Tags Posts tagged with "economy"

economy

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He said that incidences of pelting of stones and protests in J&K and naxal activities in affected districts have reduced as an impact of demonetisation as these miscreants have run out of cash.

Union Finance Minister Arun Jaitley said on Tuesday, 07 November 2017 that demonetisation is a turning point in the country’s economic history and has provided the next generation with a fair and honest system to live in.

In a blog 1,843 words long, Arun Jaitley said that, November 8, 2016 signifies the resolve of the government of India to cure the country from the disease of black money. He said that the day would be remembered as a watershed moment in the books of history of Indian economy. Doing an overall analysis, he said, it would right to say that the country has moved on to a more cleaner, transparent and honest financial system.

On the eve of the demonetisation, which invalidated 86 per cent of the currency in circulation, Mr. Jaitley said that it has met its objective of reducing cash in our economy, ending the anonymity of cash, brought more individuals inside the tax net and all the while dealt a blow to black money holders.

He said that the benefits of the move may not yet be visible to some people but the next generation of India would view the decision with a great sense of pride.

On November 8 2016, Prime Minister Narendra Modi had announced the demonetisation of Rs.1,000 and old Rs.500 notes for fighting corruption, removing black money, cutting terror funding and removing fake currency in one stroke. Total currency worth Rs.17 lakh crore approx. was in circulation in country on November 8 2016. Around Rs.15 lakh crore worth of currency was withdrawn and as on June 30, 2017, approx. Rs.15 lakh crore has been deposited back in banks.

Mr. Jaitley said that post demonetisation, the currency in circulation is less by more than Rs.3 lakh crore. This meets with the objective of less cash economy in order to reduce the flow of black money in to the system.

The removal of anonymity has led to 56 lakh new individual tax payers who are filing returns this year and self-assessment tax paid by non-corporates has increased by 34%. The leads gathered during demonetisation period have led to the identification of 2.9 lakh suspected shell companies and 2.24 lakh companies were de-registered as a result. Actions were taken to freeze their bank accounts. He said that more than 28,000 companies had deposited and approx. withdrawn Rs.10,000 crore from 50,000 bank accounts before they were struck off.

The Income Tax Department took action against more than a thousand shell companies that were used by over 22,000 beneficiaries in laundering more than Rs.13,300 crore. To stop further money laundering, SEBI has introduced a Graded Surveillance Measure at stock exchanges.

He said that incidences of pelting of stones and protests in J&K and naxal activities in affected districts have reduced as an impact of demonetisation as these miscreants have run out of cash.

He also said that demonetisation led to a leap in digital payments. And more than 350 crore transactions, valued at around Rs.6.6 lakh crore were carried out through credit cards and debit cards. The value of transactions for debit and credit cards was Rs.4 lakh crore during 2015-16.

Jaitley said that, with the return of cash in the banking system, now almost entire cash holding in the economy can be tracked. This inflow includes suspicious transactions ranging over Rs.1 lakh crore. The tax administration is now using data analytics to find and crack suspicious transactions.

 

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Pakistan is badly embroiled in the grip of fiscal deficit with its economy drifting towards the brink of disaster. After the specific warning of the US president Donald Trump expressing his anger and extreme annoyance over Pak’s unstinted support to hard core terrorists like Hafiz Sayeed, Jaish e Mohammed, Lashkare Tayyeba and Haqqani network and doing nothing to demolish the terror sanctuaries despite its (USA’s) incessant appeals and threatenings the situation has further deteriorated compounded with ban on the usual annual massive US economic aid of billions of dollars. Pakistan is undoubtedly being helped and supported economically by China but the massive financial aid its receiving is on huge interest rates putting huge extra burden on its already shattered economic situation.

According to policy analysts Pakistan is today in deep economic crisis and the situation has become so awry and distressful that in the coming few months it won’t be in a position to even pay back the huge interests on the massive international borrowings whether they are the borrowings from the world bank and other internationl financial bodies but also from US n other countries of the world including its closest ally China.

The political situation inside the country is also in turmoil, particularly after the duly elected former prime minister Nawab Sharief’s ouster on having been involved in money laundering and corruption cases in connection to the Panama papers’ leak in which his name was prominently figured. After being accused by the highest court of the land, the Supreme Court of Pakistan, Nawab Sharief has to step down who is these days also shuffling between London and Pakistan where his wife is undergoing treatment for dreaded cancer.

The entire government is in a way under the influence and guarded effect of the Pakistan Army and the ISI who are considered to be the main forces behind Shrief’s ouster and still hell bent upon to ensure his conviction and subsequent imprisonment for a long duration.

The national elections of Pakistan are scheduled to be held next year and Nawab Sharief who was considered to be in favour of holding talks for reconciliation of relations between India and Pakistan has been pre conspiratorially captured by the Pak Army and ISI inorder to keep the anti India and Kashmir crisis intact by continuing the process of sneaking Pak sponsored terrorists n Jihadies in Kashmir killing innocent Indians and Armymen thus internationalise the vexed Kashmir issue and divert the attention of Pakistanies from the core issues on which its system has failed to deliever.

How badly is the Army and ISI involved directly into Pakistan’s political affairs and decision making can be gauged from the fact that during the recent visit of the American Secretary of State Mark Tillerson to Islamabad the ISI chief and Chief of the Pakistan Army BAJWA were closely present in all the parleys with Prime minister. Not only this but the ISI chief and BAJWA also had behind the curtain deliberations with the US president’s envoy.
SUNIL NEGI

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According to Mr. Jaitley, the government certainly has no reservations in privatising state-owned firms but it has to wait for the right time before divesting its stake in PSUs.

Finance Minister Arun Jaitley on Thursday, 21 September 2017, promised “appropriate actions to revive the slow economy and said that the government has seized at the problem of private investment not picking up. Though he acknowledged that there is a problem of private investment not picking up as quickly, as was promised.

Two years ago, India had a GDP growth outpacing a slowing China. But since the start of 2016, the growth has fallen, hitting a three-year low of 5.7 per cent in the April-June quarter. It resulted in India losing the fastest growing economy tag to China.

Besides falling GDP growth rate, the exports are also decreasing and the industrial growth is the lowest in five years. The current account deficit i.e. the difference between inflow and outflow of foreign exchange has risen to 2.4 % of GDP in April-June.

For current financial year, the government has raised ₹ 72,500 crore through stake sale in PSUs. According to Mr. Jaitley, the government certainly has no reservations in privatising state-owned firms but it has to wait for the right time before divesting its stake in PSUs.

Goods and Services Tax (GST) was implemented from July 1. Since then it has subsumed over a dozen taxes and efficiently transformed India into a single market with uniform tax rates.

Mr. Jaitley has said that the government has been able to contain the inflationary impact post GST. But as far as black money and benami transactions are concerned, according to him it is no more safe in India to deal in excessive cash.

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Ever-strengthening rupee is also a significant challenge to the domestic industry as cheaper imports flood the country.

It looks as if the growth rate will be below 7% this fiscal year which translates roughly to a loss of ₹1.5 lakh crore of national income. What it signifies is millions of jobs not created.

Ever-strengthening rupee is also a significant challenge to the domestic industry. Since January the rupee is 7% stronger compared to the American dollar. It is stronger than its Asian peer currencies too, including China, the Philippines, Indonesia and Thailand. This directly hurts our export prospects.

The strong rupee also hurts the domestic industry since cheaper imports flood the country. The GST regime has given an extra advantage to importer traders since the countervailing duty that they now pay as GST can be offset against other taxes.

Demonetisation has its adverse effects as well. Investment and consumption spending which were postponed due to cash shortage might recover but jobs that are lost are lost forever.

The agriculture sector GDP shows nominal GDP growth to be lower than real GDP, which will mean depression in farmers’ incomes.

Solution to these problems is a big pick-up in manufacturing and private investment spending. Structural reforms of GST, the new insolvency code, the new monetary framework and Aadhaar linkage might show better results in the medium to long term.

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Inflation, the overall increase in the prices is rising rapidly day by day.

The inflation rate dipped to 1.5% last month because of the effective monetary management by the political system. Inflation is an indicator of an excess demand or supply of goods.

Food prices are highly volatile. They should be kept low and stable by public procurement and a minimum support price policy. Inflation control thus involves:

  • A combination of monetary management.
  • Measures to increase supply of goods like anti-hoarding measures or the release of stocks by the government.

Last year, the government gave an inflation target to the RBI, called the “flexible inflation targeting.” This is supervised by the six-member monetary policy committee (MPC), with the Governor as the chairman. They have to counter Inflation causing factors like:

  • The short run impact of the GST which is bound to be inflationary.
  • The impact of the Seventh Pay Commission which will put pressure on prices.
  • The waivers announced in some States which can cause fiscal stress.
  • Worldwide increase in metals and food prices.

economy inflationA low and stable inflation rate is required for stable economic growth. Sometime in future, the impact of the GST, the improved ease of doing business and a stronger domestic currency, will keep inflation low. But at present the short run we need to control the inflationary expectations.

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Goods and Services Tax (GST) has been rolled out. From 1st July 2017, as the prices of goods and services are going to change, it will impact every Indian. The GST Council has fixed the tax rates for 1,211 items, keeping a majority of these in the 18% slab.

Below is the list of the goods and services that will become cheaper from 1st July, as GST goes LIVE:

Eatables

Milk powder, Curd, Butter milk , Unbranded natural honey, Dairy spreads, Cheese, Spices, Tea, Wheat, Rice, Flour, Groundnut oil, Palm oil, Sunflower oil, Coconut oil, Mustard oil, Sugar, Jaggery, Sugar confectionery, Pasta, Spaghetti, Macaroni, Noodles, Fruit and vegetables, Pickle, Murabba, Chutney, Sweetmeats, Ketchup, Sauces, Toppings and spreads, Instant food mixes, Mineral water, ice, Sugar, Khandsari, Biscuits, Raisins and gum, Baking powder, Margarine, Cashew nuts.

Items of daily use

Bathing soap, Hair oil, Detergent powder, Soap, Tissue papers, Napkins, Matchsticks, Candles, Coal, Kerosene, LG domestic, Spoons, Forks, Ladles, Skimmers, Cake servers, Fish knives, Tongs, Agarbatti, Toothpaste, Tooth powder, Hair oil, Kajal, LPG stove, Plastic tarpaulin.

Stationery

Notebook , Pens, All types of paper, Graph paper, School bag, Exercise books, Picture, Drawing and coloring books, Parchment Paper, Carbon paper, Printers

Healthcare

Insulin, X-ray films for medical use, Diagnostic kits, Glasses for corrective spectacles, Medicines for diabetes and cancer.

Apparels

Silk , Woollen fabrics, Khadi yarn, Gandhi topi, Footwear below Rs 500, Apparel up to Rs 1,000

Others

Diesel engines of power not exceeding 15HP, Tractor rear tyres and tubes, Weighing machinery, Static converters (UPS), Electric transformers, Winding wires, Helmet , Crackers and explosives, Lubricants, Bikes, Movie tickets less than Rs100, Kites, Luxury cars, Motorcycles, Scooters, Economy-class air tickets, Hotels with tariff below Rs7,500, Cement, Fly ash bricks and blocks

 

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US President-elect Donald Trump’s telephonic conversation with Pakistan Prime Minister Nawaz Sharif will have grave regional and global consequences. 

Trump’s sudden call to Pakistan PM reflects his diplomatic and strategic way of rebuilding ties with Islamabad to alter the situation in the South Asian region when both India and Pakistan are nuclear powers. 

Trump told Sharif, “You are a terrific guy, You are doing amazing work which is visible in every way. I am looking forward to see you soon. As, I talk to you, Prime Minister I feel I am talking to a person I have known for long.”

The conversation released by Pakistani authorities said Donald was “ready  and willing  to play any role that you want me to play to address and find solutions to the outstanding problems.” 

Donald Trump’s detailed conversation is going to have serious implications when India and Pakistan share tense and highly militarized borders with each other. His action also revealed that his campaign remarks about his love for Hindus and India were just a casual remark. 

Donald said “You are doing amazing work which is visible in every way” implies that Pakistan PM Nawaz has shown practical wisdom in handling domestic matters when military and ISI has been seen enjoying supremacy over civilian government in that country and also internationally gaining importance over India. 

Already India-Pakistan ties are constrained due to increased number of terror attacks on Indian armed forces and ceasefire violations by Pakistani military along the LoC and the International border in the state of Jammu and Kashmir. 

Chinese leader who has already talked with Donald after his wining the elections, must have spoken to him about the strategic and economic benefits of engaging with Pakistan. 

But Donald’s haphazard way of speaking to leaders of 29 countries including Australia, Canada, China, Turkey, Israel, Russia and ignoring to speak with the Indian Prime Minister also shows his policy of seeing New Delhi for a petty and low role in his scheme of things. India should therefore guard against accepting any degraded role in the region. 

Trump’s early moves of speaking with foreign leaders without assessing the repercussions also shows his immaturity in handling diplomacy and communication strategy in world affairs. 

As a tradition the US President-elect is acquainted with the importance attached to different countries to bring about the desired changes in American policy.

Article Courtesy : Arti Bali, Senior Journalist & Analyst

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Would it surprise you to know Sweden is almost totally cashless? And the reason is related to ABBA?

Björn Ulvaeus made his fortune as one of the four members of ABBA, but he’s now making history all over again by leading the cashless revolution.

It began after Björn’s son’s Stockholm apartment was burgled twice in 2008. As Björn remembers, “There was such a feeling of insecurity. It made me think: What would happen if this was a cashless society, and the robbers couldn’t sell what they stole?”

cashless-society-2

He began writing blogs and articles on how the entire criminal economy depended on untraceable cash. If there was a digital record of every transaction, robberies, fraud and financial crimes would end.

Then, in 2011, Björn stopped using cash altogether (and he hasn’t touched it for the five years since).

When he opened the ABBA Museum two years later, it didn’t accept cash, and he put this message outside the entrance:

“I challenge anyone to come up with reasons to keep cash that outweigh the enormous benefits of getting rid of it. Imagine the worldwide suffering because of crime, from drug dealing to bicycle theft. Crime that requires cash. The Swedish krona is a small currency, used only in Sweden. This is the ideal place to start the biggest crime-preventing scheme ever. We could and should be the first cashless society in the world.—Björn Ulvaeus”

Amazingly, people started to notice. More switched to cards and digital payments. The Swedish banks created a cashless app, ‘Swish’, and Swedes began Swishing.

Today, just 3 years later, Sweden’s cashless revolution is almost complete. Bills and coins make up only 2% of Sweden’s economy. Only 20% of all consumer payments in Sweden this year will be in cash, compared to 75% in the rest of the world.

The result? Crime is down. Bank robberies are down 70%. Muggings and burglaries have also plummeted.

Sweden was the first European country to print a paper currency in 1661, and it’s likely to be the first country where paper and coin currencies will disappear altogether. Other countries will follow, with Norway and Denmark also down to just 6% cash transactions.

Including the star of a ’70’s pop band, who is spearheading the cashless revolution after making his money singing “Money, money, money…”

Björn started his movement by ‘being the change’. (Just not the change in his pocket)

Source : Internet