In an exclusive interview given to a leading economic daily, Dr Arvind Panagariya, deputy chairperson, NITI Aayog has exalted the virtues of targeted cash transfer [TCT] instead of universal cash transfer [UCT] opining that opting for the former would help in reaching out more of state financial assistance or subsidy to the poor. This is stating the obvious. A given amount of subsidy if distributed among a lesser number of persons say, those living below the poverty line [their number is naturally less than the population universe] will result in each person getting more than the amount he would get if that given subsidy amount were distributed amongt the entire population. Yet, its reiteration by none other than Dr Arvind...
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Category: Governance reforms
Taxing times: judiciary slower than bureaucracy
Giving its verdict on a bunch of petition challenging levy of ‘entry tax’ by states, a nine judge constitution bench of Supreme Court recently upheld its constitutional validity. It directed that individual cases will be decided by the regular benches concerned keeping in mind laws of the respective states. Even as regular benches take their own sweet time to conclude proceedings, the affected companies may get breather for a while to actually pay up. But, ‘Damocles sword’ hangs! The total liability on the companies – mostly in infrastructure and energy sectors which resort to large-scale transportation of goods in bulk across states – is about Rs 30,000 crore plus interest which itself would be a humongous amount considering that these...
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Black money – the ‘kachaa’ connection
Barring some short-term hiccups, the master stroke delivered by prime minister, Modi by way of declaring 1000/500 rupee notes as invalid will have a substantial positive impact on the economy. The precise quantum will of course depend effectiveness of the strategies unleashed by Team Modi [including amendment to I-T Act] to counter the maneuvers of black money holders to convert their black in to white. Modi has many more projects up his sleeves [including a frontal assault on real estate, bullion and foreign currency holdings] which he will execute from the start of next year. This should result in extermination of a lot more of black money and garnering more resources for financing development and helping poor. Having dwelt a...
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Currency scrap – bear short-term pain for long-term gain
For almost seven decades since independence, India has been grappling with the menace of black money [and corruption]. Despite political parties of all hues making lofty promises to stem it, it has only increased leaps and bounds assuming monstrous dimensions. Prime minister, Modi who was catapulted to the seat of power on the promise of rooting out this menace [besides delivering good governance and inclusive development] has taken several credible steps viz., plugging loopholes in existing laws/enacting new laws, streamlining procedures /processes and cutting bureaucratic red tape to curb its generation. These efforts continue unabated. Meanwhile, a huge stock of black money already existing in the economy [courtesy, rampant corruption and mis-governance in the past especially the period 2004-2014, better...
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Crippled at Bombay House
GOOD CORPORATE GOVERNANCE The revelations made by Cyrus Mistry, ex-Chairman, Tata Sons (letter dated October 25, 2016) immediately following his dismissal point towards a new low in corporate governance in India. If it can happen in one of India’s leading conglomerates which has a turnover of close to Rs 7,00,000 crores, market capitalisation of Rs 8,50,000 crores, operations in more than 100 countries and has about 7,00,000 employees on its rolls, this speaks volumes about the extent of degeneration that has set in corporate board rooms. What is so disconcerting about the recent events at Bombay House? The most worrying point is the brazen muscle-flexing by Tata family-owned trusts (they have 66% share in Tata Sons) which reduced its head...
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Taxing times – judiciary is even slower than bureaucracy
Giving its verdict on a bunch of petition challenging the powers of states to levy ‘entry tax’ a nine – judge constitution bench of the Supreme Court [SC] has upheld its constitutional validity. The SC has also held that individual cases will be decided by the concerned regular benches keeping in mind laws of the respective states. Even as the regular benches take their own sweet time to conclude proceedings, the affected companies may get breather for a while to actually pay up. But, ‘Damocles sword’ hangs. Having already paid 50% of the amount pursuant to interim orders of apex court, they will have to cough up the balance amount sooner than later. The total liability on the companies/dealers –...
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Bridging rich-poor divide – Modi style
One day morning, my maid informed me that a lady in another flat in the cooperative society [where I live] had offered her Rs 50,000/- to deposit in her account which should be returned in due course. She wanted my advise as to what she should do? I told her emphatically not to fall prey to such machination. The issue brought to my attention is resonating in millions of homes all over India. After prime minister, Modi announced on November 8 [8 PM], 2016 demonetization of 1000 and 500 rupee notes effective from zero hours of November 9, those holding un-accounted income/wealth or ‘black money’ [as it is known in common parlance] have been desperately look for means to convert...
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Poorly enforced contracts shatter Modi’s dream
On assumption of office, prime minister, Modi made a huge commitment to substantially improve the ease of doing business in India. He set a very ambitious target of catapulting India’s ranking in this regard to amongt top 50 countries. That was in the mid – 2014. Two-and-a-half years since then, India continue to languish at number 130 out of 189 countries in the ease of doing business as per World Bank’s Doing Business Report 2016 [a mere 4 places up from last year’s adjusted ranking of 134]. When, seen in the backdrop of far reaching reforms implemented by NDA – government [all aimed at achieving the goal set by Modi] in almost all areas of governance, this is a big...
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Good governance – slaughtered in Bombay House
The revelations made by Cyrus Mistry ex-Chairman, Tata Sons immediately following his dismissal point towards corporate governance in India reaching a new low. This is a matter of serious concern to investors/shareholders – including foreign investors – who has stakes in Indian companies. If, it can happen in one of India’s leading conglomerates which has a turnover of close to Rs 700,000 crores, market capitalization of Rs 850,000 crores, operations in more than 100 countries and has about 700,000 employees on its rolls, this speaks volumes about the extent of degeneration that has set in corporate board rooms. So, what is so disconcerting about recent events at Bombay House? The most worrying point is the brazen display of muscle flexing...
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GST – don’t fiddle with its soul
The GST Council created via the constitution amendment act on GST [Goods and Services Tax] that includes the finance ministers of all states and headed by union finance minister, Arun Jaitely is currently having brainstorming sessions to decide on the rate structure, slabs, exemptions etc. In this regard, all crucial numbers are expected to be finalized in its next meeting slated for November 3-4, 2016. Meanwhile, from deliberations thus far, a consensus view appears to be emerging in favor of 4 rates viz., 6% for essential and daily use items, two standard rates of 12% and 18% respectively and the highest rate 26% on so called de-merit goods such as luxury cars, aerated beverages, pan masala and tobacco products etc....
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