<a href="http://www.wionews.com/business-economy/consumer-inflation-soars-to-488-while-industrial-output-growth-slows-to-22-26549" target="_blank">Retail inflation hits 15-month high of 4.88% in November</a>

Fuelled by soaring food prices, retail inflation climbed to a 15-month high of 4.88% in November. It was at 3.58 % in October.

Industrial output growth meanwhile slowed to 2.2% in October from 3.8% in September, with demand continuing to suffer from the disruption caused by the rollout of the new Goods and Services Tax (GST). &nbsp;

<a href="http://www.wionews.com/india-news/government-to-set-special-courts-for-speedy-trial-of-mps-mlas-pending-cases-26535">Centre to SC: Will set up 12 special courts to decide criminal cases pending against MPs, MLAs</a>

The Centre has told the Supreme Court, in an affidavit filed by the law minister, that it will set up 12 special courts to decide criminal cases pending against MPs and MLA.&nbsp;

<a href="http://www.wionews.com/india-news/tami-nadu-honour-killing-six-of-the-convicts-get-death-sentence-including-father-in-law-26538">Tamil Nadu </a><a href="http://www.wionews.com/india-news/tami-nadu-honour-killing-six-of-the-convicts-get-death-sentence-including-father-in-law-26538">honour</a><a href="http://www.wionews.com/india-news/tami-nadu-honour-killing-six-of-the-convicts-get-death-sentence-including-father-in-law-26538"> killing: 6 sentenced to death including father-in-law</a>

A Tirupur court in Tamil Nadu convicted 11 people on Tuesday for the murder of Dalit youth V Shankar, six of the convicts were given death sentences.

One was sentenced to life imprisonment.

The convicts who were given death sentences included Shankar&#39;s father-in-law.&nbsp;

<a href="http://www.wionews.com/india-news/bjp-demands-mlas-to-step-down-for-organising-kissing-competition-26537">Jharkhand kissing competition: Organising MLAs asked to step down</a>

The BJP has come down hard on the Jharkhand Mukti Morcha leaders involved in organising the event, demanding an apology and their immediate suspension from the state assembly.

<a href="http://www.wionews.com/business-economy/indias-economy-to-grow-at-72-in-2018-un-26543">India&#39;s economy to grow at 7.2% in 2018: UN</a>

India&#39;s economy is projected to grow at 7.2 per cent in 2018 and 7.4 per cent in 2019, despite a slowdown observed this year and the lingering effects from the demonetisation, the UN has said.

Retail inflation hits 15-month high of 4.88% in November Fuelled by soaring food prices, retail inflation climbed to a 15-month high of 4.88% in November. It was at 3.58 % in October. Industrial output growth meanwhile slowed to 2.2% in October from 3.8% in September, with demand continuing to suffer from the disruption caused by the rollout of the new Goods and Services Tax (GST). Centre to SC: Will set up 12 special courts to decide criminal cases pending against MPs, MLAs The Centre has told the Supreme Court, in an affidavit filed by the law minister, that it will set up 12 special courts to decide criminal cases pending against MPs and MLA. Tamil Nadu honour killing: 6 sentenced to death including father-in-law A Tirupur court in Tamil Nadu convicted 11 people on Tuesday for the murder of Dalit youth V Shankar, six of the convicts were given death sentences. One was sentenced to life imprisonment. The convicts who were given death sentences included Shankar's father-in-law. Jharkhand kissing competition: Organising MLAs asked to step down The BJP has come down hard on the Jharkhand Mukti Morcha leaders involved in organising the event, demanding an apology and their immediate suspension from the state assembly. India's economy to grow at 7.2% in 2018: UN India's economy is projected to grow at 7.2 per cent in 2018 and 7.4 per cent in 2019, despite a slowdown observed this year and the lingering effects from the demonetisation, the UN has said.

WION Evening News Brief, December 12, 2017

The Reserve Bank on Tuesday warned the public against the risks of virtual currencies (VCs) after the recent spurt in the valuation of <a href="http://www.wionews.com/india-news/bubble-or-not-bitcoin-triggering-terror-finance-and-fraud-25623" target="_blank">Bitcoin</a>. Rapid growth in Initial Coin Offerings (ICOs) is a cause for concern, making VCs highly volatile and risk-involving tools of investment.

&quot;There is no underlying or backing of any asset for VCs. As such, their value seems to be a matter of speculation. Huge volatility in the value of VCs has been noticed in the recent past. Thus, the users are exposed to potential losses on account of such volatility in value,&quot; the central bank had said in a statement issued on December 24, 2013.&nbsp;

Simply put, Bitcoin is a cryptocurrency or currency in the digital form similar to Paytm or BHIM. A cryptocurrency is not issued by any bank, financial institution or a central authority. It isn&#39;t tangible and floats in and through digital wallets, making it an entity that is difficult to control, regulated or manipulated by international financial authorities, governments or institutions.&nbsp;

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With fin-tech on the rise around the world there is an increasing focus on cryptocurrencies, such as Bitcoin. But how do these currencies operate and how are they managed? (WION)
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The price of a single Bitcoin skyrocketed to up to US&nbsp;$11,000 last week in a rally which puzzled watchers. The apex bank had previously noted having studied the sector but emphatically clarified that it is uncomfortable with &quot;non-fiat&quot; cryptocurrencies. The RBI had also said that the exchange platforms on which Bitcoins are traded are set up in various jurisdictions whose legal status is also unclear.

&quot;The creation, trading or usage of VCs including Bitcoins, as a medium for payment are not authorised by any central bank or monetary authority. No regulatory approvals, registration or authorisation is stated to have been obtained by the entities concerned for carrying on such activities,&quot; the RBI had said in its first comments in September 2013.

Reportedly, the ministry of finance has been mulling over launching a cryptocurrency called &quot;Lakshmi&quot; and has set up a committee for the same.

(With inputs from PTI)

Bitcoin is a cryptocurrency or currency in the digital form similar to Paytm or BHIM

The Reserve Bank on Tuesday warned the public against the risks of virtual currencies (VCs) after the recent spurt in the valuation of Bitcoin. Rapid growth in Initial Coin Offerings (ICOs) is a cause for concern, making VCs highly volatile and risk-involving tools of investment. "There is no underlying or backing of any asset for VCs. As such, their value seems to be a matter of speculation. Huge volatility in the value of VCs has been noticed in the recent past. Thus, the users are exposed to potential losses on account of such volatility in value," the central bank had said in a statement issued on December 24, 2013. Simply put, Bitcoin is a cryptocurrency or currency in the digital form similar to Paytm or BHIM. A cryptocurrency is not issued by any bank, financial institution or a central authority. It isn't tangible and floats in and through digital wallets, making it an entity that is difficult to control, regulated or manipulated by international financial authorities, governments or institutions. With fin-tech on the rise around the world there is an increasing focus on cryptocurrencies, such as Bitcoin. But how do these currencies operate and how are they managed? (WION) × The price of a single Bitcoin skyrocketed to up to US $11,000 last week in a rally which puzzled watchers. The apex bank had previously noted having studied the sector but emphatically clarified that it is uncomfortable with "non-fiat" cryptocurrencies. The RBI had also said that the exchange platforms on which Bitcoins are traded are set up in various jurisdictions whose legal status is also unclear. "The creation, trading or usage of VCs including Bitcoins, as a medium for payment are not authorised by any central bank or monetary authority. No regulatory approvals, registration or authorisation is stated to have been obtained by the entities concerned for carrying on such activities," the RBI had said in its first comments in September 2013. Reportedly, the ministry of finance has been mulling over launching a cryptocurrency called "Lakshmi" and has set up a committee for the same. (With inputs from PTI)

RBI warns users against the risks of virtual currencies like Bitcoin

The International Monetary Fund (IMF) today said it will update its growth rate forecast for India in January. Recently, the US-based Moody&#39;s upgraded India&#39;s sovereign rating after a gap of 13 years to Baa2, with &#39;stable&#39; outlook, from Baa3 earlier, citing improved growth prospects driven by economic and institutional reforms.

This was followed by S&amp;P Global Rating, which kept India&#39;s sovereign rating unchanged at BBB- with stable outlook saying vulnerabilities stemming from low per capita income and high government debt balances strong GDP growth.

&quot;We will be updating the forecast for India, including the growth rate, and that will be coming in January with the update of our World Economic Outlook,&quot; IMF spokesman Gerry Rice told reporters at a news conference held at its headquarters here.

The IMF statement came as the latest figures showed that India grew at 6.3 per cent in the September quarter compared to 5.7 per cent in the June quarter, reflecting an improvement in the Indian economy. In its news dispatch from New Delhi, The Wall Street Journal said India&#39;s economic expansion accelerated in the latest quarter, ending a five-quarter slowdown and sparking optimism that the negative effects of recent economic policies may now be behind Asia&#39;s third-largest economy.

CNN reported that India&#39;s economy has bounced back from a year-long slowdown, but it was not enough to regain the global growth crown from China.

Recently, the US-based Moody's upgraded India's sovereign rating after a gap of 13 years to Baa2, with 'stable' outlook

The International Monetary Fund (IMF) today said it will update its growth rate forecast for India in January. Recently, the US-based Moody's upgraded India's sovereign rating after a gap of 13 years to Baa2, with 'stable' outlook, from Baa3 earlier, citing improved growth prospects driven by economic and institutional reforms. This was followed by S&P Global Rating, which kept India's sovereign rating unchanged at BBB- with stable outlook saying vulnerabilities stemming from low per capita income and high government debt balances strong GDP growth. "We will be updating the forecast for India, including the growth rate, and that will be coming in January with the update of our World Economic Outlook," IMF spokesman Gerry Rice told reporters at a news conference held at its headquarters here. The IMF statement came as the latest figures showed that India grew at 6.3 per cent in the September quarter compared to 5.7 per cent in the June quarter, reflecting an improvement in the Indian economy. In its news dispatch from New Delhi, The Wall Street Journal said India's economic expansion accelerated in the latest quarter, ending a five-quarter slowdown and sparking optimism that the negative effects of recent economic policies may now be behind Asia's third-largest economy. CNN reported that India's economy has bounced back from a year-long slowdown, but it was not enough to regain the global growth crown from China.

IMF to update India's growth rate forecast in January

India&#39;s economic slowdown has bottomed out and now it should start moving upwards after recovering from the &quot;temporary blip&quot; seen during the recent structural changes, Finance Minister Arun Jaitley said on&nbsp;Thursday.

Addressing investors at the Morgan Stanley annual conference here on &#39;India: Structural Reforms and Growth Path Ahead&#39;, Jaitley talked about the &quot;massive&quot; economic reforms undertaken by India.

He acknowledged that there was a &quot;temporary blip&quot; as a result of structural changes that were initiated by the government.

&quot;I think the bottoming out of the economy is complete and now it should start moving upwards. The global economy is also moving up,&quot; said Jaitly.

As part of the summit, Jaitley met the senior management of Morgan Stanley and addressed a gathering of senior fund managers and key financial institutional investors.

&quot;How do I see the economy moving? our basic parameters are quite stable. And we grew between 7-8 per cent over the last three years,? he said.

&quot;Therefore, we need over the next, at least, a decade, if not more, significantly higher growth rates in order to go ahead with expansion plan of the Indian economy,? Jaitley said.

The finance minister also assured investors of a strong banking sector in India.

&quot;The combination of the IT scheme and now the large-scale recapitalisation we have announced should be put into motion expeditiously,&quot; he said.

The combination of these two steps are likely to improve the capacity of the banks, and even lend their surplus, particularly to the small and medium-scale industries which need those funds in abundance because they are the ones that are the big job creators and keep the Indian economy going, he elaborated.

He also clarified the often over-stated labour issues, saying these were no longer there as the negative environment of disruption of industrial activity is long over.

He said the labour laws are being fortified by taking the unions into consultation, and there has not been any significant labour resistance in recent times, whether it is disinvestment or privatisation, he said.

&quot;We haven?t encountered trade union resistance as that is concerned,&quot; he pointed out, adding that there are already various kinds of reforms.

Responding to questions from investors, he said among the privatisation of public sector units (PSUs), Air India is in a very advanced stage while some of the PSUs will be kept as they are.

The state enterprises in the oil and some in the power sectors will be kept as PSUs.

&quot;But there are many which will be privatised,? he added, pointing to a list prepared by the NITI Aayog.

&quot;In any case, we are going with the divestment programme very actively,? said the minister.

He also gave the investors an update on the ongoing business reforms and called for investments for changing the landscape of India at an accelerated pace.

Jaitley, who is on a two-day visit to Singapore, held meetings with Singapore ministers and investors.&nbsp;

"I think the bottoming out of the economy is complete and now it should start moving upwards. The global economy is aalso moving up," said Jaitly.

India's economic slowdown has bottomed out and now it should start moving upwards after recovering from the "temporary blip" seen during the recent structural changes, Finance Minister Arun Jaitley said on Thursday. Addressing investors at the Morgan Stanley annual conference here on 'India: Structural Reforms and Growth Path Ahead', Jaitley talked about the "massive" economic reforms undertaken by India. He acknowledged that there was a "temporary blip" as a result of structural changes that were initiated by the government. "I think the bottoming out of the economy is complete and now it should start moving upwards. The global economy is also moving up," said Jaitly. As part of the summit, Jaitley met the senior management of Morgan Stanley and addressed a gathering of senior fund managers and key financial institutional investors. "How do I see the economy moving? our basic parameters are quite stable. And we grew between 7-8 per cent over the last three years,? he said. "Therefore, we need over the next, at least, a decade, if not more, significantly higher growth rates in order to go ahead with expansion plan of the Indian economy,? Jaitley said. The finance minister also assured investors of a strong banking sector in India. "The combination of the IT scheme and now the large-scale recapitalisation we have announced should be put into motion expeditiously," he said. The combination of these two steps are likely to improve the capacity of the banks, and even lend their surplus, particularly to the small and medium-scale industries which need those funds in abundance because they are the ones that are the big job creators and keep the Indian economy going, he elaborated. He also clarified the often over-stated labour issues, saying these were no longer there as the negative environment of disruption of industrial activity is long over. He said the labour laws are being fortified by taking the unions into consultation, and there has not been any significant labour resistance in recent times, whether it is disinvestment or privatisation, he said. "We haven?t encountered trade union resistance as that is concerned," he pointed out, adding that there are already various kinds of reforms. Responding to questions from investors, he said among the privatisation of public sector units (PSUs), Air India is in a very advanced stage while some of the PSUs will be kept as they are. The state enterprises in the oil and some in the power sectors will be kept as PSUs. "But there are many which will be privatised,? he added, pointing to a list prepared by the NITI Aayog. "In any case, we are going with the divestment programme very actively,? said the minister. He also gave the investors an update on the ongoing business reforms and called for investments for changing the landscape of India at an accelerated pace. Jaitley, who is on a two-day visit to Singapore, held meetings with Singapore ministers and investors.

Indian economy recovering from 'temporary blip': Jaitley

Congress Vice President Rahul Gandhi on Thursday said rising unemployment in India was &quot;MMD: Modi Made Disaster&quot;.

Rahul used 112th Annual Session of PHD Chamber of Commerce platform here to launch a scathing attack on the Prime Minister Narendra Modi government. &quot;Rising unemployment in India is a&nbsp;&#39;MMD: Modi Made Disaster&#39; and after 3 years of NDA (National Democratic Alliance) government, India&#39;s expectations are shattered,&quot; Rahul claimed, while adding:&quot;China creates 50,000 jobs per day against Indian rate of 458, but no amount of growth is good enough if it isn&#39;t accompanied by jobs.&quot;

The Congress vice-president further asserted that people don&#39;t trust the Modi-led central government. &quot;Business thrives on trust. Business is about creating harmony. The truth is that the trust in this government is dead. For some reasons, the PM and his government are absolutely convinced that every single person in this country is a thief,&quot; Rahul Gandhi said.

He also said that today no one in the government listens to the pain of people. &quot;One develops trust by listening to each other. Today there is no one in the government who is ready to listen to the pain of our people,&quot; the Congress vice president said.

Rahul also took a jibe at Prime Minister Narendra Modi&#39;s claim of having &#39;56-inch chest&#39; and said, &quot;Prime Minister Narendra Modi has very a big chest but a small heart. Modi ji and his government have given a double blow to our economy- demonetisation and GST (Goods and Services Tax).&quot;

As the BJP&#39;s prime ministerial candidate in January 2014, Narendra Modi declared at a rally in Uttar Pradesh that &quot;a 56-inch chest&quot; is a pre-requisite to convert India&#39;s most populous state into one as developed as Gujarat.

Ahead of the first anniversary of demonetisation on November 8, Rahul also targeted the prime minister over the shock move.

&quot;Prime Minister has forgotten that all cash is not black and all black is not bad. November 8th is the &#39;barsi&#39; (death anniversary) of note ban. GST or Gabbar Singh Tax has unleashed tax terrorism. Small businesses are crying due to the GST,&quot; Rahul Gandhi said.

On November 8, 2016, Prime Minister Narendra Modi announced the&nbsp;demonetisation of Rs 500&nbsp;and Rs 1000&nbsp;banknotes with an aim to weaken the black money or shadow economy in the country. With the shock move completing a year, the Opposition parties have announced they will observe November 8 as &#39;black day&#39;.

The BJP will&nbsp;observe the day as &#39;Anti-Black Money Day&#39; to counter the Opposition&#39;s plan. The GST is an indirect tax which was introduced in India on July 1, 2017, and is applicable throughout India which replaced multiple cascading taxes levied by the central and state governments.

On Monday, while addressing a rally in Gandhinagar, Gujarat, Rahul for the first time termed GST as &#39;Gabbar Singh Tax&#39;.

Meanwhile, the Congress vice-president also launched an attack on Union Finance Minister Arun Jaitley and said, &quot;Businesses are drowning, but Mr&nbsp;Jaitley has the nerve to go on TV every other day saying things are just fine. However, recent research by eminent economists has shown that economic inequality is at is at its highest in the Modi regime.&quot;

&quot;The &#39;Startup India&#39; is good for the economy but it cannot be accompanied by &#39;Shut up India&#39;,&quot; he added.

Jaitley on Wednesday criticised the Congress over black money by saying that he can&#39;t recollect any significant step that the grand old party had taken during its tenure to address the problem. The Finance Minister also said that the Congress and others who are making comments on note ban have not understood the whole object behind the demonetisation move.

Jaitley said that it is obvious that those parties which were in power couldn&#39;t take action against black money as squeezing black money is not possible through baby steps. Rahul also mocked the BJP over Taj Mahal controversy, on a day Uttar Pradesh Chief Minister Yogi Adityanath visited Taj Mahal for the first time since assuming power in the state and after BJP MLA Sangeet Som&#39;s stirred up a controversy with his statement on the iconic monument. &quot;World is laughing at us with debates that Taj Mahal was built by Indians,&quot; Rahul said.

The BJP MLA from Uttar Pradesh raked up a controversy by saying that Taj Mahal was built by &quot;traitors&quot; who wanted to eliminate all Hindus. After the issue was picked up by the Opposition, Uttar Pradesh Chief Minister Yogi Adityanath said that it didn&#39;t matter who built Taj Mahal and for what reason. It was built by the blood and sweat of Indian labourers.&nbsp;

Rahul Gandhi used 112th Annual Session of PHD Chamber of Commerce platform to launch a scathing attack on the Prime Minister Narendra Modi government

Congress Vice President Rahul Gandhi on Thursday said rising unemployment in India was "MMD: Modi Made Disaster". Rahul used 112th Annual Session of PHD Chamber of Commerce platform here to launch a scathing attack on the Prime Minister Narendra Modi government. "Rising unemployment in India is a 'MMD: Modi Made Disaster' and after 3 years of NDA (National Democratic Alliance) government, India's expectations are shattered," Rahul claimed, while adding:"China creates 50,000 jobs per day against Indian rate of 458, but no amount of growth is good enough if it isn't accompanied by jobs." The Congress vice-president further asserted that people don't trust the Modi-led central government. "Business thrives on trust. Business is about creating harmony. The truth is that the trust in this government is dead. For some reasons, the PM and his government are absolutely convinced that every single person in this country is a thief," Rahul Gandhi said. He also said that today no one in the government listens to the pain of people. "One develops trust by listening to each other. Today there is no one in the government who is ready to listen to the pain of our people," the Congress vice president said. Rahul also took a jibe at Prime Minister Narendra Modi's claim of having '56-inch chest' and said, "Prime Minister Narendra Modi has very a big chest but a small heart. Modi ji and his government have given a double blow to our economy- demonetisation and GST (Goods and Services Tax)." As the BJP's prime ministerial candidate in January 2014, Narendra Modi declared at a rally in Uttar Pradesh that "a 56-inch chest" is a pre-requisite to convert India's most populous state into one as developed as Gujarat. Ahead of the first anniversary of demonetisation on November 8, Rahul also targeted the prime minister over the shock move. "Prime Minister has forgotten that all cash is not black and all black is not bad. November 8th is the 'barsi' (death anniversary) of note ban. GST or Gabbar Singh Tax has unleashed tax terrorism. Small businesses are crying due to the GST," Rahul Gandhi said. On November 8, 2016, Prime Minister Narendra Modi announced the demonetisation of Rs 500 and Rs 1000 banknotes with an aim to weaken the black money or shadow economy in the country. With the shock move completing a year, the Opposition parties have announced they will observe November 8 as 'black day'. The BJP will observe the day as 'Anti-Black Money Day' to counter the Opposition's plan. The GST is an indirect tax which was introduced in India on July 1, 2017, and is applicable throughout India which replaced multiple cascading taxes levied by the central and state governments. On Monday, while addressing a rally in Gandhinagar, Gujarat, Rahul for the first time termed GST as 'Gabbar Singh Tax'. Meanwhile, the Congress vice-president also launched an attack on Union Finance Minister Arun Jaitley and said, "Businesses are drowning, but Mr Jaitley has the nerve to go on TV every other day saying things are just fine. However, recent research by eminent economists has shown that economic inequality is at is at its highest in the Modi regime." "The 'Startup India' is good for the economy but it cannot be accompanied by 'Shut up India'," he added. Jaitley on Wednesday criticised the Congress over black money by saying that he can't recollect any significant step that the grand old party had taken during its tenure to address the problem. The Finance Minister also said that the Congress and others who are making comments on note ban have not understood the whole object behind the demonetisation move. Jaitley said that it is obvious that those parties which were in power couldn't take action against black money as squeezing black money is not possible through baby steps. Rahul also mocked the BJP over Taj Mahal controversy, on a day Uttar Pradesh Chief Minister Yogi Adityanath visited Taj Mahal for the first time since assuming power in the state and after BJP MLA Sangeet Som's stirred up a controversy with his statement on the iconic monument. "World is laughing at us with debates that Taj Mahal was built by Indians," Rahul said. The BJP MLA from Uttar Pradesh raked up a controversy by saying that Taj Mahal was built by "traitors" who wanted to eliminate all Hindus. After the issue was picked up by the Opposition, Uttar Pradesh Chief Minister Yogi Adityanath said that it didn't matter who built Taj Mahal and for what reason. It was built by the blood and sweat of Indian labourers.

Rising unemployment in India is 'Modi Made Disaster': Rahul Gandhi

Nearly a year after Prime Minister Narendra Modi announced demonetisation, the Rs 500 and Rs 1,000 bills returned to banks are still being &quot;processed in all earnest&quot; through a sophisticated currency verification system, the RBI has said.

In reply to an RTI query, the central bank said it has processed about 1,134 crore pieces of Rs 500 notes and 524.90 crore pieces of Rs 1,000 junked notes, having face value of Rs 5.67 lakh crore and Rs 5.24 lakh crore respectively, as on September 30.

The combined value of the processed notes is Rs 10.91 lakh crore approximately, according to the reply.

&quot;Specified Bank Notes are being processed in all earnest in double shift on all available machines (sophisticated counting machines),&quot; the Reserve Bank of India (RBI) said in reply to the RTI query filed by a PTI correspondent.

The central bank was asked to provide details of demonetised notes counted so far.

Replying to a question on providing the deadline for completing the counting exercise, it said, &quot;The verification of notes withdrawn from the circulation is an ongoing process&quot;.

The RBI said at least 66 Sophisticated Currency Verification and Processing (CVPS) machines were being used for counting of junked Rs 500 and Rs 1,000 notes that were deposited with various banks post demonetisation.

The government had on November 8 last year banned the use of old Rs 500 and Rs 1,000 notes and allowed the holders of these currency bills to deposit them with banks or use them at certain notified utilities.

The notes deposited or collected are being verified by the central bank at its offices to establish the total number of currency bills returned and to weed out those that are fake.

Several opposition parties including the Congress and Mamata Banerjee&#39;s TMC have announced that they would observe November 8, the first anniversary of demonetisation, as &#39;Black Day&#39; and would hold protests across the country to highlight its &quot;ill-effects&quot; on the economy.

To counter the opposition protest, the ruling BJP has decided to observe the note ban anniversary as &quot;anti- blackmoney day&quot;.

In its annual report for 2016-17 released on August 30, the RBI had said Rs 15.28 lakh crore, or 99 per cent of the demonetised Rs 500 and Rs 1,000 notes, have returned to the banking system.

In the annual report, which was for the year ended June 30, 2017, the central bank said only Rs 16,050 crore out of the Rs 15.44 lakh crore in old high-denomination notes have not returned.

As on November 8, 2016, there were 1,716.5 crore pieces of Rs 500 and 685.8 crore pieces of Rs 1,000 notes in circulation, totalling Rs 15.44 lakh crore, it had said.

&quot;Subject to future corrections based on verification process when completed, the estimated value of specified bank notes received as on June 30, 2017, is Rs 15.28 trillion,&quot; RBI had said in the report.

While the counterfeit currency notes made for a minuscule number, RBI post-demonetisation spent Rs 7,965 crore on printing new Rs 500 and Rs 2,000 bills and notes of other denominations, more than double the Rs 3,421 crore spent in the previous year, it said.

'Specified Bank Notes are being processed in all earnest in double shift on all available machines (sophisticated counting machines),' the RBI said in reply to an RTI query

Nearly a year after Prime Minister Narendra Modi announced demonetisation, the Rs 500 and Rs 1,000 bills returned to banks are still being "processed in all earnest" through a sophisticated currency verification system, the RBI has said. In reply to an RTI query, the central bank said it has processed about 1,134 crore pieces of Rs 500 notes and 524.90 crore pieces of Rs 1,000 junked notes, having face value of Rs 5.67 lakh crore and Rs 5.24 lakh crore respectively, as on September 30. The combined value of the processed notes is Rs 10.91 lakh crore approximately, according to the reply. "Specified Bank Notes are being processed in all earnest in double shift on all available machines (sophisticated counting machines)," the Reserve Bank of India (RBI) said in reply to the RTI query filed by a PTI correspondent. The central bank was asked to provide details of demonetised notes counted so far. Replying to a question on providing the deadline for completing the counting exercise, it said, "The verification of notes withdrawn from the circulation is an ongoing process". The RBI said at least 66 Sophisticated Currency Verification and Processing (CVPS) machines were being used for counting of junked Rs 500 and Rs 1,000 notes that were deposited with various banks post demonetisation. The government had on November 8 last year banned the use of old Rs 500 and Rs 1,000 notes and allowed the holders of these currency bills to deposit them with banks or use them at certain notified utilities. The notes deposited or collected are being verified by the central bank at its offices to establish the total number of currency bills returned and to weed out those that are fake. Several opposition parties including the Congress and Mamata Banerjee's TMC have announced that they would observe November 8, the first anniversary of demonetisation, as 'Black Day' and would hold protests across the country to highlight its "ill-effects" on the economy. To counter the opposition protest, the ruling BJP has decided to observe the note ban anniversary as "anti- blackmoney day". In its annual report for 2016-17 released on August 30, the RBI had said Rs 15.28 lakh crore, or 99 per cent of the demonetised Rs 500 and Rs 1,000 notes, have returned to the banking system. In the annual report, which was for the year ended June 30, 2017, the central bank said only Rs 16,050 crore out of the Rs 15.44 lakh crore in old high-denomination notes have not returned. As on November 8, 2016, there were 1,716.5 crore pieces of Rs 500 and 685.8 crore pieces of Rs 1,000 notes in circulation, totalling Rs 15.44 lakh crore, it had said. "Subject to future corrections based on verification process when completed, the estimated value of specified bank notes received as on June 30, 2017, is Rs 15.28 trillion," RBI had said in the report. While the counterfeit currency notes made for a minuscule number, RBI post-demonetisation spent Rs 7,965 crore on printing new Rs 500 and Rs 2,000 bills and notes of other denominations, more than double the Rs 3,421 crore spent in the previous year, it said.

One year after demonetisation, RBI says returned notes still being counted

The government came out all guns blazing, defending the economic measures it has taken in recent years after concerns raised by the&nbsp;opposition on GDP growth.

Finance Minister Arun Jaitley, along with economic affairs secretary Subhash Chandra Garg and finance secretary Ashok Lavasa, gave a presentation on the economic plan charted out by the government to put India on a higher-growth track.

&quot;There have been lot of discussions and reviews of the economy in the past few weeks within the ministry. When results of the GDP of the first quarter came out then I had said that we will be ready for the response,&quot; Jaitley said.

India has remained the world&#39;s fastest-growing large economy for the past three years, he added.

Hailing GST, Subhash Chandra Garg said it has been the biggest reform, along with others like demonetisation and the battle against black money. He then delved into the presentation, giving details about the reduced amount of current account deficit and the overall health of the economy.

Then Lavasa took over and talked about how the government is creating more jobs and has increased its public spending.

&quot;We have launched the biggest component of road-building programme, the ?Bharat Mala programme which has been cleared by the Union Cabinet today. It will lead to building of 34,800 km of roads,&quot; Lavasa said highlighting government&rsquo;s push towards infrastructure.

About 2000 km of coastal roads will be constructed in first phase of Bharat Mala, he added.

The government said a total of&nbsp;83,677 kms of roads would be built over the next five years, creating &quot;more jobs&quot; and leading to &quot;more growth&quot;.&nbsp;&nbsp;

The second large scheme announced by Team Jaitley today was an &quot;unprecedented&quot; recapitalisation -- by Rs 2.11 lakh crore -- of public sector banks.&nbsp;

The recapitalisation, Team Jaitley said, had come after a cleaning up of the banks and their&nbsp;non-performing assets and would encourage the banks to lend to private enterprise.&nbsp;

Since it came to power three years ago, the Modi government has taken many bold steps to give boost to India&rsquo;s economy, like the a new tax regime the Goods and Services Tax and demonetisation. But both the decisions have been slammed by the opposition and other sections of society.

The Congress has even said that it will mark November 8, 2017 - the first anniversary of demonetisation - as a &#39;Black Day&#39;.

But the government has been firm in its resolve and has maintained that these economic reforms will have positive impact in long term. Many global bodies, including the IMF, have given thumbs up to government&rsquo;s reforms and have predicted bright future for Indian economy.

Team Jaitley said 83,677 kms of roads would be built over the next five years, creating 'more jobs' and leading to 'more growth'

The government came out all guns blazing, defending the economic measures it has taken in recent years after concerns raised by the opposition on GDP growth. Finance Minister Arun Jaitley, along with economic affairs secretary Subhash Chandra Garg and finance secretary Ashok Lavasa, gave a presentation on the economic plan charted out by the government to put India on a higher-growth track. "There have been lot of discussions and reviews of the economy in the past few weeks within the ministry. When results of the GDP of the first quarter came out then I had said that we will be ready for the response," Jaitley said. India has remained the world's fastest-growing large economy for the past three years, he added. Hailing GST, Subhash Chandra Garg said it has been the biggest reform, along with others like demonetisation and the battle against black money. He then delved into the presentation, giving details about the reduced amount of current account deficit and the overall health of the economy. Then Lavasa took over and talked about how the government is creating more jobs and has increased its public spending. "We have launched the biggest component of road-building programme, the ?Bharat Mala programme which has been cleared by the Union Cabinet today. It will lead to building of 34,800 km of roads," Lavasa said highlighting government’s push towards infrastructure. About 2000 km of coastal roads will be constructed in first phase of Bharat Mala, he added. The government said a total of 83,677 kms of roads would be built over the next five years, creating "more jobs" and leading to "more growth". The second large scheme announced by Team Jaitley today was an "unprecedented" recapitalisation -- by Rs 2.11 lakh crore -- of public sector banks. The recapitalisation, Team Jaitley said, had come after a cleaning up of the banks and their non-performing assets and would encourage the banks to lend to private enterprise. Since it came to power three years ago, the Modi government has taken many bold steps to give boost to India’s economy, like the a new tax regime the Goods and Services Tax and demonetisation. But both the decisions have been slammed by the opposition and other sections of society. The Congress has even said that it will mark November 8, 2017 - the first anniversary of demonetisation - as a 'Black Day'. But the government has been firm in its resolve and has maintained that these economic reforms will have positive impact in long term. Many global bodies, including the IMF, have given thumbs up to government’s reforms and have predicted bright future for Indian economy.

New highways, job creation part of govt plan to push India on high-growth track

Wholesale inflation fell to 2.60 per cent in September as prices of food articles, led by vegetables, softened.

Inflation, based on the wholesale price index (WPI), had soared to a four-month high of 3.24 per cent in August 2017. It was 1.36 per cent in September 2016.

The government data released today showed that inflation in food articles tapered to 2.04 per cent in September, as against 5.75 per cent in August on a yearly basis.

Inflation in vegetable prices cooled to 15.48 per cent in September, as against a high of 44.91 per cent in the previous month.

Onion prices, however, continued to rule high with 79.78 per cent increase in September. In egg, meat and fish segment the rate of price rise was 5.47 per cent.

Inflation in manufactured products witnessed a slight increase at 2.72 per cent, against 2.45 per cent in August.

In fuel and power segment, inflation cooled to 9.01 per cent, against 9.99 per cent in August.

Fuel inflation has remained high in the past two months as petrol and diesel prices continued to rule high relentlessly on global crude oil rates, while power tariffs shot through the roof on lower domestic production.

Pulses continued to witness deflation at 24.26 per cent, likewise in potato at 46.52 per cent and wheat at 1.71 per cent.

The final print of July WPI inflation remained unchanged from provisional estimate of 1.88 per cent.

Data released earlier this week showed retail inflation at 3.28 per cent in September, unchanged from August, even as vegetable and cereal prices softened.

Besides industrial production grew at a nine-month high of 4.3 per cent in August, mainly on account of robust performance of mining and power sectors coupled with higher capital goods output.

Earlier this month, the Reserve Bank kept benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal.

It also raised its inflation forecast to a range of 4.2 to 4.6 per cent during the remainder of current fiscal as against 4 to 4.5 per cent previously.

WPI was at a four-month high of 3.24% in August

Wholesale inflation fell to 2.60 per cent in September as prices of food articles, led by vegetables, softened. Inflation, based on the wholesale price index (WPI), had soared to a four-month high of 3.24 per cent in August 2017. It was 1.36 per cent in September 2016. The government data released today showed that inflation in food articles tapered to 2.04 per cent in September, as against 5.75 per cent in August on a yearly basis. Inflation in vegetable prices cooled to 15.48 per cent in September, as against a high of 44.91 per cent in the previous month. Onion prices, however, continued to rule high with 79.78 per cent increase in September. In egg, meat and fish segment the rate of price rise was 5.47 per cent. Inflation in manufactured products witnessed a slight increase at 2.72 per cent, against 2.45 per cent in August. In fuel and power segment, inflation cooled to 9.01 per cent, against 9.99 per cent in August. Fuel inflation has remained high in the past two months as petrol and diesel prices continued to rule high relentlessly on global crude oil rates, while power tariffs shot through the roof on lower domestic production. Pulses continued to witness deflation at 24.26 per cent, likewise in potato at 46.52 per cent and wheat at 1.71 per cent. The final print of July WPI inflation remained unchanged from provisional estimate of 1.88 per cent. Data released earlier this week showed retail inflation at 3.28 per cent in September, unchanged from August, even as vegetable and cereal prices softened. Besides industrial production grew at a nine-month high of 4.3 per cent in August, mainly on account of robust performance of mining and power sectors coupled with higher capital goods output. Earlier this month, the Reserve Bank kept benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal. It also raised its inflation forecast to a range of 4.2 to 4.6 per cent during the remainder of current fiscal as against 4 to 4.5 per cent previously.

Wholesale inflation falls to 2.6% in September

India has the potential to grow at a reasonably high level in the next decade or two, owing to some structural changes by the government and a turnaround in the global economy, Finance Minister Arun Jaitley said today.

The whole environment of doing business has changed in a matter of months, Jaitley told a Washington audience at an event organised by the US-India Strategic and Partnership Forum.

&quot;India has the potential to grow at a reasonably high level in the next one-two decades. This is mainly because of the series of structural reforms being carried out by the government, turnaround in the global economy, and the massive investment opportunity that the infrastructure sector offers,&quot; said Jaitley.

&quot;I am certain that now that the growth is returning back to the world, the future holds an important direction as far as India is concerned. The sheer size of the country and economy would offer huge opportunity for investment in India in the next few years,&quot; he said.

Jaitley said that when the BJP government came to power in 2014, it had the choice to look the other way and allow the shadow economy to continue.

&quot;But it did not do so, as it took a series of courageous steps which ultimately culminated in demonetisation of high- value currency,&quot; the finance minister said.

The government knew that there would be short-term impact on the economy, Jaitley said, &quot;but, in the long term, it would benefit the country,&quot; he told a gathering of investors and corporate leaders.

In an effort to pitch India as an investor-friendly destination, the finance minister said that his government had taken a series of steps to improve the ease of doing business.

&quot;India today is one of the most open, globally integrated economy. In the last few years, we are moving up the ease of doing business ranking,&quot; he said, as he listed out some of the key initiatives by his government.

Among these are the &quot;massive steps&quot; that the Indian government has taken in using new digital technologies for governance and making them beneficial to the people, Jaitley said.

&quot;Today, almost everyone is connected to the banking system. Almost every adult in India has biometric. The integrated data has helped the government to reach every citizen on digital platform,&quot; he said.

&quot;This has helped us save billions of dollars,&quot; he said, adding that India is now using technology &quot;in a big way&quot; in order to ensure that the resources reaches the intended population.

Speaking about the Goods and Services Tax (GST), Jaitley said it was &quot;a more efficient system which has brought the country together, even economically, allowed free flow of goods and services across the country.&quot;

However, he conceded, that it could cause disruption for a quarter or two.

The event closed a week of meetings that the minister attended in the US, including the annual meetings of the International Monetary Fund and the World Bank.

Members of the USISPF audience included senior representatives from companies such as Apple, Boeing, Google, etc. While senior officials from different departments of the US government also participated in the programme.

Mukesh Aghi, president of USISPF, noted the importance of the minister?s visit, saying India had witnessed vast reforms and gained an ability for significant economic growth in the last few years thereby opening it to huge investment potential.

&quot;US companies and investors are very much aware of the reforms the Indian government is making in order to expand the economy,&quot; he said.

&quot;With future reforms and increased partnership between US and Indian businesses, there is promising potential for this already important relationship,&quot; he said.&nbsp; 
&nbsp;

The finance minister attributed the high potential for growth to structural changes by the government and a turnaround in the global economy

India has the potential to grow at a reasonably high level in the next decade or two, owing to some structural changes by the government and a turnaround in the global economy, Finance Minister Arun Jaitley said today. The whole environment of doing business has changed in a matter of months, Jaitley told a Washington audience at an event organised by the US-India Strategic and Partnership Forum. "India has the potential to grow at a reasonably high level in the next one-two decades. This is mainly because of the series of structural reforms being carried out by the government, turnaround in the global economy, and the massive investment opportunity that the infrastructure sector offers," said Jaitley. "I am certain that now that the growth is returning back to the world, the future holds an important direction as far as India is concerned. The sheer size of the country and economy would offer huge opportunity for investment in India in the next few years," he said. Jaitley said that when the BJP government came to power in 2014, it had the choice to look the other way and allow the shadow economy to continue. "But it did not do so, as it took a series of courageous steps which ultimately culminated in demonetisation of high- value currency," the finance minister said. The government knew that there would be short-term impact on the economy, Jaitley said, "but, in the long term, it would benefit the country," he told a gathering of investors and corporate leaders. In an effort to pitch India as an investor-friendly destination, the finance minister said that his government had taken a series of steps to improve the ease of doing business. "India today is one of the most open, globally integrated economy. In the last few years, we are moving up the ease of doing business ranking," he said, as he listed out some of the key initiatives by his government. Among these are the "massive steps" that the Indian government has taken in using new digital technologies for governance and making them beneficial to the people, Jaitley said. "Today, almost everyone is connected to the banking system. Almost every adult in India has biometric. The integrated data has helped the government to reach every citizen on digital platform," he said. "This has helped us save billions of dollars," he said, adding that India is now using technology "in a big way" in order to ensure that the resources reaches the intended population. Speaking about the Goods and Services Tax (GST), Jaitley said it was "a more efficient system which has brought the country together, even economically, allowed free flow of goods and services across the country." However, he conceded, that it could cause disruption for a quarter or two. The event closed a week of meetings that the minister attended in the US, including the annual meetings of the International Monetary Fund and the World Bank. Members of the USISPF audience included senior representatives from companies such as Apple, Boeing, Google, etc. While senior officials from different departments of the US government also participated in the programme. Mukesh Aghi, president of USISPF, noted the importance of the minister?s visit, saying India had witnessed vast reforms and gained an ability for significant economic growth in the last few years thereby opening it to huge investment potential. "US companies and investors are very much aware of the reforms the Indian government is making in order to expand the economy," he said. "With future reforms and increased partnership between US and Indian businesses, there is promising potential for this already important relationship," he said.

India has high growth potential for next two decades: Arun Jaitley

Indian banks&rsquo; sour loans hit a record $145.56 billion&nbsp;at the end of June, unpublished data shows, suggesting Asia&rsquo;s third-largest economy is no nearer to bringing its bad debt problems under control.

A review of Reserve Bank of India (RBI) data obtained through right-to-information requests shows banks&rsquo; total stressed loans, including non-performing and restructured or rolled over loans, rose 4.5 per cent in the six months to end-June. In the previous six months, they had risen 5.8 per cent.

While banks remain the main source of funding for India&rsquo;s companies, the stubborn bad debt problem has eaten into bank profits and choked off new lending, especially to smaller firms, at a time when an economy that depends on them is stalling.

India grew at its slowest pace in three years in April-June, a concern for the government of Prime Minister Narendra Modi, who faces elections in 2019 and has pledged to create millions of new jobs before then.

Banks are having to take higher provisions to account for more defaulters being pushed into bankruptcy. And margins are likely to be squeezed further by proposed new rules to encourage commercial banks to pass on central bank interest rate cuts.

To be sure, the bulk of India&rsquo;s sour loans are in the state banks and stem from lending to large conglomerates, especially in steel and infrastructure. But analysts say the rise in bad loans among small firms, and even retail borrowing, is worrying and will do little to encourage new loans to help fuel growth.

&ldquo;On the corporate side, we think it&rsquo;s a recognition cycle which is nearing an end,&rdquo; said Alka Anbarasu, senior analyst at Moody&rsquo;s Investor Service, referring to more bad loans being recognised as such, as banks come under pressure from the RBI and other regulators. &ldquo;But it&rsquo;s really those data points beyond corporate that are causing some worry.&rdquo;

Anbarasu forecasts weak quarters ahead for banks before profitability picks up, and several senior bankers from public sector lenders, which account for more than two-thirds of Indian banking assets - agreed the months ahead would be strained.

Stressed loans as a percentage of total loans reached 12.6 per cent at end-June, according to the RBI data, the highest level in at least 15 years.

Part of the issue for banks and the government is a strict provisioning regime, the RBI wants banks to provide for at least 50 per cent of the secured loans to companies taken to bankruptcy proceedings, and 100 per cent for the unsecured part.

A dozen of the biggest such cases account for nearly 1.78 trillion rupees, or a quarter of total non-performing assets.

For those companies, banks will need to provide 180 billion rupees on top of existing provisions, according to July estimates from India Ratings and Research, the local affiliate of Fitch Ratings.

More than 20 other sizeable companies are at risk of being taken to bankruptcy court.

Bankers say these and other pressures, including rising government bond yields that forced banks to post mark-to-market losses, have added to the squeeze, and hit new loans.

According to RBI data, new loans grew at just about 5 per cent in the year to March, the lowest growth rate in more than six decades. Several banks have already cut back their loan books to conserve capital.

&ldquo;What are they (RBI) thinking while they&rsquo;re taking these steps all at the same time?&rdquo; said a treasurer at a state-run bank, who didn&rsquo;t want to be named due to the sensitivity of the issue. &ldquo;Do they want banks to wind up their businesses, or do they want to save the banks?&rdquo;

Treasury income accounted for 22.7 per cent of banks&rsquo; operating profits in the last financial year, doubling its share from a year earlier, India Ratings estimates.

&ldquo;The almost zero treasury income will hit provisioning ability and, in turn, make it more difficult for weaker banks to give loans as capital becomes more scarce,&rdquo; said Soumyajit Niyogi, an associate director at the rating agency.

A senior policymaker, who requested anonymity as the discussions are not public, said the government would have to help to sufficiently capitalise the banks.

Fitch Ratings estimates Indian banks will need $65 billion of additional capital by March 2019 to meet Basel III global banking rules. Moody&rsquo;s expects the top 11 state lenders alone will need nearly $15 billion. The government has just $3 billion left in its budget for bank recapitalisation.

&ldquo;We think capitalisation is the biggest challenge for the banks at the moment, given that earnings will remain subdued and will not support any capital generation,&rdquo; said Moody&rsquo;s Anbarasu.

A review of Reserve Bank of India (RBI) data obtained through right-to-information requests shows banks? total stressed loans, including non-performing and restructured or rolled over loans, rose 4.5 per cent in the six months to end-June. In the previous six months, they had risen 5.8 per cent

Indian banks’ sour loans hit a record $145.56 billion at the end of June, unpublished data shows, suggesting Asia’s third-largest economy is no nearer to bringing its bad debt problems under control. A review of Reserve Bank of India (RBI) data obtained through right-to-information requests shows banks’ total stressed loans, including non-performing and restructured or rolled over loans, rose 4.5 per cent in the six months to end-June. In the previous six months, they had risen 5.8 per cent. While banks remain the main source of funding for India’s companies, the stubborn bad debt problem has eaten into bank profits and choked off new lending, especially to smaller firms, at a time when an economy that depends on them is stalling. India grew at its slowest pace in three years in April-June, a concern for the government of Prime Minister Narendra Modi, who faces elections in 2019 and has pledged to create millions of new jobs before then. Banks are having to take higher provisions to account for more defaulters being pushed into bankruptcy. And margins are likely to be squeezed further by proposed new rules to encourage commercial banks to pass on central bank interest rate cuts. To be sure, the bulk of India’s sour loans are in the state banks and stem from lending to large conglomerates, especially in steel and infrastructure. But analysts say the rise in bad loans among small firms, and even retail borrowing, is worrying and will do little to encourage new loans to help fuel growth. “On the corporate side, we think it’s a recognition cycle which is nearing an end,” said Alka Anbarasu, senior analyst at Moody’s Investor Service, referring to more bad loans being recognised as such, as banks come under pressure from the RBI and other regulators. “But it’s really those data points beyond corporate that are causing some worry.” Anbarasu forecasts weak quarters ahead for banks before profitability picks up, and several senior bankers from public sector lenders, which account for more than two-thirds of Indian banking assets - agreed the months ahead would be strained. Stressed loans as a percentage of total loans reached 12.6 per cent at end-June, according to the RBI data, the highest level in at least 15 years. Part of the issue for banks and the government is a strict provisioning regime, the RBI wants banks to provide for at least 50 per cent of the secured loans to companies taken to bankruptcy proceedings, and 100 per cent for the unsecured part. A dozen of the biggest such cases account for nearly 1.78 trillion rupees, or a quarter of total non-performing assets. For those companies, banks will need to provide 180 billion rupees on top of existing provisions, according to July estimates from India Ratings and Research, the local affiliate of Fitch Ratings. More than 20 other sizeable companies are at risk of being taken to bankruptcy court. Bankers say these and other pressures, including rising government bond yields that forced banks to post mark-to-market losses, have added to the squeeze, and hit new loans. According to RBI data, new loans grew at just about 5 per cent in the year to March, the lowest growth rate in more than six decades. Several banks have already cut back their loan books to conserve capital. “What are they (RBI) thinking while they’re taking these steps all at the same time?” said a treasurer at a state-run bank, who didn’t want to be named due to the sensitivity of the issue. “Do they want banks to wind up their businesses, or do they want to save the banks?” Treasury income accounted for 22.7 per cent of banks’ operating profits in the last financial year, doubling its share from a year earlier, India Ratings estimates. “The almost zero treasury income will hit provisioning ability and, in turn, make it more difficult for weaker banks to give loans as capital becomes more scarce,” said Soumyajit Niyogi, an associate director at the rating agency. A senior policymaker, who requested anonymity as the discussions are not public, said the government would have to help to sufficiently capitalise the banks. Fitch Ratings estimates Indian banks will need $65 billion of additional capital by March 2019 to meet Basel III global banking rules. Moody’s expects the top 11 state lenders alone will need nearly $15 billion. The government has just $3 billion left in its budget for bank recapitalisation. “We think capitalisation is the biggest challenge for the banks at the moment, given that earnings will remain subdued and will not support any capital generation,” said Moody’s Anbarasu.

India's bad loans hit record 9.5 lakh crore

World Bank President Jim Yong Kim said the recent slowdown in India&#39;s economic growth is an &quot;aberration&quot; caused by temporary disruptions in preparation for the Goods and Service Tax (GST).

He asserted that it will get corrected in the near future.

Kim while responding to questions on the slowdown in India`s growth in the first quarter said GST is going to have a positive impact on the Indian economy.

&quot;There&#39;s been a deceleration in the first quarter, but we think that`s mostly due to temporary disruptions in preparation for the GST, which by the way is going to have a huge&nbsp;positive impact on the economy,&quot; Kim told the media during a conference ahead of the annual meeting of the International Monetary Fund and the World Bank here.

&quot;We think that the recent slowdown is an aberration which will correct in the coming months, and the GDP growth will stabilise during the year. We`ve been watching carefully, as Prime Minister (Narendra) Modi has really worked on improving the business environment, and so, we think all of those efforts will pay off as well,&quot; he added.

Further responding on India and human capital, Kim praised the &quot;commitment&quot; of Prime Minister Narendra Modi to sanitation issues, and said &quot;Swachh Bharat&quot;&nbsp;is one of the most effective programmes anywhere.

&quot;I know that Prime Minister Modi himself personally is very committed to improving opportunities for all of India. But, India has a lot of challenges. We look at some of the educational outcomes, we`ve looked at some of the health outcomes, and India has room to improve, like most other countries,&quot; he said.

&quot;Our job is to take the political will and commitment that Prime Minister Modi has clearly demonstrated and has communicated to everyone, and then bring to India the most effective intervention that will, as quickly as possible, improve the stock of human capital,&quot; Kim said.

Finance Minister Arun Jaitley would be leading a delegation to the annual meeting next week.

India`s GDP grew 5.7 per cent during the April-June period. During the previous quarter (January-March) the GDP had grown by 6.1 per cent.

<a href="http://www.wionews.com/india-news/watch-not-concerned-by-slowdown-in-indian-economy-says-mastercard-ceo-ajay-banga-21060" target="_blank">WATCH: Not concerned by slowdown in Indian economy, says Mastercard CEO Ajay Banga</a>

Also read:&nbsp;<a href="http://www.wionews.com/photos/forbes-list-mukesh-ambani-added-153-billion-last-year-485#photo-26301" target="_blank">Economy slows but India&#39;s richest 100 </a><a href="http://www.wionews.com/photos/forbes-list-mukesh-ambani-added-153-billion-last-year-485#photo-26301" target="_blank">get</a><a href="http://www.wionews.com/photos/forbes-list-mukesh-ambani-added-153-billion-last-year-485#photo-26301" target="_blank"> richer by 26%: Forbes list</a>

World Bank President Jim Yong Kim said the recent slowdown in India's economic growth is an 'aberration' caused by temporary disruptions in preparation for the Goods and Service Tax

World Bank President Jim Yong Kim said the recent slowdown in India's economic growth is an "aberration" caused by temporary disruptions in preparation for the Goods and Service Tax (GST). He asserted that it will get corrected in the near future. Kim while responding to questions on the slowdown in India`s growth in the first quarter said GST is going to have a positive impact on the Indian economy. "There's been a deceleration in the first quarter, but we think that`s mostly due to temporary disruptions in preparation for the GST, which by the way is going to have a huge positive impact on the economy," Kim told the media during a conference ahead of the annual meeting of the International Monetary Fund and the World Bank here. "We think that the recent slowdown is an aberration which will correct in the coming months, and the GDP growth will stabilise during the year. We`ve been watching carefully, as Prime Minister (Narendra) Modi has really worked on improving the business environment, and so, we think all of those efforts will pay off as well," he added. Further responding on India and human capital, Kim praised the "commitment" of Prime Minister Narendra Modi to sanitation issues, and said "Swachh Bharat" is one of the most effective programmes anywhere. "I know that Prime Minister Modi himself personally is very committed to improving opportunities for all of India. But, India has a lot of challenges. We look at some of the educational outcomes, we`ve looked at some of the health outcomes, and India has room to improve, like most other countries," he said. "Our job is to take the political will and commitment that Prime Minister Modi has clearly demonstrated and has communicated to everyone, and then bring to India the most effective intervention that will, as quickly as possible, improve the stock of human capital," Kim said. Finance Minister Arun Jaitley would be leading a delegation to the annual meeting next week. India`s GDP grew 5.7 per cent during the April-June period. During the previous quarter (January-March) the GDP had grown by 6.1 per cent. WATCH: Not concerned by slowdown in Indian economy, says Mastercard CEO Ajay Banga Also read: Economy slows but India's richest 100 get richer by 26%: Forbes list

India's economy will be back on track soon: World Bank

Responding to A<a href="http://www.wionews.com/india-news/yashwant-sinhas-criticism-of-economy-based-on-personal-frustration-bjp-20807" target="_blank">run Jaitley</a>, Yashwant Sinha has said that the&nbsp;<a href="http://www.wionews.com/india-news/yashwant-sinhas-criticism-of-economy-based-on-personal-frustration-bjp-20807" target="_blank">finance minister</a>&nbsp;has delivered a well-researched speech but he did not stick to the advice of senior BJP leader LK Advani to refrain from personal attacks.&nbsp;

<div class="ui-state-default" contenteditable="false">
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He delivered a well researched speech but overlooked Advani Ji&#39;s advice to refrain from personal attacks: Yashwant Sinha on FM Arun Jaitley <a href="https://t.co/TH59Jl2wAH">pic.twitter.com/TH59Jl2wAH</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913640761320644608?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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Replying to Jaitley&#39;s remark of &quot;job applicant at 80&quot;,&nbsp;Sinha has said&nbsp;he did not come to politics after retirement.

&quot;I&nbsp;left my&nbsp;post in IAS so I could not be asking for a job at the age of 80 years&quot;.&nbsp;

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I did not come to politics after retirement. I left my post in IAS. So I could not be asking for job at the age of 80 yrs: Yashwant Sinha <a href="https://t.co/Ds3G9qlgYh">pic.twitter.com/Ds3G9qlgYh</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913640939163238400?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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He also questioned the people calling him useless.&nbsp;

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They say I was useless as a minister. How could they have given me the ministry of External Affairs if I was so useless?: Yashwant Sinha <a href="https://t.co/LzTA73dtE4">pic.twitter.com/LzTA73dtE4</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913641451975614464?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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Hitting at the government&#39;s claim of ending corruption, he said the Pakistan prime minister has been ousted due to his involvement in Panama Case.

&quot;What measures have been taken by the government here against Panama leaks and how much black money has been recovered by Arun Jaitley&quot;.&nbsp;

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In Pak they ousted PM due to involvement in Panama Case, what did they do here? How much black money did Arun Jaitley bring back?: Y Sinha <a href="https://t.co/YaMEK8G9pU">pic.twitter.com/YaMEK8G9pU</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913642907332091904?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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He claimed that during his tenure in the finance ministry the inflation was kept under control. &nbsp;

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During my tenure (as FM) there was never a discussion on inflation in Parliament because we had kept it well under control: Yashwant Sinha <a href="https://t.co/NSQvWdchHw">pic.twitter.com/NSQvWdchHw</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913642989909508096?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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&nbsp;He said that such claims are made only by those leaders who are not attached to the grassroots&nbsp;level.&nbsp;

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Dilli mein baithe hawai neta jinka grasroot se lagav nhi hai vo aisi hi baat karenge,constituency wala kabhi aisa nhi kahega: Yashwant Sinha <a href="https://t.co/qUH0zws8rj">pic.twitter.com/qUH0zws8rj</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/913646998590414849?ref_src=twsrc%5Etfw">September 29, 2017</a></blockquote>
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On September 27, <a href="http://www.wionews.com/india-news/gst-served-as-second-big-blow-to-economy-yashwant-sinha-hits-back-at-bjp-20780" target="_blank">former finance minister Yashwant Sinha criticised Arun Jaitley </a>for making a mess of Indian economy with measures such as demonetisation and the Goods and Services Tax (GST). He found support in former finance minister P Chidambaram who asked the government to admit the truth.&nbsp;

( Also&nbsp;Read: <a href="http://www.wionews.com/india-news/yashwant-sinha-has-shown-the-mirror-shotguns-defence-of-his-colleague-20776" target="_blank">Yashwant Sinha has shown the mirror: Shotgun&#39;s </a><a href="http://www.wionews.com/india-news/yashwant-sinha-has-shown-the-mirror-shotguns-defence-of-his-colleague-20776" target="_blank">defence</a><a href="http://www.wionews.com/india-news/yashwant-sinha-has-shown-the-mirror-shotguns-defence-of-his-colleague-20776" target="_blank"> of his colleague</a>)&nbsp;

To this, the BJP government on September 28 had accused its senior leader Yashwant Sinha of sympathising with &quot;jobless&quot; Congress leaders including Rahul Gandhi and P Chidambaram.

They said that Sinha&#39;s criticism of the government&#39;s economy was due to his personal frustration.&nbsp;

&nbsp;

&nbsp;

What measures have been taken by the government here against Panama leaks and how much black money has been recovered by Arun Jaitley, Yashwant Sinha asked.

Responding to Arun Jaitley, Yashwant Sinha has said that the finance minister has delivered a well-researched speech but he did not stick to the advice of senior BJP leader LK Advani to refrain from personal attacks. He delivered a well researched speech but overlooked Advani Ji's advice to refrain from personal attacks: Yashwant Sinha on FM Arun Jaitley pic.twitter.com/TH59Jl2wAH — ANI (@ANI) September 29, 2017 × Replying to Jaitley's remark of "job applicant at 80", Sinha has said he did not come to politics after retirement. "I left my post in IAS so I could not be asking for a job at the age of 80 years". I did not come to politics after retirement. I left my post in IAS. So I could not be asking for job at the age of 80 yrs: Yashwant Sinha pic.twitter.com/Ds3G9qlgYh — ANI (@ANI) September 29, 2017 × He also questioned the people calling him useless. They say I was useless as a minister. How could they have given me the ministry of External Affairs if I was so useless?: Yashwant Sinha pic.twitter.com/LzTA73dtE4 — ANI (@ANI) September 29, 2017 × Hitting at the government's claim of ending corruption, he said the Pakistan prime minister has been ousted due to his involvement in Panama Case. "What measures have been taken by the government here against Panama leaks and how much black money has been recovered by Arun Jaitley". In Pak they ousted PM due to involvement in Panama Case, what did they do here? How much black money did Arun Jaitley bring back?: Y Sinha pic.twitter.com/YaMEK8G9pU — ANI (@ANI) September 29, 2017 × He claimed that during his tenure in the finance ministry the inflation was kept under control. During my tenure (as FM) there was never a discussion on inflation in Parliament because we had kept it well under control: Yashwant Sinha pic.twitter.com/NSQvWdchHw — ANI (@ANI) September 29, 2017 × He said that such claims are made only by those leaders who are not attached to the grassroots level. Dilli mein baithe hawai neta jinka grasroot se lagav nhi hai vo aisi hi baat karenge,constituency wala kabhi aisa nhi kahega: Yashwant Sinha pic.twitter.com/qUH0zws8rj — ANI (@ANI) September 29, 2017 × On September 27, former finance minister Yashwant Sinha criticised Arun Jaitley for making a mess of Indian economy with measures such as demonetisation and the Goods and Services Tax (GST). He found support in former finance minister P Chidambaram who asked the government to admit the truth. ( Also Read: Yashwant Sinha has shown the mirror: Shotgun's defence of his colleague) To this, the BJP government on September 28 had accused its senior leader Yashwant Sinha of sympathising with "jobless" Congress leaders including Rahul Gandhi and P Chidambaram. They said that Sinha's criticism of the government's economy was due to his personal frustration.

'How much black money did Arun Jaitley bring back': Yashwant Sinha

The Bharatiya Janata Party (BJP) on September 28 accused its senior leader Yashwant Sinha of sympathising with &quot;jobless&quot; Congress leaders including Rahul Gandhi and P Chidambaram and said his criticism on the way the economy had been handled was based on his &quot;personal frustration.&quot;

&quot;The ten years of the UPA Government at the Centre was one of the most corrupt ever. The reality is that Rahul Gandhi, Chidambaram and many others are finding themselves jobless and those who sympathise with such jobless leaders are also making an unfair criticism not based on facts, but based on one&#39;s personal frustration,&quot;&nbsp;BJP spokesman GVL&nbsp;Narasimha Rao told ANI.

The BJP also dismissed the<a href="http://www.wionews.com/india-news/will-power-admit-the-truth-chidambaram-on-yashwant-sinhas-attack-on-arun-jaitleys-economic-mess-20728"> Congress&#39; claims of economic mismanagement </a>and said that, at present, the government was doing very fine and finance minister Arun Jaitley had defended Yashwant Sinha&#39;s criticism against him by talking about economic issues rather than targeting any individual.

&quot;Jaitley categorically explained all the economic issues which are at present in debate like how the policies have worked fine in regards to demonetisation, in regard to implementation with the GST. How the Government is pro-active in solving the problems of people; how the Government is tackling the NPA problems; how much expenditure Government is taking into infrastructure?&quot; the party&#39;s national spokesperson, economic&nbsp;affairs, Gopal Krishna Agarwal said.&nbsp; 
 
On September 27, former finance minister&nbsp;&nbsp;Yashwant Sinha criticised Arun Jaitley for&nbsp;making a mess of Indian economy with measures such as demonetisation and the Goods and Services Tax (GST). He found support in former finance minister P Chidambaram who asked the government to admit the truth.&nbsp;

&quot;Will Power now admit the Truth that economy is sinking?&quot; the former finance minister wrote in one tweet. 
 
Defending the government&#39;s economic policies, and referring to Chidambaram and Yashwant Sinha&#39;s attacks on him,<a href="http://www.wionews.com/india-news/watch-slowdown-visualised-by-some-has-not-even-impacted-says-arun-jaitley-20804"> Arun Jaitley said yesterday that he did&nbsp;not have the luxury of being a former finance minister or a former finance minister who has turned a columnist.</a>&nbsp;Without taking names, he described Yashwant Sinha, 84, as a &quot;job applicant at 80&quot;.

&nbsp;&quot;I must confess that I do not have the luxury as yet of being a former finance Minister nor do I have the luxury of being a former finance minister who has turned a columnist. Therefore, I can conveniently forget a policy paralysis, four billion reserves left in 1991 and I can switch over and change a narrative. Speaking on persons and then bypassing the issues is something which is very easily done.&quot;

Backing the demonetisation,&nbsp;Jaitley said that the government intended to expose the black money market and track down those operating in it.

&quot;Demonetisation was not synonymous with confiscation of money. We gave an opportunity to people to come clean about their accounts held abroad. The prime minister had a very strong agenda on creating a new normal as far as the shadow economy in India was concerned,&quot; he said at a book launch.

The finance minister said he was being criticised for bringing out reforms too quickly.&quot;I am being criticised for doing incremental changes. Post GST, the biggest criticism was that why I implemented it so quickly after demonetisation,&quot; he said.

Arun Jaitley also downplayed&nbsp;remarks that the economy was&nbsp;on a downward spiral.

&quot;The Direct tax figures are 15.7 per cent over and above last year`s figure, so this so-called slowdown visualised by some, hasn&#39;t even impacted,&quot; he said.

Yashwant Sinha responded to Jaitley&#39;s job applicant remark by stating that had he been a job applicant, Jaitley would not have been finance minister in the first place.

In a rejoinder to his father, Yashwant Sinha&#39;s son and Minister of State for Civil Aviation Jayant Sinha said yesterday that demonetisation and the introduction of the GST were structural reforms that were necessary for transforming the economy in the long term and that GDP growth of one or two quarters was insufficient to ascertain the long-term impact of these measures.

He also rejected contentions that he wrote the opinion piece at anyone&#39;s bidding, insisting it was &quot;absolutely out of his own conscience&quot;.

He also said his difference of opinion with his father was &quot;very serious discussion&quot; and that it should not be seen &quot;in a personal way&quot;. 
&nbsp;

The BJP accused Yashwant Sinha of sympathising with "jobless" Congress leaders including Rahul Gandhi and P Chidambaram

The Bharatiya Janata Party (BJP) on September 28 accused its senior leader Yashwant Sinha of sympathising with "jobless" Congress leaders including Rahul Gandhi and P Chidambaram and said his criticism on the way the economy had been handled was based on his "personal frustration." "The ten years of the UPA Government at the Centre was one of the most corrupt ever. The reality is that Rahul Gandhi, Chidambaram and many others are finding themselves jobless and those who sympathise with such jobless leaders are also making an unfair criticism not based on facts, but based on one's personal frustration," BJP spokesman GVL Narasimha Rao told ANI. The BJP also dismissed the Congress' claims of economic mismanagement and said that, at present, the government was doing very fine and finance minister Arun Jaitley had defended Yashwant Sinha's criticism against him by talking about economic issues rather than targeting any individual. "Jaitley categorically explained all the economic issues which are at present in debate like how the policies have worked fine in regards to demonetisation, in regard to implementation with the GST. How the Government is pro-active in solving the problems of people; how the Government is tackling the NPA problems; how much expenditure Government is taking into infrastructure?" the party's national spokesperson, economic affairs, Gopal Krishna Agarwal said. On September 27, former finance minister Yashwant Sinha criticised Arun Jaitley for making a mess of Indian economy with measures such as demonetisation and the Goods and Services Tax (GST). He found support in former finance minister P Chidambaram who asked the government to admit the truth. "Will Power now admit the Truth that economy is sinking?" the former finance minister wrote in one tweet. Defending the government's economic policies, and referring to Chidambaram and Yashwant Sinha's attacks on him, Arun Jaitley said yesterday that he did not have the luxury of being a former finance minister or a former finance minister who has turned a columnist. Without taking names, he described Yashwant Sinha, 84, as a "job applicant at 80". "I must confess that I do not have the luxury as yet of being a former finance Minister nor do I have the luxury of being a former finance minister who has turned a columnist. Therefore, I can conveniently forget a policy paralysis, four billion reserves left in 1991 and I can switch over and change a narrative. Speaking on persons and then bypassing the issues is something which is very easily done." Backing the demonetisation, Jaitley said that the government intended to expose the black money market and track down those operating in it. "Demonetisation was not synonymous with confiscation of money. We gave an opportunity to people to come clean about their accounts held abroad. The prime minister had a very strong agenda on creating a new normal as far as the shadow economy in India was concerned," he said at a book launch. The finance minister said he was being criticised for bringing out reforms too quickly."I am being criticised for doing incremental changes. Post GST, the biggest criticism was that why I implemented it so quickly after demonetisation," he said. Arun Jaitley also downplayed remarks that the economy was on a downward spiral. "The Direct tax figures are 15.7 per cent over and above last year`s figure, so this so-called slowdown visualised by some, hasn't even impacted," he said. Yashwant Sinha responded to Jaitley's job applicant remark by stating that had he been a job applicant, Jaitley would not have been finance minister in the first place. In a rejoinder to his father, Yashwant Sinha's son and Minister of State for Civil Aviation Jayant Sinha said yesterday that demonetisation and the introduction of the GST were structural reforms that were necessary for transforming the economy in the long term and that GDP growth of one or two quarters was insufficient to ascertain the long-term impact of these measures. He also rejected contentions that he wrote the opinion piece at anyone's bidding, insisting it was "absolutely out of his own conscience". He also said his difference of opinion with his father was "very serious discussion" and that it should not be seen "in a personal way".

Yashwant Sinha's criticism of economy based on 'personal frustration': BJP

The BSE Sensex tanked 440 points to end at an over three-month low of 31,159.81 due to across the board selling by investors ahead of the expiry of September derivatives and weakness in the Rupee amid mixed global cues.

Extending its falling streak for the seventh straight session,&nbsp;the longest losing streak since&nbsp;December 22, the 30-share index fell by 439.95 points, or 1.39 per cent, to settle at 31,159.81 as RIL, HDFC, HDFC Bank, ITC, SBI and L&amp;T dropped.

This is the weakest closing since&nbsp;June 30&nbsp;when it had settled at 30,921.61.

The broader NSE Nifty cracked below the key 9,800-mark. It had regained the key 9,900-mark at the outset, but failed to hold on to the crucial level and dipped below the 9800-mark to hit a low of 9,714.40.

It finally settled down 135.75 points, or 1.38 per cent, at 9,735.75, it lowest closing since&nbsp;August 11&nbsp;when it closed at 9,710.80.

The September futures and options contracts are set to expire&nbsp;tomorrow, which made participants wait and watch.

Sentiments suffered another setback amid expectations of a rate hike by the US Federal Reserve later this year, accelerating the pace of outflows by foreign investors, offsetting unabated buying by DIIs, brokers said.

Escalating North Korean worries too continued to dampen trading sentiments.

In addition, the rupee quoting at over six-month low of 65.75 against the dollar in day trade too dented the sentiment further.

Sensex tumbles 440 pts ahead of F&O expiry, falls for 7th day, longest losing streak

The BSE Sensex tanked 440 points to end at an over three-month low of 31,159.81 due to across the board selling by investors ahead of the expiry of September derivatives and weakness in the Rupee amid mixed global cues. Extending its falling streak for the seventh straight session, the longest losing streak since December 22, the 30-share index fell by 439.95 points, or 1.39 per cent, to settle at 31,159.81 as RIL, HDFC, HDFC Bank, ITC, SBI and L&T dropped. This is the weakest closing since June 30 when it had settled at 30,921.61. The broader NSE Nifty cracked below the key 9,800-mark. It had regained the key 9,900-mark at the outset, but failed to hold on to the crucial level and dipped below the 9800-mark to hit a low of 9,714.40. It finally settled down 135.75 points, or 1.38 per cent, at 9,735.75, it lowest closing since August 11 when it closed at 9,710.80. The September futures and options contracts are set to expire tomorrow, which made participants wait and watch. Sentiments suffered another setback amid expectations of a rate hike by the US Federal Reserve later this year, accelerating the pace of outflows by foreign investors, offsetting unabated buying by DIIs, brokers said. Escalating North Korean worries too continued to dampen trading sentiments. In addition, the rupee quoting at over six-month low of 65.75 against the dollar in day trade too dented the sentiment further.

BSE Sensex tanked 440 points to end at over three-month low

Indian home minister Rajnath Singh today downplayed senior BJP leader Yashwant Sinha&#39;s criticism of the finance minister Arun Jaitley, saying India&#39;s economy is the fastest growing in the world, and the country&#39;s credibility has been established in the international arena.

Singh, who was responding to a question on Sinha&#39;s remarks over the state of the economy, said no one should forget these facts about the country.

&quot;The whole world admits that India is the fastest growing economy in the world. No one should forget this fact. In the matter of economy, in the international arena, India&#39;s credibility has been established,&quot; he told reporters here.

<a href="http://www.wionews.com/india-news/will-power-admit-the-truth-chidambaram-on-yashwant-sinhas-attack-on-arun-jaitleys-economic-mess-20728">In an opinion piece in Indian Express, </a>&#39;I need to speak up now&#39;, Sinha criticised Arun Jaitley over what he called the &quot;mess the finance minister has made of the economy&quot;.&nbsp;

The senior BJP leader said he would &quot;fail in my national duty if I did not speak up even now against the mess the finance minister has made of the economy.&quot;&nbsp;

Sinha, a former finance minister in prime minister Atal Bihari Vajpayee-led NDA government, who has been sidelined in the party, claimed a revival by the time of the next Lok Sabha election was &quot;highly unlikely&quot; and a &quot;hard landing&quot; appeared inevitable.&nbsp;

Sinha pointed out that the growth rate of 5.7&nbsp;per cent&nbsp;was actually 3.7&nbsp;per cent&nbsp;or less by the old method of calculation. He attributed the misleading growth rate to the government&#39;s decision to change the methodology for calculation of the&nbsp;GDP &nbsp;in&nbsp;2015 as a result of which the growth rate recorded earlier increased statistically by over 200 basis points on an annual basis.&nbsp;&nbsp; 
&nbsp; 
In a series of Twitter posts, senior Congress leader and former finance minister P Chidambaram asked the government to admit that Yashwant Sinha was speaking the truth.&nbsp;

&quot;Will Power now admit the Truth that economy is sinking?&quot; the former finance minister wrote.&nbsp;&nbsp;

Chidambaram asked the BJP government to respond to their senior party leader Yashwant Sinha&#39;s scathing attack on the central government&#39;s economic policies, particularly the &quot;mess&quot; that finance minister&nbsp;Arun&nbsp;Jaitley had made of the economy.&nbsp;

Rajnath Singh responded to former finance minister Yashwant Sinha's comment on economy

Indian home minister Rajnath Singh today downplayed senior BJP leader Yashwant Sinha's criticism of the finance minister Arun Jaitley, saying India's economy is the fastest growing in the world, and the country's credibility has been established in the international arena. Singh, who was responding to a question on Sinha's remarks over the state of the economy, said no one should forget these facts about the country. "The whole world admits that India is the fastest growing economy in the world. No one should forget this fact. In the matter of economy, in the international arena, India's credibility has been established," he told reporters here. In an opinion piece in Indian Express, 'I need to speak up now', Sinha criticised Arun Jaitley over what he called the "mess the finance minister has made of the economy". The senior BJP leader said he would "fail in my national duty if I did not speak up even now against the mess the finance minister has made of the economy." Sinha, a former finance minister in prime minister Atal Bihari Vajpayee-led NDA government, who has been sidelined in the party, claimed a revival by the time of the next Lok Sabha election was "highly unlikely" and a "hard landing" appeared inevitable. Sinha pointed out that the growth rate of 5.7 per cent was actually 3.7 per cent or less by the old method of calculation. He attributed the misleading growth rate to the government's decision to change the methodology for calculation of the GDP in 2015 as a result of which the growth rate recorded earlier increased statistically by over 200 basis points on an annual basis. In a series of Twitter posts, senior Congress leader and former finance minister P Chidambaram asked the government to admit that Yashwant Sinha was speaking the truth. "Will Power now admit the Truth that economy is sinking?" the former finance minister wrote. Chidambaram asked the BJP government to respond to their senior party leader Yashwant Sinha's scathing attack on the central government's economic policies, particularly the "mess" that finance minister Arun Jaitley had made of the economy.

World knows India's economy is the fastest growing: Rajnath

India is considering ways to revive its slowdown-hit economy and will unveil the &quot;necessary&quot; steps once Prime Minister Narendra Modi signs off on them, Finance Minister Arun Jaitley said on Wednesday.

Jaitley has held meetings with cabinet colleagues and other government officials over the past two days to devise a plan to lift economic growth, which slipped to a three-year low of 5.7 percent in the quarter to end-June.

&quot;We have taken note of all the economic indicators available,&quot; Jaitley told reporters. &quot;The government will take any additional moves which are necessary.&quot;

But he refused to divulge details, saying the measures would be unveiled only after consultation with Modi.

The last quarter&#39;s dismal figures prompted many private economists to revise down estimates for the fiscal year ending in March 2018.

The faltering economy has offered the opposition Congress party ample grist for its campaign against Modi ahead of general elections in 2019.

Although industrial output posted a modest recovery in July, 15 of 23 manufacturing industries recorded a contraction, adding to the concern.

Some economists are calling for expansionary fiscal policy to stimulate flagging consumer demand in Asia&#39;s third-largest economy.

But ramping up government spending, at a time when lower-than-expected tax collections and sluggish economic growth have strained federal revenues, could force Jaitley to walk away from his promise to trim the fiscal deficit to a decade-low of 3.2 percent of GDP.

The ebb in India&#39;s economic fortunes is in sharp contrast from a few quarters ago when it was the world&#39;s fastest growing major economy and was hailed as a rare bright spot in a dim global economy.

Since then economic growth has been on a downward trajectory, thanks to Modi&#39;s struggle to fix debt-laden state-run banks and stressed corporate balance sheets.

Faulty implementation of a nationwide goods and services tax has also caused chaos, dampening business activity in an economy that has yet to fully recover from Modi&#39;s crackdown on &quot;black money&quot;, or untaxed income. 
&nbsp;

Arun Jaitley has held meetings with cabinet colleagues and other government officials over the past two days to devise a plan to lift economic growth

India is considering ways to revive its slowdown-hit economy and will unveil the "necessary" steps once Prime Minister Narendra Modi signs off on them, Finance Minister Arun Jaitley said on Wednesday. Jaitley has held meetings with cabinet colleagues and other government officials over the past two days to devise a plan to lift economic growth, which slipped to a three-year low of 5.7 percent in the quarter to end-June. "We have taken note of all the economic indicators available," Jaitley told reporters. "The government will take any additional moves which are necessary." But he refused to divulge details, saying the measures would be unveiled only after consultation with Modi. The last quarter's dismal figures prompted many private economists to revise down estimates for the fiscal year ending in March 2018. The faltering economy has offered the opposition Congress party ample grist for its campaign against Modi ahead of general elections in 2019. Although industrial output posted a modest recovery in July, 15 of 23 manufacturing industries recorded a contraction, adding to the concern. Some economists are calling for expansionary fiscal policy to stimulate flagging consumer demand in Asia's third-largest economy. But ramping up government spending, at a time when lower-than-expected tax collections and sluggish economic growth have strained federal revenues, could force Jaitley to walk away from his promise to trim the fiscal deficit to a decade-low of 3.2 percent of GDP. The ebb in India's economic fortunes is in sharp contrast from a few quarters ago when it was the world's fastest growing major economy and was hailed as a rare bright spot in a dim global economy. Since then economic growth has been on a downward trajectory, thanks to Modi's struggle to fix debt-laden state-run banks and stressed corporate balance sheets. Faulty implementation of a nationwide goods and services tax has also caused chaos, dampening business activity in an economy that has yet to fully recover from Modi's crackdown on "black money", or untaxed income.

Taken note of indicators, will take necessary steps: Arun Jaitley on economic slowdown

India&#39;s annual consumer price inflation further eased to 1.54 percent in June, helped by a fall in food prices, government data showed on Wednesday.

The rise was slower than 1.70 percent forecast by economists in a Reuters poll, and was the lowest since India started releasing retail inflation data in January 2012 based on a combined CPI index for rural and urban consumers.

Consumer prices rose 2.18 percent year-on-year in May.

Retail food prices fell 2.12 percent last month from a year ago, compared with a 1.05 percent fall in the previous month.

(Reuters)

The rise was slower than 1.70 percent forecast by economists in a Reuters poll

India's annual consumer price inflation further eased to 1.54 percent in June, helped by a fall in food prices, government data showed on Wednesday. The rise was slower than 1.70 percent forecast by economists in a Reuters poll, and was the lowest since India started releasing retail inflation data in January 2012 based on a combined CPI index for rural and urban consumers. Consumer prices rose 2.18 percent year-on-year in May. Retail food prices fell 2.12 percent last month from a year ago, compared with a 1.05 percent fall in the previous month. (Reuters)

Retail inflation at 1.57%, slips to record low

By Sumit Chaturvedi 
 
Starting at midnight tonight, business in India will change forever as the long-awaited and long-debated Good and Services Tax (GST) rolls out.

Claimed to be the biggest and most far-reaching tax reform India has ever seen, the GST will subsume most of the indirect taxes currently levied and simplify taxation.

The GST is a destination-based tax levied on consumption, and it will replace all other indirect taxes. Like the other taxes, the GST will also be levied and paid when a consumer buys something. It will be levied on every transaction in the supply of goods and services, barring certain exempted items.

The tax levied at one stage can be set off or deducted from the tax to be paid at the next stage as well.

One tax, one nation

The GST will be a one-tax, one-nation regime where all goods and services will be taxed at 0 per cent, 5 per cent, 12 per cent, 18 per cent and 28 per cent wherever they are purchased. &nbsp;

There is higher tax called a &quot;sin&quot; tax on goods like aerated drinks.

GST also reduces the tax burden on the final consumer since it ends the tax-on-tax phenomenon, also known as cascading effect. Now, a tax paid at one stage can be deducted from the tax paid at the next stage, reducing the overall tax incidence on the item.

But not all items will be subject to GST. &nbsp;Alcoholic drinks, electricity and five petroleum products crude, petrol, diesel, natural gas and aviation turbine fuel will not be under GST and will continue to attract Value Added Tax (VAT) and central excise.

Dual GST

India will have a dual GST. This means that the single rate set for a good or service has two components &ndash; Central GST (CGST) and a State GST (SGST). So nine&nbsp;per cent of an 18 per cent GST goes to the centre and the other 9 per cent goes to the state.

There is also an Integrated GST (iGST) on the interstate supply of goods and services, which can be set off against CGST and SGST that is to be paid.

GST will replace all central taxes including central excise and additional duties of excise, service tax, countervailing duty in the case of customs duty, central surcharges and cesses.

Also, GST will replace all state taxes including state vat, central sales tax, luxury tax, all forms of entry tax, entertainment and amusement tax, taxes on advertisements, purchase tax, tax on lotteries, betting and gambling, state surcharges and cesses.

Will GST trigger inflation or bring down prices?

Normally, GST would have pushed up inflation and that is what happened in most countries that switched to GST.

The inflation spike lasted from between six months to two years. But in India, the state and central GST acts have a provision which mandates that manufacturers and service providers have to pass on any benefits from a reduction in tax rate or availing of input tax credit to consumers in the form of lower prices.

This provision was introduced at quite a late stage because of fears that companies may not lower prices even if it is warranted and trigger inflation. there are stiff penalties for companies not passing on the benefits, which includes companies losing their central GST registration. &nbsp;

&nbsp;

Business in India will change forever as the long-awaited and long-debated GST rolls out

By Sumit Chaturvedi Starting at midnight tonight, business in India will change forever as the long-awaited and long-debated Good and Services Tax (GST) rolls out. Claimed to be the biggest and most far-reaching tax reform India has ever seen, the GST will subsume most of the indirect taxes currently levied and simplify taxation. The GST is a destination-based tax levied on consumption, and it will replace all other indirect taxes. Like the other taxes, the GST will also be levied and paid when a consumer buys something. It will be levied on every transaction in the supply of goods and services, barring certain exempted items. The tax levied at one stage can be set off or deducted from the tax to be paid at the next stage as well. One tax, one nation The GST will be a one-tax, one-nation regime where all goods and services will be taxed at 0 per cent, 5 per cent, 12 per cent, 18 per cent and 28 per cent wherever they are purchased. There is higher tax called a "sin" tax on goods like aerated drinks. GST also reduces the tax burden on the final consumer since it ends the tax-on-tax phenomenon, also known as cascading effect. Now, a tax paid at one stage can be deducted from the tax paid at the next stage, reducing the overall tax incidence on the item. But not all items will be subject to GST. Alcoholic drinks, electricity and five petroleum products crude, petrol, diesel, natural gas and aviation turbine fuel will not be under GST and will continue to attract Value Added Tax (VAT) and central excise. Dual GST India will have a dual GST. This means that the single rate set for a good or service has two components – Central GST (CGST) and a State GST (SGST). So nine per cent of an 18 per cent GST goes to the centre and the other 9 per cent goes to the state. There is also an Integrated GST (iGST) on the interstate supply of goods and services, which can be set off against CGST and SGST that is to be paid. GST will replace all central taxes including central excise and additional duties of excise, service tax, countervailing duty in the case of customs duty, central surcharges and cesses. Also, GST will replace all state taxes including state vat, central sales tax, luxury tax, all forms of entry tax, entertainment and amusement tax, taxes on advertisements, purchase tax, tax on lotteries, betting and gambling, state surcharges and cesses. Will GST trigger inflation or bring down prices? Normally, GST would have pushed up inflation and that is what happened in most countries that switched to GST. The inflation spike lasted from between six months to two years. But in India, the state and central GST acts have a provision which mandates that manufacturers and service providers have to pass on any benefits from a reduction in tax rate or availing of input tax credit to consumers in the form of lower prices. This provision was introduced at quite a late stage because of fears that companies may not lower prices even if it is warranted and trigger inflation. there are stiff penalties for companies not passing on the benefits, which includes companies losing their central GST registration.

Goods and Services Tax: India's 'biggest' tax reform explained

India is bracing for upheaval as it storms ahead with its most ambitious reform in decades -- transforming the world&#39;s fastest growing major economy into a single market for the first time.

The long-awaited goods and services tax (GST) rolls out Saturday even as businesses complain they are ill-prepared for the massive changes about to ripple through India&#39;s unwieldy, $2 trillion economy.

The government promises the new regime will not just simplify trade by replacing more than a dozen levies with one tax, but combat corruption and enrichen state coffers by bringing the informal economy into the digital era.

Most economists agree the reform -- first proposed in 2006 -- is necessary and long overdue, but warn the initial shock to the economy is likely to drag, rather than stoke, growth in the short term as businesses adjust.

There are already signs the transition could be rocky.&nbsp;

Industries are on strike, others are facing an avalanche of paperwork, while some retailers remain unclear about what to charge just days before the taxes take effect.

&quot;There are different rates for a mobile set, charger and headphones -- all of which come in one box,&quot; said Praveen Khandelwal, secretary general of Confederation of All India Traders, pointing to one such example.

&quot;What tax rate will be applicable in such a scenario? We don&#39;t know yet.&quot;

It took more than a decade to get the GST through parliament and political bickering over the particulars now means there are four tax rates instead of one as originally envisioned.

A slew of basic staples like fresh vegetables and milk are exempted, along with less obvious items like temple offerings, the national flag and human hair.

So-called &quot;sin&quot; goods like tobacco will be slapped with extra levies, while states will still be allowed to separately tax some products including alcohol, petrol and aviation fuel.

Some industries have suddenly discovered their products elevated to a higher tax bracket.&nbsp;

Fireworks manufacturers are protesting over crackers being taxed at the maximum of 28 per cent, while garment and textile workers are crying foul over heightened imposts.

Ayushi Gudwani, who runs online fashion startup Fable Street, supports the creation of a common market but was shocked to learn her taxes had more than doubled.

&quot;Our profitability will be hit,&quot; she told told AFP.

Costs are also mounting at India&#39;s largest logistics firm Safexpress, which has hired 40 new staff to process a mountain of new paperwork.

Under the new regime, companies must file a tax return in every state they pass through -- a nightmare for a trucking company shipping goods nationwide. 
For Safexpress, that means instead of filing two annual tax returns they must submit 1,400, said managing director Rubal Jain.

&quot;It&#39;s going to be a lot of confusion and chaos and back and forth for the next three months, because no one knows what will happen,&quot; he told AFP.

&quot;It&#39;ll be great in the long run, but transition will be a pain.&quot;

All but the smallest businesses will now be required to declare their earnings online, an effort to broaden India&#39;s woefully small tax base, digitise the economy and flush out cash hoarders.

But training employers to log tax information online presents immense challenges in India, where most small and informal businesses don`t own computers, let alone access the internet, the trade association said.

Safexpress cannot file its own returns until drivers upload their monthly invoices -- a huge ask for truckers used to delivering goods, not paperwork, Jain said. 
Gudwani meanwhile worries her suppliers -- mostly tiny businesses -- will struggle to get the hang of issuing receipts and wind up losing contracts.

India has one of the lowest tax-to-GDP ratios in the world and these changes, though initially painful, will have a &quot;significant impact&quot; on compliance, said Neelkanth Mishra, managing director at Credit Suisse.

&quot;India is like a house under renovation. While the new parts are being built, no one will be happy,&quot; he told AFP.

The sweeping reforms comes less than a year after Prime Minister Narendra Modi devalued India`s largest banknotes in a sudden move designed to outmanoeuvre tax cheats, but was blamed for a crippling cash shortage and slowing growth.

To avoid a similarly rough landing, the government has trained 60,000 tax bureaucrats and run sessions with private accountants to ensure everyone is up to speed on the finer points of the GST.

A GST Council has spent months thrashing out the final legislation, which was blocked in parliament for a year until an amended version was approved. 
&quot;This is a tax reform that was needed,&quot; said Sunil Sinha, principal economist at Fitch India.

&quot;We came into existence as a nation in 1947 but never had a common Indian market. GST will make India one.&quot;

 
&nbsp;

Industries are on strike, others are facing an avalanche of paperwork, while some retailers remain unclear about what to charge just days before the Goods and Services Tax rolls out on July 1

India is bracing for upheaval as it storms ahead with its most ambitious reform in decades -- transforming the world's fastest growing major economy into a single market for the first time. The long-awaited goods and services tax (GST) rolls out Saturday even as businesses complain they are ill-prepared for the massive changes about to ripple through India's unwieldy, $2 trillion economy. The government promises the new regime will not just simplify trade by replacing more than a dozen levies with one tax, but combat corruption and enrichen state coffers by bringing the informal economy into the digital era. Most economists agree the reform -- first proposed in 2006 -- is necessary and long overdue, but warn the initial shock to the economy is likely to drag, rather than stoke, growth in the short term as businesses adjust. There are already signs the transition could be rocky. Industries are on strike, others are facing an avalanche of paperwork, while some retailers remain unclear about what to charge just days before the taxes take effect. "There are different rates for a mobile set, charger and headphones -- all of which come in one box," said Praveen Khandelwal, secretary general of Confederation of All India Traders, pointing to one such example. "What tax rate will be applicable in such a scenario? We don't know yet." It took more than a decade to get the GST through parliament and political bickering over the particulars now means there are four tax rates instead of one as originally envisioned. A slew of basic staples like fresh vegetables and milk are exempted, along with less obvious items like temple offerings, the national flag and human hair. So-called "sin" goods like tobacco will be slapped with extra levies, while states will still be allowed to separately tax some products including alcohol, petrol and aviation fuel. Some industries have suddenly discovered their products elevated to a higher tax bracket. Fireworks manufacturers are protesting over crackers being taxed at the maximum of 28 per cent, while garment and textile workers are crying foul over heightened imposts. Ayushi Gudwani, who runs online fashion startup Fable Street, supports the creation of a common market but was shocked to learn her taxes had more than doubled. "Our profitability will be hit," she told told AFP. Costs are also mounting at India's largest logistics firm Safexpress, which has hired 40 new staff to process a mountain of new paperwork. Under the new regime, companies must file a tax return in every state they pass through -- a nightmare for a trucking company shipping goods nationwide. For Safexpress, that means instead of filing two annual tax returns they must submit 1,400, said managing director Rubal Jain. "It's going to be a lot of confusion and chaos and back and forth for the next three months, because no one knows what will happen," he told AFP. "It'll be great in the long run, but transition will be a pain." All but the smallest businesses will now be required to declare their earnings online, an effort to broaden India's woefully small tax base, digitise the economy and flush out cash hoarders. But training employers to log tax information online presents immense challenges in India, where most small and informal businesses don`t own computers, let alone access the internet, the trade association said. Safexpress cannot file its own returns until drivers upload their monthly invoices -- a huge ask for truckers used to delivering goods, not paperwork, Jain said. Gudwani meanwhile worries her suppliers -- mostly tiny businesses -- will struggle to get the hang of issuing receipts and wind up losing contracts. India has one of the lowest tax-to-GDP ratios in the world and these changes, though initially painful, will have a "significant impact" on compliance, said Neelkanth Mishra, managing director at Credit Suisse. "India is like a house under renovation. While the new parts are being built, no one will be happy," he told AFP. The sweeping reforms comes less than a year after Prime Minister Narendra Modi devalued India`s largest banknotes in a sudden move designed to outmanoeuvre tax cheats, but was blamed for a crippling cash shortage and slowing growth. To avoid a similarly rough landing, the government has trained 60,000 tax bureaucrats and run sessions with private accountants to ensure everyone is up to speed on the finer points of the GST. A GST Council has spent months thrashing out the final legislation, which was blocked in parliament for a year until an amended version was approved. "This is a tax reform that was needed," said Sunil Sinha, principal economist at Fitch India. "We came into existence as a nation in 1947 but never had a common Indian market. GST will make India one."

Indian business braces for disruption ahead of GST

India&#39;s second tryst with destiny starts from the midnight of June 30th when Asia&#39;s third largest economy rolls out her most ambitious tax reform. Prime Minister Narendra Modi and Finance Minister Arun Jaitley have collectively staked the reputation of the world&#39;s fastest growing major economy as a haven for reform when they unveil the Goods and Services Tax &nbsp;(GST) regime from Saturday, July 1st.

What prompts this economy measured at $2.4 trillion and growing at 7 per cent a year to revamp its British-era tax structure? Why would 1.25 billion people suddenly decide they need a new tax code? Why would 28 different state governments, some of them diametrically opposed to the Bharatiya Janata Party at the Centre, agree to be a part of a symphony that plays a common tune?&nbsp;

Some of these questions are complex and may take many months to answer but the road map for this pioneering tax rejig points to forging an economic union, a single national tax market, common tax laws and a common tax base for the country.

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<h5>A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th.</h5>
</blockquote>
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There is no other comparable project this size anywhere in the world. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th.&nbsp;

As the world sleeps, India will walk into to a new dawn. This event will be addressed by Prime Minister Modi and overseen by President Pranab Mukherjee, who steered the GST Bill as the finance minister during the previous UPA government.

India is young. Her 70-odd years as an independent nation has seen a potentially great economy being held back by a multitude of taxes and dozens of hierarchies, often pulling in different directions. But it has taken this economy, liberalised in 1991, a little over a quarter of a century to become the world&#39;s 3rd largest on purchasing power parity. Today&#39;s industrialist counts global companies as his rivals apart from homegrown peers. And there is a new breed of Indian entrepreneurs raring to take on the world on their terms. They need enabling tax laws that help take on global corporations on their turf.

Hopefully, the GST, even with all its so-called ills, will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order.

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<h5>Collection and payment of taxes will be at a single point, therefore, easier.</h5>
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So, what does the GST do?

To begin with, this fully online indirect tax replaces 12 central and state level taxes. This single, common tax will help the economic supply chain breathe easy. This chain will be fattened up and yet be flexible as taxes paid on input costs and raw materials will be claimed back. This will lead to lower costs and, consequently, better prices for the end consumer. Goods will move faster now as trucks will not be stopped at any entry points of states. Collection and payment of taxes will be at a single point, therefore, easier. Large, if not all, parts of the informal economy will move into the formal order. And finally, India&#39;s tax regime will be comparable to those in advanced economies.

Sure, there are quibbles. But there always have been naysayers who want to remain outside the ambit of the formal tax structure.

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<h5>&quot;There are too many returns to file and everything is computerised!&quot;,&nbsp;some moan.</h5>
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`We are not ready,&#39; say lakhs of traders, small businessmen, companies and even large corporations. `Delay it by another quarter,&#39; they shout from industry pulpits. &quot;There are too many returns to file and everything is computerised!&quot;,&nbsp;some moan. The last ones are particularly hilarious because you would think honest tax payers would welcome online payment of tax minus the hassles!

There will be nitpickers who will find fault at everything that any government does to improve the overall life of citizens. We must ignore such voices that clamour for the old order to continue. The next two quarters will be defining moments of India&#39;s upward trajectory as a world economic power. Sure, growth may slowdown further. Companies might take a while longer to adjust to online filing of returns. Lofty stock prices may take a small tumble. And the economy may wobble just a bit more. These things happen in the life of a young nation.

Use this opportunity to ride on to the finest economy the world has at this moment. You should be buying any dips in the market. This gravy train will get thicker and fatter as time passes.

No one has won betting against the Indian economy in the longer run. No one.

So make no mistake: the GST is here to stay.

&nbsp;

GST will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order

India's second tryst with destiny starts from the midnight of June 30th when Asia's third largest economy rolls out her most ambitious tax reform. Prime Minister Narendra Modi and Finance Minister Arun Jaitley have collectively staked the reputation of the world's fastest growing major economy as a haven for reform when they unveil the Goods and Services Tax (GST) regime from Saturday, July 1st. What prompts this economy measured at $2.4 trillion and growing at 7 per cent a year to revamp its British-era tax structure? Why would 1.25 billion people suddenly decide they need a new tax code? Why would 28 different state governments, some of them diametrically opposed to the Bharatiya Janata Party at the Centre, agree to be a part of a symphony that plays a common tune? Some of these questions are complex and may take many months to answer but the road map for this pioneering tax rejig points to forging an economic union, a single national tax market, common tax laws and a common tax base for the country. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th. × There is no other comparable project this size anywhere in the world. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th. As the world sleeps, India will walk into to a new dawn. This event will be addressed by Prime Minister Modi and overseen by President Pranab Mukherjee, who steered the GST Bill as the finance minister during the previous UPA government. India is young. Her 70-odd years as an independent nation has seen a potentially great economy being held back by a multitude of taxes and dozens of hierarchies, often pulling in different directions. But it has taken this economy, liberalised in 1991, a little over a quarter of a century to become the world's 3rd largest on purchasing power parity. Today's industrialist counts global companies as his rivals apart from homegrown peers. And there is a new breed of Indian entrepreneurs raring to take on the world on their terms. They need enabling tax laws that help take on global corporations on their turf. Hopefully, the GST, even with all its so-called ills, will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order. Collection and payment of taxes will be at a single point, therefore, easier. × So, what does the GST do? To begin with, this fully online indirect tax replaces 12 central and state level taxes. This single, common tax will help the economic supply chain breathe easy. This chain will be fattened up and yet be flexible as taxes paid on input costs and raw materials will be claimed back. This will lead to lower costs and, consequently, better prices for the end consumer. Goods will move faster now as trucks will not be stopped at any entry points of states. Collection and payment of taxes will be at a single point, therefore, easier. Large, if not all, parts of the informal economy will move into the formal order. And finally, India's tax regime will be comparable to those in advanced economies. Sure, there are quibbles. But there always have been naysayers who want to remain outside the ambit of the formal tax structure. "There are too many returns to file and everything is computerised!", some moan. × `We are not ready,' say lakhs of traders, small businessmen, companies and even large corporations. `Delay it by another quarter,' they shout from industry pulpits. "There are too many returns to file and everything is computerised!", some moan. The last ones are particularly hilarious because you would think honest tax payers would welcome online payment of tax minus the hassles! There will be nitpickers who will find fault at everything that any government does to improve the overall life of citizens. We must ignore such voices that clamour for the old order to continue. The next two quarters will be defining moments of India's upward trajectory as a world economic power. Sure, growth may slowdown further. Companies might take a while longer to adjust to online filing of returns. Lofty stock prices may take a small tumble. And the economy may wobble just a bit more. These things happen in the life of a young nation. Use this opportunity to ride on to the finest economy the world has at this moment. You should be buying any dips in the market. This gravy train will get thicker and fatter as time passes. No one has won betting against the Indian economy in the longer run. No one. So make no mistake: the GST is here to stay.

GST: India's push into a higher economic orbit.

The term &ldquo;jobless growth&rdquo;, much in the news these days, is used to describe the phenomenon of GDP growth without a commensurate increase in (formal) employment. How can GDP grow without job creation? The increasing use of machines in production is one crucial reason.&nbsp;

Annual Survey of Industries data, which reports on organised or formal sector firms, shows that the capital to labour ratio has steadily risen in most industries over the past few decades. In a country like India, where labour is abundant and cheap, why are firms choosing to substitute capital (machines) for labour? Several explanations have been offered, none of them exclusive of the others.

One story, popular among some economists as well as policy-makers is that India&rsquo;s labour laws are too restrictive. Faced with an excessive regulation of hiring and firing, firms prefer to substitute machines for workers. A vigorous debate has raged over this issue. Although a consensus of sorts seems to be forming in the policy circles that labour laws are a big constraint on job creation, and several steps have already been taken at the centre and state level to dilute these laws, two things are worth noting. First, firm owners often do not list labour laws among the top two or three constraints that they face in expanding their business. Rather inadequate infrastructure, government procedures, and weak demand top the list.&nbsp;

To put it another way, if strong demand were assured and infrastructure streamlined, then labour laws would be unlikely to get in the way of firm expansion. Second, if firms really wanted to expand while avoiding being subject to labour laws, we should observe a large number of firms employing workers up to just below the threshold where labour laws kick in. But we observe no such &ldquo;clumping.&rdquo;

Of course, it is possible that firms do not face this constraint simply because they hire informal (off the books) workers via contractors. This way expansion is assured without being subject to labour laws. Indeed, the data clearly show an increasing presence of informal workers within formal sector firms. But the solution to this proliferation of precarious jobs is actually to make sure these jobs get formalised and come under the ambit of regulation. And not to remove regulation on existing formal jobs. What is needed is an intelligent approach that strengthens those regulations that will improve job security, working conditions, and rights to bargain collectively, while allowing firms the flexibility to shed labour after meeting due obligations and safeguards.

The second explanation for increasing mechanisation draws on the fact that in recent decades, the Indian economy has become increasingly more integrated into the global economy. Trade liberalisation makes the import of capital and intermediate goods easier. Imported capital goods are relatively cheaper and this reduces the relative price of capital vis-a-vis labour, inducing firms to substitute capital for labour. Trade liberalisation also forced domestic firms to compete with foreign firms in the domestic market. Since foreign firms bring in products produced with much more capital-intensive technology and lower unit costs (because they often operate in capital-rich, labour-scarce economies), domestic firms also have to adopt that technology to stay competitive. And finally, trade liberalisation allows Indian firms to access foreign markets, where again they have to compete with firms producing with capital-intensive technology.

A third explanation is that growth in the post-reform period has benefited a narrow class of Indians, thereby, increasing inequality. Hence expenditure by the elite has become an important source of demand for domestic manufacturers. This elite demand is skewed towards products, such as automobiles, electronics, white goods, higher-end services etc. which are produced by capital-intensive and not labour-intensive technology as it is done in sectors producing food and clothing etc. So a growth in elite demand, raises GDP but does not create jobs.

All this has serious implications for the &ldquo;normal&rdquo; way in which other countries historically managed to create employment, through increasing manufacturing activities. It is not available anymore because countries that are expanding their industrial and manufacturing base today have to compete with much more advanced countries in the same market. As a result, in many developing countries, manufacturing share of employment is declining instead of growing. Workers are moving directly from agriculture into services. This has been called &ldquo;premature deindustrialization.&rdquo;

Finally, at the ideological level, governments in countries like India have willingly constrained themselves. They have not adopted strategic trade and industrial policies for fear of being labeled &ldquo;protectionist,&rdquo; &ldquo;anti-market&rdquo;, &ldquo;anti-investor&rdquo;, anti-globalisation&rdquo; etc. In fact, a large economy like India should have significant leeway in policy-making to suit its own priorities. After all the true test of a well-functioning economy is whether it makes life better for all its citizens, not whether it is open and global.

Increasing uses of informal workers, rising demands of elites and a globalised economy are keeping Indians jobless.

The term “jobless growth”, much in the news these days, is used to describe the phenomenon of GDP growth without a commensurate increase in (formal) employment. How can GDP grow without job creation? The increasing use of machines in production is one crucial reason. Annual Survey of Industries data, which reports on organised or formal sector firms, shows that the capital to labour ratio has steadily risen in most industries over the past few decades. In a country like India, where labour is abundant and cheap, why are firms choosing to substitute capital (machines) for labour? Several explanations have been offered, none of them exclusive of the others. One story, popular among some economists as well as policy-makers is that India’s labour laws are too restrictive. Faced with an excessive regulation of hiring and firing, firms prefer to substitute machines for workers. A vigorous debate has raged over this issue. Although a consensus of sorts seems to be forming in the policy circles that labour laws are a big constraint on job creation, and several steps have already been taken at the centre and state level to dilute these laws, two things are worth noting. First, firm owners often do not list labour laws among the top two or three constraints that they face in expanding their business. Rather inadequate infrastructure, government procedures, and weak demand top the list. To put it another way, if strong demand were assured and infrastructure streamlined, then labour laws would be unlikely to get in the way of firm expansion. Second, if firms really wanted to expand while avoiding being subject to labour laws, we should observe a large number of firms employing workers up to just below the threshold where labour laws kick in. But we observe no such “clumping.” Of course, it is possible that firms do not face this constraint simply because they hire informal (off the books) workers via contractors. This way expansion is assured without being subject to labour laws. Indeed, the data clearly show an increasing presence of informal workers within formal sector firms. But the solution to this proliferation of precarious jobs is actually to make sure these jobs get formalised and come under the ambit of regulation. And not to remove regulation on existing formal jobs. What is needed is an intelligent approach that strengthens those regulations that will improve job security, working conditions, and rights to bargain collectively, while allowing firms the flexibility to shed labour after meeting due obligations and safeguards. The second explanation for increasing mechanisation draws on the fact that in recent decades, the Indian economy has become increasingly more integrated into the global economy. Trade liberalisation makes the import of capital and intermediate goods easier. Imported capital goods are relatively cheaper and this reduces the relative price of capital vis-a-vis labour, inducing firms to substitute capital for labour. Trade liberalisation also forced domestic firms to compete with foreign firms in the domestic market. Since foreign firms bring in products produced with much more capital-intensive technology and lower unit costs (because they often operate in capital-rich, labour-scarce economies), domestic firms also have to adopt that technology to stay competitive. And finally, trade liberalisation allows Indian firms to access foreign markets, where again they have to compete with firms producing with capital-intensive technology. A third explanation is that growth in the post-reform period has benefited a narrow class of Indians, thereby, increasing inequality. Hence expenditure by the elite has become an important source of demand for domestic manufacturers. This elite demand is skewed towards products, such as automobiles, electronics, white goods, higher-end services etc. which are produced by capital-intensive and not labour-intensive technology as it is done in sectors producing food and clothing etc. So a growth in elite demand, raises GDP but does not create jobs. All this has serious implications for the “normal” way in which other countries historically managed to create employment, through increasing manufacturing activities. It is not available anymore because countries that are expanding their industrial and manufacturing base today have to compete with much more advanced countries in the same market. As a result, in many developing countries, manufacturing share of employment is declining instead of growing. Workers are moving directly from agriculture into services. This has been called “premature deindustrialization.” Finally, at the ideological level, governments in countries like India have willingly constrained themselves. They have not adopted strategic trade and industrial policies for fear of being labeled “protectionist,” “anti-market”, “anti-investor”, anti-globalisation” etc. In fact, a large economy like India should have significant leeway in policy-making to suit its own priorities. After all the true test of a well-functioning economy is whether it makes life better for all its citizens, not whether it is open and global.

Why is India's growth not creating more jobs?

India&#39;s economy will overtake that of Germany to become the fourth largest and knock Britain out of the top&nbsp;five by 2022, an IMF study, based on analysis of growth projections, said, reported Bloomberg.

But there are significant headwinds before the economy. The biggest risk is the massive amount of bad debts plaguing the Indian banking industry.

IMF&#39;s deputy managing director Tao Zhang, in an exclusive interview to PTI, said that the health of the Indian banking industry, which is facing massive amounts of bad debt, is a concern for IMF.

However, he expressed confidence in the economic reforms being taken up. He said that the roll out of GST could move up the medium-term economic growth rate to more than eight per cent.

Other significant challenges before the Indian economy are overhauling the infrastructure, creating job opportunities, and raising corporate investments in the country.

(WION)&nbsp;

But there are significant headwinds before the economy. The biggest risk is the massive amount of bad debts plaguing the Indian banking industry

India's economy will overtake that of Germany to become the fourth largest and knock Britain out of the top five by 2022, an IMF study, based on analysis of growth projections, said, reported Bloomberg. But there are significant headwinds before the economy. The biggest risk is the massive amount of bad debts plaguing the Indian banking industry. IMF's deputy managing director Tao Zhang, in an exclusive interview to PTI, said that the health of the Indian banking industry, which is facing massive amounts of bad debt, is a concern for IMF. However, he expressed confidence in the economic reforms being taken up. He said that the roll out of GST could move up the medium-term economic growth rate to more than eight per cent. Other significant challenges before the Indian economy are overhauling the infrastructure, creating job opportunities, and raising corporate investments in the country. (WION)

IMF says Indian economy will be fourth largest by 2022: Bloomberg

India risks straining public finances and undermining already ailing state banks, economists said, after a $5.6 billion loan write-off for farmers in Uttar Pradesh and moves to do something similar in at least four other states.

One of the first acts of the new government in India&#39;s most populous state following last month&#39;s election triumph of Prime Minister Narendra Modi&#39;s Bharatiya Janata Party (BJP) was to keep a promise to provide debt relief to 21.5 million farmers.

Taking their cue from Uttar Pradesh, more state governments could waive loans to farmers, senior officials there said, to fulfil election pledges or woo rural voters before further polls in the run-up to a general election in 2019 when Modi is expected to run for a second term.&nbsp;

&quot;This will spread like a contagious disease to most parts of the country and you will very soon see at least 3-4 states announcing similar farm loan waivers,&quot; said Ashok Gulati, a farm economist who advised India&#39;s last government.

Economists caution that the move could encourage indebted farmers not to repay loans, deepening malaise at public sector banks already saddled with most of India&#39;s $150 billion in stressed loans.

Uttar Pradesh will cover the cost of the waivers by issuing bonds. This would in turn constrain India&#39;s sovereign credit because such bonds are backstopped by the federal government, the economists said.

India&#39;s total public sector debt, as a share of gross domestic product, stands at around 66 per cent - high compared to other emerging economies.

Economists at Merrill Lynch estimate that states will end up writing off debts equivalent to 2 per cent of GDP - the bulk of all outstanding loans to farmers.

&nbsp;

LEVERAGE LEVELS

Ratings agencies would like to see India&#39;s debt-to-GDP ratio fall below 60 per cent over the next three years to justify an upgrade in its sovereign rating. Yet debt waivers would, even if staggered, force up borrowing, analysts said.

&quot;The loan waivers would likely worsen the fiscal deficits and leverage levels of the state governments, unless other resources are mobilised or expenditure is controlled,&quot; said Aditi Nayar of ICRA, an affiliate of Moody&#39;s Investors Service.

&quot;There is a significant risk that productive capital spending may end up being reduced to fund a portion of the loan waivers.&quot;

A government-appointed panel has suggested capping the states&#39; debt at 20 per cent of India&#39;s GDP, while Reserve Bank of India Governor Urjit Patel has said the Uttar Pradesh loan waiver &quot;undermines honest credit culture&quot;.

&nbsp;

WHO&#39;S NEXT?

The western state of Maharashtra and Punjab in the north are expected to announce similar loan waivers soon, senior officials in both states told Reuters.

In Maharashtra, ruled by the BJP, farmers are clamouring for a bailout after two years of drought and falling commodity prices. In Punjab, known as India&#39;s grain bowl, the opposition Congress party won last month&#39;s election partly on the promise of a farm loan waiver.

In southern Tamil Nadu, reeling from dry weather, a court asked the state government to write off loans to all farmers.

Farmers from Tamil Nadu recently protested in New Delhi, showing the skulls of neighbours who had committed suicide to press their demand for drought relief and loan write-offs.

&nbsp;

WON&#39;T PAY

Some of India&#39;s 263 million farmers have decided not to repay their debts, expecting loan waivers to mean they don&#39;t have to.

&quot;I am not going to repay the loan because defaulters benefited from the previous waiver and I didn&#39;t get any government help even as I repaid the loan on time,&quot; said Gorakh Patil, a farmer from Jalgaon in western India.

Patil was referring to an $11 billion national farm loan waiver in 2008 that helped the Congress party-led coalition of the day win re-election the following year. But non-performing assets jumped.

Gross non-performing loans in agriculture and its allied sectors surged to 588 billion rupees ($9.12 billion) at the end of the December quarter, from 97.4 billion rupees in the 2007/08 fiscal year, RBI data show.

&quot;There&#39;s no benefit from such waivers,&quot; said a director at one state bank who requested anonymity due to the sensitivity of the matter. &quot;If you give any benefit across the board, it definitely has an adverse effect on credit discipline.&quot;

(Reuters)

More state governments could waive loans to farmers to fulfil election pledges to woo rural voters before the 2019 election

India risks straining public finances and undermining already ailing state banks, economists said, after a $5.6 billion loan write-off for farmers in Uttar Pradesh and moves to do something similar in at least four other states. One of the first acts of the new government in India's most populous state following last month's election triumph of Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) was to keep a promise to provide debt relief to 21.5 million farmers. Taking their cue from Uttar Pradesh, more state governments could waive loans to farmers, senior officials there said, to fulfil election pledges or woo rural voters before further polls in the run-up to a general election in 2019 when Modi is expected to run for a second term. "This will spread like a contagious disease to most parts of the country and you will very soon see at least 3-4 states announcing similar farm loan waivers," said Ashok Gulati, a farm economist who advised India's last government. Economists caution that the move could encourage indebted farmers not to repay loans, deepening malaise at public sector banks already saddled with most of India's $150 billion in stressed loans. Uttar Pradesh will cover the cost of the waivers by issuing bonds. This would in turn constrain India's sovereign credit because such bonds are backstopped by the federal government, the economists said. India's total public sector debt, as a share of gross domestic product, stands at around 66 per cent - high compared to other emerging economies. Economists at Merrill Lynch estimate that states will end up writing off debts equivalent to 2 per cent of GDP - the bulk of all outstanding loans to farmers. LEVERAGE LEVELS Ratings agencies would like to see India's debt-to-GDP ratio fall below 60 per cent over the next three years to justify an upgrade in its sovereign rating. Yet debt waivers would, even if staggered, force up borrowing, analysts said. "The loan waivers would likely worsen the fiscal deficits and leverage levels of the state governments, unless other resources are mobilised or expenditure is controlled," said Aditi Nayar of ICRA, an affiliate of Moody's Investors Service. "There is a significant risk that productive capital spending may end up being reduced to fund a portion of the loan waivers." A government-appointed panel has suggested capping the states' debt at 20 per cent of India's GDP, while Reserve Bank of India Governor Urjit Patel has said the Uttar Pradesh loan waiver "undermines honest credit culture". WHO'S NEXT? The western state of Maharashtra and Punjab in the north are expected to announce similar loan waivers soon, senior officials in both states told Reuters. In Maharashtra, ruled by the BJP, farmers are clamouring for a bailout after two years of drought and falling commodity prices. In Punjab, known as India's grain bowl, the opposition Congress party won last month's election partly on the promise of a farm loan waiver. In southern Tamil Nadu, reeling from dry weather, a court asked the state government to write off loans to all farmers. Farmers from Tamil Nadu recently protested in New Delhi, showing the skulls of neighbours who had committed suicide to press their demand for drought relief and loan write-offs. WON'T PAY Some of India's 263 million farmers have decided not to repay their debts, expecting loan waivers to mean they don't have to. "I am not going to repay the loan because defaulters benefited from the previous waiver and I didn't get any government help even as I repaid the loan on time," said Gorakh Patil, a farmer from Jalgaon in western India. Patil was referring to an $11 billion national farm loan waiver in 2008 that helped the Congress party-led coalition of the day win re-election the following year. But non-performing assets jumped. Gross non-performing loans in agriculture and its allied sectors surged to 588 billion rupees ($9.12 billion) at the end of the December quarter, from 97.4 billion rupees in the 2007/08 fiscal year, RBI data show. "There's no benefit from such waivers," said a director at one state bank who requested anonymity due to the sensitivity of the matter. "If you give any benefit across the board, it definitely has an adverse effect on credit discipline." (Reuters)

Farm loan write-offs win votes in India, but may hurt economy

The Indian Parliament passed the 122nd Constitutional Amendment Bill, ushering in the regime of goods and services tax (GST) in the country. This tax regime seeks to introduce a uniform rate of taxation for all goods and services that are being bought and sold in India. It is supposed to be designed in such a way that, irrespective of the location of the point of sale for any particular goods or services, the buyer will be&nbsp;paying the tax at the same rate.&nbsp;

Currently, the picture is just the opposite. Different kinds of state and local taxes make the rate of taxes vary across regions. Often locally produced goods enjoy favourable tax treatment compared to goods brought from other states. The proposed GST regime is supposed to wither away that kind of differential treatment. Therefore, no doubt, passing of this bill marks a milestone in India&#39;s fiscal history.&nbsp;

The concept of value-added tax (VAT), also known as the GST, was first floated in 1918 by a German industrialist Wilhelm von Siemens. However, it was first implemented as a comprehensive tax regime in France in 1954. Great Britain and Australia introduced the VAT in the 1970s. Canada introduced it in 1991. All countries in the Organisation for Economic Cooperation and Development (OECD) and in the European Union have imposed VAT on money spent by people for consumption purposes. Now almost 160 countries have embraced VAT/GST as the preferred mode of consumption tax. The latest one to board the bandwagon is Malaysia who introduced the GST in 2015. India is expected to join them from April 1, 2017. However, the USA has not shown much enthusiasm to join the league yet.

In the theoretical economic literature, the VAT/GST regime is generally commended because it brings fewer distortions compared to its close competitor sales tax or turnover tax. The VAT seeks to collect taxes at every stage of value addition in the production cycle of the goods or rendering of services. Thus, if a seller buys a shirt at Rs 500 and sells it to the ultimate buyer at Rs. 600, the tax liability for the seller would be calculated on the basis of the difference of Rs. 100 instead of the entire sum of Rs. 600. Therefore, it avoids the worst vice of the sales tax, namely, the cascading effect. In preventing the cascading-effect, the VAT/GST regime causes less distortion in the economy. If&nbsp;the concept of VAT was not introduced, every person involved in the trade would have paid taxes on selling price without having taken credit of tax paid earlier by them;&nbsp;this results in double payment of tax.

GST in India has reached its culmination through a series of reform measures aimed at rationalizing the indirect tax structure in the country. In 1976 the Indirect Taxation Enquiry Committee was constituted under the chairmanship of Dr. L.K. Jha. Its report hinted at the GST. In 1985-86 budget, the then Finance Minister Mr. V.P. Singh proposed to introduce modified value added tax (MODVAT), which became effective from April 1, 1986. Dr. Raja J. Chelliah, the&nbsp;chairman of the Tax Reforms Committee, strongly advocated for VAT &nbsp;at the manufacturing level covering all goods. The Indian government partially honoured the proposal in its 1993-94 budget.&nbsp;

In 1999, the then Finance Minister Mr. Yashwant Sinha took the initiative for the introduction of VAT in all the states of India. An Empowered Committee of State Finance Ministers was formed to deliberate on state- level VAT under the chairmanship of Dr. Asim Dasgupta, the then finance minister of the Indian state of West Bengal. Subsequently, a task force was formed with Dr. Vijay Kelker at its head which recommended GST as the indirect tax system in India.&nbsp;

In 2006, the then Finance Minister P. Chidambaram made the case for GST in his budget speech. He said, &ldquo;The world over, goods and services attract the same rate of tax. That is the foundation of a GST.&rdquo; However, in 2009 the Empowered Committee of State Finance Ministers called for a two-tier GST as the ideal solution for a country like India with a strong federal structure. Fearing revenue loss, the India states were not agreeing to a single GST&nbsp;levied by the centre alone. Now there will be the central GST as well as goods and service taxes imposed by various states. The present draft legislation has this provision.&nbsp;

It is quite clear that the GST is going to put in place an indirect tax system with greater transparency and rationality. This is in tune with best global practices. This destination based tax regime would integrate markets all over the country. The consumers will benefit from less uncertainty as there will be no need to search for places with low taxes and, hence, low prices.&nbsp;

Is there any criticism against the GST? Of course, there are. The GST, like any indirect tax regime, is regressive. Critics of the goods and services tax&nbsp;argue that under this system, the poor &nbsp;pay more, as a percentage of their income, than the rich. &nbsp;Also, there is the fear that GST may add a newly modified virus of inflation to the Indian economy.

 
&nbsp;

&nbsp;

&nbsp;&nbsp;&nbsp;

&nbsp;

&nbsp;

GST prevents double payment of tax. However, the poor may end up?paying more

The Indian Parliament passed the 122nd Constitutional Amendment Bill, ushering in the regime of goods and services tax (GST) in the country. This tax regime seeks to introduce a uniform rate of taxation for all goods and services that are being bought and sold in India. It is supposed to be designed in such a way that, irrespective of the location of the point of sale for any particular goods or services, the buyer will be paying the tax at the same rate. Currently, the picture is just the opposite. Different kinds of state and local taxes make the rate of taxes vary across regions. Often locally produced goods enjoy favourable tax treatment compared to goods brought from other states. The proposed GST regime is supposed to wither away that kind of differential treatment. Therefore, no doubt, passing of this bill marks a milestone in India's fiscal history. The concept of value-added tax (VAT), also known as the GST, was first floated in 1918 by a German industrialist Wilhelm von Siemens. However, it was first implemented as a comprehensive tax regime in France in 1954. Great Britain and Australia introduced the VAT in the 1970s. Canada introduced it in 1991. All countries in the Organisation for Economic Cooperation and Development (OECD) and in the European Union have imposed VAT on money spent by people for consumption purposes. Now almost 160 countries have embraced VAT/GST as the preferred mode of consumption tax. The latest one to board the bandwagon is Malaysia who introduced the GST in 2015. India is expected to join them from April 1, 2017. However, the USA has not shown much enthusiasm to join the league yet. In the theoretical economic literature, the VAT/GST regime is generally commended because it brings fewer distortions compared to its close competitor sales tax or turnover tax. The VAT seeks to collect taxes at every stage of value addition in the production cycle of the goods or rendering of services. Thus, if a seller buys a shirt at Rs 500 and sells it to the ultimate buyer at Rs. 600, the tax liability for the seller would be calculated on the basis of the difference of Rs. 100 instead of the entire sum of Rs. 600. Therefore, it avoids the worst vice of the sales tax, namely, the cascading effect. In preventing the cascading-effect, the VAT/GST regime causes less distortion in the economy. If the concept of VAT was not introduced, every person involved in the trade would have paid taxes on selling price without having taken credit of tax paid earlier by them; this results in double payment of tax. GST in India has reached its culmination through a series of reform measures aimed at rationalizing the indirect tax structure in the country. In 1976 the Indirect Taxation Enquiry Committee was constituted under the chairmanship of Dr. L.K. Jha. Its report hinted at the GST. In 1985-86 budget, the then Finance Minister Mr. V.P. Singh proposed to introduce modified value added tax (MODVAT), which became effective from April 1, 1986. Dr. Raja J. Chelliah, the chairman of the Tax Reforms Committee, strongly advocated for VAT at the manufacturing level covering all goods. The Indian government partially honoured the proposal in its 1993-94 budget. In 1999, the then Finance Minister Mr. Yashwant Sinha took the initiative for the introduction of VAT in all the states of India. An Empowered Committee of State Finance Ministers was formed to deliberate on state- level VAT under the chairmanship of Dr. Asim Dasgupta, the then finance minister of the Indian state of West Bengal. Subsequently, a task force was formed with Dr. Vijay Kelker at its head which recommended GST as the indirect tax system in India. In 2006, the then Finance Minister P. Chidambaram made the case for GST in his budget speech. He said, “The world over, goods and services attract the same rate of tax. That is the foundation of a GST.” However, in 2009 the Empowered Committee of State Finance Ministers called for a two-tier GST as the ideal solution for a country like India with a strong federal structure. Fearing revenue loss, the India states were not agreeing to a single GST levied by the centre alone. Now there will be the central GST as well as goods and service taxes imposed by various states. The present draft legislation has this provision. It is quite clear that the GST is going to put in place an indirect tax system with greater transparency and rationality. This is in tune with best global practices. This destination based tax regime would integrate markets all over the country. The consumers will benefit from less uncertainty as there will be no need to search for places with low taxes and, hence, low prices. Is there any criticism against the GST? Of course, there are. The GST, like any indirect tax regime, is regressive. Critics of the goods and services tax argue that under this system, the poor pay more, as a percentage of their income, than the rich. Also, there is the fear that GST may add a newly modified virus of inflation to the Indian economy.

GST in India: An indirect tax system with greater transparency and rationality

Amid signs of slippage of the April 1 GST rollout target, Finance Minister Arun Jaitley today said pending resolution of &quot;turf&quot; issues, GST is a transactional levy that unlike income tax can be implemented anytime during the year.

The Goods and Services Tax (GST), he said, can be implemented anytime between April 1 and September 16, 2017, in accordance with the constitutional amendment legislation that allows a national sales tax by subsuming central and state levies.

The GST Council has resolved 10 issues and only one pertaining to administration of tax is pending, he said.

&quot;It is a transactional tax and not an income tax. Transactional tax can start in any part of the financial year and therefore, the range of timing when it has to come into force because of constitutional necessity is April 1, 2017 to September 16, 2017. Hopefully, the earlier we do, the better it is for the new taxation system,&quot; Jaitley said at the annual general meeting (AGM) of FICCI here.

After Parliament passed the landmark constitutional amendment in August and more than half of state legislatures ratified it by mid-September, several key decisions have been taken by the GST Council headed by Jaitley and comprising state representatives.

Jaitley alluded to &quot;certain kinds of turf issues&quot; that are yet to be resolved.

&quot;But the constitutional embargo is very clear. The entire amendment was notified on September 16, 2016, and it permits the old taxation regime to continue for a period of one year,&quot; he said.

&quot;So on September 16, 2017, as far as the current mode of taxation is concerned, the curtain will be down. Therefore, neither the Centre nor&nbsp;the state can go in for collection.&quot;

According to the finance minister, there are about ten important decisions that have already been taken through consensus. The legislations which have to be passed by Parliament and state legislatures are currently in the process of being drafted.

&quot;I don&#39;t see any major difficulty for these legislations being finally approved,&quot; he said.

The only issue remaining &quot;is a very small in the larger frame of things&quot; and the tax administration is under discussion of the GST Council as three major and some minor taxes are being merged into one.

Jaitley suggested there is a need that each assessee is assessed only once since central taxes like excise and service tax and state levies like VAT are being subsumed into one.

&quot;You have the pre-existing (tax) machinery of the Centre and states. (It has to be decided) how the burden of this assessment is going to be shared between the Centre and states and how we cross-empower both the Centre and states,&quot; he said further.

Saying GST will usher in a common taxation and should lead to a federal bureaucracy, Jaitley felt that both the Centre and states should figure out sharing of the tax assessment.

Ideally, he said, it should be proper for the issues to be resolved at the beginning of financial year on April 1 for the new regime to kick in. &quot;But then, in any case, nobody has the luxury of time,&quot; he cautioned.

(PTI)

The entire amendment was notified on September 16, 2016 and it permits the old taxation regime to continue for a period of one year: Jaitley

Amid signs of slippage of the April 1 GST rollout target, Finance Minister Arun Jaitley today said pending resolution of "turf" issues, GST is a transactional levy that unlike income tax can be implemented anytime during the year. The Goods and Services Tax (GST), he said, can be implemented anytime between April 1 and September 16, 2017, in accordance with the constitutional amendment legislation that allows a national sales tax by subsuming central and state levies. The GST Council has resolved 10 issues and only one pertaining to administration of tax is pending, he said. "It is a transactional tax and not an income tax. Transactional tax can start in any part of the financial year and therefore, the range of timing when it has to come into force because of constitutional necessity is April 1, 2017 to September 16, 2017. Hopefully, the earlier we do, the better it is for the new taxation system," Jaitley said at the annual general meeting (AGM) of FICCI here. After Parliament passed the landmark constitutional amendment in August and more than half of state legislatures ratified it by mid-September, several key decisions have been taken by the GST Council headed by Jaitley and comprising state representatives. Jaitley alluded to "certain kinds of turf issues" that are yet to be resolved. "But the constitutional embargo is very clear. The entire amendment was notified on September 16, 2016, and it permits the old taxation regime to continue for a period of one year," he said. "So on September 16, 2017, as far as the current mode of taxation is concerned, the curtain will be down. Therefore, neither the Centre nor the state can go in for collection." According to the finance minister, there are about ten important decisions that have already been taken through consensus. The legislations which have to be passed by Parliament and state legislatures are currently in the process of being drafted. "I don't see any major difficulty for these legislations being finally approved," he said. The only issue remaining "is a very small in the larger frame of things" and the tax administration is under discussion of the GST Council as three major and some minor taxes are being merged into one. Jaitley suggested there is a need that each assessee is assessed only once since central taxes like excise and service tax and state levies like VAT are being subsumed into one. "You have the pre-existing (tax) machinery of the Centre and states. (It has to be decided) how the burden of this assessment is going to be shared between the Centre and states and how we cross-empower both the Centre and states," he said further. Saying GST will usher in a common taxation and should lead to a federal bureaucracy, Jaitley felt that both the Centre and states should figure out sharing of the tax assessment. Ideally, he said, it should be proper for the issues to be resolved at the beginning of financial year on April 1 for the new regime to kick in. "But then, in any case, nobody has the luxury of time," he cautioned. (PTI)

GST can be rolled out anytime between April 1 and mid-September, says Indian FM

India&#39;s ruling Bhartiya Janata Party&#39;s &nbsp;president Amit Shah on Friday launched a counter-attack on the opposition asking them to clarify whether they are &nbsp;for or against demonisation, saying that he questioned the political leaders&rsquo; commitment to do the same. He asked the opposition to clarify whether they were &quot;for or against black money and terror funded by fake notes&quot;. Shah specifically called out Delhi chief minister &nbsp;Arvind Kejriwal, saying, &ldquo;Arvind Kejriwal, make clear whether you support weeding out black money.&rdquo;

 
Attacking the West Bengal chief minister Mamata Banerjee, who called the demonetisation &ldquo;draconian&rdquo;, the BJP president said, &ldquo;I know Mamata Banerjee opposed the move, but politicians shouldn&rsquo;t join ranks of black marketeers, drug dealers who are upset.&rdquo;&nbsp;

 
However, contrary to this position, back in 2014, when &nbsp;the Congress led-United Progressive Alliance government had called in for demonetisation of currency notes issued before 2005, BJP had called it an&quot;anti-poor&quot; move which would badly affect the illiterate and poor living in remote areas of the country.

 
&quot;The latest gimmick of the finance ministry to demonetise the notes, printed before 2005, is an attempt to obfuscate the issue of black money stashed outside the country... This measure is strongly anti-poor. The &#39;aam aurats&#39; and the &#39;aadmis&#39; - those who are illiterate and have no access to banking facilities will be the ones to be hit by such diversionary measures,&quot;BJP spokesperson Meenakshi Lekhi had told the media in 2014.

 
65 per cent of people in India do not have bank accounts and are living in remote areas, they store their money in cash, she had said.

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&ldquo; They will fall victim to middlemen who will scare them that the notes are worthless and charge them hefty fees to convert them. They will also be ripped off by shopkeepers,&quot; the BJP leader had claimed.

Lekhi had went on to accuse the UPA government of not being in a position to measure the correct quantum of black money as those possessing it would convert them into new currency notes.

 
&nbsp;&quot;This policy of Mr P Chidambaram is only meant for the blue blood and not for the sweating, red-blooded, toiling millions. It is not going to affect those who have numbered accounts in Swiss accounts, but will hit those who do not have any bank account even in India.&quot;, she had said.&nbsp;

 
The step is not going to affect those who have their savings in US dollars and other foreign currencies, but those who have saved in rupees, Lekhi had said.

 
It is certain that in times to come, as the debate unfolds further, BJP will have a tough time in responding to those Indians who have been drastically hit by the move as alleged by the opposition parties.&nbsp;

 
(WION) 
&nbsp;

The party had opposed the very same move in January 2014 when a Congress-led government was in power

India's ruling Bhartiya Janata Party's president Amit Shah on Friday launched a counter-attack on the opposition asking them to clarify whether they are for or against demonisation, saying that he questioned the political leaders’ commitment to do the same. He asked the opposition to clarify whether they were "for or against black money and terror funded by fake notes". Shah specifically called out Delhi chief minister Arvind Kejriwal, saying, “Arvind Kejriwal, make clear whether you support weeding out black money.” Attacking the West Bengal chief minister Mamata Banerjee, who called the demonetisation “draconian”, the BJP president said, “I know Mamata Banerjee opposed the move, but politicians shouldn’t join ranks of black marketeers, drug dealers who are upset.” However, contrary to this position, back in 2014, when the Congress led-United Progressive Alliance government had called in for demonetisation of currency notes issued before 2005, BJP had called it an"anti-poor" move which would badly affect the illiterate and poor living in remote areas of the country. "The latest gimmick of the finance ministry to demonetise the notes, printed before 2005, is an attempt to obfuscate the issue of black money stashed outside the country... This measure is strongly anti-poor. The 'aam aurats' and the 'aadmis' - those who are illiterate and have no access to banking facilities will be the ones to be hit by such diversionary measures,"BJP spokesperson Meenakshi Lekhi had told the media in 2014. 65 per cent of people in India do not have bank accounts and are living in remote areas, they store their money in cash, she had said. “ They will fall victim to middlemen who will scare them that the notes are worthless and charge them hefty fees to convert them. They will also be ripped off by shopkeepers," the BJP leader had claimed. Lekhi had went on to accuse the UPA government of not being in a position to measure the correct quantum of black money as those possessing it would convert them into new currency notes. "This policy of Mr P Chidambaram is only meant for the blue blood and not for the sweating, red-blooded, toiling millions. It is not going to affect those who have numbered accounts in Swiss accounts, but will hit those who do not have any bank account even in India.", she had said. The step is not going to affect those who have their savings in US dollars and other foreign currencies, but those who have saved in rupees, Lekhi had said. It is certain that in times to come, as the debate unfolds further, BJP will have a tough time in responding to those Indians who have been drastically hit by the move as alleged by the opposition parties. (WION)

Demonetisation: BJP says good for economy now, but had opposed in 2014

According to a report released by the global performance management company, AC Nielsen, Indians are the most confident about&nbsp;job prospects, personal finance and immediate spending intentions in a survey conducted across&nbsp;63 countries.&nbsp;India&#39;s consumer confidence index jumped by 5 points to 133 in the third quarter of 2016, reclaiming the top spot on the global index.&nbsp;Consumer confidence levels above&nbsp;the&nbsp;baseline of 100 indicates optimism.&nbsp;

The confidence of Indians was boosted by good monsoons, controlled inflation, festive season and positive economic outlook.&nbsp;

Following India are Philippines and Indonesia with scores of 132 and 122 respectively.&nbsp;

&quot;The latest score for India is the highest historically for the quarter, and reiterates renewed optimism levels as well...The positive sentiment is helped by delayed but good monsoons, controlled inflation, positive economic outlook and onset of the festive season,&quot; Nielsen President-South Asia Prasun Basu told Indian news agency PTI. As per the report, sentiment levels of Indian on personal finances have gone up by six percentage points to 84 % this quarter (78 % in the second quarter of 2016). Over two in five (81 %) respondents indicate optimism over job prospects, up by two percentage points from last quarter. Recessionary sentiment is lower by four percentage points when compared to the same quarter last year (50 % now, versus 54 % in third quarter of 2015).&nbsp;

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India&#39;s consumer confidence index jumps by 5 points to 133, recording the highest growth till date. (WION)
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Most&nbsp;Indians are either putting their money in savings or willing to&nbsp;spend on vacations, new technology products and new clothes.

However, terrorism and job security in urban cities are still major areas&nbsp;of concern.

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Job security in urban areas and terrorism are still the major areas of concern. (WION)
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On the other hand, two other recently released global reports&nbsp;have&nbsp;put the Narendra Modi government in a position of discomfort.&nbsp;

In recently released figures by the World Bank on&nbsp;ease of doing business index, India has climbed by just one position in the world rankings. India now ranks 130 amongst 190 countries.&nbsp;&nbsp;

The global ratings agency S&amp;P kept the sovereign credit ratings for India unchanged at the lowest investment grade (BBB-) and also ruled out an upgrade till the end of 2017.&nbsp;

Dr Suyash Bhatt, economist, tells WION, &quot;While&nbsp;the Indian&nbsp;consumer confidence index is up there, there is&nbsp;an eerie&nbsp;silence amongst&nbsp;both global&nbsp;and domestic Investors. There are two possible reasons for the same.

First, there is significant&nbsp;averseness&nbsp;amongst investors and fund managers. This is partly due to US elections and partly due to underperformance of&nbsp;emerging markets (EM).&nbsp;The interest in EM is fading away and India does stand out in the EM list.&nbsp;The focus of investors is shifting back to the US economy which is showing some revival.&nbsp;

Secondly,&nbsp;there is a domestic&nbsp;issue,&nbsp;especially on the policy front. A lot is said and done by the current government.&nbsp;However, as the popular saying goes,&nbsp;the proof of the pudding is in the eating.&nbsp;

The recent &#39;ease of doing business&#39; ranking and S&amp;P&nbsp;rating&nbsp;has validated this point.&nbsp;There is a certain degree of cynicism as the policies have not impacted the&nbsp;ground level.&nbsp;This is further discouraging global investors to put their money in India.&quot;

So, even though&nbsp;India has confidence of its citizens,&nbsp;it is unable to gain the confidence of global investors.

India's consumer confidence index is the highest among 63 countries surveyed by AC Nielsen

According to a report released by the global performance management company, AC Nielsen, Indians are the most confident about job prospects, personal finance and immediate spending intentions in a survey conducted across 63 countries. India's consumer confidence index jumped by 5 points to 133 in the third quarter of 2016, reclaiming the top spot on the global index. Consumer confidence levels above the baseline of 100 indicates optimism. The confidence of Indians was boosted by good monsoons, controlled inflation, festive season and positive economic outlook. Following India are Philippines and Indonesia with scores of 132 and 122 respectively. "The latest score for India is the highest historically for the quarter, and reiterates renewed optimism levels as well...The positive sentiment is helped by delayed but good monsoons, controlled inflation, positive economic outlook and onset of the festive season," Nielsen President-South Asia Prasun Basu told Indian news agency PTI. As per the report, sentiment levels of Indian on personal finances have gone up by six percentage points to 84 % this quarter (78 % in the second quarter of 2016). Over two in five (81 %) respondents indicate optimism over job prospects, up by two percentage points from last quarter. Recessionary sentiment is lower by four percentage points when compared to the same quarter last year (50 % now, versus 54 % in third quarter of 2015). India's consumer confidence index jumps by 5 points to 133, recording the highest growth till date. (WION) × Most Indians are either putting their money in savings or willing to spend on vacations, new technology products and new clothes. However, terrorism and job security in urban cities are still major areas of concern. Job security in urban areas and terrorism are still the major areas of concern. (WION) × On the other hand, two other recently released global reports have put the Narendra Modi government in a position of discomfort. In recently released figures by the World Bank on ease of doing business index, India has climbed by just one position in the world rankings. India now ranks 130 amongst 190 countries. The global ratings agency S&P kept the sovereign credit ratings for India unchanged at the lowest investment grade (BBB-) and also ruled out an upgrade till the end of 2017. Dr Suyash Bhatt, economist, tells WION, "While the Indian consumer confidence index is up there, there is an eerie silence amongst both global and domestic Investors. There are two possible reasons for the same. First, there is significant averseness amongst investors and fund managers. This is partly due to US elections and partly due to underperformance of emerging markets (EM). The interest in EM is fading away and India does stand out in the EM list. The focus of investors is shifting back to the US economy which is showing some revival. Secondly, there is a domestic issue, especially on the policy front. A lot is said and done by the current government. However, as the popular saying goes, the proof of the pudding is in the eating. The recent 'ease of doing business' ranking and S&P rating has validated this point. There is a certain degree of cynicism as the policies have not impacted the ground level. This is further discouraging global investors to put their money in India." So, even though India has confidence of its citizens, it is unable to gain the confidence of global investors.

Indians confident about country's economy, global investors beg to differ

Monetary and fiscal policy reforms, that provided a major impetus to India&#39;s economy, have placed the country among the most competitive economies in the world.&nbsp;

India noted a jump of 16 places from last year&#39;s 55th place, the highest for any economy in 2016, according to the World Economic Forum.&nbsp;

It ranked 39th on the Global Competitiveness Index prepared by the Forum. And the second-most competitive among BRICS nations behind neighbouring China, which is at the 28th position.&nbsp;

India&#39;s &quot;competitiveness has improved across the board, in particular in goods market efficiency, business sophistication, and innovation&quot;.

&quot;Thanks to improved monetary and fiscal policies as well as lower oil prices, the Indian economy has stabilised and now boasts of the highest growth among G20 countries,&quot; according to WEF&#39;s Global Competitiveness Report 2016-17.

Switzerland, with a score of 5.81 on the index, topped the list for the eighth straight time as the most competitive economy.&nbsp;

Singapore and the US are at the second and third positions, respectively. India has a score of 4.52 on the index.

The WEF said, India still needs to work on opening the economy to foreign investors and international trade and increasing transparency in the financial system.

&quot;Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable and inclusive growth,&quot; WEF founder and executive chairman Klaus Schwab said.&nbsp;

He added that businesses still face&nbsp;rigid labour regulations in India and infrastructure also remains a bottleneck. &nbsp;

The rankings are based on the Global Competitiveness Index (GCI) from country-level data covering 12 categories.&nbsp;

The Forum assessed 138 economies for their competitiveness this year, while there were 140 economies in the 2015-16 rankings.

(WION with inputs from agencies) 
&nbsp;

India's ranking on the Global Competitiveness Index noted an improvement of 16 places, moving it to the 39th spot

Monetary and fiscal policy reforms, that provided a major impetus to India's economy, have placed the country among the most competitive economies in the world. India noted a jump of 16 places from last year's 55th place, the highest for any economy in 2016, according to the World Economic Forum. It ranked 39th on the Global Competitiveness Index prepared by the Forum. And the second-most competitive among BRICS nations behind neighbouring China, which is at the 28th position. India's "competitiveness has improved across the board, in particular in goods market efficiency, business sophistication, and innovation". "Thanks to improved monetary and fiscal policies as well as lower oil prices, the Indian economy has stabilised and now boasts of the highest growth among G20 countries," according to WEF's Global Competitiveness Report 2016-17. Switzerland, with a score of 5.81 on the index, topped the list for the eighth straight time as the most competitive economy. Singapore and the US are at the second and third positions, respectively. India has a score of 4.52 on the index. The WEF said, India still needs to work on opening the economy to foreign investors and international trade and increasing transparency in the financial system. "Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable and inclusive growth," WEF founder and executive chairman Klaus Schwab said. He added that businesses still face rigid labour regulations in India and infrastructure also remains a bottleneck. The rankings are based on the Global Competitiveness Index (GCI) from country-level data covering 12 categories. The Forum assessed 138 economies for their competitiveness this year, while there were 140 economies in the 2015-16 rankings. (WION with inputs from agencies)

World Economic Forum: India ranked as 39th most competitive economy in world

It&#39;s been two years since India emerged as the world&#39;s fastest-growing major economy, but the rapid expansion has done little to improve the lot of Ashok Kumar. 
 
Parked up and sitting on the kerb, the 25-year-old truck driver is going nowhere fast. He is the sole breadwinner for the 13 people in his extended family and his monthly salary is stuck at $150. 
 
With new, better-paid jobs hard to come by, Kumar lacks options. He fears becoming unemployed like his elder brother, who recently returned to their village in Uttar Pradesh after months of searching in vain for work. 
 
Data out on Wednesday showed India&#39;s economic growth slowed to 7.1 per cent in the quarter to June, a 15-month low. That is faster than other major economies, but not fast enough to create enough new jobs to absorb all the one million people who join the workforce every month. 
 
A government survey found that job creation fell by more than two-thirds in 2015. Analysts at HDFC Bank estimate that for every percentage point the economy grows, employment now adds just 0.15 of a percentage point - down from 0.39 in 2000. 
 
It&#39;s a major challenge for Prime Minister Narendra Modi, who has promised to create 250 million jobs over the next decade. 
 
&quot;For one job, there are at least 20 candidates,&quot; said Kumar. &quot;If you want the job, you can&#39;t afford to bargain.&quot; 
 
Nearly two-thirds of India&#39;s 1.3 billion people are under 35 years old. This rising demographic &quot;bulge&quot; will create the largest working-age population in the world. At the same time China, which has long curbed family size, will age as a society. 
 
Whether this so-called demographic dividend will translate into the kind of economic gains seen in Japan and Korea, or lead to upheavals, depends on India&#39;s ability to generate jobs. 
 
Yet, despite average annual growth of 6.5 per cent between 1991 and 2013, India added less than half the jobs needed to absorb new job seekers.
<h2>MORE WORKERS, FEWER JOBS</h2>
Under Modi, India has opened up further to foreign investment, hoping to generate more manufacturing jobs. A loan scheme for small businesses has been set up and there are plans for a $1.5 billion fund for startups. 
 
Modi has also launched a programme to train over four million people in different skills in six years. 
 
Pronab Sen, country director for the International Growth Centre, a British-backed think tank, said such measures were &quot;laudable&quot;, but they aimed at boosting supply when more demand was needed. 
 
&quot;India has become a demand-starved economy,&quot; Sen said. &quot;If there is no demand, there will be no incentive to produce more which, in turn, will mean no new jobs.&quot; 
 
The level of desperation for work is staggering. In August, nearly half a million people, including post-graduates, applied for 1,778 jobs as sweepers in the city of Kanpur. 
 
This was not a one-off. Last year, in Uttar Pradesh, 2.3 million people sought 368 low-level government jobs that required a primary education and ability to ride a bicycle. 
 
Competition for such jobs has become fiercer as the public sector&#39;s share in formal employment is declining. 
 
Two years of drought has caused distress in farming, while the construction business has suffered a prolonged downturn &ndash; making work scarcer in the two sectors that employ the bulk of India&#39;s unskilled workforce. 
 
Satellite cities around the capital, like Greater Noida were, until recently, bustling with construction activity. 
 
Now, Greater Noida&#39;s skyline is dotted with half-built, abandoned, high-rises. Cranes and diggers stand idle. 
 
In Delhi and the surrounding National Capital Region, housing starts fell 41 per cent year-on-year in the first half of the year, according to consultancy Knight Frank. Across India, starts were down 9 percent from a year earlier. 
 
Bhuwan Mahato, a contractor who supplies workers to construction projects around Noida, says demand for labour is down by at least 25 percent. 
 
&quot;I wish I hadn&#39;t joined this business,&quot; said Mahato, a 30-year-old migrant from the state of Bihar. &quot;But, truthfully, there are no other opportunities, either.&quot; 
 
(Reuters)

Despite average annual growth of 6.5 per cent between 1991 and 2013, India added less than half the jobs needed to absorb new job seekers

It's been two years since India emerged as the world's fastest-growing major economy, but the rapid expansion has done little to improve the lot of Ashok Kumar. Parked up and sitting on the kerb, the 25-year-old truck driver is going nowhere fast. He is the sole breadwinner for the 13 people in his extended family and his monthly salary is stuck at $150. With new, better-paid jobs hard to come by, Kumar lacks options. He fears becoming unemployed like his elder brother, who recently returned to their village in Uttar Pradesh after months of searching in vain for work. Data out on Wednesday showed India's economic growth slowed to 7.1 per cent in the quarter to June, a 15-month low. That is faster than other major economies, but not fast enough to create enough new jobs to absorb all the one million people who join the workforce every month. A government survey found that job creation fell by more than two-thirds in 2015. Analysts at HDFC Bank estimate that for every percentage point the economy grows, employment now adds just 0.15 of a percentage point - down from 0.39 in 2000. It's a major challenge for Prime Minister Narendra Modi, who has promised to create 250 million jobs over the next decade. "For one job, there are at least 20 candidates," said Kumar. "If you want the job, you can't afford to bargain." Nearly two-thirds of India's 1.3 billion people are under 35 years old. This rising demographic "bulge" will create the largest working-age population in the world. At the same time China, which has long curbed family size, will age as a society. Whether this so-called demographic dividend will translate into the kind of economic gains seen in Japan and Korea, or lead to upheavals, depends on India's ability to generate jobs. Yet, despite average annual growth of 6.5 per cent between 1991 and 2013, India added less than half the jobs needed to absorb new job seekers. MORE WORKERS, FEWER JOBS Under Modi, India has opened up further to foreign investment, hoping to generate more manufacturing jobs. A loan scheme for small businesses has been set up and there are plans for a $1.5 billion fund for startups. Modi has also launched a programme to train over four million people in different skills in six years. Pronab Sen, country director for the International Growth Centre, a British-backed think tank, said such measures were "laudable", but they aimed at boosting supply when more demand was needed. "India has become a demand-starved economy," Sen said. "If there is no demand, there will be no incentive to produce more which, in turn, will mean no new jobs." The level of desperation for work is staggering. In August, nearly half a million people, including post-graduates, applied for 1,778 jobs as sweepers in the city of Kanpur. This was not a one-off. Last year, in Uttar Pradesh, 2.3 million people sought 368 low-level government jobs that required a primary education and ability to ride a bicycle. Competition for such jobs has become fiercer as the public sector's share in formal employment is declining. Two years of drought has caused distress in farming, while the construction business has suffered a prolonged downturn – making work scarcer in the two sectors that employ the bulk of India's unskilled workforce. Satellite cities around the capital, like Greater Noida were, until recently, bustling with construction activity. Now, Greater Noida's skyline is dotted with half-built, abandoned, high-rises. Cranes and diggers stand idle. In Delhi and the surrounding National Capital Region, housing starts fell 41 per cent year-on-year in the first half of the year, according to consultancy Knight Frank. Across India, starts were down 9 percent from a year earlier. Bhuwan Mahato, a contractor who supplies workers to construction projects around Noida, says demand for labour is down by at least 25 percent. "I wish I hadn't joined this business," said Mahato, a 30-year-old migrant from the state of Bihar. "But, truthfully, there are no other opportunities, either." (Reuters)

Jobs elusive as India clings to fastest-growing economy tag

India&#39;s fiscal deficit in the first four months of the 2016-2017 financial year stood at 3.93 trillion Rupees ($58.69 billion), or 73.7 per cent of the annual budgeted target , official data revealed today.&nbsp; 
 
Missing expectations but raising hopes of an interest rate cut, the economic growth slowed sharply in the first quarter. &nbsp; 
 
The deficit was 69.3 per cent during the same period a year ago. Net tax receipts in the first four months of 2016-17 fiscal year were 2.22 trillion Rupees. 
 
According to the statistics ministry, gross domestic product expanded 7.1 per cent year-on-year in the three months from April-June, down from the stellar growth of 7.9 per cent in the preceding quarter, the AFP reported.&nbsp; 
 
The Indian government received 18.2 per cent of the estimated income from revenue and non-debt capital during the four months, the PTI said.&nbsp; 
 
The numbers also fell short of economists&#39; expectations. Most economists had predicted a slight slowdown in GDP growth to around 7.6 per cent for the quarter.&nbsp; 
 
However, the AFP report further underlined that India retained its place as the world&#39;s fastest-growing major economy, with growth having outpaced Asian rival China for more than a year. 
 
&quot;We were hoping for a stronger number,&quot; Shubhada Rao, chief economist at Yes Bank in Mumbai told AFP news agency, adding that sluggishness in the construction and mining sectors had weighed on growth. 
 
&quot;There is room for one rate cut from the central bank,&quot; she said. 
 
After the government in January 2015 revised its base year to 2011-12 and introduced new methods of calculating expansion which it said were closer to international standards, India&#39;s rosy GDP figures have been drawing questions.&nbsp; 
 
Ashutosh Datar, economist at IIFL Institutional Equities, described the growth figure as &quot;disappointing&quot;. 
 
&quot;We expected it to remain stable at 7.6 or 7.7 percent,&quot; he said while talking to AFP.&nbsp; 
 
(WION with inputs from agencies)&nbsp; 
&nbsp;

Missing expectations but raising hopes of an interest rate cut, the economic growth slowed sharply in the first quarter

India's fiscal deficit in the first four months of the 2016-2017 financial year stood at 3.93 trillion Rupees ($58.69 billion), or 73.7 per cent of the annual budgeted target , official data revealed today. Missing expectations but raising hopes of an interest rate cut, the economic growth slowed sharply in the first quarter. The deficit was 69.3 per cent during the same period a year ago. Net tax receipts in the first four months of 2016-17 fiscal year were 2.22 trillion Rupees. According to the statistics ministry, gross domestic product expanded 7.1 per cent year-on-year in the three months from April-June, down from the stellar growth of 7.9 per cent in the preceding quarter, the AFP reported. The Indian government received 18.2 per cent of the estimated income from revenue and non-debt capital during the four months, the PTI said. The numbers also fell short of economists' expectations. Most economists had predicted a slight slowdown in GDP growth to around 7.6 per cent for the quarter. However, the AFP report further underlined that India retained its place as the world's fastest-growing major economy, with growth having outpaced Asian rival China for more than a year. "We were hoping for a stronger number," Shubhada Rao, chief economist at Yes Bank in Mumbai told AFP news agency, adding that sluggishness in the construction and mining sectors had weighed on growth. "There is room for one rate cut from the central bank," she said. After the government in January 2015 revised its base year to 2011-12 and introduced new methods of calculating expansion which it said were closer to international standards, India's rosy GDP figures have been drawing questions. Ashutosh Datar, economist at IIFL Institutional Equities, described the growth figure as "disappointing". "We expected it to remain stable at 7.6 or 7.7 percent," he said while talking to AFP. (WION with inputs from agencies)

India's fiscal deficit reaches 74% of full-year target in July

Indian bond and share prices rose as investors welcomed the long-awaited passage of the goods and services tax (GST), though gains were tempered by concerns about the amount of work needed to bring the reforms into reality. 
 
The broader NSE Nifty index pared earlier strong gains to rise 0.28 per cent, having risen as much as 0.66 per cent. Meanwhile, the benchmark BSE Sensex 10-year bond yield was down 3 bps at 7.17 per cent. 
 
The GST passage in the Rajya Sabha paves the way for the rollout of India&#39;s single biggest tax reform since independence, one that harmonises 11 state and central levies into a national sales tax and cuts business transaction costs. 
 
Its passage marks a victory for Prime Minister Narendra Modi as he seeks to boost growth in Asia&#39;s third-largest economy, and is a relief for investors, especially overseas, who&#39;d been growing impatient about the pace of reforms. 
 
But the government and companies from sectors such as automakers and logistics will now need to implement new technology structures in preparation for the new taxes. 
 
Nomura analysts also warned the GST could negatively impact the economy in the short-term as higher taxes hit consumption and push up inflation by 20-70 basis points in the first year of implementation. 
 
&quot;Contrary to general perceptions, we believe that the short-term impact of the GST could be mixed, but the long-term impact will be clearly positive,&quot; Nomura said in a research note.&nbsp; 
 
Shares of automakers rose as the heavily taxed sector is expected to be one of the biggest beneficiaries of a unified and national taxation system. Tata Motors surged 4.3 per cent. 
 
Logistics firms also gained, with Shipping Corp of India up 3.8 per cent and Transport Corp of India up 2 per cent. 
 
(Reuters)

The National Stock Exchange index rose by 0.66% while the Bombay Stock Exchange was down by 3bps at 7.17%

Indian bond and share prices rose as investors welcomed the long-awaited passage of the goods and services tax (GST), though gains were tempered by concerns about the amount of work needed to bring the reforms into reality. The broader NSE Nifty index pared earlier strong gains to rise 0.28 per cent, having risen as much as 0.66 per cent. Meanwhile, the benchmark BSE Sensex 10-year bond yield was down 3 bps at 7.17 per cent. The GST passage in the Rajya Sabha paves the way for the rollout of India's single biggest tax reform since independence, one that harmonises 11 state and central levies into a national sales tax and cuts business transaction costs. Its passage marks a victory for Prime Minister Narendra Modi as he seeks to boost growth in Asia's third-largest economy, and is a relief for investors, especially overseas, who'd been growing impatient about the pace of reforms. But the government and companies from sectors such as automakers and logistics will now need to implement new technology structures in preparation for the new taxes. Nomura analysts also warned the GST could negatively impact the economy in the short-term as higher taxes hit consumption and push up inflation by 20-70 basis points in the first year of implementation. "Contrary to general perceptions, we believe that the short-term impact of the GST could be mixed, but the long-term impact will be clearly positive," Nomura said in a research note. Shares of automakers rose as the heavily taxed sector is expected to be one of the biggest beneficiaries of a unified and national taxation system. Tata Motors surged 4.3 per cent. Logistics firms also gained, with Shipping Corp of India up 3.8 per cent and Transport Corp of India up 2 per cent. (Reuters)

Indian market witnessed mixed response from GST clearance

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