dfa-15-oct

Daily Financial News Analysis – 15th Oct’20 – Free PDF Download

 

Loan Moratorium

  • The Supreme Court criticised the government for the delay in implementing reliefs for loans of up to ₹2 crore and asked why this was taking time.
  • The bench listed the next hearing for November 2 to allow the government to pass necessary orders and circulars to banks to pass on the reliefs.
  • The government had earlier conveyed its willingness to refrain from charging compound interest —interest on interest — for loans during the moratorium period for eight categories of borrowers for loan amounts up to ₹2 crore.
  • These include loans to MSMEs, education loans, housing loans, consumer durable loans, credit card dues, auto loans, personal and consumption loans.
  • The moratorium period ended August 31.
  • Solicitor general Tushar Mehta: the process will take time as each loan account was different.
  • The terms and conditions are diverse and complex, he said, explaining the delay.
  • “It will be done by November 15. That’s the outer limit,” he said, citing a government affidavit.
  • He assured the court that the government “intended” to pass on the benefits earlier than that.
  • “Their (common man’s) Diwali is in your hands,” Justice Shah observed in a lighter vein as the bench adjourned the hearing.

GST Payout

  • Some Opposition-ruled states will take a call on Friday on approaching the Supreme Court on the issue of the Centre pressing states to borrow to meet the deficit in GST compensation cess fund.
  • Kerala finance minister Thomas Isaac told ET that chief minister Pinarayi Vijayan will consult law department officials on Friday to decide on the legal position to be taken on the matter “and we will see that seven to eight states would be approaching the Supreme Court”.
  • V Narayanasamy, chief minister of Puducherry, said, “States have already begun discussions… It will have to be a collective decision.”
  • These states could create a common front against the Centre’s proposals, even as unconditional additional open market borrowing has been enabled for 21 states.
  • Unconditional borrowing of 0.5% of gross state domestic product (GSDP) is allowed to states that opt for option one.
  • This is separate from the borrowing of Rs 1,1 lakh crore envisaged for meeting the compensation shortfall.

Healthcare Pros Across Borders

  • India has pitched for easier cross-border movement of healthcare professionals and sought an outcome for the initiative at the ministerial conference of the World Trade Organization (WTO) next year.
  • New Delhi on Tuesday told the multilateral trade body that restrictive trade practices in the services sector have led to inability of countries in mobilising such professionals during the ongoing pandemic.
  • India: the pandemic has brought out the inherent weaknesses and inequalities in the global economic system.
  • New Delhi said the need of the hour is a short-term package of measures to address the immediate challenges posed by the pandemic, and a long-term conversation on how to reform an ailing and imbalanced global trading system.
  • India and South Africa have put a proposal that seeks to ensure timely and equitable availability of new diagnostics, therapeutics and vaccines for Covid-19 in sufficient quantities and at affordable prices.

Cabinet nod for Adnoc

  • The Cabinet has permitted Abu Dhabi National Oil Company (Adnoc) to export crude oil it has stored in Indian strategic reserve and lowered the quantity of crude oil it must always keep in the emergency stockpile in a bid to make it commercially more attractive for the foreign investor.
  • Adnoc and Saudi Aramco, the two companies that have shown interest in filling Indian strategic reserves, have been demanding the freedom to re-export crude from Indian strategic reserves.
  • Their ambition is to make India a regional crude storage hub from where they can serve neighbouring countries like Bangladesh and Sri Lanka.

4 Labour Codes

  • India intends to implement all four labour codes from April 1.
  • Rollout of flexible labour laws that will make hiring and firing easier.
  • Govt official said that we have begun the process of drafting the rules and hope to finalise them in the last quarter of this fiscal year.
  • The Union labour ministry has reached out to states to firm up rules pertaining to establishments in their jurisdictions to facilitate the simultaneous rollout of all the labour codes from the next fiscal year.
  • The labour codes, which subsume 29 labour laws into four codes, have given ample powers to states to change laws according to their requirement.
  • While states have jurisdictions over most establishments, the central government has jurisdiction over key sectors like coal and mining.
  • Parliament recently passed the Industrial Relations Code, the Code on Social Security, and the Code on Occupational Safety, Health and Working Conditions, following which they have been notified.
  • The Code on Wages was passed and notified last year but has not been implemented yet.

 

 

 

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