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Fitch ups India growth forecast to 7.4% for FY'19
Fitch Ratings today raised India growth forecast for 2018-19 to 7.4 percent from 7.3 percent, but cited higher financing costs and rising oil prices as risks to growth. For 2019-20, it estimated the country to grow at 7.5 percent.
“We have revised up our forecast for 2018-19 growth to 7.4 percent from 7.3 percent in March. However, higher financing costs (stemming from monetary tightening and higher market premiums) and rising oil prices should limit the upside to growth,” Fitch said in its Global Economic Outlook.
The economy grew at 6.7 percent in 2017-18 and 7.7 percent in January-March quarter.
Fitch said the Indian rupee has been one of the worst performing currencies in Asia this year, although the depreciation was more muted than during the 2013 taper-tantrum episode.
“India has better macroeconomic fundamentals than in 2013 and very low foreign ownership rates in the domestic government bond market, but the current account deficit has been widening as a result of rising oil prices, reviving domestic demand and poor manufacturing export performance,” it said.
Last month, US-based Moody's cut India's growth forecast for 2018-19 to 7.3 percent from 7.5 percent citing rising oil prices.
Fitch also said the near-term global growth prospects remain robust despite rising trade tensions and political risks. “Global trade tensions have risen significantly this year, but at this stage the scale of tariffs imposed remains too small to materially affect the global growth outlook.
"A major escalation that entailed blanket across-the-board geographical tariffs on all trade flows between several major countries would be much more damaging," says Brian Coulton, Fitch's Chief Economist.
Fitch ups India growth forecast to 7.4% for FY'19
Fitch Ratings today raised India growth forecast for 2018-19 to 7.4 percent from 7.3 percent, but cited higher financing costs and rising oil prices as risks to growth. For 2019-20, it estimated the country to grow at 7.5 percent.
“We have revised up our forecast for 2018-19 growth to 7.4 percent from 7.3 percent in March. However, higher financing costs (stemming from monetary tightening and higher market premiums) and rising oil prices should limit the upside to growth,” Fitch said in its Global Economic Outlook.
The economy grew at 6.7 percent in 2017-18 and 7.7 percent in January-March quarter.
Fitch said the Indian rupee has been one of the worst performing currencies in Asia this year, although the depreciation was more muted than during the 2013 taper-tantrum episode.
“India has better macroeconomic fundamentals than in 2013 and very low foreign ownership rates in the domestic government bond market, but the current account deficit has been widening as a result of rising oil prices, reviving domestic demand and poor manufacturing export performance,” it said.
Last month, US-based Moody's cut India's growth forecast for 2018-19 to 7.3 percent from 7.5 percent citing rising oil prices.
Fitch also said the near-term global growth prospects remain robust despite rising trade tensions and political risks. “Global trade tensions have risen significantly this year, but at this stage the scale of tariffs imposed remains too small to materially affect the global growth outlook.
"A major escalation that entailed blanket across-the-board geographical tariffs on all trade flows between several major countries would be much more damaging," says Brian Coulton, Fitch's Chief Economist.
Fitch ups India growth forecast to 7.4% for FY'19
India's farms prove fertile ground for tech startups
Startups are reshaping the landscape of Indian agriculture, a sector that employs half of the nation's 1.3 billion people, by improving traditional farming methods with information technology and new business models.
In the southern state of Karnataka, farmers deliver produce to a pickup point near their fields where it is inspected for size, shape, color and damage. The tomatoes, cumbers and other crops then is then collected at a fulfillment center to be shipped to small kirana shops by truck. Within 12 hours, these vegetables will line grocers' shelves in the state capital of Bangalore.
This farm-to-store platform, dubbed NinjaCart, was created by agriculture startup 63Ideas Infolabs in 2015 to simplify distribution channels. Indian farmers typically deal with at least six middlemen driving hard bargains until their products reach stores, said co-founder and CEO Thirukumaran Nagarajan.
At traditional markets, wholesalers buy produce by auction. "Farmers can get a lesser price ... and each middleman takes 15-20% out of the value," he explained.
The agri-marketing platform spreads benefits around the table. Farmers pay less in fees to wholesalers. Grocers arranged for goods to be delivered to their door with a smartphone app, saving them the trouble of going to the market themselves. Consumers enjoy fresher and cheaper foods.
"Farming actually is very profitable (when it is done properly)," Thirukumaran said.
NinjaCart works with around 4,000 farmers and 2,400 retailers, handling about 160 tons of food daily. It will begin operations in the neighboring state of Tamil Nadu in June.
India has the world's third-largest agricultural market behind China and the U.S. But most business opportunities go to big corporations like farm equipment makers Mahindra & Mahindra and Kubota or agrochemicals supplier Bayer. Startups are targeting family farms instead, looking to change traditional agricultural methods at the root.
Another app developer, Agribuddy, helps growers cultivate their land more effectively by showing them the best crops, pesticides and fertilizers to use in their area. The company appoints "buddies" who play the roles of adviser and agent to farmers. Buddies gather data such as area under cultivation, type of land, crops, family structures and household income, sharing it with the company via smartphone.
The startup launched this business three years ago in Cambodia and found success there. This past January, it set up a technology center in Bangalore. It will roll out a full-fledged version of the service soon after completing a test in the southern state of Andhra Pradesh.
Without the right knowledge, many farmers plant vegetables unfit for their land, said Vivek Radhakrishnan, Agribuddy's chief technology officer. Agribuddy provides what a farmer needs. "He (a farmer) needs credit, farm input, a guide who guides on him crop cycles and helps sell products." Radhakrishnan emphasized that productivity could be improved by introducing new methods.
Besides dispensing guidance, Agribuddy will also sell supplies like seeds and fertilizer through its advisers, as well as guarantee bank loans to farmers.
Agricultural startups have begun to garner financial support. Business accelerator Gastrotope was founded by Mistletoe, a Tokyo-based incubator created by Japanese entrepreneur Taizo Son, Indian peer GSF India and consultancy Infobridge. Together with the government of Andhra Pradesh, it will invest 100 million yen ($1 million) in 10 companies that grow, pack or distribute food by June 2019 and offer advice on technological development.
"I truly believe India will be the center of agri-food tech innovation and am very excited. India has amazing talents and engineers, and a vast land and population," said Son, brother of SoftBank Group founder Masayoshi Son.
India has over 600 million farmers, along with quadruple the farmland of Japan at roughly 150 million hectares. Though structural changes are reducing agriculture's contribution to the overall economy, the nation's growing population and economy raise demand for food.
Prime Minister Narendra Modi plans to double rural incomes by 2022, which would translate into higher consumer spending. He also raised government outlays to the farm sector by 13% in the fiscal 2018 budget.
But government support alone is insufficient. Though there is aid for fertilizer, water and electricity, low productivity coupled with unpredictable weather leaves many farmers struggling to repay debts. In March, 50,000 farmers from the western state of Maharashtra gathered to demand loan forgiveness and higher prices on agricultural goods.
Startups see the problems facing India's agricultural sector as an opportunity for growth. "It is hard to find an organized model for providing all of the infrastructure that farmers need," said Naho Shigeta, a member of the Gastrotope team.
Agribuddy's comprehensive support model resembles Japan's agricultural cooperatives. Indian villages have similar associations, but scale limits their abilities.
India's farms prove fertile ground for tech startups
Startups are reshaping the landscape of Indian agriculture, a sector that employs half of the nation's 1.3 billion people, by improving traditional farming methods with information technology and new business models.
In the southern state of Karnataka, farmers deliver produce to a pickup point near their fields where it is inspected for size, shape, color and damage. The tomatoes, cumbers and other crops then is then collected at a fulfillment center to be shipped to small kirana shops by truck. Within 12 hours, these vegetables will line grocers' shelves in the state capital of Bangalore.
This farm-to-store platform, dubbed NinjaCart, was created by agriculture startup 63Ideas Infolabs in 2015 to simplify distribution channels. Indian farmers typically deal with at least six middlemen driving hard bargains until their products reach stores, said co-founder and CEO Thirukumaran Nagarajan.
At traditional markets, wholesalers buy produce by auction. "Farmers can get a lesser price ... and each middleman takes 15-20% out of the value," he explained.
The agri-marketing platform spreads benefits around the table. Farmers pay less in fees to wholesalers. Grocers arranged for goods to be delivered to their door with a smartphone app, saving them the trouble of going to the market themselves. Consumers enjoy fresher and cheaper foods.
"Farming actually is very profitable (when it is done properly)," Thirukumaran said.
NinjaCart works with around 4,000 farmers and 2,400 retailers, handling about 160 tons of food daily. It will begin operations in the neighboring state of Tamil Nadu in June.
India has the world's third-largest agricultural market behind China and the U.S. But most business opportunities go to big corporations like farm equipment makers Mahindra & Mahindra and Kubota or agrochemicals supplier Bayer. Startups are targeting family farms instead, looking to change traditional agricultural methods at the root.
Another app developer, Agribuddy, helps growers cultivate their land more effectively by showing them the best crops, pesticides and fertilizers to use in their area. The company appoints "buddies" who play the roles of adviser and agent to farmers. Buddies gather data such as area under cultivation, type of land, crops, family structures and household income, sharing it with the company via smartphone.
The startup launched this business three years ago in Cambodia and found success there. This past January, it set up a technology center in Bangalore. It will roll out a full-fledged version of the service soon after completing a test in the southern state of Andhra Pradesh.
Without the right knowledge, many farmers plant vegetables unfit for their land, said Vivek Radhakrishnan, Agribuddy's chief technology officer. Agribuddy provides what a farmer needs. "He (a farmer) needs credit, farm input, a guide who guides on him crop cycles and helps sell products." Radhakrishnan emphasized that productivity could be improved by introducing new methods.
Besides dispensing guidance, Agribuddy will also sell supplies like seeds and fertilizer through its advisers, as well as guarantee bank loans to farmers.
Agricultural startups have begun to garner financial support. Business accelerator Gastrotope was founded by Mistletoe, a Tokyo-based incubator created by Japanese entrepreneur Taizo Son, Indian peer GSF India and consultancy Infobridge. Together with the government of Andhra Pradesh, it will invest 100 million yen ($1 million) in 10 companies that grow, pack or distribute food by June 2019 and offer advice on technological development.
"I truly believe India will be the center of agri-food tech innovation and am very excited. India has amazing talents and engineers, and a vast land and population," said Son, brother of SoftBank Group founder Masayoshi Son.
India has over 600 million farmers, along with quadruple the farmland of Japan at roughly 150 million hectares. Though structural changes are reducing agriculture's contribution to the overall economy, the nation's growing population and economy raise demand for food.
Prime Minister Narendra Modi plans to double rural incomes by 2022, which would translate into higher consumer spending. He also raised government outlays to the farm sector by 13% in the fiscal 2018 budget.
But government support alone is insufficient. Though there is aid for fertilizer, water and electricity, low productivity coupled with unpredictable weather leaves many farmers struggling to repay debts. In March, 50,000 farmers from the western state of Maharashtra gathered to demand loan forgiveness and higher prices on agricultural goods.
Startups see the problems facing India's agricultural sector as an opportunity for growth. "It is hard to find an organized model for providing all of the infrastructure that farmers need," said Naho Shigeta, a member of the Gastrotope team.
Agribuddy's comprehensive support model resembles Japan's agricultural cooperatives. Indian villages have similar associations, but scale limits their abilities.
India's farms prove fertile ground for tech startups
India envisioned as five trillion-dollar economy: PM Modi
Prime Minister Narendra Modi said the world expects India to become a five trillion-dollar economy soon.
"The world expects India to become a five trillion dollar economy soon," he said while delivering the closing remarks at a meeting of the NITI Aayog's governing council here on Sunday.
The Prime Minister also encouraged states to give fresh ideas to the Finance Commission for incentivising outcome-based allocations, and expenditure correction.
Welcoming the constructive discussion and suggestions made by various chief ministers of the states, the Prime Minister assured the gathering that these suggestions would be seriously considered in the course of decision-making.
He also directed the government's think tank to follow up with the states on the actionable points made by them within three months.
"On the lines of the 115 aspirational districts identified by NITI Aayog, states can define their own parameters to identify 20 percent of the total blocks in the state as aspirational blocks," he said.
Expressing happiness that the states were organising investor summits, he further suggested that they should focus on exports.
He also encouraged the states to boost ease of doing business, saying NITI Aayog should call a meeting with all the states for the same. He said "ease of living" for the common man was also the need of the hour, and states should take initiatives in this regard.
Speaking on the issue of environment raised by chief ministers in the meet, Prime Minister Modi urged all states to use LED bulbs in their government buildings, official residences and streetlights. He suggested that this could be implemented within a definite timeframe.
He called upon the Chief Ministers of Madhya Pradesh, Bihar, Sikkim, Gujarat, Uttar Pradesh, West Bengal and Andhra Pradesh, to work together to make recommendations on a coordinated policy approach to the two subjects of "agriculture and MNREGA," including both pre-sowing, and post-harvest phases.
The Prime Minister stated that it was vital to identify the "last people in the line" so that benefits of governance could reach them. He also said social justice was an important governmental objective and those noble causes required close coordination and constant monitoring.
Prime Minister Modi reiterated the Union Government's commitment to providing universal coverage of seven key schemes to 45,000 additional villages in 115 Aspirational Districts, by August 15 this year. (ANI)
India envisioned as five trillion-dollar economy: PM Modi
Prime Minister Narendra Modi said the world expects India to become a five trillion-dollar economy soon.
"The world expects India to become a five trillion dollar economy soon," he said while delivering the closing remarks at a meeting of the NITI Aayog's governing council here on Sunday.
The Prime Minister also encouraged states to give fresh ideas to the Finance Commission for incentivising outcome-based allocations, and expenditure correction.
Welcoming the constructive discussion and suggestions made by various chief ministers of the states, the Prime Minister assured the gathering that these suggestions would be seriously considered in the course of decision-making.
He also directed the government's think tank to follow up with the states on the actionable points made by them within three months.
"On the lines of the 115 aspirational districts identified by NITI Aayog, states can define their own parameters to identify 20 percent of the total blocks in the state as aspirational blocks," he said.
Expressing happiness that the states were organising investor summits, he further suggested that they should focus on exports.
He also encouraged the states to boost ease of doing business, saying NITI Aayog should call a meeting with all the states for the same. He said "ease of living" for the common man was also the need of the hour, and states should take initiatives in this regard.
Speaking on the issue of environment raised by chief ministers in the meet, Prime Minister Modi urged all states to use LED bulbs in their government buildings, official residences and streetlights. He suggested that this could be implemented within a definite timeframe.
He called upon the Chief Ministers of Madhya Pradesh, Bihar, Sikkim, Gujarat, Uttar Pradesh, West Bengal and Andhra Pradesh, to work together to make recommendations on a coordinated policy approach to the two subjects of "agriculture and MNREGA," including both pre-sowing, and post-harvest phases.
The Prime Minister stated that it was vital to identify the "last people in the line" so that benefits of governance could reach them. He also said social justice was an important governmental objective and those noble causes required close coordination and constant monitoring.
Prime Minister Modi reiterated the Union Government's commitment to providing universal coverage of seven key schemes to 45,000 additional villages in 115 Aspirational Districts, by August 15 this year. (ANI)
India envisioned as five trillion-dollar economy: PM Modi
Middle class ensuring India a haven for investors amid global market turmoil
As the threat of a trade war grows and emerging market central banks sacrifice growth to protect their currencies, equity investors have their backs to the wall. But in their search for a haven, one name keeps cropping up: India.
The fastest-growing major economy in the world, enjoys relative insulation from external shocks as a booming middle class delivers enough domestic demand to counter the fallout from protectionism, according to money managers including Franklin Templeton and Newton Asset Management.
Exchange-traded fund house WisdomTree Investments Inc. goes a step further, recommending investors allocate as much as 20 per cent of their portfolios to Indian equities.
India is “one of those places that provides better risk-reward compared with emerging markets at large, especially China or more globally-linked countries,” Gaurav Sinha, an asset-allocation strategist at WisdomTree, said in an interview in London. “If I am investing in India, I am investing for the local consumption.”
Government may launch Rs 500 crore credit enhancement fund in July
That might sound brave to anyone who’s been watching India’s performance this year. While stocks are up 4.1 per cent in local-currency terms, the rupee’s weakness has left investors with losses in dollar terms. Since a global selloff began in January, equities have erased $274 billion, equivalent in value to the entire market of Finland. Increased volatility and passive-fund outflows suggest India is no less vulnerable to the jitters than its peers.
The Reserve Bank of India (RBI) raised key interest rates for the first time in four years last week, and governor Urjit Patel has even gone as far as pleading with the Federal Reserve System, the central banking system of the US, to go slow with its interest rate increases. With general elections less than a year away and Prime Minister Narendra Modi facing a united opposition, political uncertainty looms large too.
But that’s doing little to deter the bulls. When the dust settles, they say, the country will start to outperform again. And they have history on their side: India was quicker to rebound from the 2008 crisis, handing investors 70 percent greater returns than the rest of the developing world since then.
“I don’t think our positive stance on India has changed,” said Vikas Chiranewal, a Mumbai-based senior executive director for Franklin Templeton Investments’ emerging-markets group. “The broader market was becoming a bit pricey and some amount of price decline is healthy.”
GROWING CONSUMERISM
Propelled by economic reforms that started in 1991 and have been deepened by Modi’s government, India’s middle class has ballooned past 60 crore, according to a study by Mumbai University. The nation will become the third-largest consumer economy, with household spending tripling to $4 trillion by 2025, according to a report by Boston Consulting Group last year. That’s made Indian markets a magnet for foreign investors, spurring flows of $335 billion in the past 10 years.
The International Monetary Fund (IMF) predicts India’s gross domestic product (GDP) will grow an average of more than 8 per cent annually in the next five years.
“India is the only, large accessible country which has the potential to grow at substantial rates,” Sinha said.
Yet India is less reliant on exports than most other emerging markets. With almost two-thirds of GDP accounted for by consumption, companies have their hands full serving local demand. As a result, exports account for just 11 per cent of the GDP, compared with China’s 19 per cent and Russia’s 23 per cent.
Mumbai’s $2.2 trillion stock market is primarily driven by investors at home. Foreign-investment flows have accounted for a fraction of the trading even during this year’s declines.
Still, signs abound that India’s stock market is overcrowded. Investors have to pay more than $18 for every dollar of projected profit, one of the world’s highest valuations. The country’s sensitivity to oil prices and the approach of the 2019 general elections increase the risk that the market may be volatile for the next 12 months.
“Valuations have become more stretched for the Indian equity market as a whole, but provided the oil price does not continue to rise, we think India does offer relative insulation against protectionist trade policy,” said Douglas Reed, a London-based strategist at Newton Investment Management.
Middle class ensuring India a haven for investors amid global market turmoil - Times of India
As the threat of a trade war grows and emerging market central banks sacrifice growth to protect their currencies, equity investors have their backs to the wall. But in their search for a haven, one name keeps cropping up: India.
The fastest-growing major economy in the world, enjoys relative insulation from external shocks as a booming middle class delivers enough domestic demand to counter the fallout from protectionism, according to money managers including Franklin Templeton and Newton Asset Management.
Exchange-traded fund house WisdomTree Investments Inc. goes a step further, recommending investors allocate as much as 20 per cent of their portfolios to Indian equities.
India is “one of those places that provides better risk-reward compared with emerging markets at large, especially China or more globally-linked countries,” Gaurav Sinha, an asset-allocation strategist at WisdomTree, said in an interview in London. “If I am investing in India, I am investing for the local consumption.”
That might sound brave to anyone who’s been watching India’s performance this year. While stocks are up 4.1 per cent in local-currency terms, the rupee’s weakness has left investors with losses in dollar terms. Since a global selloff began in January, equities have erased $274 billion, equivalent in value to the entire market of Finland. Increased volatility and passive-fund outflows suggest India is no less vulnerable to the jitters than its peers.
The Reserve Bank of India (RBI) raised key interest rates for the first time in four years last week, and governor Urjit Patel has even gone as far as pleading with the Federal Reserve System, the central banking system of the US, to go slow with its interest rate increases. With general elections less than a year away and Prime Minister Narendra Modi facing a united opposition, political uncertainty looms large too.
But that’s doing little to deter the bulls. When the dust settles, they say, the country will start to outperform again. And they have history on their side: India was quicker to rebound from the 2008 crisis, handing investors 70 percent greater returns than the rest of the developing world since then.
“I don’t think our positive stance on India has changed,” said Vikas Chiranewal, a Mumbai-based senior executive director for Franklin Templeton Investments’ emerging-markets group. “The broader market was becoming a bit pricey and some amount of price decline is healthy.”
GROWING CONSUMERISM
Propelled by economic reforms that started in 1991 and have been deepened by Modi’s government, India’s middle class has ballooned past 60 crore, according to a study by Mumbai University. The nation will become the third-largest consumer economy, with household spending tripling to $4 trillion by 2025, according to a report by Boston Consulting Group last year. That’s made Indian markets a magnet for foreign investors, spurring flows of $335 billion in the past 10 years.
The International Monetary Fund (IMF) predicts India’s gross domestic product (GDP) will grow an average of more than 8 per cent annually in the next five years.
“India is the only, large accessible country which has the potential to grow at substantial rates,” Sinha said.
Yet India is less reliant on exports than most other emerging markets. With almost two-thirds of GDP accounted for by consumption, companies have their hands full serving local demand. As a result, exports account for just 11 per cent of the GDP, compared with China’s 19 per cent and Russia’s 23 per cent.
Mumbai’s $2.2 trillion stock market is primarily driven by investors at home. Foreign-investment flows have accounted for a fraction of the trading even during this year’s declines.
Still, signs abound that India’s stock market is overcrowded. Investors have to pay more than $18 for every dollar of projected profit, one of the world’s highest valuations. The country’s sensitivity to oil prices and the approach of the 2019 general elections increase the risk that the market may be volatile for the next 12 months.
“Valuations have become more stretched for the Indian equity market as a whole, but provided the oil price does not continue to rise, we think India does offer relative insulation against protectionist trade policy,” said Douglas Reed, a London-based strategist at Newton Investment Management.
Middle class ensuring India a haven for investors amid global market turmoil - Times of India
India's retail inflation accelerates to 4.87% in May; April factory output at 4.9%
India's retail inflation accelerates to 4.87% in May; April factory output at 4.9% | The Economic Times Video | ET Now
India's retail inflation accelerates to 4.87% in May; April factory output at 4.9% | The Economic Times Video | ET Now
China slaps 25% tariffs on US cotton.India expected to export 5 times more cotton to China as a result
What India makes: List of India's manufacturing hubs
From the world's largest centre for cutting and polishing diamonds to a centuries-old hub for silk brocade, there are industrial clusters spread across India. Emerging hi-tech centres to some which are grappling with many problems, there are quite some surprises on India's manufacturing map.
Bharuch
Petroleum, petrochemicals, pharmaceutical, chemicals, fertiliser, metal fabrication, shipbuilding
Gujarat's biggest liquid cargo terminal is situated here and the city houses many multinational companies, such as Videocon, BASF, Reliance and Welspun Maxsteel
6,000 people employed
(in petrochem sector)
Challenge: Industrial pollution
Ludhiana
Apparel industry manufacturing woollen garments and hosiery apparel, hand tools and industrial equipment, bicycle manufacturing, bicycle parts and metals fabrication.
12,000 small and major industrial units that manufacture hosiery products
Rs 15,000 cr Annual revenue from woollen apparel industry
Challenges: Rising costs of operations and cheaper imports
Moradabad
Brassware
The district houses 600 export units, and over 5000 industries
Estimated turnover of Rs 9,700 cr
Export of Rs 5,400 cr
10,50,000 people employed
Challenges: Lack of promotional & technological development, poor usage of information & communication technology
Firozabad
Glass & glass products
The industry began in the late 18th century, when Muslim artists settled in the town, and began making glass bangles
4,222 units operational
Turnover of about Rs 4,000 cr annually
33,700 people employed
Challenges: Enhancement of investment limit needed, no support from state industrial policy
Kanpur
Leather, textiles
Home of many government and private textile mills from the pre-Independence era but today most of them have shut down. Now better known for leather products and automobile and machinery parts
In the 1990s, the leather industry employed over 1 mn workers, Now the number is estimated to be less than half
Challenges: Pollution; shortage of raw materials for leather industry
Varanasi
Handloom & handicrafts
Traditional handloom and silk brocade weaving cluster dating back centuries
17 lakh powerloom units employing 80 lakh workers
1.5 lakh weavers in Varanasi
Challenges: Dwindling demand. Imposition of GST caused a lot of problems
Surat
Diamond cutting & polishing
Started more than a century ago. Today it's the world's biggest diamonds cutting and polishing centre
5,000manufacturing units
Annual exports of over $20 billion
1.5 million people employed
Challenges: Shortage of uncut diamonds, rupee slide, global demand meltdown
Pimpri-Chinchwad
Automobile and automotive parts
The automobile industry in this area kicked off post liberalisation in 1991. Companies including Tata Motors, Kirloskar Engines, Tech Mahindra have manufacturing units here
198 functional units operating
12,300 people employed
Challenges: Technological upgrades and support required. Better credit facilities are needed
Kochi
Seafood, fisheries, oil refining, spices
Approximately 1,39,865 tonnes of spices produced in 2016-17
Exports valued at Rs1,76,642 cr
99 seafood processing facilities
Challenges: Lack of timely financial support; high production costs
Tirupur
Textiles
It is largest cotton textiles, and cotton knitwear, manufacturing hub in the country since the 1970s. It is also one of the biggest exporting centres of cotton textiles
Over 1000units
Tirupur's export turnover over Rs20,000 cr and domestic sales Rs15,000 cr
3,00,000 people employed
Challenges: Shortage of skilled workforce, lack of working capital
Chennai
Automobiles & Auto
Components
Started in the 1950s, with Ashok LeylandNSE 0.96 % setting up manufacturing plants to produce cars
Now, it is an automobile manufacturing hub for companies like Hyundai, Ford, Daimler and BMW
Components industry has also flourished, with turnover approximately touching
$40 billion
in 2015-16
Challenge: Other states being favoured as manufacturing hubs
Vijayawada
Auto parts
Development of auto components cluster in Vijaywada is part of the Andhra government's industrial policy. The Jawahar Lal Nehru Auto Nagar estate is one of the largest auto components industrial hubs in Asia
Over 800 working units
1,00,000 people employed
Challenges: Poor sewerage, extreme summer temperature
Visakhapatnam
Steel, shipbuilding, pharmaceuticals, fertilisers, coffee, fishing, petrochemicals, refinery
Hindustan Shipyard Limited was founded in 1941 by industrialist Walchand Hirachand but later nationalised in 1961
It has built over 180 vessels and repaired almost 2,000 ships
Rashtriya Ispat Nigam, the corporate entity of Visakhapatnam Steel Plant, is a central government undertaking with annual revenues of over
Rs 12,000 crore
Challenges: Industrial pollution & infrastructure problems
Bhilai
Steel and ancillary industries
SAIL's Bhilai Steel Plant in Chattisgarh was set up in 1955 and is India's main producer of steel rails, as well as wide steel plates and other steel products.
Annual production capacity of
3.153 MT of saleable steel
Annual exports of over
$20 billion
600 ancillary units
Earlier this week, PM Modi dedicated the expanded plant to the nation
People employed in steel and ancillary industries:50,000
Challenges: Urbanisation related issues, including slums
Jamshedpur
Iron and steel, auto parts
Tata SteelNSE 0.74 % is one of the top steel producing companies globally with annual crude steel deliveries of 27.5 million tonnes (in FY17),
The other main industries are truck manufacturing, tinplate production, cement and other small and medium scale units
74,000 employees in the steel sector
Challenges: Very small airport; poor roads
What India makes: List of India's manufacturing hubs
From the world's largest centre for cutting and polishing diamonds to a centuries-old hub for silk brocade, there are industrial clusters spread across India. Emerging hi-tech centres to some which are grappling with many problems, there are quite some surprises on India's manufacturing map.
Bharuch
Petroleum, petrochemicals, pharmaceutical, chemicals, fertiliser, metal fabrication, shipbuilding
Gujarat's biggest liquid cargo terminal is situated here and the city houses many multinational companies, such as Videocon, BASF, Reliance and Welspun Maxsteel
6,000 people employed
(in petrochem sector)
Challenge: Industrial pollution
Ludhiana
Apparel industry manufacturing woollen garments and hosiery apparel, hand tools and industrial equipment, bicycle manufacturing, bicycle parts and metals fabrication.
12,000 small and major industrial units that manufacture hosiery products
Rs 15,000 cr Annual revenue from woollen apparel industry
Challenges: Rising costs of operations and cheaper imports
Moradabad
Brassware
The district houses 600 export units, and over 5000 industries
Estimated turnover of Rs 9,700 cr
Export of Rs 5,400 cr
10,50,000 people employed
Challenges: Lack of promotional & technological development, poor usage of information & communication technology
Firozabad
Glass & glass products
The industry began in the late 18th century, when Muslim artists settled in the town, and began making glass bangles
4,222 units operational
Turnover of about Rs 4,000 cr annually
33,700 people employed
Challenges: Enhancement of investment limit needed, no support from state industrial policy
Kanpur
Leather, textiles
Home of many government and private textile mills from the pre-Independence era but today most of them have shut down. Now better known for leather products and automobile and machinery parts
In the 1990s, the leather industry employed over 1 mn workers, Now the number is estimated to be less than half
Challenges: Pollution; shortage of raw materials for leather industry
Varanasi
Handloom & handicrafts
Traditional handloom and silk brocade weaving cluster dating back centuries
17 lakh powerloom units employing 80 lakh workers
1.5 lakh weavers in Varanasi
Challenges: Dwindling demand. Imposition of GST caused a lot of problems
Surat
Diamond cutting & polishing
Started more than a century ago. Today it's the world's biggest diamonds cutting and polishing centre
5,000manufacturing units
Annual exports of over $20 billion
1.5 million people employed
Challenges: Shortage of uncut diamonds, rupee slide, global demand meltdown
Pimpri-Chinchwad
Automobile and automotive parts
The automobile industry in this area kicked off post liberalisation in 1991. Companies including Tata Motors, Kirloskar Engines, Tech Mahindra have manufacturing units here
198 functional units operating
12,300 people employed
Challenges: Technological upgrades and support required. Better credit facilities are needed
Kochi
Seafood, fisheries, oil refining, spices
Approximately 1,39,865 tonnes of spices produced in 2016-17
Exports valued at Rs1,76,642 cr
99 seafood processing facilities
Challenges: Lack of timely financial support; high production costs
Tirupur
Textiles
It is largest cotton textiles, and cotton knitwear, manufacturing hub in the country since the 1970s. It is also one of the biggest exporting centres of cotton textiles
Over 1000units
Tirupur's export turnover over Rs20,000 cr and domestic sales Rs15,000 cr
3,00,000 people employed
Challenges: Shortage of skilled workforce, lack of working capital
Chennai
Automobiles & Auto
Components
Started in the 1950s, with Ashok LeylandNSE 0.96 % setting up manufacturing plants to produce cars
Now, it is an automobile manufacturing hub for companies like Hyundai, Ford, Daimler and BMW
Components industry has also flourished, with turnover approximately touching
$40 billion
in 2015-16
Challenge: Other states being favoured as manufacturing hubs
Vijayawada
Auto parts
Development of auto components cluster in Vijaywada is part of the Andhra government's industrial policy. The Jawahar Lal Nehru Auto Nagar estate is one of the largest auto components industrial hubs in Asia
Over 800 working units
1,00,000 people employed
Challenges: Poor sewerage, extreme summer temperature
Visakhapatnam
Steel, shipbuilding, pharmaceuticals, fertilisers, coffee, fishing, petrochemicals, refinery
Hindustan Shipyard Limited was founded in 1941 by industrialist Walchand Hirachand but later nationalised in 1961
It has built over 180 vessels and repaired almost 2,000 ships
Rashtriya Ispat Nigam, the corporate entity of Visakhapatnam Steel Plant, is a central government undertaking with annual revenues of over
Rs 12,000 crore
Challenges: Industrial pollution & infrastructure problems
Bhilai
Steel and ancillary industries
SAIL's Bhilai Steel Plant in Chattisgarh was set up in 1955 and is India's main producer of steel rails, as well as wide steel plates and other steel products.
Annual production capacity of
3.153 MT of saleable steel
Annual exports of over
$20 billion
600 ancillary units
Earlier this week, PM Modi dedicated the expanded plant to the nation
People employed in steel and ancillary industries:50,000
Challenges: Urbanisation related issues, including slums
Jamshedpur
Iron and steel, auto parts
Tata SteelNSE 0.74 % is one of the top steel producing companies globally with annual crude steel deliveries of 27.5 million tonnes (in FY17),
The other main industries are truck manufacturing, tinplate production, cement and other small and medium scale units
74,000 employees in the steel sector
Challenges: Very small airport; poor roads
What India makes: List of India's manufacturing hubs
One economic problem that may be solving itself
Oil producers' cartel, OPEC (Organization of the Petroleum Exporting Countries), and Russia has decided to increase production by 1 million barrel per day (bpd) - or 1 per cent of global supply - striking a deal with Iran who were opposing the hike. Saudi Arabia persuaded arch-rival Iran to cooperate amid calls from major consumers to help reduce the price of crude and avoid a supply shortage.
The 14 member nations of OPEC - mainly Saudi, Venezuela, Iran and Iraq - controlled a little more than 80 per cent of world crude oil reserves in 2016. Russia, a non-member, is the second largest oil producer after Saudi.
Why the raise now?
World's largest oil consumers - US, China, and India - wanted the rise in supply to bring the cost down. Crude oil hit $73.98 a barrel on Brent exchange on Friday. Saudi and Russia said they were happy to pump more but Iran had criticised the idea as it faces export-crippling US sanctions.
Though raising supply would mean higher volume of exports for OPEC, the same won't hold true for Iran. US President Donald Trump had re-imposed sanctions on Tehran - and hence they have fewer buyers. Trump slapped fresh sanctions on Tehran in May and market watchers expect Iran's output to drop by a third by the end of 2018. That means the country has little to gain from a deal to raise OPEC output, unlike top oil exporter Saudi. The increase in production will be borne largely by Saudi and Russia.
The move from the US pinched India hard by sending pump prices to record highs and putting pressure on inflation, CAD (current account deficit) and government math by pushing up the oil import bill. The effect was magnified by the rupee’s fall against the US dollar. India currently imports 80 per cent of oil.
Crude oil price in India surged from $50.57 bbl in May last year to $75.31 bbl this May.
But don't expect a drastic drop in oil price. The effective increase in supply, due to crunch in other nations like Venezuela, could be 770,000 bpd, which is less than half the amount OPEC reduced in supply in 2017.
One economic problem that may be solving itself - Times of India
Oil producers' cartel, OPEC (Organization of the Petroleum Exporting Countries), and Russia has decided to increase production by 1 million barrel per day (bpd) - or 1 per cent of global supply - striking a deal with Iran who were opposing the hike. Saudi Arabia persuaded arch-rival Iran to cooperate amid calls from major consumers to help reduce the price of crude and avoid a supply shortage.
The 14 member nations of OPEC - mainly Saudi, Venezuela, Iran and Iraq - controlled a little more than 80 per cent of world crude oil reserves in 2016. Russia, a non-member, is the second largest oil producer after Saudi.
Why the raise now?
World's largest oil consumers - US, China, and India - wanted the rise in supply to bring the cost down. Crude oil hit $73.98 a barrel on Brent exchange on Friday. Saudi and Russia said they were happy to pump more but Iran had criticised the idea as it faces export-crippling US sanctions.
Though raising supply would mean higher volume of exports for OPEC, the same won't hold true for Iran. US President Donald Trump had re-imposed sanctions on Tehran - and hence they have fewer buyers. Trump slapped fresh sanctions on Tehran in May and market watchers expect Iran's output to drop by a third by the end of 2018. That means the country has little to gain from a deal to raise OPEC output, unlike top oil exporter Saudi. The increase in production will be borne largely by Saudi and Russia.
The move from the US pinched India hard by sending pump prices to record highs and putting pressure on inflation, CAD (current account deficit) and government math by pushing up the oil import bill. The effect was magnified by the rupee’s fall against the US dollar. India currently imports 80 per cent of oil.
Crude oil price in India surged from $50.57 bbl in May last year to $75.31 bbl this May.
But don't expect a drastic drop in oil price. The effective increase in supply, due to crunch in other nations like Venezuela, could be 770,000 bpd, which is less than half the amount OPEC reduced in supply in 2017.
One economic problem that may be solving itself - Times of India
Can the Indian economy really achieve double digit growth?
Analysts say it would be better for India to first target a sustained 8% growth. In 2017-18, the Indian economy grew at 6.7%, a four-year-low. Graphic: Mint
New Delhi: Within a span of just seven days, Prime Minister Narendra Modi has twice vouched to take the Indian economy to double-digit growth, and interim finance minister Piyush Goyal has claimed the target can be achieved by the fourth quarter (January-March) of the current fiscal year.
“The need of the hour is that we should work towards achieving the target of double-digit growth from 7-8%,” Modi said on Friday, while laying the foundation stone of the Vanijya Bhawan, which will house the commerce department. The world, he said, is watching when India will break into the $5 trillion economy club by doubling its economy. Modi was reiterating what he had said at the governing council meeting of the policy think tank NITI Aayog on 17 June.
“We can actually see a double-digit growth by the 4th quarter of this year, it is not impossible, there is a demand uptake in the economy, there is a mood in the nation and an aspirational billion is a fantastic marketplace,” Goyal had said on Tuesday.
The Indian economy accelerating to a seven-quarter high of 7.7% in the March quarter seems to have fired up the government. However, analysts say it would be better for India to first target a sustained 8% growth. In fiscal 2017-18, the economy grew at 6.7%, a four-year low.
Former chief statistician Pronab Sen said the conditions needed for double-digit growth are unlikely to be present anytime soon. “Private investment needs to pick up significantly, but the woes in the banking sector may drag it down. The global economy is increasingly looking dubious and a lot uncertain with an imminent threat of trade wars breaking out. In such a scenario, India is unlikely to achieve 20-25% exports growth, which is needed to achieve double digit growth,” he said.
Former chief economic adviser Arvind Virmani tweeted on Tuesday: “I have heard this many times before. In fact every time growth rises above 7%, we start hearing about the chimera of double-digit growth. The reality is that we have not been able to maintain 8% growth for even a couple of (consecutive) years!”
There have been six episodes in the last five decades when growth rates exceeded 8%, about once in each decade. However, the only instance of growth sustaining at levels above 8% for five continuous years was during 2004-08, with the average growth rate reaching an unprecedented high of 8.8% a year.
This episode benefited from the combined effect of important reforms undertaken in the 1990s and early 2000s, an unusual buoyancy in the global economy and easy global liquidity, leading to sustained growth across sectors.
Interestingly, when asked about his views on achieving double-digit growth, outgoing chief economic adviser Arvind Subramanian on Wednesday said the task becomes that much more challenging as the external economic environment has deteriorated.
“We should certainly aspire for double-digit growth. For double-digit growth, you need favourable external environment and domestic policy reforms that the government is putting together,” he said.
In its latest biannual India Development Update, the World Bank in March said attaining a growth rate of 8% or higher on a sustained basis is not guaranteed in the absence of an effective structural reform agenda including in land, labour and financial markets.
“Besides recapitalization, a consolidation of public sector banks, revising their incentive structure to align it more closely with their commercial performance, ensuring a level playing field for private banks, and opening the space for greater competition would be important measures to durably enhance the stability and efficiency of the banking sector,” the bank said.
Can the Indian economy really achieve double digit growth?
Analysts say it would be better for India to first target a sustained 8% growth. In 2017-18, the Indian economy grew at 6.7%, a four-year-low. Graphic: Mint
New Delhi: Within a span of just seven days, Prime Minister Narendra Modi has twice vouched to take the Indian economy to double-digit growth, and interim finance minister Piyush Goyal has claimed the target can be achieved by the fourth quarter (January-March) of the current fiscal year.
“The need of the hour is that we should work towards achieving the target of double-digit growth from 7-8%,” Modi said on Friday, while laying the foundation stone of the Vanijya Bhawan, which will house the commerce department. The world, he said, is watching when India will break into the $5 trillion economy club by doubling its economy. Modi was reiterating what he had said at the governing council meeting of the policy think tank NITI Aayog on 17 June.
“We can actually see a double-digit growth by the 4th quarter of this year, it is not impossible, there is a demand uptake in the economy, there is a mood in the nation and an aspirational billion is a fantastic marketplace,” Goyal had said on Tuesday.
The Indian economy accelerating to a seven-quarter high of 7.7% in the March quarter seems to have fired up the government. However, analysts say it would be better for India to first target a sustained 8% growth. In fiscal 2017-18, the economy grew at 6.7%, a four-year low.
Former chief statistician Pronab Sen said the conditions needed for double-digit growth are unlikely to be present anytime soon. “Private investment needs to pick up significantly, but the woes in the banking sector may drag it down. The global economy is increasingly looking dubious and a lot uncertain with an imminent threat of trade wars breaking out. In such a scenario, India is unlikely to achieve 20-25% exports growth, which is needed to achieve double digit growth,” he said.
Former chief economic adviser Arvind Virmani tweeted on Tuesday: “I have heard this many times before. In fact every time growth rises above 7%, we start hearing about the chimera of double-digit growth. The reality is that we have not been able to maintain 8% growth for even a couple of (consecutive) years!”
There have been six episodes in the last five decades when growth rates exceeded 8%, about once in each decade. However, the only instance of growth sustaining at levels above 8% for five continuous years was during 2004-08, with the average growth rate reaching an unprecedented high of 8.8% a year.
This episode benefited from the combined effect of important reforms undertaken in the 1990s and early 2000s, an unusual buoyancy in the global economy and easy global liquidity, leading to sustained growth across sectors.
Interestingly, when asked about his views on achieving double-digit growth, outgoing chief economic adviser Arvind Subramanian on Wednesday said the task becomes that much more challenging as the external economic environment has deteriorated.
“We should certainly aspire for double-digit growth. For double-digit growth, you need favourable external environment and domestic policy reforms that the government is putting together,” he said.
In its latest biannual India Development Update, the World Bank in March said attaining a growth rate of 8% or higher on a sustained basis is not guaranteed in the absence of an effective structural reform agenda including in land, labour and financial markets.
“Besides recapitalization, a consolidation of public sector banks, revising their incentive structure to align it more closely with their commercial performance, ensuring a level playing field for private banks, and opening the space for greater competition would be important measures to durably enhance the stability and efficiency of the banking sector,” the bank said.
Can the Indian economy really achieve double digit growth?
Kharif sowing 9.7% lower as monsoon delayed over Central, North India
Delayed arrival of the southwest monsoon in eastern, central and northern India has affected the sowing of kharif crops, which was 9.7 per cent less during the week ended June 22 compared to the same period last year.
However, government officials and agriculture experts are of the opinion that sowing of kharif crops, particularly paddy in eastern India, oilseeds and pulses in central and northern India and cotton in western parts of the country should pick up once the monsoon revives in these parts.
Monsoon had entered India two days ahead of its scheduled date and progressed well for a fortnight, before weakening from June 15. The Met department, in its weekly weather update released on Thursday, said the rains were expected to make a strong comeback from June 24.
The revival is supposed to overcome the deficit between June 1 and 20, which stood at 7 per cent as on Thursday.
Data furnished by the department of agriculture showed that till June 22, oilseeds have been planted in land almost 500,000 hectares less as compared to the same period last year, while pulses have been sown in 190,000 hectares less than the last year.
The onset of monsoon has been delayed by almost a week to 10 days over Madhya Pradesh, Maharashtra, Rajasthan, Gujarat and Chhattisgarh.
Soybean, groundnut and sunflower are the main oilseed crops grown during the kharif season. In pulses, arhar has been sown in around 137,000 hectares less than the last year. “The window for the sowing of main kharif crops such as maize, pulses and oilseeds is still open and bulk sowing will happen in July, the most crucial month for kharif crops,” K K Singh, head of agromet services at IMD said. According to the IMD, the southwest monsoon is expected to be normal in July at 101 per cent of the Long Period Average (LPA), while rainfall in August is expected to be lower at 94 per cent of the LPA.
The region-wise forecast has to be considered with a model error of plus and minus 8 per cent. Overall, though the met department has forecasted a normal monsoon in 2018, but recently doubts have crept in, particularly for the second half of the season, starting from mid-August, owing to the effect of El Nino.
Weather department officials are sure about the arrival of EI Nino, but what is significant is its timing and if it appears late in the season, it will not affect India’s peak monsoon time.
Kharif sowing 9.7% lower as monsoon delayed over Central, North India
Delayed arrival of the southwest monsoon in eastern, central and northern India has affected the sowing of kharif crops, which was 9.7 per cent less during the week ended June 22 compared to the same period last year.
However, government officials and agriculture experts are of the opinion that sowing of kharif crops, particularly paddy in eastern India, oilseeds and pulses in central and northern India and cotton in western parts of the country should pick up once the monsoon revives in these parts.
Monsoon had entered India two days ahead of its scheduled date and progressed well for a fortnight, before weakening from June 15. The Met department, in its weekly weather update released on Thursday, said the rains were expected to make a strong comeback from June 24.
The revival is supposed to overcome the deficit between June 1 and 20, which stood at 7 per cent as on Thursday.
Data furnished by the department of agriculture showed that till June 22, oilseeds have been planted in land almost 500,000 hectares less as compared to the same period last year, while pulses have been sown in 190,000 hectares less than the last year.
The onset of monsoon has been delayed by almost a week to 10 days over Madhya Pradesh, Maharashtra, Rajasthan, Gujarat and Chhattisgarh.
Soybean, groundnut and sunflower are the main oilseed crops grown during the kharif season. In pulses, arhar has been sown in around 137,000 hectares less than the last year. “The window for the sowing of main kharif crops such as maize, pulses and oilseeds is still open and bulk sowing will happen in July, the most crucial month for kharif crops,” K K Singh, head of agromet services at IMD said. According to the IMD, the southwest monsoon is expected to be normal in July at 101 per cent of the Long Period Average (LPA), while rainfall in August is expected to be lower at 94 per cent of the LPA.
The region-wise forecast has to be considered with a model error of plus and minus 8 per cent. Overall, though the met department has forecasted a normal monsoon in 2018, but recently doubts have crept in, particularly for the second half of the season, starting from mid-August, owing to the effect of El Nino.
Weather department officials are sure about the arrival of EI Nino, but what is significant is its timing and if it appears late in the season, it will not affect India’s peak monsoon time.
Kharif sowing 9.7% lower as monsoon delayed over Central, North India
Bad news for GST evaders: GSTN said to design tools for taxmen to analyse data
Almost a year into providing platform for tax collection, GST Network is now developing applications and tools for tax officers to help analyse data of their assessees and check possible evasion, a senior official said. GST Network (GSTN), the company handling the technology backbone for Goods and Services Tax, has over the last 11 months provided a platform for businesses to file their returns and pay taxes every month. GSTN Chief Executive Prakash Kumar said the next focus of the company will be on providing data analytics and improving user interface on the GSTN portal, besides developing backend system for assessment, audit, appeal and advance ruling for 27 states.
“‘We are working on the analytics part. We have already started sharing with tax officers simple analytics on differences between GSTR-3B and GSTR-1, GSTR-3B and GSTR-2A. This is a broad state-wise data generated by GSTN, based on which the officers can look into the returns filed by taxpayers in his jurisdiction and spot mismatches,” Kumar told PTI in an interview. GSTN currently only provides support to tax officers (on data analysis). And gradually we are providing them tools so that they can do it themselves… We are in the process of developing an application for Commissioners to generate data without any external help, he added.
He said the tools would enable tax officers to do the analysis themselves. “We have started work on it, We had even showed the functionality to state officers. We will be slowly releasing the tools over the next few months,” Kumar added. GSTN is also working to improve its user interface by providing systematised error messages with ‘error numbers’. Once a taxpayers sees a particular error number pop up on the screen, he can call the GSTN help desk for solutions. “Now the error message also says what has gone wrong and what you need to do to correct that. It will show a particular error number, which helps the GSTN helpdesk person to quickly identify the error that the taxpayer is committing and can guide him accordingly,” Kumar said.
Since the roll out of the GST from July 1, 2017, GSTN has handled 11.5 crore returns and processed 376 crore invoices. Currently, over 1.11 crore businesses are registered under the GST regime, of which 63.76 lakh have migrated from the erstwhile service tax and VAT regime, and 47.72 lakh are new registrants. As many as 17.61 lakh businesses have opted for composition scheme under GST.
Kumar further said that GSTN has been sending Management Information System (MIS) reports to tax officers 27 states which are categorised as model 2 states for better understanding of taxpayers in their jurisdiction. “We have provided 27 different MIS report for model 2 states. The tax officers get to see their own jurisdiction data, who their assessees are, return filed, taxes paid. The report has daily, monthly revenue collection list in the jurisdiction, ward-wise collection list, registration details, taxpayers with outstanding liability, disposal of cases, among other things,” he said.
Based on the broad data mining by GSTN, tax officers have started analysing cases where there are instances of mismatch and have been sending scrutiny notices to taxpayers whose summary sales returns GSTR-3B did not match with final returns GSTR-1 or with system generated purchase returns GSTR-2A.
Besides, many tax payers have got notices for utilising input tax credit (ITC) for payment of most of the GST liability and have been asked to explain reasons within a stipulated time. Also some notices have been sent for claiming less IGST input tax credit while filing sales returns as against the credit claims auto-generated by the GSTN.
On taxpayers getting notices for utilisation of ITC for GST payment, EY Partner Abhishek Jain said, “While these could be genuine cases for quite a number of businesses for reasons like low margins and large transitional credit pool, these notices could help check on utilisation of any ingenuine credits. Also, these could help detect fake credits claimed, if any”.
Bad news for GST evaders: GSTN said to design tools for taxmen to analyse data
Almost a year into providing platform for tax collection, GST Network is now developing applications and tools for tax officers to help analyse data of their assessees and check possible evasion, a senior official said. GST Network (GSTN), the company handling the technology backbone for Goods and Services Tax, has over the last 11 months provided a platform for businesses to file their returns and pay taxes every month. GSTN Chief Executive Prakash Kumar said the next focus of the company will be on providing data analytics and improving user interface on the GSTN portal, besides developing backend system for assessment, audit, appeal and advance ruling for 27 states.
“‘We are working on the analytics part. We have already started sharing with tax officers simple analytics on differences between GSTR-3B and GSTR-1, GSTR-3B and GSTR-2A. This is a broad state-wise data generated by GSTN, based on which the officers can look into the returns filed by taxpayers in his jurisdiction and spot mismatches,” Kumar told PTI in an interview. GSTN currently only provides support to tax officers (on data analysis). And gradually we are providing them tools so that they can do it themselves… We are in the process of developing an application for Commissioners to generate data without any external help, he added.
He said the tools would enable tax officers to do the analysis themselves. “We have started work on it, We had even showed the functionality to state officers. We will be slowly releasing the tools over the next few months,” Kumar added. GSTN is also working to improve its user interface by providing systematised error messages with ‘error numbers’. Once a taxpayers sees a particular error number pop up on the screen, he can call the GSTN help desk for solutions. “Now the error message also says what has gone wrong and what you need to do to correct that. It will show a particular error number, which helps the GSTN helpdesk person to quickly identify the error that the taxpayer is committing and can guide him accordingly,” Kumar said.
Since the roll out of the GST from July 1, 2017, GSTN has handled 11.5 crore returns and processed 376 crore invoices. Currently, over 1.11 crore businesses are registered under the GST regime, of which 63.76 lakh have migrated from the erstwhile service tax and VAT regime, and 47.72 lakh are new registrants. As many as 17.61 lakh businesses have opted for composition scheme under GST.
Kumar further said that GSTN has been sending Management Information System (MIS) reports to tax officers 27 states which are categorised as model 2 states for better understanding of taxpayers in their jurisdiction. “We have provided 27 different MIS report for model 2 states. The tax officers get to see their own jurisdiction data, who their assessees are, return filed, taxes paid. The report has daily, monthly revenue collection list in the jurisdiction, ward-wise collection list, registration details, taxpayers with outstanding liability, disposal of cases, among other things,” he said.
Based on the broad data mining by GSTN, tax officers have started analysing cases where there are instances of mismatch and have been sending scrutiny notices to taxpayers whose summary sales returns GSTR-3B did not match with final returns GSTR-1 or with system generated purchase returns GSTR-2A.
Besides, many tax payers have got notices for utilising input tax credit (ITC) for payment of most of the GST liability and have been asked to explain reasons within a stipulated time. Also some notices have been sent for claiming less IGST input tax credit while filing sales returns as against the credit claims auto-generated by the GSTN.
On taxpayers getting notices for utilisation of ITC for GST payment, EY Partner Abhishek Jain said, “While these could be genuine cases for quite a number of businesses for reasons like low margins and large transitional credit pool, these notices could help check on utilisation of any ingenuine credits. Also, these could help detect fake credits claimed, if any”.
Bad news for GST evaders: GSTN said to design tools for taxmen to analyse data
What can Pakistan possibly export?! They already have FTA but that only made things worst for them, tarrif or non tarrif barrier exemptions are for countries without FTA.
The best way is to kill off those seats. India has a huge over supply of Engineers. The Number of seats in any particular branch should be heavily regulalted to fit the maximum no of projected Jobs. otherwise you'll have the likes of Sant. Lunginath Patialawale Memorial College of Science and Technology, MG road beside lallu Panwala, Gorakhpur.... churning out engineers like Paratha on a Chandigarh highway Dhaba.
