Reserve Bank of India — ✅ خرید وی پی ان ❇ ip ثایت vPn آی پی اختصاصی ◐

اکتبر 2, 2022

maharashtra: Maharashtra govt to study, consider stamp duty reduction, says CM Shinde

The government of Maharashtra is looking to study and consider a reduction in stamp duty charges for registrations of property transactions, said Chief Minister Eknath Shinde while batting for a slum-free city with a push for affordable housing.
As a minister of Urban Development in the previous government, Shinde had already provided concessions on premium to the real estate industry that helped its revival to a large extent and is willing to extend support to the industry even now, he said.
The minister has asked real estate developers to send their detailed suggestions with respect to lower stamp duty, which will be discussed and reviewed in consultation with the finance department before taking any decision.

On Friday, the Reserve Bank of India hiked the repo rate by 50 basis points to 5.9% with immediate effect, much higher than the pre-pandemic level of 5.40%. This is the fourth successive hike in rates since May.
With the reversal in interest rate cycle, concerns over its likely impact on slow demand patterns have started to worry developers who are seeking government’s intervention.
Shinde was speaking at a property exhibition organised by realty developers’ body the National Real Estate Development Council (NAREDCO) Maharashtra. He was responding to a suggestion of NAREDCO, Maharashtra President Sandeep Runwal with respect to a reduction of stamp duty once again so that the benefits could be passed on to the homebuyers.
Rajan Bandhelkar, President of NAREDCO, India suggested that the government can reduce the stamp duty by 50% and the balance 50% could be borne by the industry.
Following the imposition of the metro cess, stamp duty on property registration in Pune and Mumbai, which are the country’s most expensive and largest real estate markets, have increased by one percentage point. In Mumbai, the stamp duty is now 6% of the asset’s value while it has risen to 7% in Pune, Nagpur, and Thane.
Mumbai, the country’s commercial capital, has been setting new benchmarks with property transactions over the last two years after the state government announced a limited-window stamp duty reduction.
With an objective of kick-starting the real estate sector and nearly 260 linked industries by encouraging housing sales, the state government had announced a reduction in stamp duty charges to 2% from 5% from September 2020 till the end of December 2020. Stamp duty was charged at 3% of the agreement value between January 2021 and March 31, 2021.
The significant but limited-period stamp duty reduction window that ended in March 2021, was a catalyst for the city’s residential market. While stamp duty rebates are not available now, the deals have continued to flow in.
The state government’s revenue collection through stamp duty charges has recorded its all-time high so far in 2022. The implementation of an additional 1% metro cess, combined with price increases and the sale of larger ticket size units, resulted in a 57% increase in revenue collection from January to September of this year, totalling Rs 6,658 crore.

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آگوست 22, 2022

Trade settlement: Govt says banks free to not deal with sanctioned entities

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ژوئن 26, 2022

RBI eyes BNPL norms, to rope in fintechs amid concerns over cards by non-bank PPI issuers to extend short-term loans

After slapping curbs on non-bank buy now pay later (BNPL) companies, the Reserve Bank of India (RBI) is likely to come out with guidelines for the BNPL segment which was using pre-paid instruments (PPIs) to extend short-term, interest-free loans to customers for online purchases.
“This novel method shall be examined, and issuance of appropriate guidelines on payments involving BNPL shall be explored,” the central bank said in its Payments Vision 2025 document. The RBI had last week communicated to non-bank PPI issuers — or BNPL companies — to stop issuing cards where the funds are loaded through a credit line from NBFCs, sending jitters in the segment.
According to banking observers, the Reserve Bank is not happy with fintech companies using PPIs as a credit instrument, circumventing the regulatory oversight. The banking regulator is in discussion with fintech players to find a way out and bring the segment under a regulatory framework so that PPIs are used as a payment instrument and not as a credit avenue.

While BNPL services have developed into a new payment mode alongside the existing payment modes like cards, UPI and net banking, it has remained outside the direct RBI regulation. This channel, facilitated by a few payment aggregators, leverages the existing nodal account (escrow account after authorisation) to route payments between a BNPL customer and a merchant. “We welcome RBI’s move on barring wallet and PPIs top up from the credit lines. This will bring more transparency in the fintech lending space. We believe the main purpose of a PPI licence is to act as a payment instrument and not as a credit instrument,” said Nipun Jain, CEO, RapiPay Fintech Ltd.
The latest regulation is probably coming from recent developments wherein newer business models of credit-based payment products were built by companies using PPI as a vehicle, analysts said. The RBI has raised concerns on funding of these PPI instruments through a credit line from an NBFC, Kotak Securities said in a report.

ExplainedHow does a BNPL company operate?A customer who holds a BNPL card or account can make a purchase at a participating retailer and opt for the ‘Buy now, pay later’ option. After the purchase, the customer can repay the BNPL firm in a series of interest-free EMIs – unlike credit cards which carry a high interest rate of 42 per cent — spread over 3 months or as a lumpsum amount. If it remains unpaid, interest will be charged. The BNPL company will pay the merchant immediately. However, for a purchase of Rs 500, instead of settling the full Rs 500, they would pay something like Rs 470 or Rs 450 and pocket the difference. The merchant agrees to give a discount to the BNPL firm.

The RBI’s working group on digital lending had recently proposed restricting balance sheet lending by digital lending apps (DLAs) only to regulated entities of the central bank or entities registered under any other law for specifically undertaking lending business, enacting a separate legislation to prevent illegal digital lending activities and treating BNPL as part of balance sheet lending, and prohibition on unregulated entities from offering first loss default guarantee (FLDG).
Another major factor that worries the RBI could be the high delinquency levels in the BNPL segment. In the case of 60 days past due (DPD) credit, delinquencies in the BNPL segment are 18.9 per cent whereas non-BNPL show 10.1 per cent delinquencies, according to TransUnion Cibil data.
BNPL is India’s fastest-growing online payment method with a significant impact on banks, large merchants and card schemes. Due to its hassle-free on-boarding experience, extension of credit facility, low-cost structure for the customer and facilitating easy repayments, BNPL is growing popular among young income earners.
Some of the popular BNPL companies are LazyPay, Simpl, ZestMoney, Amazon Pay Later, Ola Money Postpaid, Paytm Postpaid, Flexmoney, Slice, UNI and EPayLater.
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“Regulatory clarity for big tech and fintechs as well as BNPL will really help entities plan long term and invest even more in fintech in India,” said Avinash Godkhindi, MD and CEO, Zaggle.
The RBI ban on credit lines from NBFCs is likely to hit fintech companies in the BNPL segment. BNPL companies are active on Zomato, Swiggy and other e-commerce sites.
For customers around the globe, e-commerce payment preferences continue to shift away from cash and credit cards towards digital wallets and BNPL. In its report ‘Digital Payments in India: A US$10 Trillion Opportunity’, BCG said the digital payment market In India will be $10 trillion in the next five years (by 2026), with non-cash contributions comprising 65 per cent of all payments and two out of three transactions will be digital in the next five years.

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ژوئن 1, 2022

How trade can boost India’s growth

India’s exports surpassing the pre-pandemic level of $331 billion in FY 2018-19 and reaching $418 billion in FY 2021-22 is certainly an achievement. Total exports, including the services exports of around $240 billion, amount to more than $650 billion. The revival of exports has provided relief at a time when major components of aggregate demand such as consumption and investment had been slowing down. Total merchandise trade, including imports of $610 billion, amounts to $1.28 trillion for FY 2021-22. These milestones on the trade front are a sign of a rising India, which would certainly accelerate the growth and the increasing imports are a good sign given the high import intensity of India’s exports. If we sustain the momentum and capitalise on our exports’ potential, we will meet the targets of $1 trillion in merchandise exports by 2027-28 and $1 trillion in services exports by 2030, which will help achieve the $-5 trillion economy goal sooner.
The trade achievements are a sign of growing confidence in the Indian economy. The proactive policy schemes by the government — such as merchandise exports scheme, duty exemption scheme, export promotion capital goods, transport and marketing assistance scheme — have helped the export sector. Schemes like the gold card scheme and interest equalisation scheme by RBI and the market access initiative by the export promotion councils are also useful.
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Though achievements in trade are laudable, India still has much potential. For example, the annual growth rate of India’s exports between 2011 to 2020 is a little over 1 per cent compared to 3 per cent and 4.2 per cent, respectively, for China and Bangladesh. If we go by India’s Trade Portal estimates, we find a huge difference in India’s exports potential and actual exports in many sectors, especially pharmaceuticals, gems and jewellery and chemicals. Therefore, it is time to address sector-specific and market-specific problems so that we fully capitalise on exports across sectors. For example, India’s potential in diamond and jewellery exports is close to $58 billion but actual exports are at $30 billion.Best of Express PremiumPremiumPremiumPremiumPremium
To achieve the export target, India has to aggressively increase its participation in global value chains (GVCs). India’s best endowment for the next couple of decades is its working-age population and its strength is in labour-intensive manufacturing. However, the space vacated by manufacturing giants such as Japan, Korea, Malaysia and China has been captured by Vietnam, Bangladesh, Mexico and Thailand. Many of these manufacturing giants are moving away from the labour-intensive assembly of network products, which offers India an opportunity. As the Economic Survey (2019-20) suggests, “assemble in India”, particularly in network products, will increase India’s share in world exports to 6 per cent and create 80 million jobs. It is time to find out and research why MNCs are (re)locating to countries like Vietnam, Bangladesh and Mexico when India offers a big market and cheap manpower. We are yet to capitalise on “China+1 strategy”.
India also needs to work on institutions facilitating trade, processes for exports and imports and logistics that not only reduce trade and transaction costs but also ensure reliability and timely delivery, which is important to becoming part of GVCs. India’s rank in the logistics performance index is 44 while China’s rank is 26 and South Korea’s 25. The unit cost of a container of exports is significantly higher for India compared to China, South Korea and others, thereby reducing the price competitiveness of India’s exports.

Recently, the Niti Aayog, in partnership with the Institute of Competitiveness, prepared the Export Preparedness Index (EPI) 2021 for Indian states. There are wide variations in the EPI index, which is based on trade policy, business ecosystem, export ecosystem and performance. It’s time to focus on the first three of these input pillars in states whose scores are below the national average. State-level reforms in reducing red tape and complex laws including taxation will go a long way. One way to reduce the complexities of trade and business is by signing free trade agreements. These not only reduce tariffs and give market access but bring down non-tariff barriers such as administrative fees, labelling requirements, anti-dumping duties and countervailing measures. It’s a good sign that Delhi recently concluded FTAs with the UAE, and Australia and is negotiating with the UK, GCC and Canada. Though FTAs may not necessarily help the trade balance immediately, they help in streamlining policies.
Along with the merchandise exports, India should focus on services exports. As per the Ministry of Commerce (MoC), services exports are expected to reach the target of $1 trillion before the deadline of 2030. India has done well in IT and IES exports and it can accelerate services exports in other categories including travel and tourism and business, commercial and financial services. However, the services sector needs government support.
The acceleration of merchandise and services exports could potentially make the Indian economy a $5-trillion economy sooner provided we are proactive in policies to capitalise on our exports potential, explore new markets and curb protectionism. There are also opportunities arising out of geo-political conflicts and the intention of the world to diversify its supply chain portfolio. India should capitalise on the “China+1” strategy. However, we must avoid protectionism and inverted duty structures which may give temporary relief to domestic industries but will affect India’s overall competitiveness.
(Sahoo is professor, and Mujtaba is research analyst, at the Institute of Economic Growth (IEG), Delhi)

می 9, 2022

Food inflation has not started to hurt India yet. Stepping up production can help country duck global trend

A considerable part of the RBI’s statement accompanying its last week’s exceptional monetary tightening measures focused on the challenges arising from food inflation. That problem, till recently, was largely confined to edible oils (from soaring international prices even prior to the Russia-Ukraine war) and the likes of onion and tomato (due to unseasonal heavy rains). But now there is fear of food inflation getting “generalised”. The Food and Agriculture Organisation’s food price index has shown a 29.8 per cent year-on-year increase for April. Moreover, all commodity group price indices have posted huge jumps: Cereals (34.3 per cent), vegetable oils (46.5 per cent), dairy (23.5 per cent), sugar (21.8 per cent) and meat (16.8 per cent). Simply put, food inflation is already rising across-the-board globally — because of supply disruptions from the war, dry weather in South America, high crude prices inducing greater diversion of corn, sugar, palm and soyabean oil for bio-fuel, and so on.

The transmission of the above global inflation to domestic food prices basically depends on how much of a country’s consumption/production is imported/exported. Such transmission is evident in edible oils and cotton, where up to two-thirds of India’s consumption and a fifth of its production are imported and exported, respectively. The same is starting to happen in wheat. Till two months ago, the country seemed set to harvest a bumper crop and also surpass last year’s all-time-high exports. But with the heat wave from mid-March severely impacting yields, both public stocks and overall domestic availability are under pressure, even as open market prices have risen to export parity levels. Not surprisingly, the Centre has decided to slash wheat allocations and offer more rice under its flagship free-grains scheme. Export demand is, likewise, helping maize trade well above its minimum support price (MSP). But that, alongside higher oil meal prices, will also push up livestock feed costs and, in turn, translate into inflation in milk, egg and meat.
For now, though, the consolation is that there is little to no inflation in pulses, sugar, onion, potato and most summer vegetables. To that extent, food inflation isn’t yet “generalised” in India. Sugar is one commodity where retail prices haven’t gone up much, despite record exports by mills. The reason for it is production also hitting a historic high. In short, while global food inflation is a reality, the only way to contain the effects of it getting “imported” is to step up domestic production. That would call for early announcement of kharif MSPs with credible procurement plans for oilseeds and pulses; ensuring timely availability of seed, fertiliser, crop protection chemicals and credit by actively engaging the industry; and not resorting to knee-jerk export bans or stocking controls, which will only disincentivise producers.
This column first appeared in the print edition on May 9, 2022, under the title ‘Eye on the plate’.