Economy

CURRENT AFFAIRS april 2019

PAN Card Aadhaar linkage deadline

extended till September 2019

Central Board of Direct Taxes (CBDT) has extended date of linking Permanent
Account Number (PAN) card with Aadhaar by six months till September 30,
2019 from existing deadline of March 31, 2019 This is for the sixth time
government has extended the deadline. However, CBDT has announced that
Aadhaar will remain mandatory for filing income tax returns (ITRs) following
the Supreme Court order.

Background
The five-judge Supreme Court constitution bench in September 2018 had
declared Central Government’s flagship Aadhaar scheme as constitutionally
valid and held that biometric ID would remain mandatory for filing of IT
returns and allotment of PAN. However, it held that it is not mandatory to link
Aadhaar to bank accounts and telecom service providers cannot seek its
linking for mobile connections.
The apex court in its February 2019 order also had upheld section 139AA of
Income Tax (IT) Act. It also upheld mandatory to link PAN with Aadhaar
number for filing income tax return.

Section 139AA of IT Act

It was introduced by Finance Act, 2017. It makes mandatory to Aadhaar for
the filing of return of income as well as in application form to enrol for PAN. It
makes mandatory for those possessing PAN numbers to link with their
Aadhaar. In case of failing to do so, it prescribes to invalid the PAN number.

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Economy
CURRENT AFFAIRS april 2019

Unorganized sector generates largest

number of jobs in India: Oxfam Report

According to Oxfam’s recently released 'Mind The Gap - State of Employment

in India' report, in India, largest number of jobs are generated in the
unorganized sector. The report also highlights that lack of quality jobs and
increasing wage disparity are key markers of inequality in the Indian labour
market

Highlights of report
Largest number of jobs were generated in the unorganized sector, which
highlights questions over India's growth data and not being reflected in the
growth of jobs.
Women’s participation: Regressive social norms continue to hamper women's
participation in the workforce. On an average, women are paid 34% less than
similarly qualified male workers for performing the same tasks.
Women are being left out of economic growth narrative as a consequence of
poor policy choices and lack of investment in social security and
infrastructure.
Demonitisation: Job generation was adversely impacted after demonetization
and hit the women workforce most. There is decline in rural jobs.
Post-demonetisation period also saw drop in households with two or more
persons being employed.
Between January and October 2016, 34.8% households saw two or more
persons employed. Post-demonetisation, this dropped to 31.8% with women
workers becoming the first casualties of job losses.
Social realities: Class and caste still continue to play crucial roles in
determining employment for men and women, especially in stigmatised
vocations like sanitation, jobs in the leather industry and rag-picking.

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Economy
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Discrimination also exists in terms of market participation
Policy interventions: Economic factors can be improved by way of policy
interventions. There is need shift in development focus towards labour
intensive sectors to create more jobs and pushes for better work conditions
to make jobs more inclusive.
There is need for higher investments in health and education to improve
productivity.
Disparities in education system: Students from state education boards do
considerably worse than those of independent national boards that cater to
richer, better schools.
Within public education system, there are also glaring inequalities in
educational investment.
Notes

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Economy
CURRENT AFFAIRS april 2019

Odisha’s Kandhamal Haldi accorded GI tag

Kandhamal Haldi, a variety of indigenous turmeric grown only in southern

Odisha, has received Geographical indication (GI) tag from Intellectual
Property India. It has been placed under Class-30 type trademark/GI for
grains and agricultural, horticultural, and forestry products.

Kandhamal Haldi
This unique variety of turmeric is grown in Odisha's southern hinterland. It is
key cash crop of tribal people from Kandhamal district of Odisha.
It has multifaceted utility in food, medicine and cosmetics considering its
unique aroma and color to food items and various cuisines.
It has more oleo resin and volatile oil contents compared to other turmeric
varieties. This gives it strong aroma and has high medicinal value and healing
properties.

Geographical Indication (GI)

It is name or sign used on products which corresponds to specific
geographical location or origin (can be town, region or country).
It acts as authenticity certification that product possesses certain qualities
and is made according to traditional methods and enjoys certain reputation
due to its geographical origin.
It is accorded to natural, agricultural and manufactured goods (commodity)
having special quality and established reputation.
It is covered as element of intellectual property rights (IPRs) under Paris
Convention for Protection of Industrial Property.
In India, GI recognition is valid for 10 years after which it needs to be
renewed. It is governed and regulated Geographical Indications of Goods

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Economy april 2019
CURRENT AFFAIRS
(Registration and Protection Act), 1999. This Act is administered by Controller
General of Patents, Designs and Trade Marks (under Ministry of Commerce),
who is also Registrar of GI.

Benefits of GI
It gives GI accorded products complete exclusivity, ensuring that no one can
use their name. It plays very important role to increase realm of market for
the original product. It also indirectly leads to sustainable development, boosts
exports as well tourism. It enables stakeholders to authenticate their
production while earning premium and derive improved livelihood. Its violation
is punishable offence under law.

Notes

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Economy
CURRENT AFFAIRS april 2019

Core sectors record 2.1% growth in

February 2019

According to data released by Ministry of Commerce, the combined index of

the eight sectors recorded 2.1% growth in February 2019. Its dismal show in
February 2019 was on account of fall in output registered in the crude oil and
refinery products.
Its cumulative growth during April to February 2018-19 was 4.3%. These eight
sectors had recorded had growth of 5.4% in February 2018.

Sector wise breakaway

Coal production: It grew by 7.3% in February 2019 against 1.3% growth in the
same period a year ago.
Steel production: It recorded 17.92% growth  as against 5% growth in the
same period a year ago.
Natural gas production: It grew by 3.8%.
Fertilizers Sector: It grew by 2.5%.
Cement production: It grew by 8%.
Electricity production: It grew by 0.7%, falling from 4.6% growth in February
2018.
Production of crude oil: It recorded -6.1% growth.
Refinery products: It recorded -0.8% growth.

About Index of Eight Core Industries (ICI)

It is monthly production volume index of eight core industries of the economy.
It is considered as lead indicator of monthly industrial performance.  Its base
year is 2011-12.
It measures individual as well as collective performance of production in
selected eight core industries viz. Petroleum Refinery Products, Natural Gas,
Coal, Fertilizers, Crude Oil, Steel, Cement and Electricity.

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Economy april 2019
CURRENT AFFAIRS
These eights industries are main industry of the economy i.e. are considered
as backbone of all other industries. They have significant impact on general
economic activities as well as industrial activities.
It is compiled and released by Office of Economic Adviser (OEA), Department
for Promotion of Industry and Internal Trade (earlier DIPP), Ministry of
Commerce & Industry.
These eight core sectors constitute 40.27% of total of the weight of items
included Index of Industrial Production (IIP).
Components and weightages of core sectors: Petroleum Refinery production
(weight: 28.04%), electricity generation (9.85%), Steel production (17.92%),
Coal production (10.33%), Crude Oil production (8.98%), Natural Gas
production (6,88%), Cement production (5.37%) and Fertilizers production
(2.63%). Note: Highest weightage is for Petroleum Refinery production
(weight: 28.04%) and lowest is for Fertilizers production (2.63%).

Notes

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Economy
CURRENT AFFAIRS april 2019

EU launches WTO case against India

over import duties on ICT products

European Union (EU) has filed complaint against India at World Trade
Organisation’s (WTO) dispute settlement mechanism over imposition of import
duties on wide range of ICT products. It has requested consultations with
Indian government under WTO rules governing settlement of disputes in this
regard.

EU Complaint
Challenges introduction of import duties by India on wide range of ICT
products ranging from 7.5 to 20%.
Imposition of import duties goes against India’s earlier legally binding
commitment in WTO to allow duty free trade in ICT products.
It is affecting EU significant economic interest as it exports ICT products
worth €600 million per year to India.
It is undermining competitiveness of European ICT companies which supports
hundreds of thousands of high value jobs across Europe.

Background
India had hiked import duty on certain information, communication and
technology (ICT) items including mobile phones and components, base
stations, integrated circuits and optical instruments in October 2018.  It was
hiked as part of Government’s efforts to check widening current account
deficit (CAD) by curbing unnecessary imports.
Seeking consultation is first step of dispute settlement process under WTO
international trade regime. If consultations requested does not result in
satisfactory solution, then EU can request that WTO set up panel in case to
rule on raised issue.

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Economy
CURRENT AFFAIRS april 2019

Government imposes antidumping duty on

solar cell component from four nations

Department of Revenue under Ministry of Finance has imposed anti-dumping

duty of up to US $1,559 per tonne on imports of Ethylene Vinyl Acetate sheet
used in solar cell making from China, Saudi Arabia, Malaysia and Thailand for
five years. It was imposed based on recommendation of Directorate General of
Trade Remedies (DGTR) under Commerce Ministry to safeguard domestic
players against cheap shipments.

Background
Following a complaint by domestic company, DGTR had initiated probe in April
2018. In its probe, it found that imposition of duty is required to offset
dumping and injury caused by dumped imports from China, Malaysia, Saudi
Arabia, and Thailand
Ethylene Vinyl Acetate (EVA) is a polymer based component used in the
manufacturing of solar PV (Photo Voltaic) modules. Its imports had increased
in recent times after launch of Jawaharlal Nehru National Solar Mission in
January 2010 aimed at generating 20,000 megawatt (MW) of solar power by
2022.
Imports of EVA sheets from these four countries had increased to 6,367 tonne
during period of investigation (October 2016 to September 2017) from 4,674
tonne in 2016-17. The imports stood at US $1,025 tonnes in 2015-16 and US
$594 tonnes in 2014-15.
Tap into the growing solar power sector in India, several countries were
dumping or exporting solar equipment at lower rates compared to domestic
market. Due to surge in cheap imports, domestic industries were impacted.

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Economy
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Anti-Dumping Duty
It is import duty imposed by government as protectionist and counter import
measure on imported products which have prices less than their normal
values or domestic price.  It is imposed under multilateral World Trade
Organisation (WTO) regime to protect its domestic producers and market
from below-cost/cheap imports

It is aimed at ensuring fair trading practises and create level-playing field for
domestic producers with regard to foreign producers and exporters.  In
India, anti-dumping duty is imposed by Finance Ministry (Revenue
Department) based on is recommendation of Ministry of Commerce (i.e. by
DGAD).

Notes

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Economy
CURRENT AFFAIRS april 2019

CBDT enters into 18 Advance Pricing

Agreements

Central Board of Direct Taxes (CBDT) entered into 18 Advance Pricing

Agreements (APAs) including three Bilateral APAs (BAPAs) in March 2019.
These 18 APAS cover international transactions in sectors pertaining to
manufacturing, software development services, other services, royalty
payment for technology and brand, trading and payment of interest. With this,
total number of APAs entered into by CBDT so far has increased to 271,
including 31 BAPAs. In FY 2018-19, CBDT had signed 52 APAs, including 11
BAPAs

Advance Pricing Agreement (APA)

It is agreement entered between taxpayer and tax authority determining
Transfer Pricing methodology for pricing tax payer’s international
transactions for future years. In this case, transfer pricing is setting of price
for goods and services sold between related legal entities or subsidiaries
within enterprise.

APAs can be of three types

Unilateral: It involves only taxpayer and tax authority of country where
taxpayer is located.
Bilateral: It involves tax payer, associated enterprise (AE) of taxpayer in
foreign country, tax authority of country where taxpayer is located and
foreign tax authority of AE.
Multilateral: involves taxpayer, two or more AEs of tax payer in different
foreign countries, tax authority of country where taxpayer is located and tax
authorities of AEs.

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 april 2019
Economy
CURRENT AFFAIRS
India’s APA scheme
It was launched by Government aims to provide certainty to taxpayers in
domain of transfer pricing by specifying methods of pricing and setting
prices of international transactions in advance.  Its provision was
introduced in Income-Tax (IT) Act, 1961 in 2012. Further rollback provision
was added to in 2014.  It aims gives certainty to taxpayers (including MNCs)
agreed by them on certain principles in valuation of their cross-border
transactions. It also provides them with alternate dispute resolution
mechanism with respect to transfer pricing.

Benefits of APA
It helps in determining arm’s length price of international transactions in
advance for max period of five future years.
It provides certainty with respect to tax outcome of tax payer’s
international transactions.
It also seeks to strengthen Government’s resolve of fostering non-
adversarial tax regime.
It has significantly contributed towards improving ease of doing business in
India.
India’s APA regime is appreciated nationally and internationally for being
able to address complex transfer pricing issues in a fair and transparent
manner.
Notes

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ECONOMY
CURRENT AFFAIRS april 2019

ADB lowers India’s growth projection for

FY20 to 7.2%

Asian Development Bank (ADB) in its recently released Asian Development

Outlook (ADO) 2019 has lowered growth forecast of India for 2019-20 fiscal to
7.2% from 7.6% estimated earlier. The downgrade is attributed to moderation
in global demand and likely shortfall in revenue on domestic front. However,
India will remain one of the fastest-growing major economies in 2019-20

ADB Projections
For 2018-19, ADB has cut growth estimate to 7% from 7.3% projected in
December 2018.
The reasons for growth cut are weaker agricultural output and consumption
growth curtailed by higher global oil prices and lower government
expenditure.
Growth is expected to rebound to 7.2% in 2019 and 7.3% in 2020 as policy
rates are cut expected and farmers receive income support, bolstering
domestic demand.
This growth will reverse two years of declining trend as reforms to improve
business and investment climate take effect.
However, India’s growth faces some downside risks such as moderation in
global demand as financial conditions tighten, uncertainty arising out of global
trade tensions, and the weak economic outlook in industrial countries.
On the domestic front, growth could suffer if tax revenue falls short or any
disruption affects ongoing resolution of twin problems of bank and corporate
balance sheets/

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ECONOMY
CURRENT AFFAIRS
Asian Development Bank (ADB)
It is multilateral lending agency based in Manila, Philippines. It was
established on 19 December 1966.
It is collectively owned by its members. It has total 67 members – 48 from
Asia-Pacific region (including India) and 19 from outside.
It is modeled closely on World Bank and has similar weighted voting system
where votes are distributed in proportion with members' capital
subscriptions.
It envisions prosperous, inclusive, resilient, and sustainable Asia and Pacific,
while sustaining its efforts to eradicate extreme poverty in the region.
It assists its members, and partners, by providing loans, technical assistance,
grants and equity investments to promote social and economic development
It provides finance to both sovereign countries as well as to private entities. It
provides soft loans to poorer countries and hard loans to middle-income
countries.
Most of its lending is concentrated in five operational areas viz. education,
environment, climate Change & disaster management, finance sector
development, regional cooperation & integration and private sector lending.

Notes

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Economy
CURRENT AFFAIRS april 2019

BSE, India INX sign MoU with Moscow

Exchange

BSE and India International Exchange (India INX) became the first Indian
exchanges to sign MoU with Moscow Exchange (MOEX) to connect investor
community and companies in both countries besides allowing a capital
formation platform.
The three exchanges have mutual understanding of each other's market in
the premise of a bi-lateral investment. This MoU is expected to lead to
enhance understanding of activities in each other's market.

Under this MoU

They will also collaborate together to facilitate the development of channels
of communication. They will also conduct joint research to explore
possibility of further cooperating in area of cross-listing of derivative
products, dual listing, exchange traded fund (ETF) and fixed income product
cooperation.
These exchanges will use India-Russia Initiative as important portal for
professional intermediaries in both markets to share their know-how and
expand their client network in their home market and abroad.
It will allow India-Russia Initiative uses to have access to community of
professional intermediary networks to benefit their development and cross-
border operation, according to an official statement.

Bombay Stock Exchange (BSE)

It is the oldest stock exchange in Asia established by eight native stock
brokers association in 1875. It is ocated at Dala street, Mumbai. At present,
it is 10th largest stock market in the world by market capitalization at $1.7
trillion and has more than 5,000 companies listed in it.

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Economy
CURRENT AFFAIRS
India International Exchange (India INX)
It is India’s first international exchange located at IFSC Gujarat
International Financial Tech (GIFT) City in Gandhinagar district of Gujarat.
It is wholly-owned subsidiary of BSE. It trades in equity derivatives,
currency derivatives, commodity derivatives including Index and Stocks. It
also offers depository receipts and bonds.
It is one of world’s most advanced and fastest trading technology platforms
with turn-around time of 4 micro seconds. It operates for 22 hours in a day,
which allows international investors and NRIs to trade from anywhere
across globe.

Notes

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Economy
CURRENT AFFAIRS april 2019

India's GDP to expand 7.5% in

2019-20: World Bank

According to World Bank latest report on South Asia, India's GDP growth is
expected to accelerate moderately to 7.5% in fiscal year 2019-20. It will be
driven by continued investment strengthening-particularly private, improved
export performance and resilient consumption. The report came ahead of
spring meeting of World Bank and International Monetary Fund (IMF).
Report highlights
The real GDP growth was estimated at 7.2% in financial year 2018-19. Data for
first three quarters suggest that growth was broad-based.
Industrial growth accelerated to 7.9%, making up for a deceleration in services.
Besides, agriculture growth was robust at 4%.
On the demand side, domestic consumption remained primary growth driver.
Moreover, gross fixed capital formation and exports both also made growing
contributions.
Over last quarter, growth is expected to remain balanced across sectors.
Inflation dynamics also have been subdued over most of FY18/19.
India's GDP growth is expected to accelerate moderately to 7.5% in FY19/20/
With robust growth, and food prices poised to recover, inflation is expected to
converge toward 4%.
Moreover, both the current account and the fiscal deficit are expected to
narrow. On the external front, improvements in India's export performance and
low oil prices will also bring about reduction in CAD to 1.9% of GDP.
On the internal front, consolidated fiscal deficit is projected to decline, albeit
slowly (to 6.2 and 6.0% of GDP in FY19/20 and FY20/21 respectively).
As center's deficit is budgeted to remain unchanged at 3.4% of GDP in
FY19/20, burden of adjustment will rest on states.
There is steady decline in inflation due to sustained decline in food prices
since July 2018, subsequently complemented by softening of oil prices and
concomitant appreciation of the rupee.

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Economy
CURRENT AFFAIRS april 2019

India highest recipient of remittances

in 2018: World Bank

According to recently published World Bank's Migration and Development

brief, India retained its position as world's top recipient of remittances by
receiving record $79 billion back home in 2018. India was followed by China
($67 billion), Mexico ($36 billion), Philippines ($34 billion), and Egypt ($29
billion).
Key Highlights of WB Brief
Global remittances: Including high-income countries has reached $689 billion in
2018, up from $633 billion in 2017. Remittances are on track to become largest
source of external financing in developing countries.
Remittances to low-and middle-income countries: It has reached record high of
$529 billion in 2018, an increase of 9.6% over the previous record high of $483
billion in 2017.
Remittance to India: Over the last three years, India has registered significant
flow of remittances from $62.7 billion in 2016 to $65.3 billion 2017. Remittances
grew by more than 14% in India. Flooding disaster in Kerala has likely boosted
financial help that migrants sent to families.
Remittances to South Asia: It grew 12% to $131 billion in 2018, outpacing the 6%
growth in 2017. The upsurge was driven by stronger economic conditions in
United States and pick-up in oil prices, which had positive impact on outward
remittances from some Gulf Cooperation Council (GCC) countries. Avg cost of
sending remittance: Global average cost of sending $200 remittance remained
high, at around 7% in first quarter of 2019.
The high costs of money transfers reduce benefits of migration. Reducing
remittance costs to 3% by 2030 is global target under Sustainable Development
Goal (SDG) 10.7.
There is need for renegotiating exclusive partnerships and allowing players
operate through national post offices, banks, and telecommunications
companies to increase competition for opening new transferring and lowering
remittance prices.
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Economy
CURRENT AFFAIRS april 2019

Indian firms foreign investment rises 18%

to $2.69 billion in March 2019: RBI

According to Reserve Bank of India (RBI) data on outward foreign direct

investment, Indian companies' foreign investment abroad grew 18% to $2.69
billion in March 2019 as compared to the year-ago period. The domestic firms
had made investment of $2.28 billion in their subsidiaries and wholly-owned
units abroad during March 2018. In February 2019, investment by Indian
firms was $1.71 billion,

March 2019 Outward investments

Of the total investment overseas in March 2019, US $1.68 billion was in form
of loan, $564.97 million as equity while rest $443.71 million was in the form of
issuance of guarantee.
Major investors included Tata Steel, which invested $1.15 billion in its
subsidiary in Singapore.
It was followed by JSW Cement with $82 million investment in its wholly-
owned subsidiary in the UAE,
IONGC Videsh Ltd also made investment worth $70.37 million in various joint
ventures in Myanmar, Russia and Vietnam.

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Economy
CURRENT AFFAIRS april 2019

India needs to bolster level of capitalisation

of state-owned banks: IMF

International Monetary Fund’s (IMF) Financial Sector Assessment Programme

(FSAP) for India has recommended bolstering level of capitalisation of some
banks, particularly government-owned banks. This is required considering
high level of non-performing loans in India.

Highlights of FSAP for India

It also has recommended resolution and recognition of Non-performing loans
as part of process of cleaning up the banking system of non-performing loans.
It also acknowledged that some steps that were taken by authorities to boost
capital buffers in banks and also to improve governance in state-owned banks
that have had some positive impact.

Financial Sector Assessment Programme (FSAP)

It is comprehensive and in-depth analysis of country’s financial sector. Its
assessments are joint responsibility of the IMF and World Bank in developing
economies and emerging markets and of IMF alone in advanced economies.
It includes two major components: (i) financial stability assessment, which is
the responsibility of the IMF, and (ii) financial development assessment, which
is responsibility of World Bank.
Two-fold goal of FSAP assessments: Gauge stability and soundness of financial
sector and assess its potential contribution to growth and development.

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Miscellaneous
CURRENT AFFAIRS april 2019

India ranks 19th in Index of Cancer

Preparedness

India was ranked at 19 out of 28 countries in Index of Cancer Preparedness

(ICP) released by the Economist Intelligence Unit (EIU). It was released as
part of the report titled “Cancer preparedness around the world: National
readiness for a global epidemic” prepared by EIU.

Index of Cancer Preparedness (ICO)

Its objective is to allow benchmarking of national efforts and identify best
practice in addressing the cancer challenge. It took 28 countries into
consideration.
It explores issue of cancer preparedness through three broad domains: (i)
policy and planning; (ii) care delivery; and (iii) health systems and
governance.
Under it, four essentials of cancer preparedness are: (i) investment i.e.
appropriate spending and resources), (ii) roadmap for effective planning), (iii)
foundation for functioning health systems and (iv) intelligence in availability
and quality of cancer-related data).
Findings on overall best practices for cancer preparedness: Top 3 countries
are: Australia (1st), Netherlands (2nd) and Germany (3rd).
Bottom three are: Saudi Arabia (28th), Romania (27th) and Egypt (26th).
These counties need largest room for improvement.
India and ICP: Its overall rank was 19th with a score of 64.9. India ranked
17th in cancer policy and planning.
India has relatively high score of 80.8 and it largely stems from its strong
cancer research and tobacco control measures.
India ranked first for research and third for tobacco control. It ranks 23rd
for its national cancer control plan.

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Miscellaneous
CURRENT AFFAIRS
India’s healthcare system was ranked 25th in the index. In its delivery of
cancer care, it was ranked 20th with a score of 61.3.
India’s healthcare infrastructure is the second worst among these
countries. It has high standard of clinical guidelines category where it is
ranked first. But it falls short on immunization, screening and early
detection.

Cancer
It is generic term for large group of diseases characterized by growth of
abnormal cells beyond their usual boundaries that can then invade adjoining
parts of body and spread to other organs. It is world’s second biggest killer,
responsible for 9.6 million deaths in 2018–roughly i.e. one out of six across
globe. It is second largest cause of mortality before the age of 70 in over half
the world’s countries.
Notes

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Economy
CURRENT AFFAIRS april 2019

DPE puts hold on granting

Maharatna status to HPCL

Department of Public Enterprises (DPE) has put hold on proposal of Union

Petroleum Ministry to grant Maharatna status to Hindustan Petroleum
(HPCL) citing procedures and antecedents. Petroleum Ministry had pushed
for this proposal to grant more autonomy to HPCL.

Reasons for hold

DPE has insisted that Petroleum Ministry should first obtain consent of
HPCL’s holding company Oil and Natural Gas Corp (ONGC) before
resubmitting revised proposal on giving Maharatna status to HPCL. ONGC
had bought Government’s entire 51.11%  share stake in HPCL for Rs
36,915 crore in 2018.
DPE has also asked Petroleum Ministry to give reasons for providing the
exalted status to HPCL considering that ONGC was already a Maharatna
company Currently, there is no previous instance of grant of Maharatna
status to subsidiary Central public sector enterprise.

Hindustan Petroleum Corporation Limited (HPCL):

It is Indian oil and natural gas refining and marketing company. It was
established in 1974 and is headquartered in Mumbai, Maharashtra.
Currently it enjoys autonomy status of Navratna CPSE.
Ownership Conflict: It is a subsidiary of ONGC. ONGC had bought
Government’s 51.11 % share in 2018, thus becoming the promoter of the
company. However, HPCL has been denying to identify ONGC as promoter
on ground that majority of its Board Of Directors are from Union
Government and not ONGC.

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Economy
CURRENT AFFAIRS
Maharatna Central Public Sector Enterprises (CPSEs)
Government had introduced “Maharatna” category for CPSEs in 2009 with
objective to empower mega CPSEs to expand their operations and emerge
as global giants or become Indian Multinational Companies (MNCs). This
status is granted to CPSEs by Department of Public Enterprises (DPE),
Ministry of Heavy Industries and Public Enterprises after they meet
eligibility criteria.
Currently there are 7 CPSEs have Maharatna status. They are Bharat Heavy
Electricals Limited, Coal India Limited, Indian Oil Corporation Limited, NTPC
Limited, Oil & Natural Gas Corporation Limited, Steel Authority of India
Limited, Bharat Petroleum Corporation Limited,

Eligibility Criteria for granting Maharatna status

CPSEs should be having Navratna status.
They should be listed on Indian stock exchange with minimum prescribed
public shareholding under SEBI regulations.
They should have average annual turnover of more than Rs. 25,000 crore,
during the last 3 years.
They should have average annual net worth of more than Rs. 15,000 crore,
during the last 3 years.
They should have average annual net profit after tax of more than Rs. 5,000
crore, during the last 3 years.
Besides, they should also have significant global presence/international
operations.

Benefits of Maharatna Status

It bestows greater autonomy or freedom to CPSEs from government control
as well to incur capital expenditure on projects and purchases without any
monetary ceiling. It also provides significant autonomy to CPSEs to pump
equity in joint ventures and float subsidiaries, raise debt, undertake
mergers and acquisitions without seeking approval.

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economy
CURRENT AFFAIRS april 2019

Government asks all departments to

review Government Guarantee

Union Finance Ministry has asked all departments to undertake review of

government guarantees given by respective ministries to their Central Public
Sector Enterprises (CPSEs) or entities. It also has extended date for submission
of these details to April 30, 2019 from earlier April 10.  

Review of government guarantees

Guarantees are contingent liabilities have potential to impact the financial
performance of the government. The review of government guarantees should
undertake aspects like discharge of repayment obligations or interest
obligations as per terms of loan agreement and covenants and conditions met. It
should also include details of CPSEs or entities due guarantee fee paid on time to
the government.

Background
The earlier circular issued by Finance Ministry has held that Fiscal
Responsibility and Budget Management (FRBM) Rules stipulates that government
cannot guarantee more than 0.5% of the GDP of the respective financial year to
CPSE/entities. The guarantees already approved by Budget Division of
Department of Economic Affairs, Finance Ministry but not executed till March 31,
2019, also are needed to be revalidated and such proposals may also be
included on total guarantee requirement of 2019-20. Ministries and
departments are requested that prioritised guarantee requirement for 2019-20
may be worked out to include only such proposals where the loan agreement
can be signed and guarantee agreement can be executed during the year.

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ECONOMY
CURRENT AFFAIRS april 2019

Government extends ban on import of

milk products from China

Directorate General of Foreign Trade (DGFT) has extended ban on import of

milk and its products, including chocolates, from China till laboratories at
ports are upgraded for testing presence of toxic chemical melamine. The
extension of ban was recommended by Food regulator Food Safety and
Standards Authority of India (FSSAI) until all labs at ports are modernised
to test the chemical. However, FSSAI has not mentioned any timeline for
upgradation of that capacity of all laboratories.

Background
The ban was first imposed in September 2008 and was subsequently
extended from time to time. The latest ban imposed by government ended
23 April 2019. The ban was imposed on apprehensions of presence of
melamine in some milk consignments from China. Melamine is toxic
chemical used for making plastics and fertilisers. Although India does not
import milk, milk products from China, the ban was imposed as a preventive
measure.

India’s Milk Production

India is world's largest producer and consumer of milk. It produces around
150 million tonne milk annually. Uttar Pradesh is leading state in milk
production followed by Rajasthan and Gujarat.

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ECONOMY
CURRENT AFFAIRS april 2019

US, Singapore, Taiwan seek to join consultations

in WTO dispute over India's tariffs on ICT goods

United States (US), Singapore and Chinese Taipei (Taiwan) have expressed
their interest to join consultations sought by European Union (EU) under
World Trade Organization's (WTO) dispute settlement mechanism against
India's import duties on certain Information Communication and Technology
(ICT) products, including mobile phones. As per the WTO rules, these three
countries would have to seek approval from India and EU to join the
consultation process.

Background
In April 2019, EU dragged India into the WTO's dispute settlement mechanism
over imposition of import duties on these products, alleging breach of global
trade norms. EU has challenged introduction of import duties by India on
wide range of ICT products, for instance, mobile phones and components,
base stations, integrated circuits and optical instruments.  EU has requested
consultations with India under WTO rules governing the settlement of
disputes with regard to the tariff treatment that the country accords to
certain goods in the ICT sector.

Consultation seeking process

Seeking consultation is the first step of dispute settlement process as per
WTO rules. If consultations requested with both India and EU do not result in
satisfactory solution, EU can request WTO to set up panel in the case to rule
on the issue raised.

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ECONOMY
CURRENT AFFAIRS april 2019

India’s pharmaceutical exports rose by

11% in 2018-19

According to Ministry of Commerce data, India’s pharmaceutical exports

rose by 11% to US $19.2 billion in 2018-19. The rise was mainly driven by
higher demand in regions such as North America and Europe.  The pharma
exports in 2017-18 were US $17.3 billion and US $16.7 billion in the
previous fiscal.

Pharma sector Exports

It accounted for about 6% of the country’s total exports of US $331 billion in
2018-19. It is one of top five sectors in the exports segment.
Generic drugs: It accounts for largest segment of the Indian pharmaceutical
sector, with 75% market share (in terms of revenues). India supplies 20% of
global generic medicines in terms of volume, making the country largest
provider of generic medicines globally.
Export Destinations: Over 55% of the country’s exports go to highly
regulated markets. North America constitutes about 30% of Indian pharma
exports share, followed by Africa (19%) and European Union (16% ) share.
The other important destinations include South Africa, Russia, Nigeria,
Brazil and Germany, where exports are registering growth. Chinese pharma
market is also gradually opening up for India’s exports and government is
working to push India’s exports there as it holds huge potential.
Significance of Exports: Higher growth in outbound shipments helps create
employment opportunities, earn foreign exchange and boost economic
activities.

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Economy
CURRENT AFFAIRS april 2019

IEPF Authority recovers Rs. 1,514

crore deposits

Investor Education and Protection Fund (IEPF) Authority has recovered

deposits worth Rs. 1,514 crore from Kolkata-based Peerless General
Finance and Investment Company.
This money of depositors was pending with company for last 15 years. It
was taken by issuing 1.49 crore deposit certificates to over one crore
individual investors.
IEPF Authority recovered depositors amount and credited to IEPF Fund/
account. This was done in compliance with Section 125 (2) (a) of
Companies Act, 2013 which says that matured deposits with companies
remaining unclaimed for period of 7 years from date it became due for
payment shall be credited to IEPF Fund/account.

About Investor Education and Protection Fund (IEPF) Authority

It is statutory body under the Ministry of Corporate Affairs established
under Section 125 of Companies Act 2013. Secretary in Ministry of
Corporate Affairs is the Chairperson of IEPF.
Mandate: To administer Investor Education and Protection Fund with the
objective of promoting investor’s education, awareness and protection of
their interests.
Powers: It is empowered to undertake various initiatives to fulfil its
mandate through investor awareness programmes and various other
mediums like print, electronic, social media and dommunity Radio.
IEPF Fund: Unclaimed dividend, refund of application money, matured
company deposits and debentures and interest on them are moved to this
fund if not claimed within seven years.

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 april 2019
Economy
CURRENT AFFAIRS
It is monitored by a trust, which decides how money will be utilised for
specific activities of investor awareness and education.
Once unclaimed amount is credited to this fund, investor cannot recover
unclaimed amount.
Investors can claim unpaid amounts from company before they are credited
to IEPF account by following the procedure prescribed by the company.

Notes

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Economy
CURRENT AFFAIRS april 2019

 USTR places India on Priority

Watch List

United States Trade Representatives (USTR) has placed 11 countries,

including India, in its 'Priority Watch List' released as part of Special 301
Report. Besides it also has placed 25 countries, including Pakistan and
Turkey on the Watch List. These countries were placed in these list for not
taking sufficient measurable improvements to their Intellectual Property
(IP) framework on long-standing and new challenges that have negatively
affected US IP right holders over past year. These countries will be
subjected to increased bilateral engagement with USTR to address IP
concerns.

Special 301 Report

It is prepared annually by Office of USTR. It identifies trade barriers to US
companies and products due to intellectual property laws, such as
copyright, patents and trademarks, in other countries.
It identifies countries which do not provide adequate and effective
protection of intellectual property rights (IPR) or fair and equitable
market access to US persons that rely upon intellectual property rights.

Why India is placed in 2019 Report?

Though India has taken steps to address intellectual property challenges
and promote IP protection and enforcement over the past year, but many
of the actions have not yet translated into concrete benefits for innovators
and creators.
Long-standing deficiencies persist in India’s IPR framework and its
remains one of world's most challenging major economies with respect to

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 april 2019
Economy
CURRENT AFFAIRS
protection and enforcement of IP.
US businesses in India faces challenges which make it difficult for innovators
to receive and maintain patents, particularly for pharmaceuticals.
Moreover, India’s insufficient enforcement actions, copyright policies do not
properly incentivise creation and commercialisation of content and outdated
and insufficient trade secrets legal framework.
USTR also has alleged that India also has restricted transparency of
information provided on state-issued pharmaceutical manufacturing licenses,
and expanded application of patentability exceptions to reject pharmaceutical
patents.

Notes

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Economy
CURRENT AFFAIRS april 2019

Government brings in changes in e-way

bill system to check GST evasion

Union Finance Ministry (Revenue Department) has introduced changes in

e-way bill system to curb malpractices and check evasion of Good and
Services Tax (GST). These changes come after Finance Ministry had
detected instances of malpractices in e-way bill generation causing loss to
state exchequer.

Changes made in e-way bill system

Auto-calculation of distance between source and destination, based on PIN
codes. The user will be allowed to enter actual distance as per movement
of goods, which will be limited to 10%  more than the auto calculated
distance displayed.
Blocking generation of multiple e-way bills based on one invoice.  This
means that if e-way bill is generated once with particular invoice number,
then none of parties consignor, transporter or consignee can generate
another e-way bill with the same invoice number.
Transporters of goods worth over Rs. 50,000 will be required to present
e-way bill during transit to GST inspector, if asked. Failure to produce e-
way bill can attract penalty.
The e-way bill portal developed by National Informatics Centre (NIC) will
also generate a report for users on the list of e-way bills about to expire.
This will help user to analyse data and ensure that goods reach
destination within valid time period.

GST E-Way Bill (Electronic way bill)

It is electronic documentation detailing movement of goods under GST

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 april 2019
Economy
CURRENT AFFAIRS
regime. It has to be carried by transporters for any consignment exceeding
Rs. 50,000 in value.
It must be raised before shipping of goods. It should include details of goods,
their consignor, recipient and transporter.
It can be generated from GSTN set up for e-way bill system by transporter
before the movement of goods begins.
It was made mandatory from April 1, 2018 for all inter-state transport of
goods valued above Rs 50,000 and later for moving goods within state.
It purpose is to reducing transit delays check-posts have been abolished
under GST regime and serve as anti-tax evasion measure as it will allow tax
authorities to easily tracj tax evaders from underreporting transactions.
Validity of e-way bills: It varies depending on distance that goods have to
travel. Typically, it is valid for one day for every 100km of movement of goods.
Goods excluded: It is not needed for perishable items (such as meat, fruits and
vegetables and milk and milk products), cooking gas cylinders, raw silk, wool
and handlooms and gold and silver jewellery.
Penalty for violation: If consignment is found without e-way bill, Rs. 10, 000
penalty or tax sought to be evaded, whichever is greater, can be levied.

Notes

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Economy
CURRENT AFFAIRS april 2019

RBI allows FPIs to buy

Municipal Bonds

Reserve Bank of India (RBI) has further eased norms for foreign portfolio
investors (FPIs) by allowing them to invest in municipal bonds under
prescribed limits. This decision is aimed at broadening access of non–
resident investors to debt instruments in India.

Limits for FPIs in investing in municipal bonds

FPI investment in municipal bonds will be reckoned within the limits set
for FPI investment in State Development Loans (SDLs). The current limits
set for SDLs amount to 2% of outstanding securities.

Background
Municipal bond is bond or debt instrument or secuirty issued by local
government or territory, or one of their agencies. It is generally used to
finance public infrastructure projects such as roads, schools, airports
and seaports, and infrastructure-related repairs.
At present, investing in municipal bonds in India is not popular opinion as
majority municipalities are not cash rich. But economists believe that if
FPIs start investing in these bonds, domestic players also might find
interest and also could prove to be good income source for municipalities

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Economy
CURRENT AFFAIRS april 2019

IRDAI constitutes Suresh Mathur Committee

to review microinsurance framework

Insurance Regulatory and Development Authority of India (IRDAI) has

constituted 13-member committee to review the regulatory framework on
microinsurance and recommend measures to increase the demand for such
products.
Composition: It will be headed by IRDAI Executive Director Suresh
Mathur. It comprises officials of the IRDAI, insurers representatives from
life, general and health insurance companies in the public and private
sectors and NGOs as it members.

Terms of Reference of Committee

It has been tasked to suggest product designs with customer-friendly
underwriting, including easy premium payment methods and simple claims
settlement procedures. It will review regulatory framework on
microinsurance in the country and abroad.
It will suggest changes in distribution structure, if any, including
mobile-based and technology driven solutions. It will also give
suggestions on creating effective awareness programmes. It will submit
recommendations within three months.

Background
The committee has been formed in backdrop of less- than-desired offtake of
microinsurance products despite their inherent benefits. India has seen to
be very exciting market and pioneer in microinsurance sector in the world.
Specifically intended for protection of low-income people, with affordable
insurance products, microinsurance promises to support sustainable
livelihoods of the poor. However, its market penetration remains low.

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Economy
CURRENT AFFAIRS april 2019

Renewable energy certificates

sales down by 65% in April 2019

The sales of renewable energy certificates (RECs) have dropped by about

65% to 3.68 lakh units in April 2019 as compared to 10.62 lakh in same
month last year due to lower supply. Both non-solar and solar RECs have
continued to see low supply situation with buy bids exceeding sell bids due to
very low inventory (supply).

Renewable Energy Certificate (REC)

It is also known as green energy certificate or tradable renewable
certificate. It is proof that energy has been generated from renewable
sources such as solar or wind power.
It is market based instrument/mechanism to promote renewable sources of
energy and development of market in electricity. Each REC represents
environmental benefits of 1MWh of renewable energy generation.
Significance: Purchase of REC indicates that renewable energy is generated
on behalf of purchaser. It provides alternative voluntary route to generator
to sell his electricity from renewable sources just like conventional
electricity and offers green attribute (RECs) separately to obligated entities
to fulfil their renewable purchase obligation (RPO).
RPO:  Under it, bulk purchasers like discoms, open access consumers and
capacitive users are required to buy certain proportion of RECs. They can
buy RECs from renewable energy producers to meet RPO norms. The
proportion of renewable energy for utilities are fixed by Central and State
electricity regulatory commissions.
Trading of RECs: Indian Energy Exchange% (IEX) and Power Exchange of
India (PXIL) are two power bourses in country, currently engaged in trading
of RECs and electricity. The trading of RECs is conducted on last Wednesday
of every month.
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Economy
CURRENT AFFAIRS april 2019

Government notifies pact with US to

check tax evasion by MNCs

Government has notified inter-governmental agreement with United States

for exchange of country-by-country (CbC) reports filed by multinational
enterprises (MNEs) regarding income allocation and payment of taxes. It
comes after this agreement was signed by both countries in March 2019.
This agreement is aimed at providing relief to subsidiaries of US
multinationals and ensuring a check on cross-border tax evasion,

Key facts
This agreement for exchange of CbC reports, along with Bilateral
Competent Authority Arrangement, will enable both countries to
automatically exchange CbC reports filed by the ultimate parent entities of
MNEs in respective jurisdictions, pertaining to the years commencing on or
after January 1, 2016. As a result, Indian entities will not be required to do
local filing of the CbC Reports in India.

Significance of agreement
It will provide relevant and reliable information to perform an efficient and
robust transfer pricing risk assessment analysis.
It will also obviate the need for Indian subsidiary companies of US MNCs to
do local filing of CbC reports, thereby reducing the compliance burden.
It will provide reliable information, ensure strong risk assessment analysis
and help keep a check on tax evasion.

What is CbC report?

It aggregates country-by-country information relating to global allocation
of income, taxes paid and certain other indicators of MNEs. It also contains
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 april 2019
Economy
CURRENT AFFAIRS
list of all group companies operating in particular jurisdiction and nature
of main business activity of each such constituent entity. Its provisions are
prescribed under Action 13 Report of OECD/G20 Base

Erosion Profit Sharing (BEPS) Project,

MNEs having global consolidated revenue of 750 million euro or more (or
Rs 5,500 crore in case of India) in a year are required to file CbC reports in
their parent entity’s jurisdiction. India already has signed MCAA for
Exchange of CbC reports, with 62 jurisdictions, which has enabled
exchange of CbC reports.
Notes

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