12, September 2016

Cabinet approves extension of contract between India and the International Seabed Authority for exploration of Polymetallic Nodules

Source: PIB

The Union Cabinet has approved the extension of contract between Ministry of Earth Sciences, Government of India and the International Seabed Authority (ISA) for exploration of Polymetallic Nodules for a further period of 5 years (2017-22). The earlier contract is expiring on 24th March 2017.

Significance of the Contract:

By extending the contract, India’s exclusive rights for exploration of Polymetallic Nodules in the allotted Area in the Central Indian Ocean Basin will continue and would open up new opportunities for resources of commercial and strategic value in area beyond national jurisdiction. Further, it would provide strategic importance for India in terms of enhanced presence in Indian Ocean where other international: players are also active.

What are Polymetallic Nodules?

Polymetallic nodules (also known as manganese nodules) are potato-shaped, largely porous nodules found in abundance carpeting the sea floor of world oceans in deep sea. Besides manganese and iron, they contain nickel, copper, cobalt, lead, molybdenum, cadmium, vanadium, titanium, of which nickel, cobalt and copper are considered to be of economic and strategic importance. India signed a 15 year contract for exploration of Polymetallic Nodules (PMN) in Central Indian Ocean Basin with the International Seabed Authority (ISA) (an Institution set up under the Convention on Law of the Sea to which India is a Party) on 25th March, 2002 with the approval of Cabinet. India is presently having an area of 75,000 sq.km. Located about 2000 km away from her southern tip for exploration of PMN.

What is International Seabed Authority?

ISA is an intergovernmental body based in Kingston, Jamaica, that was established to organize, regulate and control all mineral-related activities in the international seabed area beyond the limits of national jurisdiction, an area underlying most of the world’s oceans. It is an organization established by the Law of the Sea Convention.

Stan Wawrinka wins 2016 US Open Men’s Singles title

Source: BBC Sports

Switzerland’s Stan Wawrinka beat world number one Novak Djokovic with a scintillating display to win his first US Open and third Grand Slam title.

Deepa Malik first Indian woman to win Paralympics medal

Source: Times of India, Hindustan Times

Deepa Malik’s silver extended India’s tally at the Rio Paralympics to three medals.

Who is Deepa Malik?

A former Rajasthan state women’s cricketer. She is first Indian woman to participate at the Paralympics, but it comes on the back of a dazzling array of swimming and javelin efforts for the paraplegic, who has been paralyzed from the waist down after a spinal tumor in 1999, followed by three surgeries and 183 stitches, made walking impossible.

In 2008, Deepa created another record when she swam the Yamuna for a kilometre upstream.Four years later, she was awarded the Arjuna Award for her swimming performances. In all, she has 17 international medals, 58 National gold medals, she holds the Asian record in javelin throw and also has World Championship silver medals in shot put and discus in 2011.

Cabinet approves creation of GST Council and its Secretariat

Source: The Hindu

The Union Cabinet approved the setting up of the Goods & Services Tax (GST) Council and its Secretariat. The Empowered Committee of State Finance Ministers on the GST could cease to be the forum at which the discussions between the Centre and States would take place, the Centre said, after announcing the creation of the Council.  Creation of the GST Council as per Article 279A of the amended Constitution.

First GST Council meet on Sept.22

Union Finance Minister has scheduled the Council’s first meeting for September 22 and 23. The Finance Ministry hopes the GST rates, including the floor rates with bands, special rates for raising additional resources during natural calamities and disasters, exemptions, threshold limits and the other issues will be decided by November 22, so that the model laws can then be considered for passage in the winter session of Parliament.

GST Council Secretariat:

The Cabinet approves the creation of the GST Council Secretariat, with its office in New Delhi. It also sanctioned the creation of new jobs — Additional Secretary to the Council and four posts of Commissioner at the level of Joint Secretary to the Centre.

The appointments approved include that of the Union Revenue Secretary as the ex-officio secretary of the Council and the inclusion of the Central Board of Excise and Customs (CBEC) Chairperson as a permanent and non-voting invitee to all of its proceedings.

The Cabinet also decided to provide adequate funds for meeting the recurring and non-recurring expenses of the Secretariat. The entire cost is being borne by the Centre.

What is the structure of the Council?

As per Article 279A of the amended Constitution, GST Council which will be a joint forum of the Centre and the States. It shall consist of the following composition

  • Union Finance Minister (Chairperson).
  • The Union Minister of State (MoS) in-charge of Revenue of finance (Member)
  • The Minister In-charge of taxation or finance or any other Minister nominated by each State Government (Members)

While the Centre will have one-third vote, states together will have a two-third say. To adopt a resolution, three-fourth majority would be required.

Background of the GST Council:

The bill was sent to the President’s secretariat after as many as 19 states — BJP-ruled Assam being the first — ratified the bill.

The other states, which passed the legislation include Bihar, Jharkhand, Chhattisgarh, Himachal Pradesh, Gujarat, Madhya Pradesh, Delhi, Nagaland, Maharashtra, Haryana, Sikkim, Mizoram, Telangana, Goa, Odisha and Rajasthan.

What is the GST Council?

The GST Council will decide on the tax rate, will recommend the taxes to be subsumed and exempted from GST, the rates of taxation and the model Central, State and Integrated GST laws.

It is the council’s responsibility to have one uniform rate of GST tax to be introduced all over India. It will also decide the threshold for levy of the tax, as well as the dispute resolution mechanism.

Apart from these, it will also decide special rates during adversities and special provisions for some states.

The government has notified 12 September as the date for setting up of the GST Council which will be completed within 60 days.

What lies ahead?

The states and the Centre have to draft the Central GST, State GST and Integrated GST laws. These laws have to be passed by Parliament and respective legislatures. The CGST and IGST will be drafted on the basis of the model GST law. The states will draft their respective State GST (SGST) laws with minor variation incorporating state-based exemptions. The IGST law would deal with inter-state movement of goods and services.

Tea Board seeks nod for insurance scheme

Source: The Hindu

The Tea Board has sought the Centre’s approval for modifying an insurance scheme meant for workers in small tea gardens in July.

What the proposal says?

The proposal, which was approved by Tea Board at its last board meeting, workers at small tea gardens would be eligible to apply for the accident insurance scheme. Owners of the small gardens are also eligible under the new plan.

Background:

The Tea Board of India had introduced in July, an accident insurance scheme for workers in small tea gardens at an annual premium of Rs.14. Of this, tea-farmers will have to pay only Rs. 3.50 annually. Oriental Insurance would issue the master-policy in the Tea Board’s name. This scheme was open only to workers. The initiative would be funded under the 12th Plan scheme, according to Tea Board officials. The Centre had made an allocation of Rs.200 crore in a plan of Rs.1, 425 crore.

Why this proposal?

As enrolment of workers began for the scheme, it became evident that many small-growers would be left out of the ambit of the scheme in its present form, as they were also owners of small patches of gardens and the scheme was only for small tea garden workers. Now, the scheme is proposed to be widened to include owner/ growers too.

About Tea Board of India:

The Tea Board is set up under the Tea Act 1953. It has succeeded the Central Tea Board and the Indian Tea Licencing Committee which functioned respectively under the Central Tea Board Act, 1949 and the Indian Tea Control Act, 1938 which were repealed.

The Tea Board is functioning as a statutory body of the Central Government under the Ministry of Commerce.

The Board is constituted of 31 members (including Chairman) drawn from Members of Parliament, tea producers, tea traders, tea brokers, consumers, and representatives of Governments from the principal tea producing states, and trade unions . The Board is reconstituted every three years.

China’s BRICS trade pact idea finds no takers

Source: The Hindu

India and three others in the BRICS bloc — Brazil, Russia and South Africa — have cold-shouldered China’s attempt to bring to the negotiating table a proposal for a Free Trade Agreement (FTA) between the five major emerging economies.

BRICS FTA – proposed by China:

While Beijing’s proposal for a ‘BRICS FTA’ is aimed at boosting trade ties in the grouping through binding commitments on eliminating tariffs, BRICS members barring China are not keen on such a pact.

Their apprehensions about the plan include the fear that it could lead to a surge in imports of Chinese goods into their territory — in turn, hurting local manufacturing.

Background:

The development comes amid hectic preparations for the BRICS Trade Ministers Meeting on October 13 and the first BRICS Trade Fair from October 12 to 14 (both in Delhi) as well as the Eighth BRICS Summit (to be held in Goa) on October 15-16. India is hosting these events as it currently holds the BRICS Chairmanship.

China had recently “informally sounded out other BRICS members regarding the need to take up the FTA proposal during the Trade Ministers Meeting, there were no takers for it.” There was also no interest to start negotiations on a separate ‘BRICS Investment (protection & promotion) Treaty.

What are India’s Concerns?

India has raised concerns regarding a widening goods trade deficit with China. India’s goods trade deficit with China has escalated from $1.1 billion in 2003-04 to $52.7 billion in 2015-16, according to Indian government statistics.

As per Chinese government statistics, in 2014, China enjoyed a goods trade surplus with India (to the tune of $37.9 billion) and with Russia (worth $12 billion), with Chinese exports outstripping imports into China from these countries.

BRICS the Road Ahead:

The forthcoming BRICS Trade Ministers Meeting would look at a cooperation agreement for an exchange of services trade data, in addition to discussions on the proposed ‘BRICS Visa’ (or long-term multiple-entry visa for business persons to attend meetings and conferences, as well as for tourism and medical treatment purposes).

On IPR, there could be talks on exchange of regulations and an agreement to co-ordinate negotiating positions for IPR-related negotiations at the multilateral level. There will also be efforts to rope in the BRICS New Development Bank to finance projects mainly in the infrastructure sector in BRICS countries.

What are magnetars?

Source: The Hindu

This week, astronomers picked up strange X-ray bursts using NASA’s Swift telescope. These strange bursts were very similar to that of a magnetar — an extremely dense type of neutron star that can produce magnetic fields trillions of times stronger than our sun’s.

The magnetar, called 1E 1613 — at the centre of RCW 103, and the remains of a supernova explosion located about 9,000 light years from Earth — rotates once every 24,000 seconds (6.67 hours).

Neutron stars are formed when stars more massive than our sun explode as supernovae. Just a regular neutron star has a magnetic field of a trillion gauss. Magnetars are 1,000 times more powerful than that, with a magnetic field of a quadrillion gauss.

The earth’s core has a magnetic field of 25 gauss. Magnetars can cause starquakes, or earthquakes on stars. Because of its properties, the magnetar releases a blast of radiation that can be seen clear across the Milky Way.

The most powerful starquake ever recorded came from a magnetar called SGR 1806-20, located about 50,000 light years away. In a tenth of a second, one of these starquakes released more energy than the sun gives off in 1, 00,000 years.

SEBI gives nod for realty, infra investment trust norms

Source: The Hindu

Background:

Investors who wish to invest in property for the lucrative gains it offers, but do not have sufficient capital to acquire physical real estate assets such as land or buildings now have a market option. Market regulator Securities and Exchange Board of India (SEBI) on Sunday issued the guidelines under which Real Estate Investment Trusts (REITs) will be allowed to operate in India.

What is Real Estate Investment Trusts (REITs)?

An REIT operates a bit like a mutual fund, offering units to investors. The funds are invested in assets owned, and usually operated by the REIT. Investors stand to earn both dividends (from rental income of the property), as well as capital appreciation.

According to the guidelines, investors will have to put in a minimum of 2 lakh. The units can be traded on stock exchanges once listed. The trading lot for such units will be 1 lakh.

What are Infrastructure Investment Trusts (InvITs)?

InvITs are similar to REITs, but focus on investments in infrastructure.

The market regulator’s decision follows Budget announcement that complete tax pass-through will be available for these two products. This means that the income generated will be taxed in the hands of the investors, and that the fund itself will not have to pay any tax on the same, eliminating the possibility of double taxation.

Any REITs or InvITs entering the market will have to be listed. The minimum initial offer size should be 250 crore. They can also borrow additional funds to acquire assets, but the borrowings cannot exceed 49 per cent of the value of the trust’s assets.

Cabinet approves Bilateral Technical Arrangement between India and Switzerland on the identification and return of Swiss and Indian Nationals

Source: PIB

The Union Cabinet has given its approval for signing of the Technical Arrangement between India and Switzerland on the identification and return of Swiss and Indian Nationals and its implementation.

Significance:

Conclusion of the Bilateral Technical Arrangement (BTA) has been linked to the Visa Free Agreement for holders of Diplomatic passports as a package deal.

The BTA essentially aims to formalize the existing procedure for cooperation on the return of irregular migrants between the two countries without introducing any additional obligations or exacting timeframes.

It is noteworthy that the estimated number of irregular migrants in Switzerland who are thought to be from India is less than 100. If the BTA with Switzerland is approved as proposed, it would offer an opportunity to use the same as a model template for negotiations on the subject with other EU countries, which have been raising the issue regularly with us.

It would also help to leverage the Readmission Agreement to liberalize visa and work permit regimes for legitimate Indian travelers. This has been envisaged as a key goal in the recently concluded India-EU Common Agenda on Migration and Mobility (CAMM).

CBEC to be renamed as CBIT under GST regime

Source: Indian Express

Apex indirect tax body CBEC will be renamed as the Central Board of Indirect Tax (CBIT) once the new national tax framework kicks in from April 1 next year, as per the draft dealing in GST organizational structure prepared by the Centre.

What are the Proposed Changes of CBIT?

CBIT will consist of six members, who will look after Customs, policy and IT, central excise and legal issues, training and litigation.

Headed by a secretary-level officer, CBIT will implement the rules, including exemptions and threshold, to be set by the GST Council, which is chaired by Union Finance Minister and has state finance ministers as its members.

The government plans to implement the new indirect tax regime goods and services tax (GST) from April 1, 2017. GST will subsume central excise, service tax and other local levies, including VAT and octroi.

Besides, a new legacy commissionerate will be formed for the initial 5 years to handle pending adjudication, audits, legal issues and the like.

As per the draft blueprint, the entire country will be divided into six regions — northern, southern, eastern, western, north-eastern and central — and will be headed by a principal commissioner-level officer.

The regions will then be divided into zones putting certain states together and each zone will be headed by a chief commissioner.

Creation of DGITI:

As per the structure, the Directorate General of Central Excise Intelligence (DGCEI) will be rechristened as DGITI (Directorate General of Indirect Tax Intelligence).

Significance of DGITI:

Since the tax base in the GST set-up is bound to increase manifold, the challenge will be to provide maximum facilitation and at the same time ensure optimum compliance. In this context, the role of DGITI will be of paramount significance.

Creation of RMC:

Also, a position of DG, Risk Management Centre (RMC), is proposed to be created and headed by a senior officer of the rank of director general.

RMC shall identify, develop, update and maintain risk parameters in relation to trade, commodities, services and all stakeholders in the domestic supply chain. It will have a strong data analysis unit to ensure seamless flow of data and information from agencies within and outside the central and state tax administration.

Cabinet approves MoU between India and Kenya on cooperation in the field of National Housing Policy Development and Management

Source: PIB

The Union Cabinet has given its expost-facto approval for the Memorandum of Understanding (MoU) between India and Kenya on cooperation in the field of National Housing Policy Development and Management (NHPDM). The MoU was signed on 11th July, 2016 at Nairobi during the visit of the Prime Minister of India.

Prospects of the MoU:

The cooperation between the two countries will focus on up scaling slum up gradation and prevention initiatives based on the experience and implementation process of each country.

They will collaborate on development and sharing of information on housing and real estate data base including market trends, best practices and investment opportunities.

It will encourage technical cooperation in facilitating access to affordable housing from locally available building materials. It will also encourage technical cooperation in development of Government/Public employee facilitated housing.

This would be useful to explore ways of a delivery model towards Government employees housing scheme, including creating an enabling environment for participation in the delivery of such intended scheme by private sector players.

Cabinet approves enhancing buffer stock of pulses up to 20 lakh tonnes

Source: Indian Express

The Cabinet Committee on Economic Affairs has approved the proposal of Department of Consumer Affairs on enhancing the buffer stock for pulses up to 20 lakh tonnes. The buffer stock will be built through domestic procurement and imports of 10 lakh tonnes each.

The specific variety of pulses and their respective quantities for the buffer stock, their phasing and procurement will be decided based on price and availability position, both domestic and global, and changes, if any, in the procurement plan for the current and subsequent seasons will be with due approvals.

Releases from the stock and procurement in subsequent year would be based on the prevailing pulse scenario as well as buffer stock position. Requisite funds for this operation would be provided to the ‘Price Stabilization Fund’ Scheme of the Department.

Creation of Buffer stock:

The domestic procurement operations will be undertaken by the Central Agencies namely FCI, NAFED and SFAC or any other agency as decided by PSFMC at the prevailing market prices if the prevailing market prices are above Minimum Support Prices (MSP), and at MSP, if otherwise.

 In addition, State Governments may also be authorized, wherever possible, to undertake the procurement in a manner similar to decentralized procurement of food-grains.

Task force moots new panel on BPL

Source: The Hindu

A task force headed by NITI Aayog Vice-Chairman Arvind Panagariya to prepare a road map for elimination of poverty has submitted its report to the Prime Minister’s Office (PMO) and suggested setting up of a committee to identify people below the poverty line (BPL).

Agenda for the Task Force:

The task force has also suggested participation from the States in defining the BPL population.

Its terms of reference included developing a working definition of poverty and coordinating and developing synergy with Central Ministries and State government task forces.

Its main task was to prepare a road map for elimination of poverty as well as suggest strategies and anti-poverty programmes.

Key Issues identified in the Study report:

According to the discussion paper on poverty, official measures are based on the Tendulkar poverty line. But the line is not without its share of controversies, with many terming it being too low.

This has prompted the previous government to appoint the Rangarajan Committee, which has recommended higher rural and urban poverty lines.

The paper talks of considering four options for tracking the poor. First, continue with the Tendulkar poverty line.

Second, switch to the Rangarajan or other higher rural and urban poverty lines.

Third, track progress over time of the bottom 30 per cent of the population and last, track progress along specific components of poverty such as nutrition, housing, drinking water, sanitation, electricity and connectivity.

Third and fourth options can complement measurement of poverty using a poverty line, the paper suggested, adding that they could not be a substitute for it.



Leave a Reply