Income tax mop-up from Mumbai rises 20% to Rs 1.14 trillion

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Income TaxIncome tax collection from the Mumbai region has gone up by over 20 per cent as of November 21 over the year-ago period.
The region, which mops up more than one-third of the total direct tax, has collected Rs. 1.14 trillion (Rs 1,14,000 crore) as of November 21, up from Rs. 0.95 trillion in the year-ago period, showing a growth by 20.17 per cent, Principal Chief Commissioner of Income Tax and Head of Mumbai region DS Saksena told PTI.
The department is hopeful of achieving its projected collection of Rs. 2.56 trillion for the fiscal by March from Mumbai region alone, he added.

Against this, indirect taxes have been doing much better with the collection till September rising over 35.8 per cent to over Rs. 3.24 trillion in the first half of the current fiscal, reflecting growth in economic activity against Rs. 2.38 trillion.
Saksena said while advance tax collection from the region rose only 6.47 per cent to Rs. 58,000 crore during the period, up from Rs. 54,761 crore a year ago, TDS collections rose 10 per cent to Rs. 53,062 crore from Rs. 48,223 crore.
Saksena attributed the rise in collections to the uptick in the performance of industries and “given the trend so far, we are quite hopeful of achieving the target of Rs. 2.56 trillion.”

For the entire country, which comprises 17 regions, income tax collections as on November 21 stood at Rs. 3.63 trillion against a budget estimate of Rs. 7.97 trillion for the full year.
Nationally advance tax mop up rose to Rs. 1.42 trillion from Rs. 1.34 trillion in the year-ago period and thus showing a growth of 6.5 per cent.
Similarly, TDS amounting to Rs. 1.95 trillion was collected from the entire country during the period, showing a growth by 11.33 per cent over the year-ago period’s collections at Rs. 1.75 trillion.

The growth rate in collection during the first half of 2015—16 is double the budget requirement of 18.8 per cent for the full fiscal.
Bulk of the growth in the indirect taxes has been contributed by excise duty collection, which grew 69.6 per cent during the period. Excise collection during April—September over Rs. 1.25 trillion, as against Rs. 74,019 crore in the same period last fiscal, while Customs mop up grew 17.5 per cent to over Rs. 1.03 trillion during the six months and service tax grew 24.3 per cent to Rs. 95,493 crore.

The government has budgeted to collect over Rs. 6.47 trillion from indirect taxes in the current fiscal, a growth of 18.8 per cent over last fiscal.

Source: http://www.thehindubusinessline.com/news/income-tax-mopup-from-mumbai-rises-20-to-rs-114-trillion/article7912856.ece

Singapore to focus more on economic activities in India: Experts

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“The emphasis would be on working with India in the areas we are good at, including skill development and town planning,” he told PTI in comments on India-Singapore ties ahead of Modi’s visit from November 23.

Singapore will further strengthen its bilateral trade ties with India through the “strategic partnership” the two countries will establish during Prime Minister Narendra Modi’s visit here next week, according to experts.

 

“The strategic partnership means bringing the relationship between the two countries to a higher level. This is likely to be focused on economic activities,” said Gopinath Pillai, Chairman of the Institute of South Asia Studies, a think-tank of the National University of Singapore.

 

“The emphasis would be on working with India in the areas we are good at, including skill development and town planning,” he told PTI in comments on India-Singapore ties ahead of Modi’s visit from November 23.

 

Singapore and India have enjoyed steadfast bilateral relations for the past five decades which were further enhanced under the 2005-Comprehensive Economic Cooperation Agreement (CECA), a free-trade pact promoting economic and trade activities.

 

Singapore is India’s second largest investor, especially in the power and port sectors.

 

CECA is further being reviewed and would encourage more international investments through Singapore into massive developments taking place in India.

The Indian government has this month further liberalised Foreign Direct Investment (FDI) in infrastructure, sending a clear signal of its economic reform programmes, Pillai added.

 

Depending on how the reviewed CECA is positioned, Singapore-based investors remain “gung-ho” on economic prospects in India and will use the treaty to venture into the Indian market, just as Indian companies and businesses are using Singapore as a springboard to spread across Asian markets, including China, he said.

 

The Indian leader’s visit to Singapore is also seen as timely and comes soon after one made by Chinese President Xi Jinping in early November.

 

Singapore, as a signatory to the Trans-Pacific Partnership and as negotiator of the China-led pan-Asian Regional Comprehensive Economic Partnership, can help India expand into Asia, according to Girija Pande, Executive Chairman of Apex Avalon.

 

Pande also pointed out that, Singapore with its links to the Asian supply chain, can also play an important role in ‘Make in India’ initiative, calling on the Indian Prime Minister to push for more commercial engagement with Singapore and the wider ASEAN region.

 

Singapore and India have many collaborative programmes between schools and colleges.

 

“Students from Singapore often visit Indian schools to get better understanding of the Indian communities and study approaches and vice versa,” he said.

 

Source:  http://economictimes.indiatimes.com/articleshow/49857019.cms

Finance ministry raises duty drawback rates for exports for engineering, marine, leather and textiles

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As exports fell for the 11th month in a row in October 2015, the government on Monday increased the refunds to exporters on duties on imports, particularly those relating to engineering products. This would also neutralise the impact of import duty hike in steel, used in engineering products.

Besides engineering goods, the government raised the duty drawback rates on composite products such as leather handbags, ready-made garments made of cotton wool and those made of cotton with lycra.

The Central Board of Excise and Customs raised the duty drawback rate by two percentage points for the engineering sector, which would allow higher tax refund to exporters of machinery and appliances, electrical machinery, tools and implements, among others.

“These revised rates are based on average incidence of customs and central excise duties and service tax related with the manufacture of export goods and involve substantial total drawback for exporters,” the government said in a release.

After the additional hike in the duty drawback, the rate for certain engineering products could go up to close to eight per cent, sources said.

However, the government did not take into the account the 20 per cent safeguard duty imposed on hot-rolled steel. “It is a positive that the government has made up for the hike in duty on steel. But the smaller firms will have to bear the impact of safeguard duty, as it is not factored in new duty drawback announced ” said Ajay Sahai, director-general and CEO, Federation of Indian Export Organisations.

CRUX OF THE MATTER

  • Move expected to neutralise impact of import duty hike in steel
  • Duty drawback rates raised on engineering goods, leather handbags, readymade garments made of cotton wool and cotton with lycra, shrimps
  • Two percentage points rise in duty drawback for engineering sector to allow higher tax refund to exporters of machinery and appliances, electrical machinery, tools among others
  • Former CMD N Ramanujan had worked out a JV with Titan Watches when Xerxes Desai was heading it. But the government turned it down
  • The only operational plant at Tumkur, Karnataka, has 2 million-unit capacity of quartz watches
  • The watch model, Kanchan, used to sell at a premium in the grey market at Rs 1,000, when its legal price was Rs 700

Duty drawback is a refund of certain types of customs and Central excise duties as well as service tax on imports of inputs or raw materials that are used to manufacture goods for exports.

The revised rates of duty drawback notified by the finance ministry will be effective from November 23.

In a first, the government extended the brand rate of duty drawback to wheat. It also provided a mechanism to pay provisional drawback to exporters soon after export, for certain exports made under the claim for brand rate of duty drawback.

“This was pending for a long time. In a positive development, the government also allowed exporters claiming brand rate of drawback rate to avail provisional drawback rate until the brand rate is decided,” said Sahai.

The government added the expert committee would look into exporters’ concerns arising from new schedule of rates and make further recommendations to the government in January 2016. The government will also take into account feedback from export promotion councils to this effect.

Source:

http://www.business-standard.com/article/economy-policy/finmin-raises-duty-drawback-rates-to-arrest-export-slump-115111700035_1.html

India, Japan sign action plan to double investments in 5-years

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The governments of India and Japan signed an agreement on Thursday for doubling of Japanese investment into Indian firms in the next five years, and  boosting two-way trade. The signatories were Commerce and Industry Minister Nirmala Sitharaman and Japan’s minister for economy, trade and industry, Yoichi Miyazawa.

The plan was categorised into five broad areas: development of selected townships in India, promotion of investment and infrastructure development, further development and cooperation in information technology, enhancing cooperation in strategic sectors and Asia-Pacific economic integration.

Signing of the action plan is seen “as a step further in improving the trade relationship between India and Japan as a follow-up of Prime Minister Narendra Modi’s visit to Japan last year,” stated a release quoting Miyazawa.

According to Sitharaman, the agenda was in line with PM’s Make in India plan that will further investments from Japan into the country’s manufacturing sector.

Last year, the Department of Industrial Policy and Promotion under the ministry of commerce and industry had set up a mechanism to fast-track Japanese investments named ‘Japan Plus.’

During Modi’s visit, Japanese Prime Minister Shinzo Abe had set a target of 3.5 trillion yen ($33.5 billion) of public and private investment and financing from Japan including official development assistance to India to be made over five years. There are already 1,209 Japanese firms operating in India out of which 137 have started their operations after October 2013.

Japan is the fourth largest foreign direct investment (FDI) contributor to India, with major interests in pharmaceuticals, automobiles, and services sectors accounting for 7.46 per cent of total FDI equity inflows into India. During April 2000-November 2014, FDI from Japan into India stood at $17.55 billion.

Under the Tokyo Declaration for Japan-India Special Strategic and Global Partnership, Modi and Abe have set a target of doubling Japanese FDI and the number of Japanese firms in India by 2019.

Source: http://www.business-standard.com/article/economy-policy/india-japan-sign-action-plan-to-double-investments-in-5-years-115043000401_1.html

Strengthening Iran-India trade ties a great opportunity for both

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Iran’s Ambassador to India Gholamreza Ansari at the inaugural session of the United Economic Forum’s Trade Summit 2015 in Chennai on Saturday.

Iran’s Ambassador to India Gholamreza Ansari at the inaugural session of the United Economic Forum’s Trade Summit 2015 in Chennai on Saturday.

India is on top of Iran’s list of partners with which it plans to strengthen economic ties in the region, according to Ghulam Raza Ansari, Ambassador of Iran to India.

Ansari, who just returned from Iran after participating in a seminar on its economic direction post-sanctions, said that the countries in the region had been Iran’s biggest asset in tiding over a three-decade long sanction imposed by the West.

Iran had managed the sanctions and achieved its rights through diplomacy and cooperation. It will first focus on growing trade relations in the region and India is a top priority. There is a great opportunity for both countries to increase economic relations across a wide range of sectors such as oil and gas including transmission, metal, food and agriculture.

Tamil Nadu particularly was first destination of Iran’s investments when it invested in 1960s in petrochemicals and refinery, he said, addressing the inaugural function of a two-day trade summit organised by the United Economic Forum, a platform for the socio-economic development of muslims.

Mufti Mohammad Sayeed, Chief Minister, Jammu and Kashmir, said education is the key to the development of the community.

The Sachar Committee, which had been appointed by the previous Central Government to go into socio economic status of Muslims and make recommendations for their development, had pointed out that educational backwardness was the reason for economic backwardness.

The Committee’s recommendations such as starting quality government schools in areas where there are Muslims, schools for girls and skill development facilities need to be implemented. Degrees awarded by traditional institutions such as the Madarasas must be recognised in mainstream education and competitive exams, he said.

Ahmed AR Buhari, President, UEF, said India is a bright spot in the globe in terms of economic development. The forum is actively participating in the ‘Make in India’ campaign launched by the Prime Minister, Narendra Modi.

UEF has set a target of garnering ₹ 10,000 crore in investments during the two-day summit and has tied up investments of over ₹ 2,000 crore on the first day across a range of sectors including tourism, hospitality, real estate and logistics.

Source: http://www.thehindubusinessline.com/economy/strengthening-iranindia-trade-ties-a-great-opportunity-for-both/article7877117.ece

 

 

RBI allows foreign currency-rupee swap transactions

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RBI said that such swap transactions could be undertaken by the MFI/IFI concerned on a back-to-back basis with an authorised dealers (AD) Category-I bank in India

The Reserve Bank of India (RBI) on Thursday allowed residents having a long-term foreign currency liability to enter into foreign currency-rupee swaps with multilateral or international financial institutions (MFI/IFI) in which the government of India is a shareholding member, subject to certain conditions.

RBI said that such swap transactions could be undertaken by the MFI/IFI concerned on a back-to-back basis with an authorised dealers (AD) Category-I bank in India. The tenure of such swaps should be at least three years, according to a notification issued by the central bank.

In the event of a default by the resident borrower on its swap obligations, the MFI/IFI concerned will have to bring in foreign currency funds to meet its corresponding liabilities to the counter-party AD Cat-I bank in India, the central bank said.

The AD Cat-I bank will have to report the FCY-INR swaps transactions entered into with the MFIs/IFIs on a back-to-back basis to CCIL reporting platform, including the details of the foreign currency borrower. Furthermore, the banks will have to bring the contents of this circular to the notice of their constituents and customers concerned.

Services sector growth hits 8-month high in October

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India’s services sector activity touched an eight-month high in October driven by a significant rise in new business orders even as growth in manufacturing output eased, a Nikkei survey said.

The Nikkei Business Activity index climbed to 53.2 in October, from 51.3 in September, as fresh orders expanded at a solid pace and were most pronounced since February.

“Services companies saw a faster rise in new businesses than their manufacturing counterparts,” said Pollyanna De Lima, economist at Markit, which compiled the survey.

Meanwhile, the seasonally adjusted Nikkei India Composite PMI Output index, which maps manufacturing and services sectors, rose to 52.6 in October from 51.5 in September helped by new businesses.

A reading of 50 divides growth and contraction.

“India’s economic growth shifted into higher gear in October driven by the services sector. Although manufacturing production continued to expand, the growth eased and was sluggish by historical standards,” Lima added.

Lima noted that “the upward trend in private sector output reflected stronger inflows of incoming new works, one that was most marked since March”.

Going forward, services business sentiment regarding the 12-month business outlook remained positive in October.

Notwithstanding the growth in services activity, October data indicated that services sector employment remained unchanged. Around 98 per cent of respondents reported no change in payroll numbers since the preceding month.

“Private sector firms remained wary of costs and payroll numbers, once again, were unchanged,” Lima said.

On the prices front, the Nikkei survey said average input costs rose in both services and manufacturing sectors, albeit at a slower pace.

Reserve Bank Governor Raghuram Rajan on September 29 effected a more-than-expected interest rate cut of half a per cent to spur the economy.

Moreover, RBI has also lowered its economic growth forecast for the current fiscal to 7.4 per cent, from its previous projection of 7.6 per cent.

The April-June quarter GDP slipped to 7 per cent, from 7.5 per cent in the preceding quarter.

Source:http://economictimes.indiatimes.com/articleshow/49654978.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst