France will partner India to build three ‘smart’ cities

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France partners with IndiaFrance will help India develop Chandigarh, Nagpur and Puducherry as smart cities. Agence Française de Developpement (French Development Agency) signed memoranda of understanding with the government of Union territory of Chandigarh, and government of Union territory of Puducherry and the Maharashtra government here on Sunday in the presence of French President Francois Hollande and Prime Minister Narendra Modi.

Chandigarh, designed by the French architect Le Corbusier half a century ago as a model city, is spread across 114 sq km and the urban infrastructure and green belt of the city provide it a distinguished status among India’s planned cities.

On January 26, Modi is set to announce the official list of 20 smart cities to be developed in the first phase.

A delegation of 26 CEOs from France travelled to Chandigarh with Hollande and had discussions on CEO forums to explore partnerships in renewable energy, defence, information technology and aerospace.

Modi said French companies can exploit India’s trained and affordable manpower to expand their manufacturing operations in the country. The French president committed annual investment to the tune of €1 billion to strengthen business relations with India.

An agreement between Airbus and Mahindra was also inked under Indo-French cooperation to manufacture helicopters within the Make in India initiative.

French companies will also collaborate with public sector firm Engineering Projects India to provide integrated railways solutions. The railway stations of Ambala and Ludhiana will also be redeveloped with French partnership.

The French delegation evinced interest in the areas of renewable energy, infrastructure, transport, defence, and water treatment.

Source: http://www.business-standard.com/article/economy-policy/france-will-partner-india-to-build-three-smart-cities-116012500034_1.html

Income Tax Department processes 32.7 million returns during April-December, 2015

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Income Tax Department has processed 3.27 crore returns and has issued refunds in 1.81 crore cases during April-December period of this fiscal.

 

CBDTCentralized Processing Centre (CPC), Bengaluru has processed 3.27 crore returns as of December 31, registering a growth of 18 per cent over 2.65 crore returns processed during the corresponding period of the previous fiscal.

“During the current financial year, the CPC has issued refunds in 1.81 crore cases out of which in 1.32 crore cases, that is 73 per cent, the refunds were issued within 30 days of filing by the taxpayers,” an official statement said.

The number of Tax payers in the income bracket of Rs 1 crore and below was 2.39 crore as of October 31 last year. For 2014-15 it was 3.66 crore; 3.73 crore in 2013-14 and 3.26 crore in 2012-13.

The Department is committed to continuously improving the quality of tax payer services and enhance taxpayer satisfaction, it added.

Meanwhile, on January 11, CPC was awarded “ISO 9001:2008 Standard for Quality Management System” Certificate by British Standards Institution (BSI).

The Certificate encompasses all business services and business enabler services of CPC, it said.

ISO 9001 is an international standard that specifies requirements for quality management system (QMS) addressing the principles and processes that surround the design, development and delivery of services, it said.

Organisations use this standard to demonstrate their ability to consistently provide services that meet customer and regulatory requirements, it added.

Source: http://economictimes.indiatimes.com/articleshow/50623770.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Startups enjoy 3 years tax holiday over a five year window

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If a startup claims benefit in first year & does not make profit in next two years, it can still enjoy tax exemption on profit in fourth and fifth year

The three-year tax holiday proposed for startups in India will be available over a five-year window, ensuring that innovators won’t lose the benefit even if they make a profit later, the government said.

Those seeking the income tax exemption, announced in the Startup Action Plan on Saturday, will need to get approval by March 2019, in line with the government’s policy to weed out exemptions and bring down the corporate tax rate to 25%. Startups approved until March 31, 2019, will enjoy the benefit for up to five years. The government has proposed that a high-level, inter-ministerial committee should vet startup proposals to validate the innovative nature of the business for granting tax-related benefits. The details of the tax benefits will be announced in the budget.

“The benefit will be available for three years over a five-year period, “a senior government official told ET. If a startup claims the benefit in the first year and does not have a profit in the next two years, it will not lose out on the exemption. If profits are made in the fourth and fifth year, they will still be eligible for the tax break.

“All startups incorporated in India not prior to five years as per the definition of startup and starting the operations before 2019 can get this benefit for three years,“ said Amitabh Kant, secretary in the Department of Industrial Policy and Promotion, which piloted the startup initiative.

With the deadline for seeking exemption set for March 2019, the scheme will effectively run till March 2024, a period of eight years from now.

“This fiscal exemption shall facilitate growth of business and meet the working capital requirements during the initial years of operations, “according to the action plan document.

The policy imposes only one condition on startups claiming the benefit, apart from seeking approval from the appropriate body and meeting eligibility criteria: it should not distribute dividend while getting the tax exemption.

Tax-friendly Regime Need of the Hour for Startup Investors

The devil is in the details. The tax incentive package for startups will be clear in the Budget. But open-ended tax breaks won’t be possible as the government has already signalled a phasing out of exemptions to lower the corporate tax rate. Investments in unicorns would typically be long-term. So, it makes eminent sense to spare investors from paying capital gains tax when they sell their unlisted shares in startups after holding them for over a year. A tax-friendly regime will encourage many of them to relocate to India from, say, Singapore. The government, as promised, should end its Inspector Raj to boost the startup ecosystem.

Source: http://epaperbeta.timesofindia.com/Article.aspx?eid=31816&articlexml=Startups-May-Get-5-Year-Window-to-Avail-18012016015013

 

India, Qatar to boost cooperation in hydrocarbons

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Prime Minister Narendra Modi with Emir of Qatar Sheikh Tamim bin Hamad Al-Thani during the welcome ceremony.

DOHA: With Qatar having the world’s third largest gas reserves and being India’s largest supplier of liquefied natural gas (LNG), both countries are expected to give a fillip to cooperation in the hydrocarbons sector .

Qatar has gas reserves exceeding 900 trillion cubic feet (25 trillion cubic metres) or 14 per cent of global reserves. It is the largest LNG exporter in the world.

The Gulf Cooperation Council member accounted for 65 per cent of India’s total LNG imports last fiscal.

India is also hoping to tap the Gulf nation’s sovereign wealth fund, estimated at $300 billion, for infrastructure projects.

Prime Minister Narendra Modi , who is visiting Doha on the second leg of his five-nation foreign tour, praised the role of the Emir of Qatar in promoting business ties with India.

Modi on Sunday also invited Qatari industry leaders to invest in India.

“India is a land of opportunity. I have come to personally invite you to take advantage of this opportunity,” Modi said, according to a tweet by India’s Ministry of External Affairs (MEA) spokesperson Vikas Swarup.

“Business First. For first engagement of the day, PM attends roundtable meeting with Qatari Business Leaders,” the spokesperson said in another tweet following Modi’s meeting here with business leaders.

“Qatar’s Minister of Trade and Economy welcomes PM Narendra Modi, seeks more intensive eco engagement with India,” it added.

This is the second prime ministerial visit from India to energy-rich Qatar in eight years after Manmohan Singh’s visit in 2008.

“It can also be a large economic partner as it has a large sovereign wealth fund,” Foreign Secretary S. Jaishankar said on Friday in a pre-departure media briefing.

Bilateral trade between India and Qatar stands at $10 billion.

Earlier this year, India re-negotiated favourably its LNG agreement with Qatar to bring down the cost of importing natural gas to less than $5 per unit from $12.

In return for the renegotiation, India’s Petronet LNG has signed an agreement for additional import of one million tonnes of LNG per year from Qatar’s Ras Gas for about 12 years with effect from January 1, this year, at the prevailing market prices.

Ras Gas will also not seek Rs.12,000 crore from Petronet for under-lifting LNG by 38 per cent.

The new contract is effective from January 1, 2016, and ends in 2028.

Modi addressed Indian workers at a medical camp in Doha on Saturday night. There are 6,30,000 Indians living in Qatar comprising the largest expatriate community in that country.

Modi, who arrived here from Afghanistan, will also visit Switzerland, the US and Mexico during his seven-day sojourn.

Source: http://economictimes.indiatimes.com/articleshow/52603895.cms

FTA with EU: India to take up ‘stock-taking exercise’

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FTA with EU: India to take up ‘stock-taking exercise’ for a free trade agreement with the EU later this month, after a gap of three years, and pitch for greater market access in services..

India will undertake a “stock-taking exercise” for a free trade agreement with the EU later this month, after a gap of three years, and pitch for greater market access in services once the stage is set for further negotiations, a senior commerce ministry official said.

Before engaging in serious formal talks on the EU-India Bilateral Trade and Investment Agreement (BTIA), a “stock-taking exercise” will be undertaken, as some contours of the earlier negotiations have to be altered, keeping in view the changes that have taken place since the talks were stuck in 2013, Arvind Mehta, additional secretary in the commerce ministry, told FE.

For instance, India has further liberalised many sectors for foreign investments, including some of the areas where the EU had interests, over the past three years. For instance, the FDI cap in insurance has been raised to 49% from 26% and 100% FDI is allowed in telecoms. In private sector banking, full fungibility of foreign investment is now permitted and accordingly FIIs/FPIs/QFIs can now invest up to a sectoral limit of 74%, with certain conditions.

While India feels the flexibilities shown by it in further opening up to foreign investments should be considered positively by the EU, it also expects some reciprocal measures by the 28-member bloc to address its concerns, especially on data privacy and market access in the services sector. However, there will be no binding commitments until India’s core concerns are addressed suitably, Mehta said. The BTIA negotiations cover boosting goods and services trade as well as investment.

India seeks a data secure status because the high compliance cost with EU’s data protection laws will hit small and medium enterprises (SMEs) of India and make them un-competitive.

Mehta said India will be betting for a trade facilitation agreement (TFA) in services at the World Trade Organisation — similar to the TFA in goods — that would focus on liberalised visa regime, long term visas for business community and freer movement of professionals for the greater benefit of both India and the world. India will pursue it vigorously in negotiations for the BTIA as well as Regional Comprehensive Economic Partnership. RCEP is a proposed FTA between the Asean members and the six states with which it has forged FTAs, including India.

Gr3

India is keen on services, as they account for over a half of its GDP. The EU is India’s largest trade partner, accounting for close to 15% of trade in both goods and services. It is a major market for Indian textiles, garments, pharmaceuticals, gems and jewellery and IT. The EU is also the largest source of FDI inflows to India, accounting for over one-fourth of the total. However, India ranks only ninth among the EU’s top trade partners, making up for just about 2% of its total merchandise goods in 2014.

BTIA talks were to be revived last year, but the EU’s surprise ban on 700 products of GVK shocked India, which then called off the negotiations. Prior to that, the negotiations centred around India’s demand for.

The EU is interested in further liberalisation of FDI in multi-brand retail and insurance, and closed sectors like accountancy and legal services. The underutilised private banking space in India is another draw. India’s intellectual property regime (IPR), which is unlikely to allow ever-greening of patents, remains a concern for European pharma majors. Moreover, the EU has been seeking a cut in the high import duties on assembled vehicles and wines and spirits. In case of assembled vehicles, the import duties remain in the range of 60-75%.

Source: http://www.financialexpress.com/article/economy/fta-with-eu-india-to-take-up-stock-taking-exercise/191733/

Post Bank likely to handle DBT schemes

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The entire direct benefit transfer (DBT) scheme for distribution of government subsidy is likely to be handled by the Post Bank — the new payments bank which will be under the Department of Posts.

The entire direct benefit transfer (DBT) scheme for distribution of government subsidy is likely to be handled by the Post Bank — the new payments bank which will be under the Department of Posts.

“Earlier initial capital approval sought for setting up Post Bank was about Rs 300 crore which has been increased to Rs 800 crore as there is proposal now that entire DBT scheme should be handled by it as well as saving accounts currently handled by DoP should also be moved under it,” an official source told PTI.

Public Investment Board (PIB) will consider this proposal in its meeting on January 15 and then send its recommendation to Cabinet Committee on Economic Affairs for final approval, the official said.

The Reserve Bank of India has granted Payments Bank permit to the postal department, which has 1.55 lakh branches across country and already provides financial services.

Pilot for the Payments Bank is set to start from January 2017 while full-fledged operations are to start from March 7, 2017.

Under DBT scheme government directly transfer subsidies in to bank account of people eligible for it. Subsidies of around 35-40 government schemes are covered under it including that provided on domestic LPG connections.

As per official data, till December 27 around Rs 40,000 crore was directly reaching the beneficiaries through various schemes.

As many as 40 international financial conglomerates, including World Bank and Barclays, have shown interest to partner with Postal Department for the payments bank.

The DoP has shortlisted six consultants including McKinsey, KPMG, Ernst and Young and PricewaterhouseCoopers. The postal department expects to finalise consultant for setting up of payment banks by end of this month.

At the end March 2015, the DoP housed around 20 lakh saving accounts which held total deposit of about Rs 47,800 crore. The payment bank wing of DoP is also proposed to manage these accounts.

As per RBI guidelines, payments banks would offer a limited range of products such as demand deposits and remittances.

They will, however, not be allowed to undertake lending activities and will initially be restricted to holding a maximum balance of Rs 1 lakh per individual customer.

They will be allowed to issue ATM or debit cards as also other prepaid payment instruments, but not credit cards.

Source: http://www.financialexpress.com/article/industry/banking-finance/post-bank-likely-to-handle-dbt-schemes/191551/

All communication of tax scrutiny to be via e-mail from FY17

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The I-T department in the recent times has taken a host of initiatives to reduce human interface between tax official and assessees and make the tax system non-adversarial

 

The income tax department is planning to carry out all communication related to the scrutiny of returns through e-mails from the next fiscal to reduce harassment of tax payers by eliminating interface between assessees and taxmen.

 

The I-T department, on a pilot basis, has already started scrutiny of returns through e-mails in 5 metropolitan cities- Delhi, Mumbai, Bengaluru, Ahmedabad and Chennai regions.

 

“We are working on a software so that all scrutiny communications can be stored in a specified server. Once it is ready, we will shift to e-environment as far as scrutiny, and all communications in this regard are concerned,” a top revenue department official told PTI.

 

The official further said that moving to e-scrutiny would help in combating corruption, as it would reduce the interface between assessee and tax officials. Also, he added that all the communication records with regard to scrutiny would be stored in one place and can be verified whenever needed.

 

“There has been an encouraging response to the pilot project undertaken by the tax department. From next fiscal we want to make all scrutiny communication through emails,” the official said.

 

The Central Board of Direct Taxes (CBDT) has already asked the officials to initiate the concept of using emails for corresponding with taxpayers.

 

The I-T department in the recent times has taken a host of initiatives to reduce human interface between tax official and assessees and make the tax system non-adversarial. These include directing field offices to raise only specific queries in income tax assessment cases picked up for scrutiny. It also directed expeditious completion of those scrutiny cases where income concealed is up to Rs.5 lakh.

 

The department had also stipulated that appeals before I-T commissioner should be filed in electronic format by those assessees who e-file their returns.

 

Source: http://www.livemint.com/Politics/q7dtcfDoj7LMFeJkTG1VRK/All-communication-of-tax-scrutiny-to-be-via-email-from-FY17.html