Banking, Financial and Economic Awareness

2020-03-31

1. Government allows IS benefits to banks and PRI benefits to farmers till 31st May

  • The government has allowed 2% IS benefits to banks and 3% PRI benefits to farmers till 31st May.
  • Till 31st May, banks will get 2% interest subvention (IS) benefit for every crop loan that is less than or equal to Rs. 3 lakh and is due for payment or will become due during 1st March 2020 to 31st May 2020.
  • Similarly, farmers will get 3% Prompt Repayment Incentive (PRI) benefit for every crop loan that is less than or equal to Rs. 3 lakh and is due for payment or will become due during 1st March 2020 to 31st May 2020. 
  • Government has extended these benefits to farmers to help them from the negative effects of lockdown and COVID-19 pandemic.
  • Government gives 2% interest subvention to banks to provide crop loans to farmers at concessional rates.

2. Government gives more time for payment of PLI and RPLI premium

  • The government has given more time for payment of Postal Life Insurance (PLI) and Rural Postal Life Insurance (RPLI) premium.
  • PLI and RPLI premium can be paid till 30 April and no penalty will be applied.
  • PLI and RPLI premium period has been extended as PLI and RPLI customers may not be able to pay the premium due to restricted movement caused by lockdown.
  • RPLI was started in 1995 after the recommendations of Malhotra Committee. It covers weaker sections, women workers and people living in rural areas.
  • PLI was started in 1884. Initially, it was limited to postal employees only. But, it now covers central government employees, employees of state governments, CPSUs and state PSUs and banks.
  • Defence officers and staff, paramilitary officers and staff, university employees, employees of educational institutions aided by government and other employees are also covered under PLI.

3. ADB to invest 100 million US Dollars through NIIF

  • Asian Development Bank (ADB) will invest 100 million US Dollars through National Investment and Infrastructure Fund (NIIF).
  • The investment will be made in the Indian infrastructure sector through NIIF.
  • NIIF was started in February 2015. It consists of three funds. They are master fund, fund of funds (fof), and strategic investment fund.
  • Asian Development Bank (ADB) was formed in1966. It is headquartered in Mandaluyong City in Manila, Philippines. Masatsugu Asakawa is its President.
  • ADB has 68 member countries. It works for social and economic development and extreme poverty eradication in Asia and Pacific.
  • Japan holds maximum percentage of ADB's total subscribed capital and total voting power. Japan is followed by US, China, India and Australia. So, India is fourth largest holder of ADB's total subscribed capital and total voting power.

4. Amendment in Indian Stamp Act to come into effect from July 1

  • The government has said that the amendment in the Indian Stamp Act will come into effect from July 1.
  • Earlier, the amended Indian Stamp Act, 1899 was to become effective from April 1, 2020.
  • Indian Stamp Act, 1899, was amended through Finance Act 2019 to make stamp duty collection efficient and prevent evasion of tax.
  • Amendments in the Indian Stamp Act include decision to make Maharashtra's stamp duty rates as the benchmark because collections from Maharashtra form 70% of total stamp duty collection.
  • Amendments in the Indian Stamp Act also include payment of stamp duty by either buyer or seller of financial security.

5. FTP 2015-20 may be extended by six months

  • The government may extend Foreign Trade Policy (FTP) 2015-20 by six months after April 1, 2020.
  • Public consultations for FTP 2020-25 have not been completed till now.
  • Extension of current FTP will mean the continuation of current schemes for importers and exporters such as Merchandise Export from India Scheme (MEIS) and Export Promotion Capital Goods (EPCG).
  • In April- February 2020, exports of goods from India have decreased by 1.5% to $292.91 billion and exports may decrease further due to Covid 19 pandemic.
  • Earlier, the government has announced the replacement of MEIS scheme with the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme.
  • Export Promotion Capital Goods (EPCG) scheme was started by the Directorate General of Foreign Trade (DGFT) under FTP 2015-20.
  • It aims to make the import of capital goods easier and increase the manufacturing competitiveness of India.

 

Multiple Choice Questions (MCQs)

1. Recently, the government has allowed 2% Interest Subvention (IS) benefits to banks till

  1. 31st April 2020
  2. 31st May 2020
  3. 31st June 2020
  4. 31st April 2021
  5. 31st May 2021

2. Recently, government has said that Postal Life Insurance (PLI) premium can be paid till 30 April. When was PLI scheme started?

  1. 1884
  2. 1984
  3. 1995
  4. 2004
  5. 2005

3. How much money will be invested by Asian Development Bank (ADB) through National Investment and Infrastructure Fund (NIIF)?

  1. 10 million US Dollars
  2. 50 million US Dollars
  3. 100 million US Dollars
  4. 500 million US Dollars
  5. 1000 million US Dollars

4. Which of the following states accounts for 70% of total stamp duty collection?

  1. Odisha
  2. Tamil Nadu
  3. Uttar Pradesh
  4. Maharashtra
  5. Madhya Pradesh

5. In April- February 2020, exports of goods from India have decreased by

  1. 0.5%
  2. 1.0%
  3. 1.5%
  4. 2.0%
  5. 3.0%

 

Solution:

1. B

2. A

3. C

4. D

5. C

 

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