Banking, Financial and Economic Awareness of 16 and 17 March 2020

1. Appropriation Bill 2020-21 passed by Lok Sabha

• Lok Sabha has passed Appropriation Bill 2020-21 and authorized government to spend ₹110 lakh crore from the Consolidated Fund of India for the financial year 2020-21.
• Passing of Appropriation Bill 2020-21 is a stage in the process for approval of Budget 2020-21.
• Now, Finance Bill will be discussed and passed in the next stage. Finance Bill contains tax proposals of the government.
• Lok Sabha speaker, Om Birla, has decided to guillotine demands of grants for various ministries.
• During the passing of Budget 2020-21, demands for grants of three ministries were discussed by Lok Sabha. They are tourism, railways and social justice and empowerment.
• Guillotine means placing a time limit on the demands of grants. Guillotine helps in the timely passage of the Finance Bill.
• Guillotine is invoked after discussion on demand for grants for certain ministries. Once guillotine is invoked, pending demands are urgently put to vote. 
• Article 266 of the Constitution provides for the Consolidated Fund of India.
• Stages for the passing of budget:
  • There are six stages for passing of budget in Parliament.
  • In the first stage, the budget is presented by the Finance Minister with budget speech.
  • In the second stage, both the houses of Parliament hold general discussion on Budget.
  • In the third stage, departmental standing committees scrutinize demands for grants of ministries.
  • In the fourth stage, Lok Sabha votes on demands for grants for 26 days.
  • Appropriation Bill and Finance Bill are respectively passed in the fifth and sixth stages.

2. Government not planning to stop ₹2,000 notes

• Government has said that it is not planning to stop ₹2,000 notes.
• Government has not ordered presses to print ₹2,000 denomination notes for the Financial Year 2019-2020.
• Government consults RBI before deciding on the printing of banknotes to keep the availability of banknotes of different denominations at the desired level.
• SBI and Indian bank have made changes to their ATMs for ₹500 and ₹200 notes.
• Till 31^st March 2019, nearly 5,225 complaints of financial fraud were received on Sachet portal.
• Sachet is a portal of RBI that helps the public to file complaints of financial frauds. 
• Government has implemented Banning of Unregulated Deposit Schemes Act, 2019, from February 21, 2019.
• It aims to keep a check on Ponzi schemes and safeguard interests of people, 
• Government has also said that it is not having any proposal for changing compensation cess on tobacco products.
• GST council gives recommendations for fixing GST rates and cess on goods. 

3. DoT requests SC to give 20 years to telecom companies

• Department of Technology (DoT) has requested the Supreme Court to give 20 years to telecom companies for payment of AGR dues.
• In its plea before SC, DoT said that telecom companies should be allowed to pay AGR dues in annual installments.
• DoT has requested that interest on unpaid dues may be stopped as of 24^th October, 2019.
• DoT plea says that telecom companies should be held responsible for paying interest on not yet paid dues of the license fee and spectrum usage charges that begin to develop after SC judgment of October 24.
• In its October 24, 2019 judgment, SC has decided January 23, 2020, as deadline for payment of Adjusted Gross Revenue dues.
• On January 23, DoT had issued notification for not taking strict action in case of telecom companies failing to pay dues.
• Telecom companies filed a plea in SC for permitting them to negotiate with DoT and pay dues slowly.
• On February 14, SC fixed March 17 as the deadline for full payment of AGR dues.

4. Wholesale inflation remains at 2.26% in February

• Wholesale inflation has remained at 2.26% in February. It remained at 3.3% in January.
• In February 2019, wholesale inflation was at 2.93%.
• During the financial year 2019-20, build-up inflation rate remained at 1.92 %.
• During the financial year 2018-19, build-up inflation rate was 2.75 %.
• In February 2020, WPI Food Index became lower to 7.31% from 10.12% (January 2020).
• WPI Food Index is an aggregate of the Wholesale Price Index of Food Articles from Primary Articles group and Wholesale Price Index of Food products from the Manufacture Products category. It was started in May 2017.
• In February, the Consumer Price Index became lower to 6.58% from 7.59 % in January.
• Despite decline, CPI is still higher than range fixed by RBI.  The range fixed by RBI is 4% with a margin of 2% on either side. This means that CPI should not cross the range of 2% to 6%.       
• Build-up inflation is a part of the current inflation rate. Current inflation rate is a sum of build-up inflation, demand-pull inflation and cost-push inflation.
• If demand-pull inflation and cost-push inflation continue for a longer time, build-up inflation starts to develop.

Multiple Choice Questions (MCQs)

1. Lok Sabha has recently passed Appropriation Bill 2020-21. Appropriation Bill authorizes the government to withdraw money from

1. Contingency Fund of India
2. Consolidated Fund of India
3. Public Account of India
4. Both A and B
5. A, B and C

2. Which of the following category of notes were not printed by the government in Financial Year 2019-2020?

1. ₹100 notes
2. ₹200 notes
3. ₹500 notes
4. ₹2,000 notes
5. None of the above

3. When did Supreme Court fix March 17 as the deadline for payment of adjusted gross revenue dues by telecom companies?

1. July 14, 2019
2. September 18, 2019
3. October 24, 2019
4. February 14, 2020
5. January 23, 2020

4. In February, wholesale inflation declined from 3.3% in January to

1. 2.2 %
2. 2.3 %
3. 2.4%
4. 2.5%
5. 2.6%

Solution:

1. B

2. D

3. D

4. B

Read Banking Awareness PDF - 16 and 17 March 2020