Banking, Financial and Economic Awareness of 26 and 27 May 2021

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

2. Finance Ministry forms a Group of States’ Finance Ministers (GoM) to look into GST related to casinos, race course and online gaming.

• 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

3. NHAI issues guidelines to ensure that service time at toll plaza does not exceed 10 seconds per vehicle.

• 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

4. IFSCA formed an expert committee on Investment Funds.

• 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

5. ZipLoan enters into partnership with InCred to provide micro-loans to MSMEs.

• 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

6. IREDA invites bids for central government’s ₹4,500 crore solar production-linked incentive (PLI) scheme.

• 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.

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