax treaty with Mauritius, aimed mainly at curbing tax evasion, round-tripping (Indian investors using circuitous foreign routes to invest in India for better post-tax returns) and other illegal monetary benefits. SEBI's decision on P-Notes, also called overseas derivative instruments (ODIs), came on the lines of recommendations by a special investigation team on black money that was set up by the Supreme Court.
  
• G-7 summit 2016: Finance ministers discuss Chinese economy, oil prices
  G7 Finance Ministers and central bank governors have held discussions on the world economy, ahead of next week's G7 summit to be held in Ise-Shima, central Japan. The first day of the 2-day meeting ended in the northern Japanese city of Sendai on 20th May. The participants are said to have exchanged views on what their governments can do to put the global economy back on track and achieve sustainable growth. Among world economic issues that they have discussed are the slowing Chinese economy and lower crude oil prices. They also discussed ways of dealing with tax evasion and questionable tax avoidance in reaction to disclosures in the Panama Papers.
  
• RBI: Banks should increase provisioning on bad loans
  Reserve Bank of India Deputy Governor S S Mundra on 20th May said banks should increase the provision coverage ratio (PCR) and aim to raise it to 70 per cent, the amount lenders were mandated to maintain earlier. Earlier, banks were required to mandatorily maintain a PCR of 70 per cent. But, the mandate was withdrawn in September 2011 after most banks had met the criterion.
  
  Now, with the rise in bad loan, banks are increasingly reducing the PCR to ensure that the profitability is not hit adversely. In fact, several public sector banks (PSBs) have seen a reduction in their PCR, as non-performing assets (NPAs) in balance sheets have increased. Several banks' PCR stand at about 50 per cent mark. Mundra also added banks should increase the PCR instead of chasing profitability.
  
  He also said it was not only the PSBs but also the private lenders that are increasingly witnessing asset quality pressure.
  
  He also said early recognition of bad assets will help in preserving the health of the assets and will also ensure speedier recovery. In case where banks are responsible, lenders have been asked by the regulator to help in further financing as long as it is being done with the intention of resolving the problem and not for evergreening.
  
  Mundra also added a word of caution saying it was in the interest of the borrowers to co-perate in case of defaults. As there are several investigative agencies and the legal system which can bring the erroneous defaulter to task.
  
• Centre cracks down on food prices
  The central government on 21st May announced a slew of measures to keep prices of essential commodities under check during the festival months of July to December.
  
  These included recommending delisting of chana from the futures market, favouring a lower import duty on sugar, directing states to rationalise stock holding limits on pulses for millers, producers and importers, and exempting them from value-added tax.
  
  The government would also consider increasing the size of the pulses buffer stock to 900,000 tonnes from 150,000 tonnes as recommended by a departmental committee.
  
  The meeting also adopted a five-point action plan to contain prices of essential commodities that includes a price stabilisation fund in states.
  
  India's annual wholesale price index (WPI) for April entered the positive terrain after staying in negative zone for 17 straight months, mainly because of high prices of pulses, sugar, eggs, meat, fish and milk, official data showed. Consumer Price Inflation also rose to a stronger-than-expected 5.39 per cent from 4.83 per cent in the previous month.
  
  A persistent increase in inflation, particularly consumer prices, could refrain the Reserve Bank of India from cutting key policy rates next month.
  
  Pulses production is around 17 million tonnes while demand is for 23.6 million tonnes. Although India imported 5.5 million tonnes of pulses in 2015-16, there was still a shortfall of around 1 million tonnes, putting upward pressure on prices.
  
  The minister said pulses importers should display their stock positions on public platforms to bring in more transparency. For this Paswan will approach Commerce Minister Nirmala Sitharaman.
  CENTRE’S ACTION ON PRICE RISE
  Pulses
  • Recommending delisting chana from futures market
  • Direct states to rationalise vat on pulses, rationalise stock holding limits
  • Pulses importers may get 45-day window to dispose off imported stock without any limit
  • Centre to hire independent private agency to monitor price of essential commodities from over 600 districts
  • Pulses importers to be encouraged to enter into long-term contracts to cut down on shipment delays
  • Pulses importers might be asked to display all details of contracts entered, shipment arrived, quantity arrived, quantity in transit etc, on a transparent platform
  
  Sugar
  • Open to lowering import duty from 40 per cent to boost supplies
  • Food minister has asked Maharashtra, Uttar Pradesh, Karnataka and Tamil Nadu to keep a close watch on sugar stocks held by millers to ensure availability in the domestic market
  • States directed to effectively implement stock holding limits on sugar
  • Centre, along with states, to work out a five-point action plan to keep prices of essential commodities under check
  • The action plan includes state having their own price stabilisation funds, quick notification of rules under the National Food Security Act
  
  
• South Indian Bank announces tie-up with National Australia Bank
  South Indian Bank has announced its new tie-up with National Australia Bank (NAB) for online inward remittance from Australia at competitive rates. The remittance fee is as low as AUD 7 and the arrangement enables faster, hassle-free remittance through internet at the best exchange rates.
  
  NAB is South Indian Bank’s main banking correspondent in Australia. As the exchange rate is decided by South Indian Bank, NRI customers in Australia would get the best possible rates. The remitted money can be either converted into Indian rupee or maintained in Australian dollar, said K N Reghunathan, Executive Vice President (Treasury) of South Indian Bank.
  
  South Indian Bank is also having tie-ups with leading banks and exchange houses in the USA, Europe, and Asia. It has also extensive arrangements with the leading exchange houses in West Asia with special facilities for NRE account opening through welcome kits and online mode.
  
• Govt allows 100% ‘automatic’ FDI in ARCs
   The Centre has allowed 100 per cent foreign direct investment (FDI) in asset reconstruction companies (ARCs) under the automatic route. So far, foreign investment was automatic only up to 49 per cent; beyond that government approval was needed. Now, DIPP has said 100 per cent FDI is allowed in ARCs under the automatic route.
  
  However, some conditions have been set, including the stipulation that the total shareholding of individual foreign institutional investors/foreign portfolio investors must be below 10 per cent of the total paid-up capital.
  
  Also, FII/FPIs have been permitted to invest up to 100 per cent of each tranche in security receipts issued by ARCs, subject to RBI directions/guidelines.
  
  The DIPP has now said that the investment limit of a sponsor in the shareholding of an ARC will be governed by the provision of the Sarfaesi law, as amended from time to time.
  
  Allowing 100 per cent FDI would come as big boost for companies which are struggling for funds, as banks refuse to give steep discounts on stressed assets and the ARCs have to make upfront payment of 15 per cent of the cost of the asset.
  
• E-commerce sector to see $120 bn revenue by 2020
  The country's e-commerce sector is expected to see revenues of $120 billion by 2020 from $30 billion at the end of last fiscal, a report said.
  
  The increase would be mainly on the back of young demographic profile, rising Internet penetration and relatively better economic performance, the Assocham-Forrester study said.
  
  India's e-commerce sector saw revenues of $30 billion at the end of the financial year 2015-16. It is expected to reach $120 billion by 2020, it said. The report further said that India has an Internet user base of 400 million in 2016 whereas Brazil has 210 million Internet users and Russia 130 million, among the BRICS nations.
  
  About 75% of the country's online users are in the age group of 15-34 years since India is one of the youngest demographies globally and one out of every 5 (online user) visits the Indian Railways site, the report said.
  
  In India, about 60-65% of the total e-commerce sales are being generated through smart phones. Branded apparel, accessories, jewellery, gifts, footwear are among the major hits on the e-commerce platforms, it added.
  
• Govt releases commemorative coin on Maharana Pratap
  Government on 9th May released a commemorative coin of hundred rupees and a circulation coin of ten rupees as a part of 475th Birth Anniversary celebrations of Maharana Pratap.
  
  Releasing the coin in New Delhi, Tourism Minister Dr Mahesh Sharma said, Maharana Pratap was a brave warrior, successful organizer and ingenious strategist, fearlessly fought the Mughals and protected his people until his death.
  
  He said, the stories of Maharana Pratap who fought fearlessly to regain the prestige for his nation and people still inspire the present generation to do brave deeds for the honour of their motherland.
  
  Ministry of Culture has been celebrating the 475th Birth Anniversary of Maharana Pratap during 2015-16 in association with the State Government of Rajasthan.
  
• Govt notifies roll back of import duties on mobile components
  The Central Board of Excise and Customs (CBEC) has issued notifications partly rolling back import duties of 29.441 per cent imposed on key mobile phone components such as chargers and batteries.
  
  In the Budget for 2016-17, Finance Minister Arun Jaitley had proposed to levy a basic customs duty of 10 per cent on charger or adaptor, battery, wired headsets for use in manufacture of mobile handsets including cellular phones.
  
  Another 12.5 per cent countervailing duty was proposed on the same and a 4 per cent Special Additional Duty, totalling the incidence of duties to 29.441 per cent.
  
  A CBEC notification said the basic customs duty and special additional duty has been reversed and importers of mobile handset components such as chargers, adaptors, batteries and wired headsets now need to pay only the countervailing duty of 12.5 per cent.
  
  This being subject to "the importer shall comply the procedure specified in the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2016," the notification said. This rollback brings them at par with the duty of the full mobile phone package.
  
  The import duty on preform of silica for use in the manufacture of telecommunication grade optical fibres or optical fibre cables has been halved to 5 per cent from 10 per cent proposed by Jaitley in Budget for 2016-17.
  
  It also exempted components or parts, including engines of aircraft from customs duty to boost Make-in-India. There was no import duty on these parts previously as well but the CBEC conditioned the exemption to the importer submitting "documents duly certified by the Director General of Civil Aviation approved Quality Managers of aircraft maintenance organisations indicating such parts, testing equipment, tools and tool-kits."
  
  Also, the components or parts, including engines, of aircraft which is imported for maintenance, repair or overhauling by units approved by the Director General of Civil Aviation in the Ministry of Civil Aviation, have to be exported back after repairs.
  
• India and Mauritius sign protocol for avoidance of double taxation
  The Protocol for amendment of the Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital gains between India and Mauritius was signed by both countries today at Port Louis, Mauritius. The key features of the Protocol are as under:
  
  Source-based taxation of capital gains on shares: With this Protocol, India gets taxation rights on capital gains arising from alienation of shares acquired on or after 1st April, 2017 in a company resident in India with effect from financial year 2017-18, while simultaneously protection to investments in shares acquired before 1st April, 2017 has also been provided.
  
  Further, in respect of such capital gains arising during the transition period from 1st April, 2017 to 31st March, 2019, the tax rate will be limited to 50% of the domestic tax rate of India, subject to the fulfillment of the conditions in the Limitation of Benefits Article. Taxation in India at full domestic tax rate will take place from financial year 2019-20 onwards.
  
  Limitation of Benefits (LOB): The benefit of 50% reduction in tax rate during the transition period from 1st April, 2017 to 31st March, 2019 shall be subject to LOB Article, whereby a resident of Mauritius (including a shell / conduit company) will not be entitled to benefits of 50% reduction in tax rate, if it fails the main purpose test and bonafide business test. A resident is deemed to be a shell/ conduit company, if its total expenditure on operations in Mauritius is less than Rs. 2,700,000 (Mauritian Rupees 1,500,000) in the immediately preceding 12 months.
  
  Source-based taxation of interest income of banks: Interest arising in India to Mauritian resident banks will be subject to withholding tax in India at the rate of 7.5% in respect of debt claims or loans made after 31st March, 2017. However, interest income of Mauritian resident banks in respect of debt-claims existing on or before 31st March, 2017 shall be exempt from tax in India.
  
  The Protocol also provides for updation of Exchange of Information Article as per international standard, provision for assistance in collection of taxes, source-based taxation of other income, amongst other changes.
  
  Major impact: The Protocol will tackle the long pending issues of treaty abuse and round tripping of funds attributed to the India-Mauritius treaty, curb revenue loss, prevent double non-taxation, streamline the flow of investment and stimulate the flow of exchange of information between India and Mauritius. It will improve transparency in tax matters and will help curb tax evasion and tax avoidance. At the same time, existing investments, i.e. investments made before 1.4.2017 have been grand-fathered and will not be subject to capital gains taxation in India.
  
• RBI to issue Rs 1000 banknotes with inset letter R
  Reserve Bank of India will shortly issue banknotes of 1000 rupees denominations with inset letter 'R' in both the number panels. In a release, RBI said that the banknotes will also have on the obverse, all the other security features, including ascending size of numerals, bleed lines and enlarged identification mark.
  
  It added that the banknotes bearing signature of RBI Governor Raghuram G Rajan, will also have the year of printing '2016' printed on the reverse. It also added that the banknotes in the denomination of 1000 rupees issued by RBI in the past, would continue to be legal tender.
  
• Apex court nixes TRAI’s call-drop penalty In a major relief to telecom operators, the Supreme Court on 11th May scrapped the regulation by TRAI that allowed users to claim compensation for dropped calls. Terming the regulation “arbitrary” and “unreasonable”, the apex court said TRAI had framed the law without “intelligent care and deliberation”.
  
  The judgment, delivered by Justices RF Nariman and Kurian Koseph, said it was not clear why TRAI had decided to limit the compensation to three call drops a day, or how it had arrived at the figure of Rs. 1 to compensate inconvenience caused to the consumer.
  
  According to sector specialists, the court order not only raises questions about TRAI’s credibility, it also points to the larger issue of transparency in constitutional bodies. The Supreme Court, in fact, exhorted Parliament to take up this issue and frame legislation along the lines of the US Administrative Procedure Act by which all subordinate legislation is subject to a transparent process.
  
  The immediate impact of the Supreme Court ruling will be on mobile consumers, who will not get any compensation for poor quality of service offered by the telecom operators.
  
• Rajya Sabha passes Bankruptcy Code
  The Rajya Sabha on 11th May passed the Insolvency and Bankruptcy Code Bill, enabling a single law to deal with distressed companies, their promoters, creditors, employees and other stakeholders for the first time in India.
  
  The law - which will ensure a time-bound process of winding-up a company or limited liability entity, a 'Fresh Start' for debt-laden individuals under a certain threshold and temporary transfer of management of the troubled entity into the hands of resolution professionals - was passed by the Lok Sabha all ready.
  
  The law is expected to help banks deal with about Rs 8 lakh crore of stressed assets and will streamline the existing insolvency process, which has so far depended on 11 separate laws. The law repeals the Presidency Towns Insolvency Act, 1909 and Provincial Insolvency Act, 1920. In addition, it amends laws such as the Companies Act, 2013, and the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, among others.
  
  The law allows the setting up of an insolvency regulator, for oversight over insolvency professionals who will carry out the bankruptcy process. Debt Recovery Tribunals will be the adjudicating authority for individuals and unlimited liability partnership firms and the National Company Law Tribunal will adjudicate for companies and limited liability entities.
  The Law says….
  • Law allows early identification of financial distress to help revive a company
  • 75% of creditors have to agree on a revival plan
  • Individuals to be given a chance of 'Fresh Start', where outstanding debt will be written off
  • Allows for insolvency regulator; says regulatory powers with govt till such body is set up
  • Specifies penalties for offences committed under corporate insolvency
  • Penalty will be imprisonment up to five years, or a fine up to Rs 1 crore, or both.
  • Debt Recovery Tribunal mooted as adjudicating authority for individuals/ unlimited liability entities
  • National Company Law Tribunal to be adjudicating authority for companies/ limited liability entities
  
  
• Assocham: Drought has trickle-down effect on economy
  Drought in 10 states is estimated to impact the economy by at least Rs 6.5 lakh crore, with 330 million people across 256 districts facing a grim situation, an Assocham study has revealed.
  
  Two consecutive years of poor monsoon, water shortage in reservoirs as well as lowering of groundwater table have created challenges to drought-affected areas in 10 states, the study said.
  
  The loss of subsidies on power, fertiliser and other inputs multiply the impact, it added. On the economic impact of drought, the study said the financial resources get diverted from development to aid, and the possible migration puts pressure on urban infra and supplies. The drought would create inflationary pressures, making food management a challenge for the government and policymakers, it added.
  
• RBI issues norms for branch offices by foreign entities
  The Reserve Bank of India has said that entities from Pakistan, China, Bangladesh and four other regions including Sri Lanka, Afghanistan, Iran and Hong Kong or Macau will require its prior approval to establish branch office or project office in India.
  
  RBI has released new guidelines for foreign entities to open a branch office (BO) or a liaison office (LO) or a project office (PO) in India.
  
  It has said that Permission of RBI will also be required for opening a BO/LO/PO in Jammu and Kashmir, North East region and Andaman and Nicobar Islands.
  
  The apex bank said that its approval would also be required if the applicant is a Non-Government Organization (NGO), a Non-Profit Organization, or a Body/ Agency/ Department of a foreign government.
  
  It further said that approval would also be needed if the principal business of the applicant falls in the four sectors viz, defence, telecom, private security and information and broadcasting.
  
  However, the RBI has clarified that in the case of proposal for opening a PO relating to defence sector, no separate reference or approval of Government of India shall be required if the said non-resident applicant has been awarded a contract by/ entered into an agreement with Ministry of Defence or Service Headquarters or Defence Public Sector Undertakings.
  
• Cabinet approves Delhi-Meerut Expressway
  The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval for widening of the UP Gate to Dasna stretch of the Delhi-Meerut Expressway. Approval was also given for development of 8/6 laning of Delhi-Meerut Expressway to Dasna Section of NH-24 in Uttar Pradesh.
  
  The project's estimated cost would be Rs 1,983 crore, which will ease traffic congestion in the national capital. The Cabinet also gave its clearance to a proposed inter-governmental agreement to be signed between India and Mauritius to extend bilateral co-operation for development of co-operatives and related fields.
  
  Another approval given by the Cabinet was for signing of a Memorandum of Understanding between SEBI and Financial Services Regulatory Authority, Abu Dhabi for mutual co-operation and technical assistance between the two regulators.
  
  The MoU would contribute towards strengthening information sharing framework between the two regulators.
  
  Prime Minister Narendra Modi was apprised of a General Framework Agreement (GFA) on Renewable Energy Cooperation between India and United Arab Emirates (UAE).
  
• India signs multilateral pact for information exchange on MNCs
  India has signed a multilateral pact that would help it gain a better understanding on the way multinational enterprises structure their operations around the world and allocate incomes and taxes paid.
  
  The Multilateral Competent Authority Agreement for automatic exchange of country-by-country reports (CbC MCAA) was signed by India at Beijing on May 12.
  
  Besides India, five other countries – Canada, China, Iceland, Israel and New Zealand – also signed the pact on the same day, taking the total number of signatories to 39 countries.
  
  The CbC MCAA allows all signatories to bilaterally and automatically exchange country-by-country reports with each other as contemplated by Article 13 of BEPS (Base Erosion and Profit Shifting) Action plan.
  
  The OECD/G20 BEPS project had set out 15 key actions to reform the international tax framework and ensure that profits are reported where economic activities are carried out and value created.
  
  BEPS is of major significance for developing countries due to their heavy reliance on corporate income tax particularly from multinational enterprises.
  
  The Union government had in this year's Budget introduced CbC reporting in the domestic law. The threshold for filing the report has been maintained at €750 million and the format is to be notified at a later date. The due date for filing the CbC report for tax year 2016-17 would be November 30, 2017.
  
  CbC reporting requires multinational enterprises to provide aggregate information annually in each jurisdiction where they do business, relating to the global allocation of income and taxes paid, together with the other indicators of the location of economic activity within the MNE group.
  
• NCAER pegs GDP growth for FY16 at 7.6%
  The National Council of Applied Economic Research (NCAER) has scaled up India's economic growth projection to 7.6 per cent for 2015-16, from the earlier 7.4 per cent. It pegged the growth marginally higher at 7.7 per cent for 2016-17, due to a pickup in the agriculture sector on the back of expected normal monsoon.
  
  "NCAER's annual model for gross domestic product (GDP), at 2011-12 prices, estimates GDP growth rate at 7.6 per cent for 2015-2016 and forecasts it at 7.7 per cent for 2016-17," the council said in its latest quarterly review. In its previous quarterly review, it had projected the economy to grow by 7.4 per cent in 2014-15.
  
  Its new projections are in line with the government expectations for 2015-16. The data would be released by this month end.
  
  NCAER predicted exports to contract 1.6 per cent in 2016-17, which would be their third year of decline. Despite the agriculture sector expected to perform better, NCAER believed that the economy would grow just one percentage point higher in the current financial year than that of 2015-16. The government expects the economy to grow in the range of 7-7.75 per cent, but said the growth may turn out to be higher if the farm sector performs well. The council said the agriculture sector has witnessed feeble growth on account of drought for two successive years. The average rate of growth in the agricultural and allied sectors' for 2014-15 and 2015-16 has been a low 0.5 per cent. Two consecutive years of sub-par monsoon have had a significant impact on the output of both food as well as non-food crops.
  
  The Indian Meteorological Department has predicted monsoon for 2016-17 at 106 per cent of the long period average (LPA). However, in the industrial sector, the manufacturing sector, after showing robust growth in the second quarter, has slowed down consistently in the third and fourth quarter. The Index of Industrial Production (IIP) recorded a 2.4 per cent rise in 2015-16, against 2.8 per cent in 2014-15. In the fourth quarter, IIP manufacturing was in a "recession" (-1.1 per cent) and the overall IIP grew by 0.2 per cent on a y-o-y basis. In the fourth quarter, capital goods contracted by 15.4 per cent and consumer non-durables by 3.9 per cent.
  
• Taxpayers account for just about 1% of India's population
  Taxpayers account for just about one per cent of India's population, as per the latest data disclosed by the government for assessment year 2012-13. The data has been made public as part of a transparency drive. A total of 2 crore 87 lakhs individuals filed the Income Tax Returns for 20112-13, but one crore 62 lakhs of them did not pay any tax. It left the number of taxpayers at just about 1 crore 25 lakhs.
  
  The tax outgo was less than one lakh 50 thousand for a vast majority of nearly 89 per cent taxpayers. The three individuals in the top-bracket of 100 to 500 crore paid a total tax of 437 crore rupees.
  
  As many as 5,430 individuals paid income tax of over one crore rupees. As per the overall data, total income tax collections rose nine-fold to 2.86 lakh crore rupees in 2015-16, from 31,764 crore rupees in 2000-01.
  
• Real Estate Act comes into force
  The much awaited and widely acclaimed Real Estate (Regulation and Development) Act, 2016 has comes into force from 1st May onwards.
  
  The Act has set into motion the process of making necessary operational rules and creation of the institutional infrastructure to make the Act effective on ground.
  
  Ministry of Housing & Urban Poverty Alleviation has notified 69 of the total 92 sections of the Act on last Wednesday, bringing the Act into force from 1st May,2016 culminating the eight year long efforts in this regard.
  
  A proposal for a law for Real Estate was first mooted at the National Conference of Housing Ministers of States and Union Territories in January, 2009.
  
  As per the notification, Rules under the Act have to be formulated by the Central and State Governments within a maximum period of six months.
  
  It also said the proposed authorities, which will ensure timely execution of projects, and the appellate tribunals to adjudicate cases will come up in one year's time.
  
  The Act makes it difficult for promoters and builders to delay projects and gives relief to home-buyers. It also proposes imprisonment of up to three years besides monetary penalties for any violation of rules.
  
• Telecom panel proposes VRS for MTNL employees above 50 years
  The inter-ministerial panel Telecom Commission (TC) on 30th April has decided to offer voluntary retirement scheme (VRS) option to Mahanagar Telephone Nigam Ltd (MTNL) employees, who are 50 years of age and above. The move is expected to save costs for the company.
  
  The government can save around Rs. 500- Rs. 600 crore in a year by giving VRS to some employees of MTNL. It can save up to Rs. 300 crore every year from renting out its assets such as buildings and towers, and more deployment of CCTV cameras with local authorities.
  
  The official said the government would spend around Rs. 2,000 crore on VRS. There are around 46,000 employees in MTNL and around 26,600 of them will be retiring in the next 10 years. Therefore, the government thought of saving some costs and offering the VRS option to 20 per cent of its employees who are above 50 years of age.
  
  The proposed scheme would be eligible to 5,312 employees. It will be open for about three months period from the date of Cabinet approval, the official said adding that expenses on MTNL employees are 78 per cent of its total revenue against industry average of three per cent. The proposal will go to the Cabinet for approval in next few days.
  
  The Commission has also decided to auction all telecom spectrum, according to the reserve prices suggested by the Telecom Regulatory Authority of India (TRAI), which can fetch the government around Rs.5.36 lakh crore.
  
  The panel also favoured that companies winning spectrum in higher frequency band, above 1GHz band (1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz) should make 50 per cent upfront payment instead of 33 per cent according to the earlier rules, and the rest in 10 years after two years of moratorium.
  
  For spectrum purchased in below 1GHz band (700 MHz, 800 MHz and 900 MHz), companies would require to pay 25 per cent upfront and the balance in 10 years after two years of moratorium. There has been no change in the earlier practice of the government, the official said.
  
  On the annual spectrum usage charges (SUC), the panel deferred the decision and kept it for the next meeting. In another decision, the Commission considered improving connectivity in Andaman & Nicobar islands through laying of submarine cable which will cost around Rs. 1,000 crore to the government.
  
  At present, telecom services in the islands are provided through satellites. The panel has also approved increasing satellite bandwidth three times for Lakshadweep islands to 300 mbps from 100 mbps.
  
  For BharatNet project, the panel has approved a plan to connect one lakh gram panchayats with high speed broadband by March 2017 with the help of optical fibre and expeditious purchase of equipment.
  
  For the remaining 1.5 lakh gram panchayats, the Commission has approved Wi-Fi-based connectivity through common service centres by September 2018. However, all decisions taken on Saturday will go to the Cabinet first for approval and then only a final decision will be taken in another round of the Commission’s meeting.
  
• Bitcoin creator Satoshi Nakamoto reveals identity
  Australian entrepreneur Craig Wright has publicly identified himself as Bitcoin creator Satoshi Nakamoto. His admission ends years of speculation about who came up with the original ideas underlying the digital cash system.
  
  Mr Wright has provided technical proof to back up his claim using coins known to be owned by Bitcoin's creator. Prominent members of the Bitcoin community and its core development team have also confirmed Mr Wright's claim.
  
  About Bit coin
  A Bitcoin is a virtual currency that is created from computer code. Unlike a real-world currency such as the US dollar or the euro, it has no central bank and is not backed by any government
  
  Instead, its community of users control and regulate it. Advocates say this makes it an efficient alternative to traditional currencies because it is not subject to the whims of a state that may wish to devalue its money to inflate away debt, for example.
  
  Just like other currencies, Bitcoins can be exchanged for goods and services -- or for other currencies -- provided the other party is willing to accept them.
  
  Bitcoin was launched in 2009 as a bit of software written under the Japanese-sounding name Satoshi Nakamoto which, it now appears, hid Craig Wright's true identity. Other digital currencies followed but Bitcoin was by far the most popular.
  
  Transactions happen when heavily encrypted codes are passed across a computer network. The network as a whole monitors and verifies the transaction in a process that is intended to ensure no single Bitcoin can be spent in more than one place simultaneously.
  
  Users can "mine" Bitcoins -- bring new ones into being -- by having their computers run complicated and increasingly difficult processes. However, the model is limited and only 21 million units will ever be created. Like any other currency, its value fluctuates. But unlike most real-world analogues, Bitcoin's value has swung wildly in a short period.
  
  When the unit first came into existence it was worth a few US cents. Its price topped out at well over $1,000 in 2013. Now, a single Bitcoin is worth about $460 (400 euros).
  
  There are presently more than 15 million units in circulation. Some economists point to the fact that -- because it is limited -- its price will increase over the long run, making it less useful as a currency and more a vehicle to store value, like gold. But others point to Bitcoin's volatility, security issues and other weaknesses.
  
• Parliament approves Mines and Minerals Amendment Bill, 2016
  Parliament gave its seal of approval to the Mines and Minerals (Development and Regulation) Amendment Bill, 2016 with the Rajya Sabha adopting it on 2nd May. The bill has already been passed by the Lok Sabha.
  
  The Bill provides for transfer of mining leases, which have been granted through procedures other than auction and where minerals are used for captive purpose.
  
  This provision will allow for merger and acquisition of companies with captive mining leases. The bill adds the definition of leased area as the area within which mining operations can be undertaken. This will also include the non-mineralised area required and approved for the activities defined under Mines Act 1952.
  
• Rs. 3,000 cr. for projects to clean up the Ganga
  Indian Prime Minister Narendra Modi visited his Lok Sabha constituency, Varanasi, the Expenditure Finance Committee on 2nd May approved projects worth nearly Rs. 3,000 crore for the government’s flagship programme, Namami Gange.
  
  This is the biggest-ever approval for projects meant to clean up the Ganga — till now a total of Rs. 4,000 crore has been spent on cleaning the river through many governments since 1985. A decision has been taken to fast-track the integrated Ganga conservation programme, a year after the Union Cabinet approved it in May 2015.
  
• IMF retains India growth forecast at 7.5% for 2016-17
  Noting that India remains the fastest-growing large economy in the world, the International Monetary Fund has retained its growth forecast for the country at 7.5 percent for this year. The IMF said, in its latest Regional Economic Outlook for Asia and the Pacific, that this growth momentum is expected to be underpinned by private consumption, which has benefited from lower energy prices.
  
  An incipient recovery in private investment is expected to help broaden the recovery. But the IMF also observed that weak exports and sluggish credit growth will weigh on the Indian economy. The IMF said, growth in Asia and the Pacific is expected to remain strong, at 5.3 per cent, this year and the next. But China and Japan continue to face challenges. China's growth is forecast to moderate from 6.9 per cent in 2015, to 6.5 per cent this year.
  
• Parliamentary panel calls for reducing cess on domestic oil
  Domestic oil exploration companies have found support from a Parliamentary Panel for their demand for lowering of cess on locally produced crude oil, preferably in the range of 10 per cent.
  
  The Standing Committee on Petroleum & Natural Gas, in its report on demands for grants (2016-17) for the Ministry, which was tabled in the Lok Sabha on 3rd May said that it would extend support the lowering of ad valorem rate making it more practical and simpler to administer the cess. The committee further noted that it may be informed about the outcome in this regard.
  
  The government has modified the levy of Oil Industries Development (OID) cess on domestically produced crude oil from 4,500 a tonne to 20 per cent ad valorem. This will result in saving of about Rs.1,150 a tonne at the crude oil rate of $35 a barrel and exchange rate of Rs. 67 versus US dollar.
  
  The Ministry has decided to take up the matter with the Ministry of Finance for reduction of the cess from the current 20 per cent to reasonable levels.
  
  On the international gas pipeline projects — Turkmenistan-Afghanistan-Pakistan-India (TAPI) and Iran-Pakistan-India (IPI) — the committee recommended a focussed approach for TAPI so that there is no or cost overrun. For IPI, it desired that the project should be pursued to resolve outstanding issues and recommended close monitoring as international conditions have become favourable following lifting of sanctions against Iran.
  
• House panel suggests special funds for water-starved cities
  Practically no city in India gets sufficient water to meet the needs of city dwellers and the Ministry of Urban Development and state governments must step in and provide immediate relief measures, a Parliamentary panel report said.
  
  Latur in Maharashtra has water supply once in a month….the Centre has neither any separate plan to address the water problem nor has the city been included under Atal Mission for Rejuvenation and Urban Transformation (AMRUT) despite having a population for over 3 lakh,” the Standing Committee on Urban Development said in its report.
  
  The panel recommended that Latur and other water-scarce cities be included under AMRUT with the provision of special funding for them. It also expressed concern over eight States being declared drought-affected during the current year.
  
  The model building byelaws 2016 brought out by the Ministry has a separate chapter on rain water harvesting which has recommended the establishment of rain water harvesting cell at the urban local body. However, the Committee was surprised to note that the Ministry has not engaged in appointing any agency for assessing the availability and extraction of ground water.
  
  They have not institutionalised any central system of documentation on harvesting of rain water in Delhi and other metros but only issued advisory, the report said.
  
  The government should also engage an agency for assessing the availability and extraction of ground water in urban areas on priority basis, it added.
  
  The Committee also urged the government that the installation of rain water harvesting system should be compulsory in all future projects to be financed by Centre, state government attached offices and PSUs.
  
• Asian Development Bank at 50: The bank's annual meetings through the years
  The Asian Development Bank will be holding the 49th edition of its annual meeting in Frankfurt, Germany on May 2-5 — an event that will also kick off the institution's 50th anniversary celebrations in providing development financing and solutions to the Asia-Pacific region.
  
  The Manila-based institution has been the only multilateral development institution addressing the development needs of the region until the establishment of new institutions including the Asian Infrastructure Investment Bank and the New Development Bank over the past couple of years.
  
  But with its rich history and experience in tackling development and humanitarian issues for the past half-century, ADB is poised to remain a major development player in the world’s most populous region. One way to look at the bank’s history and experience is through its annual meetings over the years and the themes it focused on. Bank sources confirm, however, that earlier annual meetings did not have specific themes, unlike those in recent years.
  
• Wilful defaulters owe over Rs 66000 cr to state-run banks: Govt
  According to the Minister of state for Finance Jayant Sinha, there were 7,686 wilful defaulters owing Rs 66,190 crore to state-owned banks as of December 2015.
  
  The number of wilful defaulters of Public sector banks, (PSBs) rose from 5,554 to 7,686 in three years to December 2015 while the amount involved more than doubled to Rs 66,190 crore from Rs 27,749 crore. The total outstanding amount in top 100 non-performing accounts (NPAs) with PSBs was 1.73 lakh crore rupees as of December 2015.
  
  The Minister added that the total exposure of top 50 defaulters of PSBs as on December 2015 was Rs 1,21,832 crore. There were 1,365 borrower accounts having funded outstanding loans of Rs 500 crore and above at the end of 2015.
  
• Asian economies to account for two-thirds of global growth: IMF
  The International Monetary Fund says Asia's economies are still set to underpin world economic growth, despite being dragged by a slowdown in China. IMF in its Regional Economic Outlook said, the Asia Pacific region is expected to grow at a strong 5.3 per cent this year, accounting for nearly two-thirds of global growth.
  
  The IMF is forecasting India will remain the world's fastest-growing large economy, set to grow 7.5 per cent this year and next, as it benefits from lower oil prices. Last year, India's economy grew 7.3 per cent.
  
  China, which is re-balancing its economy away from a dependence on manufacturing and towards consumption, is expected to see its economic growth slow to 6.5 per cent this year and 6.2 per cent in 2017, from 6.9 per cent last year.
  
  It expects Vietnam will be among the region's fastest growing economies, while domestic demand will remain resilient in the Philippines and Malaysia.
  
• India to clock GDP growth of 7.4 pc in FY17: HSBC
  India's GDP is likely to ‘auto correct’, and the headline growth of the country in this fiscal is expected to remain flat at 7.4 per cent, says an HSBC report
  
  According to the global financial services major, India's new GDP series seem to exaggerate the economy's true growth rate and this overestimation is likely to narrow over the next few quarters.
  
  The global brokerage firm also noted that the country is not likely to see a staggering fall in overall GDP as the overestimation narrows. According to HSBC, while normalising manufacturing growth and banking sector stress are likely to be a drag, a bounce- back in agriculture alongside the ongoing consumption revival could just about offset the slowdown.
  
  The Reserve Bank of India in April had said that the economy is likely to grow by 7.6 per cent in the current fiscal on the back of favourable monsoon. The Finance Ministry has projected Indian economy to grow 7-7.75 per cent in the current fiscal.
  
  The Asian Development Bank (ADB) too had projected Indian's economic growth for current fiscal at 7.4 per cent.
  
• Nod for Rs. 4,300 crore worth of highway projects
  The Government on 4th May approved two highway projects worth around Rs.4,300 crore, among a slew of other decisions. The Cabinet Committee on Economic Affairs gave a nod to the four-laning of the Lucknow-Sultanpur section on National Highway-56 in Uttar Pradesh at an estimated cost of Rs.2844.72 crore.
  
  The two-laning, with the formation of four lanes, of the Shimla Bypass (Kaithlighat to Shimla section) on National Highway-22 in Himachal Pradesh was the second project which was approved, at a cost of Rs.1583.18 crore.
  
  The Cabinet also approved a proposal to create flexibility in the use of domestic coal. The move is expected to reduce the cost of power generation by 40-50 paise per unit, which will lead to savings of Rs 25,000 per year in around 4-5 years.
  
  The adoption of the United Nations Fundamental Principles of Official Statistics was also approved. This adoption is expected to bring “professional independence, impartiality, accountability and transparency in methods of collection, compilation and dissemination of official statistics,” according to the Government.
  
  A Memorandum of Understanding signed between the Reserve Bank of India and the Central Bank of the United Arab Emirates on cooperation concerning currency swap agreements was approved.
  
  The Cabinet approved the proposal to move, in Parliament, the adoption of the recommendations of the Railway Convention Committee (2014) – dividend of five per cent and four per cent for the years 2014-15 and 2015-16respectively on the capital invested in Railways.
  
• Govt eases norm for availing export benefits under MEIS
  Exporters have been relieved from submitting the landing certificate of goods to avail benefits under the Merchandise Exports India Scheme (MEIS). According to Commerce and Industry Ministry, the move is aimed at improving ease of doing business in the country to promote exports, which are in the negative zone since December 2014.
  
  Under the scheme, the government provides duty benefits at 2 per cent, 3 per cent and 5 per cent depending upon the product and country.
  
  The Merchandise Export from India Scheme was introduced in the Foreign Trade Policy 2015-20 on April last year. MEIS aims to incentivize export of merchandise which are produced and manufactured in India.
  
• Lok Sabha passes Bankruptcy bill; Seeks to promote business in India
  The Lok Sabha on 5th May passed the Insolvency and Bankruptcy Code, 2016. The Code seeks to consolidate and amend the laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner.
  
  The bill provides for setting up of a Insolvency and Bankruptcy Board of India to regulate professionals, agencies and information utilities engaged in resolution of insolvencies of companies.
  
  As per the code, in case of insolvency, interest of the workers should be fully protected and they should be given dues for 24 months.
  
  The code provides for establishment of National Companies Law Tribunal and Debt Recovery Tribunals as adjudicating authorities for resolution of insolvency, liquidation and bankruptcy.
  
  The bill was introduced in Lok Sabha on 21st of December last year and was referred to the Joint Committee of both the Houses. The Committee submitted its report on 28th of last month.Initiating the discussion, Sushmita Dev of Congress said that the Code will help improve the country’s ranking in respect of ease of doing business.
  
• RBI unveils norms for ‘on tap’ bank licences
  As part of its plan to put universal bank licences ‘on tap’, the Reserve Bank of India unveiled draft guidelines on 5th May that could encourage big non-banking financial players such as Bajaj Finserv Ltd, L&T Finance Holdings, Reliance Capital and Shriram Capital to throw their hats in the banking ring.
  
  These players had applied for a bank licence but did not make the cut in the last round when the RBI issued fresh permits to two companies.
  
  The central bank has been opening the bank licence window only periodically. Under the ‘on tap’ mechanism, however, an application can be made at any time subject to certain conditions.
  
  According to the draft RBI guidelines, non-banking finance companies and resident individuals or professionals with 10 years of experience in banking and finance will be eligible to apply.
  
  Also eligible are private sector entities and groups owned and controlled by residents, provided they have total assets worth at least Rs. 5,000 crore, with the non-financial group business not accounting for more than 40 per cent of the total assets or the gross income.
  
  Individuals and companies directly or indirectly connected with large industrial houses may also take equity in a new private bank but only up to 10 per cent. Such shareholders will not get any representation on the board.
  
  The initial minimum paid-up voting equity capital for a bank has been left unchanged at Rs. 500 crore. But the bank has to have a minimum net worth of Rs. 500 crore at all times. The promoters need to hold a minimum 40 per cent of the paid-up voting equity capital, which will be locked-in for five years from the date of commencement of business. The RBI has allowed banks to get their shares listed within six years (three years earlier) of commencement of business.
  
  In the case of an NBFC applying for a licence, if the entity has diluted the promoter shareholding to below 40 per cent but above 26 per cent, the RBI may not insist on the promoters’ minimum initial contribution. However, the lock-in period of five years will apply to the 26 per cent promoter shareholding.
  
• In Telangana paddy procurement goes online; farmers to get paid within 48 hrs
  The long wait of nearly three crore farmers in Telangana for payments after selling their produce to government agencies, will soon as new online paddy procurement process.
  
  For the first time, Telangana is implementing the mandatory online payment process for the present Rabi season and there will be no manual process, according to the Rajat Kumar, Commissioner Civil Supplies and ex-officio Principal Secretary to Government of Telangana
  
  The paddy procurement process in the State follows a decentralised programme, which had commenced last month. It will continue up to September under the Rabi season.
  
  As part of the online process, an android device will be used to buy paddy from a farmer that captures his particulars like name, Aadhaar card and Jan Dhan account numbers, among others. In the system being followed till now, everything was manual and papers were used to process payments, resulting in delays, besides allowing middlemen to go for corrupt practices.
  
  A pilot on online procurement was implemented in the Kharif procurement, which ended in March. Out of a total of 3.5 lakh transactions we had in the Kharif season, a close to 10 per cent were online. But now, it is mandatory everywhere
  
  There are about 2,000 paddy procurement centres in Telangana. While half of them are managed by women groups, the remaining are operated by primary agricultural societies and others.
  
  In the Kharif season, there was record procurement of 15.2 lakh tonnes of paddy, despite prevailing drought conditions covering 2.8 crore beneficiaries. The requirement for public distribution and others is about 22 lakh tonnes per year.
  
• Govt disbursed Rs 62,000 cr as cash benefits under 59 central schemes: Jayant Sinha
  The government has disbursed around Rs 62,000 crores as cash benefits under 59 central schemes to 30.78 crores beneficiaries in 2015-16.
  
  According to the Minister of State for Finance, Jayant Sinha in the next two - three years every citizen will have bank account in the country to avail the benefits of government schemes. He said the LPG cylinders are being sold at no subsidized prices and subsidy, as admissible, is being transferred to consumers directly into their bank accounts.
  
  He said cash transfer of food subsidy scheme under the National Food Security Act provide for foodsubsidy in cash into the bank account of entitled household to enable them to purchase food grains from open market.
  
  At present the scheme has been implemented on pilot basis in Chandigarh and Puducherry from 1st September 2015 and partially in Dadra and Nagar Haveli from 1st March this year.
  
• Water scarcity to cost growth, spark conflict, migration: World Bank
  The World Bank has warned that water scarcity, exacerbated by climate change, could impact growth, spur migration and spark conflict across the globe including in India where several regions are facing water deficit.
  
  A World Bank report 'High and Dry: Climate Change, Water and the Economy' said the combined effects of growing populations, rising incomes and expanding cities will see demand for water rising exponentially, while supply becomes more erratic and uncertain.
  
  Calling for need to enhance efficiency of water use in India, atop World Bank official said there is going to be mounting, increasing water deficits or at least increasing demands for water across India.
  
  In India, property related violence increases by about four per cent when there is below average rainfall and communal riots become more frequent following episodes of floods, the World Bank said.
  
  In Gujarat, when groundwater irrigation became less available or more expensive due to a declining water table, farmers migrated to cities instead of seeking alternative adaptation strategies such as shifts in cropping patterns or more efficient irrigation technologies, it said.
  
  According to one estimate, groundwater pumping accounts for no less than four to six per cent of India's total carbon emissions, the World Bank said. World Bank Lead Economist Richard Damania said the climate models projections about the monsoons have wide variability; they come out with a number of results.
  
• India to spend $6 billion on creating new forests
  The Lawmakers in a low house have passed Compensatory Afforestation Fund Bill, 2015. This bill aims at the afforestation that means to increase the forest cover in our country from 21.34 per cent of 33 per cent total land.
  
  The upper house should approve the bill now, to ensure the expeditious use of Rs 40,000 crore which accumulated and was idle with a new ad-hoc central body for more than a decade. Which give space to new forests ahead.
  
  This was historic because for the last 12 years the funds meant for afforestation were deposited in only banks and were not used on the ground. Our forest cover will dramatically increase and it will result in achieving our target 33 percent of tree cover and most importantly 2.5 billion tonne of carbon sink as we have indicated in our INDCs,” said India’s Environment Minister Prakash Javadekar
  
  The returns could be more beneficial with what the India is now allotting large amounts of money to develop these forests and create new ones. Man made climatic changes can be absconded with this large-scale afforestation.
  
  These trees are providing a wide range of social, environmental and economic benefits than the global warming. India is struggling with air pollution at present but these trees can help the worse cases to face by absorbing pollutants and improve air quality.
  
  Many animals, birds, and other small creatures get shelter from these trees which are considered as a good step by the government. This can also help in promoting bio diversity and management and conservation of wild life.
  
• Indian railways attracts Rs.42,000-cr FDI: Govt
  Government on 7th May said Indian railways has attracted foreign direct investment (FDI) to the tune of Rs 42,000 crore and will soon float tenders for manufacturing rail coaches in the country.
  
  Indian Railways has been able to attract one of the largest FDIs in terms of placing orders. Two of the top companies, one European and one American, with the contract value as high as Rs 42,000 crore. This is the largest FDI in terms of contract, according to the Indian Railways Minister Suresh Prabhu.
  
  India needs a stable source of investment and FDI is one of those, he said, adding that the government is also planning to build new dedicated freight corridors that will again attract investment. According to the Suresh Prabhu…
  
  Railways is working towards attracting more investment, the government has planned as much as USD 16 billion investment for high speed trains.
  
  The government will soon open bids for manufacturing train coaches in India.
  
  The government has left behind the "legacy issues" of the past government of a decade and is now moving towards increased manufacturing activity and investment.
  
• Food security scheme: only half the targeted identified, says CAG
  Only half of the targeted beneficiaries under the National Food Security Act (NFSA) have been identified by States and Union Territories so far, according to an audit by the Comptroller and Auditor General of India. Old databases of beneficiaries are still in use in these regions, the CAG found.
  
  It has directed the Centre to assure itself that the States/UTs have identified beneficiaries by following transparent processes before allowing them revised and enhanced entitlements.
  
  The NFSA, which came into effect from July 5 2013, aims to provide foodgrains to 81.34 crore beneficiaries — 75 per cent rural and 50 per cent urban population as per Census 2011 — at highly subsidised rates.
  
  As per the CAG report, only 18 States/UTs are reported to have begun implementation of NFSA. In many of them, the identification of beneficiaries is not complete, and yet the Ministry of Consumer Affairs, Food and Public Distribution has allotted them the revised allocation of foodgrains.
  
  Most of the implementing States did not identify the Antyodaya Anna Yojana and priority household beneficiaries as per the provisions of the NFSA, but used the old database of beneficiaries, the report observed.
  
  The ineligible get food
  In Himachal Pradesh, 6.9 lakh old ration cards were stamped as priority household and AAY households and re-issued as NFSA compliant. In Karnataka, 8.90 lakh bogus and ineligible ration cards were found (June 2015) during the seeding of voter identity card details. Instead of cancelling these bogus ration cards, the State continued to issue foodgrains to them.
  
  In Maharashtra, the ration cards were revalidated by merely affixing stamps on the existing ration cards under different categories.
  
  The delay in the implementation of NFSA in some States/UTs was blamed on non-finalisation of figures under Socio Economic Caste Census, lack of infrastructural facilities and insufficient funds and manpower.
  
  As there is no enabling provision in the NFSA, the Centre should obtain Parliament approval for extending the timeline (which has already been thrice extended without approval) laid down for its implementation.
  
• Installation of Solar Power Plant set up at Central State Farm at Jetsar
  The Union Cabinet chaired by the Prime Minister Narendra Modi has given its approval for utilization of 400 hectares of un-cultivable farm land at the Central State Farm (CSF), Jetsar in Sri Ganganagar District, Rajasthan for setting up of a solar Power Plant of capacity exceeding 200 MW
  
  The land is presently in possession of National Seeds Corporation (NSC), a Central Public Sector Enterprise (CPSE) under the administrative control of the Ministry of Agriculture and Farmers Welfare.
  
  The Solar Power Plant will be set up by a CPSE, which would be selected through negotiation. NSC will provide 400 hectares of un-cultivable land, out of the 5394 hectares under its possession to the identified CPSE, which will bear the costs relating to the installation of the Solar Power Plant.
  
  The selected CPSE will have to do tariff based competitive bidding for the project. It will be allowed to utilize the land for the installation of a Solar Power Plant over a contract period of 25 years, which may be extended on mutually agreed terms and conditions, after which the entire plant will be surrendered to the NSC on as is where basis is.
  
  The Project, by utilizing un-cultivable land for a Solar Power Project, will yield revenue for NSC and will also generate clean energy for the nation.
  
• Infosys introduces new artificial intelligence platform
  Infosys, India’s second largest IT services exporter, has introduced a new artificial intelligence (AI) platform called Mana. Infosys Mana brings machine learning together with the deep knowledge of an organisation, to drive automation and innovation.
  
  According to the IT major, Mana, with the Infosys Aikido service offerings will lower the cost of maintenance for both physical and digital assets. Infosys said this will leverage the power of automation for repetitive tasks and frees people to focus on the higher value work and on innovation.