Centre lifts embargo on grant of govt businesses to private banks

The government has announced new information technology rules to curb the misuse of social media platforms and mandated firms to appoint a grievance officer and disclose the first originator of the mischievous information and remove it within 36 hours

Business Standard
05th March

  • Finance Minister Nirmala Sitharaman last week announced that the Centre had lifted restrictions on the grant of government business to private banks. All private-sector banks will now be allowed to conduct government-related banking transactions, such as tax and pension payments. Sitharaman said in a tweet that private banks could now be equal partners in the development of the Indian economy, furthering the government’s social sector initiatives and enhancing customer convenience.
  • Even as the government moves closer to seek custody of fugitive offender Nirav Modi from the UK, its success rate in extraditing fugitives has been low due to complex diplomatic processes. In the last five years, India managed to bring only about 20 fugitive offenders including AgustaWestland deal middleman Christian Michel James, and is strongly pursuing extradition cases of liquor baron Vijay Mallya and jeweller Mehul Choksi.
  • The government last week announced new information technology rules to curb the misuse of social media platforms. It mandated firms to appoint a grievance officer and disclose the first originator of mischievous information and remove it within 36 hours. The rules said content depicting nudity or morphed pictures of women needed to be removed within 24 hours.
  • India’s gross domestic product returned to the growth path – with a 0.4 per cent expansion in the October-December quarter – after two quarters of contraction, National Statistical Office (NSO) data showed. In 2020-21, GDP is set to contract 8 per cent, against an earlier estimate of 7.7 per cent.
  • The Sensex and the Nifty plunged nearly 4 per cent on Friday. However, what could possibly give comfort to investors is that the US yields have cooled to 1.41 per cent, although they still remain high, compared with 1.08 per cent a month ago.
  • India’s economic activity is gaining steam, but considerable uncertainty surrounds the outlook owing to the renewed surge in coronavirus infections, the Reserve Bank of India (RBI) said in its State of the Economy report this week. “...The gathering strength of the recovery and its broadening ambit hold out optimism and the will to survive and revive,” said the report, part of the RBI bulletin.
  • Reliance Jio emerged as the highest bidderin the 4G telecom spectrum auction, which concluded on Tuesday in just six rounds, beating incumbents Bharti Airtel and Vodafone Idea by a wide margin. The Centre would get Rs 77,815 crore from the two-day auction — one of the shortest in a decade. While the amount has exceeded the government’s expectation, the total mop-up is far below the Rs 3.92 trillion worth of airwaves put up for sale.
  • Franklin Templeton Mutual Fund (MF), which shut its six schemes in April 2020, is facing the heat from the Enforcement Directorate (ED) and the Securities and Exchange Board of India (Sebi). According to reports, while the ED has registered a money-laundering case against the fund house and eight others, the market regulator has issued a showcause notice and summons to the company and its key personnel who redeemed their investments days or weeks before the closure announcement.

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A few links for further reading

Hard path to growth

The signals for the economy are not positive: overall demand is yet to pick up; the share of total exports in India’s GDP is declining, and industrial output pattern remains worrying.

Small savings scheme

Investors breathed a sigh of relief when the government announced that interest rates on these instruments would not be revised for the fourth quarter of the calendar year.

Invest and emigrate

The great Indian dream of settling abroad is achievable if one has a few crores to invest. Rich nations offer a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances. Wealthy Indians, troubled by polluted cities and the red tape holding up entrepreneurship, may want a quick ticket out of the country. Sanjay Kumar Singh lists a range of options: from a Canadian province’s investor programme to America’s US EB-5 plan.

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