สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 4 กุมภาพันธ์ 2557
Govt may tinker with tax rates to boost economy: FM
Finance minister P Chidambaram on Monday hinted at making some changes in the indirect tax regime, and outlining certain policy priorities to be pursued if the UPA is voted back to power, when he presents the vote on account for 2014-15 in Parliament on February 17. Tax experts see scope for a cut in excise and service tax rates from the current 12%, given the central GST rate of 10% proposed earlier and the notion that lower taxes could give an impetus to consumption. They also expect a five-year extension of the excise duty exemption given to the industry in states such as Himachal Pradesh and J&K that expires in May 2014. The dismal industrial production scenario – output contracted 2.1% in November-- and a sluggish economic growth of below 5% may prompt the government to experiment with indirect tax cuts in the hope that resultant higher growth could boost revenues. Chidambaram said although government cannot propose amendments to the Income Tax Act, Customs Act or the Excise Act, it can certainly make any proposal that is short of amending the law. Changes in indirect tax rates don't require Parliament's assent (they only require to be notified and placed before Parliament), while those in direct taxes need it. An aggressive spending cut is already underway.The government has averred that the fiscal deficit target of 4.8% of the GDP for this fiscal would be met, but many, including RBI governor Raghuram Rajan, have expressed concern over the quality of expenditure reductions. It is believed that helped by the expenditure cuts and some last-minute success on the disinvestment front, besides higher income from PSUs in the form of special dividends, could allow the finance minister to show a fiscal deficit of 4.8% or even slightly less than that. Referring to last week's imposition of a 5% export duty on iron pellets and increase in exise duty on pan masala, gutkha and chewing tobacco, Chidambaram said that such changes in indirect taxes only have to be notified and placed before Parliament.
(Source: Financial Express)
Interim budget may see some change in taxes: P Chidambaram
The upcoming interim budget could have some goodies for the aam aadmi in the form of indirect tax cuts, but there won't be any income-tax relief soon for inflationscarred consumers. Finance minister P Chidambaram will present the vote-on-account on February 17. This could mean possible moves to ease curbs on gold and selective changes to provide an impetus to some sectors. Indirect taxes include excise duty levied on goods at the factory gate, all import duties such as basic Customs duty, special additional duty, countervailing duty and service tax. Higher foreign direct investment (FDI) in insurance is not likely any time soon. The insurance Bill is not on the list of business for the upcoming session of Parliament in which government wants to get 39 Bills passed. The United Progressive Alliance government's ambitious reform of the tax structure - the Goods and Service Tax and the Direct Taxes Code - has also been put on the backburner.
(Source: Economic Times)
Manufacturing PMI highest since March 2013
Indian factories started 2014 on a high note, with activity growing at its fastest pace in nearly a year as domestic and overseas orders increased, according to a survey that also showed inflation accelerated. The HSBC Manufacturing Purchasing Managers' Index (PMI), compiled by Markit, bounced to 51.4 in January, its highest since March, from 50.7 in the previous month. The index, which gauges business activity in Indian factories but not utilities, spent three months below the 50 mark that separates growth from contraction before rising above it in November. After faltering late last year, the new orders sub-index rose to 52.4 last month from 51.3 in December while the pace of incoming export orders picked up for the second straight month. That prompted firms to ramp up output last month. The latest PMI reading may offer some relief for policymakers who have been struggling with stubbornly high inflation, government policy paralysis and fragile global demand, which put India in a rut of slowing growth. But chances are that any respite might be short lived.
(Source: Financial Express)
British companies looking to invest in North East
British companies have been looking to invest in infrastructure development of North East, especially constructing new roads and rail links, a top official said. "My commercial team from the UK Trade & Investment make regular visits to North East to promote bilateral business ties. I hope to work closely with both state governments and industry in North East to foster closer India-UK partnership in the region," British Deputy High Commissioner to Eastern India Scott Furssedonn-Wood said here. The British Council has been actively working with governments in the education sector in many states, including Assam, he said at the inauguration programme of a seminar here. The Indian government's 'Look East' policy is likely to increase trade with ASEAN countries and benefit this region, he added. "I am sure this region has tremendous growth opportunities, especially in sectors like infrastructure, education and training, oil and gas, power, low carbon development and healthcare. I know there is ongoing business to business dialogue with companies and governments in the North East to promote trade and commerce," Wood said. He, however, said there cannot be business and economic growth without peace and stability. "I would say that rooting out conflict and ushering in peace is an essential prerequisite for real development to occur. That is particularly true here in North East India. There is tremendous economic potential here and the regional economy is growing," Wood said.
(Source: Economic Times)
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