QBiz: Mistry to Challenge Chandrasekaran’s Appointment & More
The Quint brings you the top business news from dailies across the country.
1. Cyrus Mistry Calls Chandrasekaran’s Appointment Illegal, May Challenge Decision in Court
Former Tata Sons chairman Cyrus Mistry has opposed the appointment of Natarajan Chandrasekaran as his successor and may even be preparing to open another legal front challenging the decision, officials in the know said.
A day before the board of Tata Sons met to consider Chandrasekaran as the chairman last week, Mistry shot off an angry letter to his fellow board members challenging the legality of the appointment.
"Unlike the October board meeting, when the decision to sack Mistry was not mentioned in the board agenda circulated before, this time the members were aware of what to expect. Mistry is still a director of Tata Sons and the agenda papers were circulated to him as well. That prompted the mail from him," said an official aware of the communications.
2. Suresh Prabhu Unveils 10-Year Energy Plan for Railways to Save Rs 41,000 Crore
Railway Minister Suresh Prabhu on Tuesday unveiled a plan to save Rs 41,000 crore over 10 years through an integrated energy management system.
According to Indian Railways’ Mission 41,000 initiative, the national carrier will electrify 24,000 km of rail tracks over the next five years by doubling the annual rate of electrification from 2,000 km to 4,000 km in the next two years.
To achieve this target, the Railways plans to follow the engineering, procurement, and construction (EPC) model of awarding contracts for railway electrification projects. It also plans to mechanise the execution through self-propelled wiring trains among other initiatives.
Prabhu said switching from diesel to electricity can help railways in a big way. Through electrification, railways can reduce dependence on imported fuel and rationalise the cost of energy.
3. Cess On Luxury Cars, Sin Products Can Be Extended Beyond Five Years Under GST
The proposed cess on items like luxury cars, tobacco products and aerated drinks under the Goods and Services Tax (GST) regime is likely to be extended beyond the first five years to bridge any shortfall in funds to compensate states, said an official document, which BloombergQuint has accessed.
In case the GST Compensation Fund fell short of the compensation payable (to states) in any bimonthly period, the GST Council shall decide the mode of raising additional resources, including borrowing from the market, which would be repaid by collection of cess in the sixth year or further subsequent year.Official Document Accessed By BloombergQuint
Finance Minister Arun Jaitley had said that the states will be compensated every two months for any loss incurred in the first five years of the new indirect tax regime coming into play.
(Source: Bloomberg Quint)
4. Trumped IT Firms to Start Hiring More Freshers in US
Indian outsourcing giants Infosys and Tata Consultancy Services will hire more engineers from campuses in the United States as they brace themselves for stringent visa norms, expected to be unveiled by the new American administration led by Donald Trump.
The move marks a change in strategy for the $150-billion Indian outsourcing industry, which until now has mostly relied on hiring large numbers of engineering graduates in India who were then posted to overseas client locations, a model that helped the industry win multi-billion dollar contracts but has also attracted the ire of locals.
Last fortnight, Senator Jeff Sessions, in his confirmation hearing for the post of attorney general of the United States, said that the Donald Trump administration will push for legislative reform to curb what he termed as "abuse of H-1B visas for foreign workers".
5. Budget 2017: Arun Jaitley Likely to Take the Stimulus Route to Economic Growth
Finance Minister Arun Jaitley is likely to significantly increase public investment in infrastructure in Union Budget 2017, offering fiscal stimulus to boost economic growth at a time when private investment shows no signs of a pick-up.
There is near unanimity that the economy needs to be spurred through higher public investment, unlike last year when there was a significant divergence of opinion over the need for fiscal stimulus, said an official with knowledge of the thinking within the government. The official requested anonymity.
Last year, chief economic adviser in the Finance Ministry Arvind Subramanian advocated a stimulus, but the minister decided to stick to the fiscal deficit target of 3.5% of gross domestic product (GDP), fearing a backlash from investors and rating agencies.
6. RBI Has No Idea How Much It Cost to Print the New Notes
The country's central bank has astonishingly revealed that it doesn’t know how much money was spent on printing the new currency notes.
To a Right to Information query filed by BusinessLine on 25 November on the cost of printing the new ₹500 and ₹2,000 notes, the RBI said “the information sought is not available with us”.
“Bank notes are printed by presses under the Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL) and the Security Printing and Minting Corporation of India (SPMCIL),” the central bank said, while transferring the query to the two agencies.
According to the RBI’s weekly statistical supplement, the total currency in circulation is pegged at Rs 8,734.16 lakh crore as on 6 January. This includes lower denomination notes as well as the new high denominates notes.
7. CBDT Holds Circular on Indirect Tax Provisions
In a significant relief to foreign investors, the Central Board of Direct Taxes (CBDT) has put in abeyance a recent circular clarifying the indirect transfer provisions, which had led to retrospective tax cases like that of Vodafone.
An official statement from CBDT said the matter is now under consideration.
In representations against the circular issued on 21 December 2016, FPIs, FIIs , VCFs and other stakeholders had said that it does not address the issue of possible multiple taxation of the same income.
“Pending a decision in the matter, the operation of the above mentioned circular is kept in abeyance for the time being,” the CBDT statement said.
The circular had listed 19 instances when indirect tax provisions would come into play.
8. India's Economic Growth Is Linked to the Fortunes of the Energy Sector
India is firmly set on a path of economic growth that is estimated to usher in prosperity like never before. This economic prosperity will need to be built on the back of significant transformations across several facilitating elements, the primary ones being infrastructure build-out, energy availability and sustainability.
India’s per capita energy consumption currently is almost one-third the global average, and trails far behind the mean figure for the developed world. Our energy consumption is largely based on coal, along with a preponderant dependence on other fossil fuels.
Although per capita energy consumption has more than doubled over the past 15 years, almost 240 million people do not have access to affordable energy supply today.
9. Demonetisation Will Impact Consumer Spending in Short Term : United Nations Report
Demonetisation will have a “significant impact” on consumer spending in the short term but the country’s economy will return to about 7.6-7.7 percent growth, forecasted a flagship UN report, a senior economic official said.
The United Nations World Economic Situation and Prospects (WESP) 2017 report launched on Tuesday said India’s economy is projected to grow by 7.7 per cent in fiscal year 2017 and 7.6 per cent in 2018, benefiting from strong private consumption. The report, however, did not take into consideration the impact of the demonetisation policy on the country’s economic growth.
The report added that India’s economic growth rate could see a downward revision when the estimates are updated in the next few months, taking into account the demonetisation impact.
(Source: The Financial Express)
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