1. NE region witness more than 85 pc export growth in last six years
Tags: Economy/Finance
The export of agricultural products to the North-East region has increased by more than 85 percent in the last six years.
Important facts
According to the Commerce and Industry Ministry the export has reached over 17 million dollars in 2021-22 from 2.52 million dollar in 2016-17.
The major destinations of exports have been Bangladesh, Bhutan, Middle East, UK and European countries.
There has been a significant increase in the export of agricultural products from the northeastern states like Assam, Nagaland, Manipur, Mizoram, Tripura, Arunachal Pradesh, Sikkim and Meghalaya.
In the last three years, Agricultural and Processed Food Products Development and Authority (APEDA) has conducted 136 capacity building programs on export awareness in different parts of the North Eastern Region.
APEDA organized a conference on Export Potential of Natural, Organic and Geographical Indications (GI) agricultural products in Guwahati on 24 June.
India's North-East region
The North Eastern Region (NER) comprises eight States - Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.
The North Eastern region of India is a landlocked region with no access to the sea.
It is geographically isolated from the rest of India and is connected to the mainland by a narrow strip of land called the Siliguri Corridor (Chicken’s Neck).
Sikkim - the ‘Brother’ of the Seven Sisters
Assam- World’s largest ‘Tea Producer’
Manipur- Jewel of India
Arunachal Pradesh- Land of Rising Sun
Meghalaya- Scotland of India
Tripura- the most ‘Literate’ in the Northeast around 95% Literacy rate
Mizoram- Molasses Basin
Sikkim- Sparsely Populated, the only state having world’s largest ‘Kanchenjunga Mountain’
Nagaland- famous for Mon’s Ethnicity
2. Paper Import Monitoring System will come into effect from 1st October
Tags: Economy/Finance
The Paper Import Monitoring System (PIMS) is being implemented from October 1 this year.
Important facts
The Directorate General of Foreign Trade (DGFT) introduced the Paper Import Monitoring System (PIMS) by making amendments to the import policy of major paper products.
The online facility of registration will be available from 15th July 2022.
Process of registration
Under PIMS, an importer needs to obtain an automatic registration number by paying a registration fee of Rs 500 through the online system.
This registration number will be allotted not later than the 75th day preceding the expected date of arrival of the import consignment and not later than the fifth day preceding the expected date of arrival of the consignment.
This automatic registration number will be valid for a period of 75 days and within the validity period of registration, Bill of Entry (BOE) of miscellaneous consignments will be allowed under the same registration number for the sanctioned quantity.
What are major paper products on which the import system will apply?
The PIMS will apply to imports by a domestic sector unit on a wide range of paper products covering 201 tariff lines, such as newsprint, handmade paper, tissue paper, toilet paper and cartons etc.
Paper products like currency paper, bank bond and check paper, security printing paper etc. have been kept out of the purview of compulsory registration.
Objectives of Paper Import Monitoring System
Ban on dumping of paper products in the domestic market through under-invoicing
Prohibition of entry of prohibited goods by false declaration
Prohibiting the re-transport of goods through other countries in lieu of trade agreements
3. India's retail inflation eases to 7.01 percent in June
Tags: Economy/Finance
Retail inflation based on the Consumer Price Index (CPI) declined to 7.01 per cent in June this year from 7.04 per cent in the previous month.
Important facts
This is mainly on account of marginal reduction in prices of vegetables and pulses, though it still remained above the Reserve Bank's level for the sixth consecutive month.
According to data released by the National Statistical Office (NSO) Consumer Price Index (CPI) based inflation stood at 6.26 per cent in June 2021.
The increase in prices in rural India was faster in the month of June as compared to the urban parts of the country.
CPI-based inflation for rural areas rose marginally to 7.09 per cent in June from 7.08 per cent in May.
Rural inflation was 6.16 per cent in June 2021.
Urban inflation declined to 6.92 per cent in June 2022 from 7.08 per cent in May 2022.
Inflation in the food basket in June 2022 was 7.75 per cent, compared to 7.97 per cent in the previous month.
The inflation figure in vegetables eased to 17.37 percent during June from 18.26 percent in May 2022.
The central bank has been asked to ensure that inflation remains at 4% with a margin of 2% on either side.
What is CPI based inflation or retail inflation?
CPI (Consumer Price Index) monitors retail prices at a certain level for price movement of a particular commodity, goods and services at rural, urban and all India levels.
The change in the price index over a period of time is known as CPI-based inflation, or retail inflation.
CPI formula - (Price of basket in current period / Price of basket in base period) x 100
Kindly see also 14 June 2022 post
4. Industrial output jumped 19.6% in May
Tags: Economy/Finance
According to data released by the National Statistical Office, the Index of Industrial Production (IIP) has increased by 19.6 per cent in May this year, from 7.1 per cent in the previous month.
Important facts
The manufacturing sector's output grew by 20.6% in May this year.
In May 2022, mining output increased by 10.9% and electricity generation increased by 23.5%.
Industrial production has been affected due to the Covid-19 pandemic since March 2020, when it stood at 18.7%.
It shrank by 57.3% in April 2020 due to a decline in economic activity in the wake of the lockdown imposed to contain the spread of COVID-19.
Industrial production had increased by 13% in August 2021.
Thereafter, IIP growth remained below 4.4% (in September) and touched an all-time low of 1% in November as well as December 2021.
Retail inflation
Meanwhile, retail inflation declined marginally to 7.01% in June, mainly due to a marginal moderation in food prices.
The Consumer Price Index (CPI) based inflation stood at 7.04% in May and 6.26% in June last year.
According to government data, inflation in the food basket stood at 7.75% in June 2022, up from 7.97% in the previous month.
The central bank has been asked to ensure that inflation remains at 4% with a margin of 2% on either side.
Index of Industrial Production (IIP)
It is an index that shows the growth rate in different industry groups of the economy over a given period.
The index is calculated and published on a monthly basis by the Central Statistical Organization (CSO).
Industry groups which are classified under IIP
Broad sectors - Mining, Manufacturing and Electricity
Use-based sectors - Basic Goods, Capital Goods and Intermediate Goods
5. GODI, the first Indian company to receive BIS Certification to sell Li-ion cells in India
Tags: Economy/Finance
Hyderabad-based GODI India has become the first company in the country to receive the Bureau of Indian Standards (BIS) certification for a lithium-ion cell made using its in-house technology.
Important facts
These cells were tested and qualified by a third-party testing agency, TUV.
GODI will also set up a giga-factory for battery cell manufacturing in India by 2024.
Which mainly refers to the facility used to manufacture electronic batteries on a large scale for use in electric vehicles.
For the first time in Indian History, NMC811 21700, 3.65V-4.5Ah Cylindrical Cells were Made-in-India and Made-for-India.
About Bureau of Indian Standards
Bureau of Indian Standards is the national standards body of India under the Department of Consumer Affairs, Ministry of Consumer Affairs, Food and Public Distribution, Government of India.
Headquarters- Manak Bhawan, Old Delhi
Director General- Pramod Kumar Tiwari
Established- 23 December 1986
GODI India, Founder & CEO- Mahesh Godi
6. RBI allows payments for cross-border trade in rupee
Tags: Economy/Finance
The Reserve Bank of India (RBI) on 11 July allowed invoicing and payments for international trade in rupees.
Rupee Settlement System for International Trade
Banks acting as authorized dealers for such transactions would be required to obtain prior approval from the regulator to facilitate the same.
Under the invoicing system, all exports and imports can be denominated and invoiced in rupees.
The exchange rate between the currencies of two trading partner countries can be determined by the market.
Exporters and importers can now use a special Vostro account linked to the partner country's bank for receipts and payments in Rupees.
A Vostro account is one that is opened by a bank on behalf of a foreign bank in its home country.
These accounts can be used to pay for projects and investments, manage import or export advances, and invest in Treasury bills.
Bank guarantees, adjustment of export receivables, advances for exports, utilization of surplus funds, approval process, documentation etc. will be covered under FEMA rules.
Why did RBI take this step?
The rupee is at a historically low level against the dollar.
This mechanism has been brought in to facilitate trade with sanctioned countries.
Payments became difficult for exporters immediately after the Russo-Ukraine War broke out.
Payment issues with Russia could be eased as a result of the Trade Facilitation Mechanism introduced by RBI.
The move will also reduce the risk of forex fluctuations, especially in view of the Euro-Rupee parity.
This can be seen as the first step towards 100% convertibility of rupee.
This will also help to stabilize the rupee.
Many countries including Sri Lanka and some countries in Africa and Latin America are facing foreign exchange crunch.
The new mechanism will help India promote its exports.
7. R. Dinesh elected as President of CII for 2022-23
Tags: Economy/Finance Person in news
R Dinesh, Executive Vice President, TVS Supply Chain Solutions, has been named as the President of the Confederation of Indian Industry (CII) for 2022-2023.
Important facts
He previously served as the Chairman of National Committees on Logistics, CII Family Business Network India Chapter Council, CII Tamil Nadu State Council and CII Institute of Logistics Advisory Council.
From 2018 to 2019, he also served as the President of CII Southern Region.
ITC's Chairman and Managing Director Sanjiv Puri has been elected as the Vice-Chairman of the Confederation of Indian Industry (CII) for the financial year 2022-23.
Sanjeev Bajaj, Chairman and Managing Director, Bajaj Finserv Limited will continue as the chairman of the organisation for the current financial year.
About Confederation of Indian Industry (CII)
CII is a non-profit and non-governmental organisation.
The objective of CII is to achieve a conducive environment for the development of industry and civil society in India.
It was established in 1895.
It has over 8,000 members from both the public and private sectors.
8. Global Findex Database 2021
Tags: Economy/Finance
The World Bank recently released the “Global Findex Database 2021”.
Major findings of the report
Account ownership
According to this report, account ownership has increased worldwide.
Today three out of four adults have a financial account, according to this report. Yet 1.4 billion adults do not have a bank account.
Account ownership has increased by 50% worldwide, with 76 percent of the adult population having access to accounts.
Account ownership has increased widely in dozens of developing economies, and most new accounts have been opened in India and China.
Access to Formal Banking
The bulk of the global population (130 million and 230 million, respectively) without formal banking lives in India and China.
Men in developing countries accounted for 74%, while women were six points behind, with 68% of the accounts.
Unbanking
Globally 24% of adults are unbanked, with one of various reasons being a lack of money, with distance being a barrier for 31% of unbanked adults.
People who do not have an account with any financial institution or mobile money service provider are classified as unbanked.
Globally, 64% of unbanked adults are educated at the primary level or below.
36% of unbanked adults worldwide say financial services are too expensive.
Covid-19 and digital payments
In 2021, 18% of adults in developing countries paid utility bills directly from the account. About one-third of these bills were paid online for the first time.
Mobile money
Mobile Money is supporting financial inclusion in sub-Saharan Africa, especially for women.
There are 11 economies where adults have more mobile money accounts than financial institution accounts, all located in sub-Saharan Africa.
9. Vivo India transferred Rs 62,476 crore to China to avoid taxes
Tags: Economy/Finance National News
According to a statement issued by the Enforcement Directorate, Rs 62,476 crore has been "illegally" transferred to China by smartphone maker Vivo to evade payment of taxes in India between 2017 and 2021.
Important facts
18 companies that were incorporated fraudulently helped the smartphone maker Vivo to transfer 50 percent of the turnover outside India to mainly China.
Under the provisions of the Prevention of Money Laundering Act (PMLA), 119 bank accounts of entities with a gross balance of Rs 465 crore have been seized so far.
While transferring money to China, Vivo India has shown losses in most of its associate firms.
The Ministry of Corporate Affairs (MCA) has filed a police complaint against Vivo's subsidiary Grand Prospect International Communication Pvt Ltd (GPICPL), its directors, shareholders, certifying professionals etc.
Prevention of Money Laundering Act
It was enacted in 2002 and came into force in 2005.
The objective of the Act is to prevent money laundering, that is, the process of converting black money into white.
The Act empowers government officials to confiscate property acquired through illegal sources and money laundering.
Under the Act the burden of proof lies with the accused, who has to prove that the suspect property has not been obtained through unfair means.
Enforcement Directorate
It is a specialised financial investigation agency under the Department of Revenue, Ministry of Finance, Government of India.
It is a law enforcement and economic intelligence agency responsible for enforcing economic laws and fighting economic crime in India.
Its name was changed to Enforcement Directorate (ED) in 1957.
Its headquarters is in New Delhi and has many regional offices all over the country.
The Directorate of Enforcement (ED) - Sanjay Kumar Mishra
10. HDFC, ICICI, Axis Bank allowed to provide services for overseas procurement
Tags: Economy/Finance
The Defence Ministry on 7 July has approved three Private Sector Banks to provide financial services in overseas procurement.
The ministry has allowed HDFC Bank, ICICI Bank and Axis Bank to provide letter of credit and direct bank transfer business for overseas procurement.
In this regard, PCDA on behalf of the Ministry of Defence had recently signed a Memorandum of Understanding (MoU) with these three banks in New Delhi.
Till now only authorized public sector banks were used to provide these services to the Ministry of Defence.
For the first time, three private sector banks have also been allowed by the Defence Ministry to provide financial services for overseas procurement.
Selected banks can be allotted with LC business of Rs 2,000 crore (Rs 666 Crore for each bank under both capital as well as Revenue) on capital and revenue side for a period of one year on concurrent basis.
The performance of these banks will be regularly monitored so that further action can be taken as required.
