Economy Issue June 2013 Www.upscportal.com

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1083 CroreRupees Revival Plan for HMT

The Cabinet Committee on

Economic Affairs (CCEA) underUnion Government on 18 April 2013approved a 1083-crore Rupees

renewal package for watch andtractor maker company HMT. Theapproval of the revival Plan Directly

aims to modernise the company andhelp it turn around in five years. Thepackage approved basicallyincludes a cash infusion of 450 crorerupees and a non-cash assistance of630 crore Rupees.

Significance of the Package

Approved

The package is aimed atturning the loss making

Economycompany to profit-making oneover five years by increasingproduction.

The cash component of thepackage will be used formodernization, workingcapital needs and wagerevision.

The company also aims to hike

production to 30000 unitsfrom the current 4500 unitsover five years.

Workshop on GreenNational Accounting for India

T w o - d a y I n t e r n a t i o n a l

Wo rkshop on Green Nationa lAccounting for India finished inNew Delhi on 6 April 2013. The

Government of India established the

expert group under Ministry ofStatistics and Programme

Implementation (MOSPI) in August2011. The aim of this expert group

was development of framework forgreen national accounts,identification of data gaps andpreparation of a road map to

implement the framework. The

expert group conducted in-depthdeliberations on these issues overpast one and half years. The report

was submitted in the internationalworkshop. The report called, Green

National Accounts in India A

Framework was released by thePrime Minister of India, ManmohanSingh on 5 April 2013. The GreenNational Accounts in India AFramework report reflected the

state of economy. It also formed theraw material for assessment and

policy formulation. This reportconsisted of six chapters andincludes conceptual foundations ofeconomic evaluation. The report

also deals with not only theconceptual building up of thesystem of Green National Accounts,

but also deals with the
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implementation ability aspectsbased on the conceptual frameworkof Green Accounting Framework.

Changes in FTP 2009-14 toEnhance Trade and SEZs

Union Minister for Commerce,Industry and Textiles, AnandSharma released the Annual

Supplement 2013-14 to ForeignTrade Policy (FTP) 2009-14 18 April2013 at Vigyan Bhawan, New Delhi.

During the fiscal year 2012-13, theexport of India grew to 300.60 US

Billion Dollar from 300 US BillionDollar, but it fell by 1.76 percentprevious year. The trade deficit

which was 183.4 US Bil lion Dollarlast year has increased to 190.91 USBillion Dollar. On this occasion of

releasing the Annual Supplement2013-14 to Foreign Trade Policy2009-14 the government introducedmany strategic Changes to policiesto revive the interest of the investorsin Social Economic Zones (SEZs) as

well as to boost exports.

Few of the important changesintroducedChanges in SEZs

Size of total area of landrequired for developmentof SEZs have been reduced

Graded Scale for MinimumLand Criteria has beenintroduced

Flexibilities are introduced to

set up additional units sectorspecific SEZs

Policy to provide duty benefitsto pre-existing structures andactivities being undertaken

Salient Features of the Zero Duty

EPCG includes

Authorization holders willhave export obligation of 6

times the duty saved amount.The export obligation has tobe completed in a period of 6

years The period for import under

the Scheme would be 18months

The discharge of ExportObligation by export ofalternate products and theaccounting of groupcompanies has been barred

The benefits of the Zero DutyEPCG Scheme can be availedby the exporters who haveavailed benefits underTechnology Upgradation FundScheme (TUFS) administeredby Ministry of Textiles

Under the new Zero DutyEPCG Scheme, import ofmotor cars, SUVs, all purpose

vehicl es for hotels, trav elagents, or tour transportoperators and companiesowning/operating golf resorts

will not allowed

Reduced EO for DomesticSourcing of Capital Goods

The quantum of specif icExport Obligation (EO) in thecase of domestic sourcing ofcapital goods under EPCGauthorizations has beenreduced by 10%. This wouldpromote domesticmanufacturing of capitalgoods.

Reduced EO for units in the State

of Jammu & Kashmir To encourage manufacturing

activity in the State of Jammu& Kashmir the specific exportobligation (EO) is reduced to25% of the normal exportobligation. Earlier, this benefit

was announced on 5 June

after notification have beenintroduced

In IT SEZs, the criterion ofminimum land area of 10hectares has been done away

Zero Duty Export PromotionCapital Goods (EPCG) Scheme

Foreign Trade Policy has twovariants under this scheme, Zero

Duty EPCG for few sectors and 3%Duty EPCG for all sectors. On 5 June2012, a new Post Export EPCG

Scheme was also announced whichwas notified on 18 February 2013 bythe CBEC. Now the Union

Government has decided to mergethe Zero Duty EPCG and 3% EPCGScheme into one scheme and make

it a Zero Duty EPCG Schemecovering all sectors.
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2012 in respect of unitslocated in North EasternRegion and Sikkim and thesame provision is now beingextended to J&K.

Widening ofInterest Subvention Scheme

Presently there existsavailability of 2% interestsubvention scheme to certainspecific sectors likeHandicrafts, Handlooms,Carpets, ReadymadeGarments, Processed

Agricultural Products, SportsGoods and Toys. The schemehad been further widened to

include 134 sub-sectors ofengineering sector.Government had alsoannounced that the benefit ofthis scheme of 2% interestsubvention could be availableup to 31 March 2014

Items covered under theChapter 63 of ITC (HS) (othermade up textile articles, sets,rags) and additional specifiedtariff lines of engineeringsector items under thescheme have also beenincluded in the scheme by

widening its provisions

Widening the Scope of Utilizationof Duty Credit Scrip

Duty Credit Scrips issuedunder Focus Market Schemes,Focus Product Scheme and

Vishesh Krishi Gramin UdyogYojana (VKGUY) can be usedfor payment of service tax onprocurement of services

within the legal framework of

service tax exemptionnotifications under theFinance Act, 1994. Holder ofthe scrip shall be entitled toavail drawback or CENVATcredit of the service taxdebited in the scrips as perDepartment of Revenue rules.

All duty credit scrips issuedunder Chapter 3 can beutilized for payment ofapplication fee to DGFT forobtaining any authorization

under Foreign Trade Policy.This benefit shall be availableonly to the original duty creditscrip holders. Duty creditscrip can also be paid forpayment of composition feeand for payment of valueshortfalls in EO under para4.28 (b) of Hand Book ofProcedure Vol. 1.

Market and ProductDiversification

Norway has been addedunder Focus Market Schemeand Venezuela has beenadded under Special FocusMarket Scheme. The totalnumber of countries underFocus Market Scheme andSpecial Focus Market Schemebecomes 125 and 50respectively.

Approximately, 126 newproducts have been addedunder Focus Product Scheme.These products include itemsfrom engineering, electronics,chemicals, pharmaceuticalsand textiles sector.

About 47 new products havebeen added under MarketLinked Focus Product Scheme(MLFPS). These products arefrom engineering, autocomponents and textilessector. 2 new countries i.e.,Brunei and Yemen have beenadded as new markets underMLFPS.

MLFPS is being extended from01.04.2013 to 31.03.2014 forexports to USA and EU inrespect of items falling inChapter 61 and Chapter 62 ofITC (HS).

Exports of High Techproducts would be incentived

and it would be separatelynotified by 30th June, 2013.

The towns of Morbi (Gujarat)and Gurgaon (Haryana) havebeen added to the existing list

of towns of export excellencefor ceramic tiles and apparelexports respectively. Thesetowns shall be eligible to getbenefit under ASIDE Scheme.

Incremental ExportsIncentivisation Scheme

Government has announcedIncremental ExportIncentivisation Scheme on 26December 2012 for theexports made during January

2013 to March 2013. Thisscheme is available forexports made to USA, EU and

Asia. It has been agreed toextend this scheme for the

year 2013-14. The calculat ionof the benefit shall be onannual basis under theextended scheme.

The Government has alsoagreed to include additionalcountries under IncrementalExports IncentivisationScheme. 53 countries of Latin

America and Africa have beenadded with the objective toincrease Indias share in thesemarkets. The present exportsto each of these markets areless than US $ 100 million.

Changes have been introduced in

many other schemes and they are

Facil ity to close cases ofdefault in Export Obligation

Served from India Scheme(SFIS)

VKGUY Scheme Status Holder Incentive

Scheme (SHIS) Re-credit of 4% SAD Duty Free Import

Authorization Scheme (DFIA) Import of Cars Improvement in quality and


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timeliness of Foreign TradeData

Second Task Force onTransaction Cost inInternational Trade

Electronic Data InterchangeInitiatives

Ease of Documentation andprocedural simplification

Widening of items eligible forimport for Handloom/Madeups and Sports Goods

WTO Slashed Trade GrowthForecast for 2013 to 3.3 Percent

The World Trade Organization(WTO) on 10 April 2013 slashed the

forecast of global trade by 1.2percent to 3.3 percent fromprevious 4.5 percent. The WTOcalled up for strengthening the trade

via multi lateral system to ensuretrade emerges as the engine of

growth. WTO also informed that thetrade growth of the world slowedto 2 percent in the year 2012 from

the previous year 2011 rate of 5.2percent. As per the details provided,the trade growth rate of the world

is likely to remain low in 2013 as theeconomic slowdown of the

European Countries wassuppressing the global import.Merchandise Trade: Th eforecast of merchandise trade for2013 is 3.3 percent and this is belowthe average of 20 years from 1992to 2012, i.e. 5.3 percent

Trade Forecast 2013: The WTOmade a forecast of 2.1 percentgrowth in world output and itdepends upon the sovereign debtcrisis in Europe

In 2012 the World Growth Ratewas measured to be 2 percent buthave gone down from 5.2 percentthat was recorded in 2011.

IMF Slashed World Growth

Forecast to 3.3 percent for the

Year 2013

International Monetary Fund

(IMF) in its latest assessment of the

United States. Slow growth incountries like Russia, Brazil, Chinaand India is also a reason foreconomic weakness. The globaleconomy survived from the crash

after defuse of the two largest shortterm threats to the recovery and they

were disintegration of the eurozoneand extreme budget cuts and taxhikes in United States. The U.Sgrowth forecasted for the year 2013

is 1.9 percent and for Eurozone it is0.3 percent. The measures adoptedby the world to get out of the

financial crisis have been failing dueto the bad debt and weak capitalhobbled by the banks. Due to Bank

of Japans ambitious plan launched

to reflate the economy, the IMFupped its forecast for the country

to 1.6 percent from initial 1.2percent.

Statement from World EconomicOutlook Report of IMF

IMF in its WEO Reportsuggested that the Global prospectshave improved again but the roadto recovery in the advanced

economies will remain bumpy.

ITPO Signed a MoU withGovernment of India

India Trade PromotionOrganisation (ITPO) signed a

Memorandum of Understanding(MoU) with Government of India forthe year 2013-14 on 20 March 2013.The MoU was signed between Rita

Menon, Chairperson and ManagingDirector of ITPO and S R Rao,Secretary, Ministry of Commerce &Industry.

global economy released on 16April 2013 revised its world growth

forecast for 2013 and slashed it to3.3 percent from previous forecastof 3.5 percent predicted in January2013. IMF revised its forecast

because of the continued recessionin the Eurozone. The IMF alsoforecasted that the economic

growth will be on its pick by thesecond half of the year. The slowgrowth rate of the United States

region is also a region behind thedowngrade of the forecast. TheChief Economist of IMF, Olivier

Blanchard warned that the freshbailout of Cyprus and weakness ofItaly could spark setbacks for the

international economy. IMF in itsassessment also expressedconcerns over the global

fragmentation of the dynamism ofthe emerging economies and the


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Highlights of the MoU The major highlight of the

MoU is the projected surplusof Rs. 100 Crore by ITPO

during 2013-14. The MoU laid down target forinvestment proposal to besubmitted for theredevelopment of PragatiMaidan into a modern andstate-of-the-art integratedExhibition-cum-ConventionCentre, to the Union Cabinetfor approval.

Certain other targets were alsoincluded in the MoU and theseincluded 850 man-days oftraining to its both senior and

other employees during 2013-14 and reduction of electricity

wate r consumpti on by 5percent and 10 percentrespectively.

To Revive Interest in SEZs of

Investors Government announced

Changes in FTP

The Annual Supplement 2013-14 to Foreign Trade Policy (FTP)

2009-14 was announced on 18 April2013 by the Union Minister for

Commerce, Industry and Textiles,Anand Sharma at Vigyan Bhawan,New Delhi.

In the latest Annual

Supplement 2013-14 the UnionGovernment has tried to implementmeasures to revive the interest of theinvestors in Social Economic Zones(SEZs) as well as to boost exports.

Important features of the Package

are

The Government has reducedthe size of total land area

required for development ofSEZs to its half from its initialrequirement of minimum Land

Ar ea of 10 0 hec ta re s forallowing the development ofSEZs. Now an investor needsto have 50 hectares of land todevelop a SEZ. This has been

done in response to end thedifficulties being faced by theinvestors in gaining collectivelarge area of uncultivable landfor setting up of the SEZ.

Graded Scale for MinimumLand Criteria has beenintroduced to permit the SEZan additional sector for eachcontiguous 50 hectare parcelof land. This has been done toensure flexibility in utilizationof the land tracts that fallsbetween the 50 to 450hectares.

Flexibi l ity is granted forsetting-up additional units ina sector specific SEZ. This will

be done by introducingsectoral broad-banding toencompass similar/relatedareas under the same sector.

In context of Vacancy of Land:the government has revisedthe policy in existence thatallowed a parcel of land withpre-existing structures but notin commercial use to beconsidered as a vacant landand this was used with thepurpose of notifying it for a

SEZ. The new policy beingintroduced is that pre-existingstructures and activities beingundertaken after notification

would be eligible for dutybenefits similar to any otheractivity in the SEZ.IT Exports constitute a very

significant part of Indias exports

and IT SEZs have a majorcontribution in it. Exports from ITSEZs during financial year 2012-13have exceeded 1.40 lakh crorerupees and it registered a growth ofover 70 percent, over the previous

years exports. The Government hasbrought in new changes to boostgrowth in the IT SEZ sector and toencourage the employmentopportunities in Tier-II and Tier-IIIcities.

Changes Implemented in ITExports

For development of IT SEZs,the Government has done

away the criterion onminimum land area of 10hectares, making it to nominimum land requirement forsetting up an IT/ITES SEZ. TheSEZ developers will have tomeet up with the minimumbuilt in area requirement.

The criteria of requiring aminimum build-up land areahas also been relaxed to agreater extent. Therequirement of one lakhsquare meters is applicable in7 major cities namely Mumbai,Delhi (NCR), Chennai,Hyderabad, Bangalore, Puneand Kolkata. For the otherCategory B cities 50000 squaremeters and for remainingcities only 25000 squaremeters built up area norm willbe applicable.The SEZ policy Framework in

existence at present doesnt includea policy of exit but now theGovernment permits, the transfer of

ownership of SEZ units, includingsale. The Government has alsointroduced several schemes andmodified different policies as perthe requirements.

4065.81 Crore Rupees for WaterPollution Control

The Union Government ofIndia on 5 April 2013 sanctioned4065.81 crore rupees for pollutionabatement schemes of rivers andlakes in different states. Of all the

states, Uttar Pradesh received1385.95 crore rupees. The sanctioncost of projects and expenditureincludes the State Governmentsshare under the National RiverConservation Programme (NRCP)

and the National Lake ConservationProgramme (NLCP).


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National Lake Conservation Plan(NLCP)

National Lake Conservation

Plan (NLCP) started in June 2001with a funding scheme of 70:30 fundsharing between centre and state.

The main objective of the schemeis to restore and conserve the urbanand semi-urban lakes of the country

degraded due to waste waterdischarge into the lake and otherunique freshwater eco systems,

through an integrated ecosystemapproach.

National River ConservationProgramme (NRCP)

National River ConservationProgramme (NRCP) is the centrally

sponsored Scheme implemented bythe central Government jointly withthe State Government on a cost-

sharing basis. The pollutionabatement works under NRCPpresently cover identified polluted

stretches of 39 major rivers in 185towns spread over 20 States in thecountry.

Highlights of PMEAC EconomicReview 2012-13

The Prime Ministers EconomicAdvisory Council (PMEAC) under

the Chairmanship of C Rangarajan on23 April 2013 presented theEconomic review 2012-13.

Find here the highlights of the

Economic Policy Review presentedby the Prime Ministers Economic

Advisory Council:

Indias economy is expectedto grow 6.4 percent in the newfinancial year that began on 1

April 2013. PMEAC pegged the WPI

inflation at around 6 percentand food inflation, at 8percent.

FY13 bank credit growth at14.1% vs 17% in the year-agoperiod. Bank credit growthlower due to weak creditdemand & tight liquidity.

Net FDI at 18 billion dollars inFY13. FII inflows at 24 billiondollar in FY13 We expect netFDI inflow at 24 billiondollars and FII at 18 billion

dollars for FY14 The fiscal deficit of the Centre

for 2012-13 is estimated to be5.2% of GDP. It was 520924crores Rupees in 2012-13 asper revised estimates, and isexpected to be 542499 croresRupees in 2013-14 as perbudget estimates.

Current Account Deficit isestimated to be 94 billiondollars (5.1% of GDP) in 2012-13 and is projected to be 100

billion dollars (4.7% of GDP)in 2013-14. Merchandise trade deficit is

estimated to be 200 billiondollars (10.9% of the GDP) in2012-13 and is projected to be213 billion dollars (9.9% ofGDP) in 2013-14.

Net invisibles earnings areestimated to be 105.8 billiondollars (5.7 % of GDP) in 2012-13 and are projected to be 113billion dollars (5.3 % of GDP)in 2013-14.

It is estimated that for 2012-13 the net inflow of FDI was18 billion dollars (26 billioninbound and 8 billion dollarsoutbound). For 2013-14 EAChas projected higher inboundflows of the order of 36 bil lion

dollars. Outbound FDI is alsoexpected to increase,resulting in net FDI inflow of24 billion dollars.

FII inflows were weak in the

first quarter of 2012-13, butpicked up in the second andthird quarters. For the year asa whole, portfolio inflows areestimated to be close to $24billion. Portfolio capital flowsare projected to be 18 billiondollars in 2013-14.

The total inflows under thehead of loans are estimated tobe about 30 billion dollars in2012-13. This comprisesmostly of external commercial

borrowings (ECBs) and short-term loans. The projectedfigure for 2013-14 is $36billion.

The total banking capitalinflows for 2012-13 areestimated to be $24 billionand are projected to be at 22billion dollars for 2013-14.

Reserve Bank of India to StartPlastic Money Project on TrialBasis

The Reserve Bank of India on16 April 2013 announced that it

would start the introducti on of

Plastic Notes in the market on trial

basis. The announcement was madeby the Deputy Governor of RBI, K.C.

Chakrabarty in Mangalore. TheDeputy Governor in hisannouncement informed that the

Central Bank would launch theplastic notes the denomination of 10rupees and will continue with other


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small denominations dependingupon the success of these notes. Theintroduction of the scheme wouldstart on a trial basis following themandate of the Union Government

to introduce plastic/polymercurrency notes of 10 rupees on afield trial in five cities of India. Thedate for launch of the Plastic Notes

was not cleared by the Bank.

NEEPCO granted MiniratnaCategory1 Status

North Eastern Electric PowerCorporation (NEEPCO) wasconferred with the Miniratna Category 1 status by the President

of India, Pranab Mukherjee on 8

April 2013. NEEPCO was earlier theschedule A Corporation.

Status of Category-I

Miniratna Firms

Category-I Miniratna firms canincur the capital expenditure on

modernization, new projects as wellas equipment purchase without theapproval of the Government, up to

500 crore Rupees. The Category-IIMiniratna firms, on the other hand,have the financial freedom of

spending up to 300 crore Rupees or

50 percent of total net worth,whichever out of these is lower.

NEEPCOs status after beingconferred with Miniratna Category 1

NEEPCO was initially theschedule A Corporation. Afterbeing elevated to Miniratna Category 1 status, NEEPCO willhave autonomy to take the

investment decisions freely withoutthe consent of Ministry of Power.

About NEEPCO

NEEPCO plays a crucial rolein the power sector of NorthEast region. it serves around50 percent powerrequirement of this region.

By 2018, NEEPCO has plans to

add 2300 MW of powerthrough the thermal and hydroprojects.

At present, NEEPCO executes5 projects in North East region

with total installed capacity of917 MW.

List of Maharatna, Navratna andMiniratna CPSEsMaharatna CPSEs

1. Bharat Heavy ElectricalsLimited

2. Coal India Limited3. GAIL (India) Limited4. Indian Oil Corporation Limited5. NTPC Limited6. Oil & Natural Gas Corporation

Limited7. Steel Authority of India

Limited

Navratna CPSEs1. Bharat Electronics Limited2. Bharat Petroleum Corporation

Limited3. Hindustan Aeronautics

Limited4. Hindustan Petroleum

Corporation Limited5. Mahanagar Telephone Nigam

Limited6. National Aluminium CompanyLimited

7. NMDC Limited8. Neyveli Lignite Corporation

Limited9. Oil India Limited

10. Power Finance CorporationLimited

11. Power Grid Corporation ofIndia Limited

12. Rashtriya Ispat Nigam Limited13. Rural Electrification

Corporation Limited14. Shipping Corporation of India

Limited

Miniratna Category - I CPSEs1. Airports Authority of India2. Antrix Corporation Limited3. Balmer Lawrie & Co. Limited4. Bharat Dynamics Limited

5. BEML Limited6. Bharat Sanchar Nigam Limited7. Bridge & Roof Company

(India) Limited8. Central Warehousing

Corporation9. Central Coalfields Limited

10. Chennai PetroleumCorporation Limited

11. Cochin Shipyard Limited12. Container Corporation of India

Limited13. Dredging Corporation of India

Limited14. Engineers India Limited15. Ennore Port Limited16. Garden Reach Shipbuilders &

Engineers Limited

17. Goa Shipyard Limited18. Hindustan Copper Limited19. HLL Lifecare Limited20. Hindustan Newsprint Limited21. Hindustan Paper Corporation

Limited22. Housing & Urban

Development CorporationLimited

23. India Tourism DevelopmentCorporation Limited

24. Indian Railway Catering &Tourism Corporation Limited

25. IRCON International Limited26. KIOCL Limited27. Mazagaon Dock Limited28. Mahanadi Coalfields Limited29. Manganese Ore (India)

Limited30. Mangalore Refinery &

Petrochemical Limited31. Mishra Dhatu Nigam Limited32. MMTC Limited33. MSTC Limited34. National Fertilizers Limited35. National Seeds Corporation

Limited36. NHPC Limited37. Northern Coalfields Limited38. Numaligarh Refinery Limited39. ONGC Videsh Limited40. Pawan Hans Helicopters

Limited41. Projects & Development India

Limited


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42. Railtel Corporation of IndiaLimited

43. Rashtriya Chemicals &Fertilizers Limited

44. RITES Limited

45. SJVN Limited46. Security Printing and Minting

Corporation of India Limited47. South Eastern Coalfields

Limited48. State Trading Corporation of

India Limited49. T e l e c o m m u n i c a t i o n s

Consultants India Limited50. THDC India Limited51. Western Coalfields Limited52. WAPCOS Limited

Miniratna Category-II CPSEs53. Bharat Pumps & Compressors

Limited54. Broadcast Engineering

Consultants (I) Limited55. Central Mine Planning &

Design Institute Limited56. Ed.CIL (India) Limited57. Engineering Projects (India)

Limited58. FCI Aravali Gypsum &

Minerals India Limited59. Ferro Scrap Nigam Limited60. HMT (International) Limited61. HSCC (India) Limited62. India Trade Promotion

Organisation63. Indian Medicines &

Pharmaceuticals CorporationLimited

64. M E C O N Limited65. National Film Development

Corporation Limited66. National Small Industries

Corporation Limited67. P E C Limited68. Rajasthan Electronics &

Instruments Limited

FCI Raised 5000 Crore Rupees byIssuing Taxable Bonds

The Food Corporation of India(FCI) raised 5000 crore Rupees by

issuing taxable bonds backed byGovernment of India Guarantee in

order to meet the additionalworking capital requirement. Theissue of bonds was opened on 21March 2013 and closed on 22 March2013. These bonds are of two

tenures- 10 years (300 crore Rupees)and 15 years (4700 crore Rupees).The coupon rate for 10 years was8.62 percent per annum and 8.80percent per annum for 15 years.Food Corporation of India (FCI) has

the Cash Credit Limit withConsortium of 62 banks.

At present, the Cash CreditLimit is 54495 crore Rupees whichis secured by mortgaging entirestock of FCI and guaranteed byGovernment of India. At present, theinterest rate on Cash Credit Limit is10.79 percent monthly whicheventually translates into 11.34 onannual basis. Annual interest savingthrough issue of this bond will be127.54 crore Rupees.

CCEA approved FourLaning of Jorhat toDemow section of NH-37

The Cabinet Committee onEconomic Affairs gave its approvalfor the four laning of the Jorhat-Demow section of NationalHighway-37 in the state of Assam

under the Special Accelerated RoadDevelopment Programme in North

Eastern Region (SARDP-NE) PhaseA on Design, Build, Finance,Operate and Transfer (DBFOT) basisin Build-Operate-Transfer (BOT)

(Annuity) mode of delivery. The costis estimated to be 874.69 crorerupees excluding land acquisition

and other pre-construction

activities. The total length of roadwi ll be 80 ki lomet re sapproximately. The project willexpedite the improvement ofinfrastructure in the state of Assam

and also reduce the time and costof travel for traffic, particularly heavytraffic, plying between Guwahati toDibrugarh and Nagaon to Dibrugarh.It will also increase employmentpotential for local labourers for

project activities. The project iscovered in the districts of Golaghat,

Jorhat, Sivsagar and Dibrugarh and

passes through the towns ofNumaligarh, Dergaon, Jorhat, Jhanji,Gorisagar, Sivsagar, Demow, Sapan,

Maran and Dibrugarh.

CCI slapped fine of 8000 Crorerupees in 19 Cases

Competition Commission ofIndia (CCI) penalised 19 businessentities for anti-competitivepractices collectively for around8000 crore Rupees by the end offinancial year 2012-13. It was figured

out as on 31 March 2013 that CCCIhad received 347 cases regarding

vi olati ons of anti -com peti ti ve

practices. Out of the 347registered cases , the Commissionhad closed 262 cases, while in 28

cases cease and desist orders havebeen passed, also in other 19 cases,

total penalties of 8013 crore rupeeswas imposed along with cease anddesist orders. In view of theCompetition Act, the CCI has got theauthority to issue cease anddesist order to abstain thecompany from pursuing any anti-

competitive practices. Also in


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another major upshot a total of 55.67crore rupees of undisbursed fundsin the last fiscal have been creditedto Consolidated Fund of India. It wascalculated that during the 2001-

2012, a sum of 637.17 crore rupeeshad been credited to theConsolidated Fund of India. To deal

with th e is sue of cred it in aneffective way, the Uniongovernment has established

Investor Education and ProtectionFunds (IEPF) by which unclaimedfunds on account of dividends,

matured deposits, matureddebentures and share applicationmoney are transferred to the

government by the company on

completion of seven years.

National Workshop on GridIntegration

The Minister for New &Renewable Energy, Farooq

Abdullah inaugurated the NationalWorkshop on Grid Integration ofRenewable Energy Sources and

Energy Efficiency on 8 April 2013.The workshop discussed theimportant areas of clean energy

development which are gridintegration of renewable energy andenergy efficiency. The National

Workshop on Grid Integration ofRenewable Energy Sources and

Energy Efficiency was organised incollaboration with United StateDepartment of Energy under theUnited States 21st Century PowerPartnership initiative. Grid planningin the high-renewable energypenetration scenario is of strategic

importance. Also, development of

smart grids for enabling moreefficient, resilient, and safedistribution of power is another areaof action.There are certain highlightsunder the 21st Century PowerPartnership initiative, which are asfollows:

Developing & sharingknowledge on topic relating toexpansion of electricity sector

Strengthening anddisseminating these tools toaccelerate this transformation

Improving the capacity ofexperts and building expertis

Leveraging al l three-knowledge tools and

expertise to improve ourpolicies

CCEAApproved de-control of Sugar

The Cabinet Committee onEconomic Affairs (CCEA) on 4 April2013 decided to de-control sugarand did away the levy on sugar millsand regulated release mechanism.This de-control will raise the subsidyburden to 5300 crore rupees fromprevious 2700 crore rupees. De-control on sugar will not have animpact on the sugar made availablein the Public DistributionSystem. The de-control of sugar willabolish the rule for sugar mills thatmakes it mandatory for sugar millersto sell sugar to the Government at adiscounted price as well as thelimitation on the amount theychoose to sell in the open market .

13 Power Projects and 25 OilGas Blocks approved

The Cabinet Committee on

Investment on 22 April 2013 cleared13 power projects that involvesinvestment of 33000 crore rupees.The projects on which theinvestments will be made include

one hydro and two thermal projectas well as ten transmissionprojects. 25 oil and gas blocks with

investment commitment of aboutseven billion US dollars also gotapproval during the same meet. Ofthese 16 blocks were givenconditional clearances, while nine

blocks were approved without anycondition.

Approval of these projects was

pending due to the objectionsraised by the Ministry of Defenceover national security. During themeet of Cabinet Committee onInvestment in New Delhi twentydifferent power projects that awaitclearances from the UnionEnvironment and Forest Ministry

were also reviewed. The meet washeaded by the Prime Minister ofIndia, Dr. Manmohan Singh.

Core Sector Growth Slumped by2.5 Percent in February 2013

The production of eight coresector industries decreased by 2.5

percent in the month of February2013, for the first time in 2012-13financial year. This happened

because of a decrease in the outputof natural gas. The biggest declinehappened in the natural gas sector

wi th more th an 20 pe rcen t inFebruary.

This was followed by coal (-8

percent), electricity generation (-4.1percent) and crude oil (-4 percent).

The overall output growth of thecore sector industries was

witnessed at 7.7 percent in February2012. Negative performance in

February 2013 diminishedcumulative growth in 11 months of2012-13 FY ending February to 2.6percent in comparison to 5.2


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percent during same period in 2011-12 FY. Eight core industries includeelectricity, cement, crude oil,finished steel, petroleum refineryproducts, fertiliser, coal and

electricity.These industries have weight

of 37.9 percent in Index of IndustrialProduction (IIP). During February2013, fertiliser output decreased by4 percent in comparison to 4.1

percent growth in February 2012.Cement output increased by 3.9percent in comparison to 9.8

percent in February 2012. Petroleumrefinery output increased by 4.3percent in comparison to 6 percent

in February 2012. Steel production

increased by 0.5 percent incomparison to 8.7 percent in

February 2012. In January 2013,these core industries increased by3.1 percent.

Indian Railways Carried 1009.73Million Tonnes of Freight duringFiscal 2012-13

Indian Railways carried1009.73 million tonnes of revenueearning freight traffic during thefinancial year 2012-13 as per thedata released by Ministry ofRailways. The freight carried shows

an increase of 39.95 million tonnesover the freight traffic of 969.78million tonnes actually carried

during the corresponding periodlast year, registering an increase of4.12 per cent. During the month of

March 2013, the revenue earningfreight traffic carried by IndianRailways was 98.20 million tonnes.

There is an increase of 4.35 milliontonnes over the actual freight trafficof 93.85 million tonnes carried bythe Indian Railways during the sameperiod last year, showing an

increase of 4.64 per cent.

Foreign Tourist Arrivals in IndiaIncreased by About 3 Percent

Foreign Tourist Arrivals (FTAs)

showed a growth of 2.8 percent inMarch 2013 over March 2012. Thegrowth rate in Foreign ExchangeEarnings (FEEs) from tourism inRupee terms in March 2013 overMarch 2012 was 21percent. The

following are the importanthighlights regarding FTAs and FEEsfrom tourism during the month ofMarch, 2013.

Foreign Tourist Arrivals (FTAs):

FTAs during the Month ofMarch 2013 were 6.40 lakh ascompared to FTAs of 6.23 lakhduring the month of March2012 and 5.36 lakh in March2011.

There has been a growth of 2.8percent in March 2013 overMarch 2012 as compared to agrowth of 16.3 percentregistered in March 2012 overMarch 2011.

FTAs during the period

Jan uary -March 2013 were20.27 lakh with a growth of 2.3percent, as compared to theFTAs of 19.81 lakh with agrowth of 10.9percent during

January-March 2012 over thecorresponding period of 2011.

Foreign Exchange Earnings

(FEEs) from Tourism in rupee

terms and US dollar terms

FEEs during the month of

March 2013 were Rs. 9,491crore as compared to 7843crore rupees in March 2012and 5522 crore rupees inMarch 2011.

The growth rate in FEEs inrupee terms in March 2013over March 2012 was 21.0percent as compared to 42.0percent in March 2012 overMarch 2011.

FEEs from tourism in rupeeterms during January-March2013 were 30075 crore rupees

with a growth of 20.5 percent,as compared to the FEE of24968 crore rupees with agrowth of 31.7 percent during

January-March 2012 over thecorresponding period of 2011.

FEEs in US dollar terms duringthe month of March 2013 were1.75 billion US dollars ascompared to FEEs of 1.56billion US dollars during themonth of March 2012 and 1.23billion US dollars in March

2011. The growth rate in FEEs in US

dollar terms in March 2013over March 2012 was 11.9percent as compared to thegrowth of 27.1 percent inMarch 2012 over March 2011.

FEE from tourism in terms ofUS dollar during January-March 2013 were 5.55 billionUS dollar with a growth of 11.6percent, as compared to 4.97billion US dollar with a growth

of 18.9 percent duringJanuary-March 2012 over thecorresponding period of 2011.Ministry of Tourism compiles

monthly estimates of Foreign TouristArrivals (FTAs) on the basis of data

received from major ports andForeign Exchange Earnings (FEEs)


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from tourism on the basis of datareceived from Reserve Bank of India.

Union Government achievedFY13 Revised Tax CollectionTarget

Union government in theMonth of March 2013 announced

that it has met its revised taxcollection target for 2012-13. Withthis there is also possibility that thetax collection may even exceed theestimates because of better-than-expected indirect tax collections.Combining (direct and indirect tax

collections) the government met therevised estimates. From the revenueside a bit for fiscal consolidation

was do ne . Howev er the fi na lnumbers for direct taxes will beknown only after 20 April 2013. For

the year 2012-13, the Uniongovernment had revised its directtax collections target to 5.65 lakhcrore Rupees from budget estimatesof 5.70 lakh crore Rupees. Thetarget for indirect taxes was revised

to 4.69 lakh crore rupees frombudget estimates of 5.05 lakh croreRupees.

It is also important here to notethat the fiscal deficit target for 2012-13 of 5.2% of the gross domestic

product (GDP) has also beenachieved. For 2013-14, budgetestimates for direct taxes and

indirect taxes are 6.68 lakh croreRupees and 5.65 lakh crore Rupees,respectively.The number of tax

returns filed in 2012-13 wasestimated around 2.15 crorecompared to 1.64 crore a year ago.

On 31March 2013 as many as 7.5lakh tax returns were filed. Thegovernment was trying its best toimplement the Goods and ServicesTax (GST) as early as possible.

What is Direct tax?

Direct tax is a tax paid directlyto the government by the personson whom it is imposed. Direct taxesmainly comprise of corporate taxand income tax. It is imposed uponan individual person (juristic ornatural) or on property, as distinctfrom a tax imposed upon atransaction.

What is Indirect tax?

An indirect tax can be referredto taxes such as sales tax, a specifictax, value added tax (VAT), or goodsand services tax (GST). It is a taxcollected by an intermediary (suchas a retail store) from the person

who bears the ultimate economicburden of the tax (such as theconsumer).

CCEA approved SpecialInfrastructure Scheme in LWEaffected States

The Cabinet Committee onEconomic Affairs(CCEA) on 2 April2013 approved the proposal of the

Ministry of Home Affairs forcontinuation of the Scheme forSpecial Infrastructure (SIS) in Left

Wing Extremism (LWE) affectedstates during the 12th Plan period.

The proposal includes an addedobjective of upgradation and criticalgap filling of training infrastructure,residential infrastructure, weaponry,

vehicles and any other related itemspertaining to Special Forces of LWEaffected states. The total cost wouldbe 373 crore rupees comprising 280crore rupees as central governmentshare and 93 crore rupees as stategovernment share on a 75 (central):25 (state) funding pattern.Thescheme will enhance the security in

the region which would provide anenabling environment fordevelopment. The scheme wasbeing implemented from the year2008-09 with the broad objective toadequately provide for criticalinfrastructure requirements that arecritical to the policing and securityneeds in the field, but are notadequately or otherwise providedfor in any other scheme. During the11th Plan period 100 percentfunding was provided by the CentralGovernment to the 9 LWE affectedstates for implementing variousprojects under the scheme. The totalfunds were released under thescheme by the central governmentto the 9 LWE affected states duringthe 11th Plan period is 445.82 crorerupees.

Government permitted Railwaysto use its Land for MetroNetworks


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The Union Cabinet of India on18 April 2013 gave its approval tothe proposal of the Indian Railwaysfor permitting use of its land forcrossing metro networks under

ground, on the surface as well aselevated/over ground. The Indian

Railways will also allow opening ofKendriya Vidyalayas on its land inorder to provide adequateeducational facilities to children ofrailway staff/officials placed in

remote areas, and whereeducational institutions are not

adequate. Exchange of railway landwith centra l/state governments ,department/local bodies for settingup public utilities shall also beentered into by the Indian Railways,

wherever cons id ered mutuallybeneficial.

for


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