Banking, Financial and Economic Awareness of 23 and 24 September 2020

1. JETRO to support Japanese and Indian companies establishing and expanding business in Africa

• Japan External Trade Organisation (JETRO) will support Japanese and Indian companies establishing and expanding business in Africa.
• Japan is the fourth largest investor in India. During the 2000-2020, cumulative FDI inflows from Japan to India stood at $33.5 billion. 
• Cumulative FDI inflows of $33.5 billion during 2000-2020 were equal to 7.2% of India’s total FDI inflows.
• Now, India is also part of Japan’s $230-million subsidy programme, which aims to help relocate Japanese companies in China to other countries.
• Japan External Trade Organisation (JETRO) is foreign trade promotion body of Japan.

2. CAG report shows non-utilization of cesses, levies for specified purposes

• CAG report on the accounts of the government for 2018-19 shows non-utilization of cesses, levies for specified purposes.
• As per the report, the Central government has collected ₹2.74-lakh crore through 35 types of cesses during FY 2018-19.
• The government has only transferred ₹1, 64,322 crores to Reserve Funds and kept the rest amount in the Consolidated Fund of India.
• However, the rules require that the government should first transfer collections to Reserve Funds and then use it for specific purposes as approved by Parliament.
• The report says that a ‘Social Welfare Surcharge’ on Customs Duty was levied. But, a dedicated fund for ‘Social Welfare Surcharge’ on Customs Duty was not created.
• As per the report, the government has not credited more than ₹40,000 crore of GST Compensation Cess to related Reserve Fund. ₹10,157 crore of the Road and Infrastructure Cess were also not transferred to the related Reserve Fund.
• Similarly, the government has not transferred more than ₹1.24-lakh crore collected as cess on crude oil to Oil Industry Development Board and kept in CFI.
• ₹2,123 crore of the Universal Service Levy and ₹79 crore of the National Mineral Trust Levy were also not transferred to Reserve Funds.
• The report says that states received overall fewer funds on account of IGST.  
• Article 266 of the Constitution provides for a Consolidated Fund of India from which money can be withdrawn as prescribed by Parliament.
• Comptroller and Auditor General of India (CAG):
  • It is an independent authority established under Article 148 of the Indian Constitution and appointed by the President of India.
  • CAG is the head of the Indian Audit and Accounts Department.
• In August 2020, Former J&K Lieutenant Governor G C Murmu has been appointed as new CAG of India.

3. SEBI increases penalty on ICRA and CARE

• SEBI has increased the penalty on ICRA and CARE from ₹25 lakh to ₹1 crore.
• In December 2019, SEBI fined ICRA and CARE for giving high ratings (AAA) to Non-Convertible Debentures (NCDs) of IL&FS, which later defaulted in payments.
• The failure of IL&FS became known in 2018 when SEBI examined the rating agencies.
• SEBI has increased the fine after seeing the orders of its Adjudicating Officer. SEBI found that the fine is not equal in proportion to impact of wrong ratings on market.
• Along with defaulting on interest payments on NCDs, IL&FS and its subsidiary IL&FS Financial Services (IFIN) have defaulted on their obligations on commercial paper (CP), inter-corporate deposits (ICDs).

4. GSMA postpones Mobile World Congress (MWC) 2021

• GSMA has changed the date of Mobile World Congress (MWC) 2021 from early March to 28 June.
• The MWC 2021 will now be held from 28 June to 1 July in Barcelona, Spain. The theme for MWC 2021 is connected impact.
• The annual event will be held physically. But the number of attendees will be decreased.
• GSMA has also changed the date of the Chinese edition of MWC (MWC Shanghai) to 23-25 February.
• GSMA (GSM Association) has 750 operators and 400 companies as its members. GSM refers to Global System for Mobile Communications, a standard by European Telecommunications Standards Institute for 2G mobile networks.
• Mobile World Congress (MWC) is the mobile industry’s largest exhibition and conference.  It is now known as MWC Barcelona.  GSMA will keep MWC in Barcelona until 2024. 

5. Major Port Authorities Bill, 2020 passed by Lok Sabha

• Major Port Authorities Bill, 2020 has been passed by Lok Sabha to replace Major Port Trusts Act, 1963.
• The bill has provision for the creation of a Board of Major Port Authority for each major port to replace existing Port Trusts.
• Board of Major Port Authority will have a Chairperson and a Deputy Chairperson. It will have a member from the state government.
• One member of the Board of Major Port Authority will be from each Ministry of Railways, Ministry of Defence and Customs Department.  
• The bill provides more autonomy to major ports of India, increases transparency in functioning and helps them in developing world class infrastructure.
• The bill’s provisions will not have an effect on the pension of the retired employees of major ports.
• Major ports in India:
  • There are a total of 13 major seaports in India, 12 of which are government and one is Ennore Port of Chennai is corporate.
  • The other 12 major ports of India are as follows: Kolkata Port, Paradip Port, New Mangalore Port, Cochin Port, Jawaharlal Nehru Port, Mumbai Port, Kandla Port, Visakhapatnam Port, Chennai Port, Tuticorin Port, Mormugao Port and Port Blair Port.

6. Three labour code bills passed in Rajya Sabha

• Industrial Relations Code 2020, Code on Occupational Safety, Health & Working Conditions Code 2020 and Social Security Code 2020 has been passed in Rajya Sabha on 23 September.
• Lok Sabha has already passed these bills on 22 September.  Social Security Code 2020 extends the reach of ESIC and EPFO. The facility of ESIC will be provided in all 740 districts.
• It provides for the linking of establishments in hazardous sectors, even if the establishment has only one worker.
• Government will make a scheme for linking unorganized sector and Gig workers with ESIC.
• The code gives plantation owners the option of linking plantation workers with ESIC and to establishments with less than 10 workers.
• All establishments having 20 workers would be covered under EPFO. But, establishments having less than 20 workers will have the option to join EPFO.
• Social Security Code 2020 also provides for the creation of the Social Security Fund.
• Occupational Safety, Health & Working Conditions Code, 2020, provides for free health checkup of workers of a certain age once a year by employer and, for the first time, gives legal right for an appointment letter to workers.
• Industrial Relations Code, 2020, provides for two members instead of one member in the Industrial tribunal. It says that the award of the tribunal is to be implemented in 30 days.
• Industrial Relations Code, 2020, also provides for negotiating union and negotiating council for negotiations on any dispute. It has a provision for the RE-Skilling fund for the first time.
• The codes also provide for the establishment of the National Occupational Safety and Health Board. They also provide for Database on Migrant Workers, journey allowance to them from Employer to visit home town once a year and helpline to redress their grievances.

Read Banking Awareness PDF - 23 and 24 September 2020