Gujarat Chamber of Commerce & Industry

36/2015-16

Thu, 03 March 2016

Trade & Industry

Highlights of Union Budget 2016-17

Key features of the Union Budget 2016-17 sector wise can be obtained from the below given source:

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Economic Survey 2016: A look at the highlights

The Economic Survey, which sets the scene for the Annual Union Budget 2016-17, forecasted that the Indian economy would grow by between 7.0 per cent and 7.75 per cent in the 2016-17 fiscal year that starts on April 1. The highlights of the Economic Survey can be read from the below link

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DIPP seeks to appoint companies as third party inspecting authorities

The Commerce and Industry Ministry has invited applications from companies to be recognised as third party inspecting authorities for the boiler industry, a move aimed at promoting ease of doing business. Third party inspecting authorities, as per the Indian Boilers Regulations (IBR), are allowed to inspect and certify boilers and boiler components.

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Now, govt schemes to come with sunset date

From now on, new government schemes will come with a sunset clause, a date on which they will cease to exist. Finance Minister Arun Jaitley, while presenting the Union Budget, said, "To improve the quality of government expenditure, every new scheme being sanctioned by government will have a sunset date." He also said all schemes sanctioned will also come out with an "outcome review" to find out who it actually helped the intended beneficiaries.

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Effective corporate tax rate increases to 24.67% in FY15 from 23.22% in FY14

Indias effective rate of corporate tax has inched up in the past one year closer to 25%, the proposed tax rate after phasing out exemptions. The effective rate went up to 24.67% in 2014-15 from 23.22% in 2013-14. Significantly, the effective rate is the highest for smaller companies that have a turnover of up to Rs 1 crore and lowest for those having turnover of more than Rs 500 crore. Smaller companies faced a rate of 29.37%, closer to the statutory rate, while their larger counterparts enjoyed a rate as low as 22.88% Statutory rate of income tax for companies having a turnover of Rs 10 crore is 33.84%, while for those with turnover of up to Rs 10 crore it comes to 32.44%.

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CBEC to withdraw 15-year old cases of Rs 5 lakh excise evasion

In a bid to cut litigation, the government has decided to withdraw central excise cases older than 15 years involving duty less than Rs 5 lakh. The Central Board of Excise and Customs (CBEC) in an order to all its Principal Chief Commissioners/ Chief Commissioners of Central Excise said the decision was in conformity with the policy of the government to reduce litigation in taxation.

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Income Tax department clarifies on capital gains for 2000-13 period

With an aim to reduce litigation and easing burden of compliance, the Income-Tax Department today said the amount received on buyback of shares between period April 1, 2000 and May 31, 2013 will be taxed as capital gains and not dividend in the hands of the recipient.

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Services PMI cools to 3-month low, rate cut hopes brighten

Indias economic growth slowed in February and the services sector activity fell to a 3-month low amid subdued growth in new orders, a monthly survey showed, adding to expectations of a rate cut by the RBI. The Nikkei Services Business Activity index fell to a 3-month low of 51.4 in February, from 54.3 in January, as increase in prices led to muted demand.

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Manufacturing growth loses momentum in February with PMI at 51.1, same as January

Manufacturing business conditions in India continued to improve, with new orders, exports, output and purchasing activity all rising in February. However, a faster expansion in new business inflows failed to lift growth of output. At 51.1 in February, unchanged from Januarys reading, the seasonally adjusted Nikkei India Manufacturing Purchasing Managers Index (PMI), pointed to a second consecutive monthly improvement in business conditions across the sector.

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Core sectors growth up 2.9% in January

Growth in the eight core sectors jumped to a three-month high of 2.9 per cent in January due to sharp pick-up in coal, cement and electricity generation. The eight core industries - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - comprising nearly 38 per cent of Indias total industrial production had grown at 2.3 per cent in January last year. In October 2015, the sectors had witnessed a growth of 3.2 per cent.

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Gujarat to get Spices Park, quality testing lab soon

Soon, producers and traders of spices in the state will be able to process, test and export spices from Gujarat itself. Spices Board of India (SBI) is in the process of setting up long-awaited Spices Park in Mehsana near Unjha and a quality evaluation lab for spices near Kandla port. According to the SBI officials, these measures will lead to shift in exports of spices from Mumbai to Gujarat. There are currently six spices parks operational in the country and three more are likely to come up in Raebareli (UP), Kota (Rajasthan) and Mehsana.

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Gujarat Government: Will implement Food Security Act from April

The state government has informed Gujarat high court that it has decided to implement the national Food Security Act, 2013 from April 1. It has also placed a communique with the Centre intimating it that the preparations of database about beneficiaries are also under way for proper implementation of the ambitious law.

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Economic & Finance

Easier capital norms to unlock resources: Banks

RBI allowed banks to beef up their capital adequacy by including certain items such as property value and foreign currency reserves for calculation of their Tier-1 capital. RBIs move is expected to free up to Rs 40,000 crore that banks could count as equity capital. The regulator has, however, allowed banks to count only 45% of the property value in their core capital.

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Budget 2016: FY17 Plan spending up 15%, FY16 expenditure too hiked by 2.6%

Government hiked Plan expenditure for next fiscal by 15.3 per cent to over Rs 5.5 lakh crore and also increased the revised estimate spending for this fiscal to over Rs 4.77 lakh crore compared to budgeted Rs 4.65 lakh crore. It has been a practise for some years to cut budgeted Plan expenditure at the revised estimate stage to keep a tab on burgeoning fiscal deficit. In the last Budget, the government had cut Plan spending by Rs 1,07,066 crore at revised stage.

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IMF projects 7.3% GDP growth rate for India this fiscal

Bullish on India, the International Monetary Fund has projected a robust growth rate of 7.3 per cent for the country this fiscal, picking up to 7.5 per cent next year. "India has a very good outlook at the present time. India certainly benefited from low oil and energy prices, one of the worlds largest oil importers and thats raised the real income of all Indians," said Paul Cashin, India Mission Chief for the International Monetary Fund.

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New Projects

Engineering students come up with low bandwidth video conferencing tool and messaging app

Students from a clutch of Indian colleges have come up with two innovations in the communications space. Presented at the recently held Tata IIT Delhi Pioneers Makerthon, a competition to build the messaging tool of the future.

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1,500 multi skill development units at cost of Rs 1,700 crore to be set up under Pradhan Mantri Kaushal Yojana

Finance Minister Arun Jaitley announced a scheme to develop entreprenuerial skills in one crore youth in the next one year under the Pradhan Mantri Kaushal Yojana. For this purpose, he announced setting up of 1,500 units for skill development and set aside Rs 1,700 crore for this purpose.

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Science & Technology

Budget 2016: IT hardware sector expects Rs 10k cr investment, lower prices

Hailing budget announcement, IT hardware companies expect prices of devices like modems, routers, set-top-boxes to go down by 8 per cent within a year and about Rs 10,000 crore investment in local production.

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Digital India will be a $1-trillion business opportunity: Ravi Shankar Prasad

Communications and IT minister Ravi Shankar Prasad has said that Digital India will be a $1 trillion business opportunity, combining the requirements of the telecoms, IT/ITeS and electronics manufacturing sectors.

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