Banking, Financial and Economic Awareness of 21 and 22 May 2020

1. Local products having GI logo need to be supported

• There is a need to support local products having GI logo, which was announced by Department for Promotion of Industry and Internal Trade (DPIIT) in August, 2018.
• DPIIT has also announced a tagline ‘Invaluable products of Incredible India’ in August 2018.
• The GI logo is having two alphabets, tricolours and tagline. The two alphabets on GI logo are G and I.

(Source: The Hindu)

• Total 361 foreign and Indian unique products are recognised and registered with GI registry.
• In July 2019, government has also provided guidelines for usage of GI logo. But, they are not implemented till now.
• To administer Geographical Indications of Goods (Registration and Protection) Act, 1999, Government has formed GI registry. Its location is at Chennai. The act became effective in September, 2003.

2. Safe Harbour Rules notified for the AY 2020-21 

• Safe Harbour Rules for the Assessment Year (AY) 2020-21 have been notified by the Central Board of Direct Taxes (CBDT).
• The rules have not changed the rates. The rates for AY 2020-21 will remain same to the rates for AY 2017-18 to 2019-20.
• CBDT has introduced the concept of the safe harbour in 2009. It provides for situations in which transfer price is accepted by tax authorities without questioning or scrutiny.
• After introduction in 2009, the 1^st round of SHR rules came in August 2013 for 3 years. They were revised in 2013. The revised SHR rules were effective till FY 2019.
• On 20 May, CBDT changed Rule 10TD and 10TE of IT Rules, 1962 and made the rates for AY 2017-18 to 2019-20 effective for AY 2020-21.

3. Partial Credit Guarantee Scheme (PCGS) 2.0 guidelines issued 

• Finance Ministry has issued guidelines for extended Partial Credit Guarantee Scheme (PCGS 2.0).
• The PCGS 2.0 provides temporary liquidity support to NBFCs/HFCs and limits guarantees at Rs 10,000 crore.
• The Finance Minister has announced PCGS 2.0 under first part of PCGS 2.0. It aims at dealing with temporary liquidity mismatches of NBFCs/HFCs/MFIs that are otherwise solvent.

• PCGS 2.0 does not cover pooled debt instruments and covers all bonds/CPs of primary issuance that PSBs can buy.
• In December 2019, Government has launched current Partial Credit Guarantee Scheme.

4. Scheme for Formalization of Micro Food Processing Enterprises approved

• A new Scheme for Formalization of Micro Food Processing Enterprises has been approved by union cabinet.
• The scheme is a centrally sponsored scheme. The central government will provide 60% of expenditure and state government will provide remaining expenditure.
• The scheme is for unorganized sector and it carries an outlay of Rs. 10,000 crore.
• The scheme will continue for five years from 2020-21 to 2024-25 and help 2 lakh micro enterprises with credit linked subsidy.
• Under the scheme, a credit link subsidy will be given to micro enterprises at 30% of the cost of eligible project. The subsidy will have limit of RS 10 lakh.
• The scheme will be implemented all over India. Under the scheme, a SHG will get Rs 4 lakh as seed capital.
• An Inter-Ministerial Empowered Committee will monitor the scheme at central level and State and UT Level Committee will monitor the scheme at state/ UT level.
• Minister of Food Processing Industries will be the chairman of the committee at central level.  Chief Secretary will be the chairman of the committee at state/ UT level.
• Annual action plan will be prepared by states and approved by centre. There will also be third party evaluation of implementation of scheme.

5. Futures trading launched on Agridex

• Futures trading have been launched on Agridex by National Commodity and Derivatives Exchange (NCDEX).
• Four contracts with expiry dates in June, July, September and December will be offered from May 26.
• NCDEX has also entered into partnership with NSE Indices. The partnership is for maintaining and disseminating NCDEX Agridex values on real-time basis.
• NSE Indices limited maintains and calculates first return based agricultural futures index of India or NCDEX Agridex.
• NCDEX Agridex tracks ten commodities that are traded on NCDEX. It was launched in November 2019.
• National Commodity & Derivatives Exchange Limited (NCDEX) was launched in December 2003. It is an online commodity exchange located in Mumbai.

Read Banking Awareness PDF - 21 and 22 May 2020