Banking, Financial and Economic Awareness

Main Headlines:

Topic: Taxation

1. GST Council likely to correct inverted duty structure for textiles and footwear industries.

GST Council is likely to correct the inverted duty structure for textiles and footwear industries.
In an inverted duty structure, duty on inputs is higher than levy on finished products. This provides higher refund to industry and negatively affects revenue collections of government.
GST Council’s Fitment Committee was of the view that the rate of readymade garments and made-ups should be uniform at 12%.
The Committee is for keeping rate unchanged on Covid vaccines, PPE kits and N-95 masks. It has recommended lowering the duty on oxygen concentrators and pulse oximeters for a limited period.
Final decision on suggestions of Fitment Committee will be taken at GST Council’s meeting on May 28.
GST Council’s Fitment Committee prepares proposals for rate revisions. Its suggestions are not binding on the GST Council. It consists of tax and revenue officers from Centre and states.

Topic: Committees/ Commissions/Taskforces

Finance Ministry has formed a Group of States’ Finance Ministers (GoM) to look into GST issues related to casinos, race course and online gaming.
Nitin Patel will be Convener of the Committee (GoM). He is Deputy Chief Minister of Gujarat. The Committee (GoM) has six members.
GoM will submit its recommendation to GST Council within six months. It will examine valuation of services provided by casinos, race courses and online gaming portals.

Topic: Miscellaneous

National Highways Authority of India (NHAI) has issued guidelines to ensure that service time at toll plaza does not exceed 10 seconds per vehicle.
The guidelines will ensure service time of not more than 10 seconds per vehicle even during peak hours at toll plazas on National Highways.
Vehicles will be allowed to pass without paying the toll in case of queue of more than 100 metres of waiting vehicles until the queue comes within 100 meters range.
A yellow line will be marked in each lane at a distance of 100 meters from toll booth.
National Highway Authority of India (NHAI):
- The National Highway Authority of India is an autonomous agency of the Government of India.
- It is a nodal agency of the Ministry of Road Transport and Highways.
- It was founded in 1988.
- Its headquarters is located in New Delhi.
- Current Chairman: Sukhbir Singh Sandhu

Topic: Committees/ Commissions/Taskforces

International Financial Services Centres Authority (IFSCA) has formed an expert committee on Investment Funds.
The committee is headed by Nilesh Shah, Managing Director, Kotak Mahindra Asset Management Co Ltd.
It will recommend long-term vision for operation of Investment Funds in IFSC. It has 12 members.
It will also give recommendations with respect to the structure of Investment Funds in IFSC.
The committee will give short-term and mid-term recommendations.
Short-term recommendations can be implemented by IFSCA immediately in less than 3 months. Mid-term recommendations may be implemented in mid-term (6 month to 1 year).

Topic: Corporates/Companies

ZipLoan has entered into a partnership with InCred to provide micro-loans to MSMEs that are not able to access financial services from traditional banking players.
Micro-loans will range from Rs1 lakh to Rs10 lakh with tenure upto 36 months.
As part of the partnership, ZipLoan will originate and process unsecured retail business loans.
InCred will have 80 % of the total loan on its books, while the remaining will be on ZipLoan’s books.
ZipLoan is a trade name of Blue Jay Finlease Ltd. It is an RBI registered NBFC with headquarters in Delhi. InCred is an NBFC headquartered in Mumbai.

Topic: Infrastructure and Energy

Indian Renewable Energy Development Agency (IREDA) has invited bids for central government’s ₹4,500 crore worth PLI scheme for setting up solar manufacturing units.
The offer-for-bids will close on June 30. Under the scheme, PLI will be disbursed to successful bidders annually for five years since commissioning of their plant.
The Cabinet approved the production-linked incentive (PLI) scheme in April. It gives manufacturers 1-1/2 to 3 years to set up new units.