Air travellers can now expect lower fares on any domestic routes provided they do not carry check-in baggage, Ashish Sinha reports A separate category of air fares for only carry-on baggage passengers will be announced very soon by the domestic carriers after the Director General of Civil Aviation (DGCA), the aviation regulator, has allowed all domestic carriers to roll out “zero bag” fares and charge penalty against check-in baggage for tickets booked under such an offer. This move is significant because in March, DGCA had supported the unbundling of services and fees by scheduled airlines provided it was optional for the passengers. But later opposed the move through a circular in July after complaints lodged by air travellers. Justifying the go ahead for zero bag fares, DGCA said in its latest circular that such a move has the "potential to make basic fare more affordable". It said this will provide consumer an option of paying for the services they wish to avail. Aviation experts said allowing the zero bag scheme will help the business air travellers more who frequently fly in and out of a city either the same day or the next day. However, if a passenger who avails the zero bag fares turns up at the airport with check-in baggage, the airlines can now charge a penalty. Before the DGCA circular was issued on November 8, 2015, all domestic carriers except Air India allowed air travellers to carry up to 15 kilograms of check-in baggage without any extra cost. Air India allowed up to 23 Kilograms of free check-in baggage. SpiceJet has welcomed this customer and environment friendly move stating that it was is "in line" with the changing trends. In June this year, SpiceJet had rolled out a scheme, offering a discount of Rs. 200 to every passenger who books a flight with only one handbag and no check-in baggage. The offer, however, came with a rider that those who book tickets at discounted fares but later decide to carry check-in baggage would have to pay a fee of Rs. 500 for up to 10 kg and Rs. 750 for up to 15 kg baggage. November CircularThe November 8, 2015 circular will now supersede all previous circulars issued by the DGCA on "Unbundle of services and fees by scheduled airlines". "On the basis of various feedback received, it is felt that many a times these services provided by the airlines may not be required by the passengers while travelling. Considering the fact that unbundling of services and charges thereto has the potential to make basic fare more affordable and provides consumer an option of paying for the services which he/she wishes to avail, it has been decided by the Government to allow following services to be unbundled and charged separately on opt-in basis. These include Preferential seating, Meal/snack/drink charges (except drinking water), Charges for using airline lounges, Check-in baggage charges (above 15 kgs of free check-in baggage allowance). Airlines are allowed to offer “no check-in baggage/hand baggage only” fare scheme subject to the condition that the penalty to be imposed on a passenger, who avails such schemes but turns up with baggage for check-in at airline counter, cannot exceed the amount of incentive offered compared to lowest fare. March CircularOn March 24, the DGCA had issued the “Air Transport Circular 1 of 2015” titled ‘Unbundle of services and fees by scheduled airlines’. The circular said: “Considering the fact that unbundling of services and charges thereto has the potential to make basic fare more affordable and provides consumer an option of paying for the services which he/she wishes to avail, it has been decided by the Government to allow following services to be unbundled and charged separately on opt-in basis. These include Preferential seating, meal/snack/drink charges (except drinking water), Charges for using airline lounges, check-in baggage charges, sports equipment charges, musical instrument carriage, and fee for special declaration of valuable baggage (allow for higher unit on carrier liability).” The circular, however, came with certain riders: “The unbundled services must be provided on “opt-in” basis and not on “opt-out” basis. Charges for the unbundled services shall be fixed amount and shall not vary with the base fare for a particular sector/flight. Changes, if any, should be announced at least 30 days in advance by the airlines; and the scheduled airlines shall display the unbundled services and charges thereto on their respective websites in a transparent and conspicuous manner.” The riders also ensured that the airlines will be responsible for ensuring that the charges for the unbundled services are displayed by the travel portals/travel agents too,” it said. Taking a cue from this circular, which sources say is born out of years of continuous presentations and convincing the aviation authorities by the domestic airlines, three Indian low cost carriers had sent in their proposal to offer lower fare for passengers who fly only with cabin baggage. This low fare option was suggested to be in addition to the regular fare offered currently where 15 kg of check-in baggage is allowed. According to DGCA officials, the proposal was examined to see whether the low cost carriers give substantial benefit to flyers for not carrying check-in baggage and avoid a situation where the 15-kg baggage is taken without adequate advantage to the flyer. In effect, this suggestion entails the option of offering two sets of fares to the air traveller for the same destination - low fares (around Rs 500-1,000 less depending upon the airfare) for only hand baggage and the regular ones (with 15 kg of baggage allowed). The November Circular is the result of the initiatives of the low-cost carriers, said an industry insider. “Very soon you will see the special zero bag fare scheme getting launched. With the amount of interest among air travellers, the zero bag scheme will find many takers on the busy Mumbai-Delhi, Delhi-Bangalore, Delhi-Pune, Delhi-Hyderabad, Mumbai-Hyderabad, Mumbai-Ahmedabad, Delhi-Amritsar and Delhi-Kolkata route among others,” said a senior executive of a Delhi-based carrier. ashish.sinha@businessworld.in
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CH Unnikrishnan Government move to ease foreign direct investment (FDI) norms in certain segments in the civil aviation sector, including general aviation charter operations and ground handling services, is a welcome move. Lifting the limit of FDI in these segments from the current 74 per cent to 100 per cent will bring a positive structural push in the India's civil aviation market, resolving one of the key challenges that the industry faces currently, which is the weak infrastructure and supporting services. The new foreign investment policy will bring large foreign companies, which have the required expertise and capabilities in this supporting segment, to set up their operations in the country in a big way. Being choosy on the segments for allowing increased foreign investment cap is important in India. A discussion paper prepared by Confederation of Indian Industries (CII) on FDI in airlines recently had highlighted that the key challenge for India's civil aviation sector currently is not 'more airlines', but more infrastructure. This industry discussion paper had stated with ultimate clarity that; “Additional airlines and foreign owned carriers will certainly mean more aircraft and more congestion.” Therefore, the current move to relax FDI norms in selected areas is a decision in the right direction. Till now, these sectors were allowed up to 49 per cent FDI under the automatic route and above this limit and up to 74 per cent were allowed under the government approval route, although 100 per cent FDI by non-resident Indians were already allowed in these sectors. The government decision to allow 49 per cent FDI in regional air transport services with yesterday’s decision is also positive step as it will give a much needed push to the government's earlier proposal in the draft civil aviation policy to increase regional connectivity. While the draft civil aviation policy released by the ministry civil aviation last month has mentioned a likely increase of FDI in the scheduled airline segment, industry experts are quite apprehensive about this plan as it will suddenly see change in majority ownership of several airlines currently registered in India. It will also see many foreign operators entering the country all of a sudden creating more operational challenges including safety and infrastructure. India should now be little more cautious about raising foreign investment limits in schedules airlines. As industry analysts have already alerted the airline industry has remained an exception globally to the process of economic liberalization. While, the sector remains subject to several restrictions globally in terms of both operations and of ownership and control. Most of the countries, including the US, Singapore and China, currently impose restrictions in this sector, mainly in terms of protecting the interests of the country as such and the local players. At present, a good majority of the countries have imposed a 49 per cent ownership limit in the airline industry. This is true for both developed and developing economies. The airline industry in India is currently passing through one of its most competitive phases. Even though the sector has of late shown a significant revival in terms of financial performance and investor confidence, one should not forget that there is already tight competition exist in the market. A positive turnaround in the sector, after long years of crisis, may get reverted to worse again if the current balance is lost with an increased FDI in the scheduled airline segment. The aggressive route expansion plans of the Indian carriers, both old and new entrants, have already created excess supply, leading to congestion on the ground and the skies. So, a selected approach that could be well augmented to push the infrastructure including the airport, ground handling and maintenance and repair, is the right way to go.
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BW Online Bureau The changes announced in the FDI norms for the construction sector is set to give a fillip to low cost housing in a big way and bring in the much needed foreign investments in the sector experts said. The government has eased rules for foreign investors to exit and repatriate their investments. It also said that each phase of the project would be considered as a separate project for the purpose of FDI policy. Making "radical changes" in FDI regime in the construction development sector, the government said: "Conditions of area restriction of floor area of 20,000 sq meters in construction development projects and minimum capitalisation of $5 million to be brought in within the period of six months of the commencement of business, have been removed". Although 100 per cent foreign direct investment was allowed in townships, housing and built-up infrastructure and construction developments since 2005, the government had imposed certain conditions. The government had relaxed the FDI norms for construction sector in October last year. Now, it has further eased the norms as realty sector is facing demand slowdown leading to liquidity crunch and delay upto 5 years in completing project. "A foreign investor will be permitted to exit and repatriate foreign investment before the completion of project under automatic route, provided that a lock-in-period of three years, calculated with reference to each tranche of foreign investment has been completed," the government said. Moreover, the transfer of stake from one non-resident to another non-resident without repatriation of investment will neither be subject to any lock-in-period nor to any government approval. "Nonetheless, exit is permitted at any time if project or trunk infrastructure is completed before the lock-in-period," it added. The condition of lock-in-period would not apply to hotels and tourist resorts, hospitals, special economic zones (SEZs), educational institutions, old age homes and investment by NRIs. The following changes have been made to the FDI norms: Two crucial conditions have been relaxed. These include area restriction of 20,000 sq. mtrs in construction development projects and minimum capitalization of US $ 5 million to be brought in within the period of six months of the commencement of business have been removed. Now each phase of the construction development project would be considered as a separate project for the purposes of FDI policy. As per the changes, a foreign investor will be permitted to exit and repatriate foreign investment before the completion of project under automatic route, provided that a lock-in-period of three years, calculated with reference to each tranche of foreign investment has been completed. Further, transfer of stake from one non-resident to another non-resident, without repatriation of investment will neither be subject to any lock-in period nor to any government approval. “Nonetheless, exit is permitted at any time if project or trunk infrastructure is completed before the lock-in period,” the DIPP circular in this regard said. The changed norms have brought in more clarity on the definition of what constitutes real estate business. As per the amendments made, Real Estate Business will now mean ‘dealing in land and immovable property with a view to earning profit therefrom. This will not include development of townships, construction of residential/ commercial premises, roads or bridges, educational institutions, recreational facilities, city and regional level infrastructure, townships. “Further, earning of rent/ income on lease of the property, not amounting to transfer, will not amount to real estate business,” the DIPP circular said. The government has also said that condition of lock-in period will not apply to Hotels &Tourist Resorts, Hospitals, Special Economic Zones (SEZs), Educational Institutions, Old Age Homes and investment by NRIs. The government has also permitted 100% FDI under automatic route in completed projects for operation and management of townships, malls/ shopping complexes and business centres. Consequent to foreign investment, transfer of ownership and/or control of the investee company from residents to non-residents has also been permitted. “However, there would be a lock-in-period of three years, calculated with reference to each tranche of FDI, and transfer of immovable property or part thereof is not permitted during this period,” it said. The government has also clarified that "Transfer", in relation to FDI policy on the sector will now include the sale, exchange or relinquishment of the asset ; or the extinguishment of any rights therein ; or the compulsory acquisition thereof under any law ; or any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882) ; or any transaction, by acquiring shares in a company or by way of any agreement or any arrangement or in any other manner whatsoever, which has the effect of transferring, or enabling the enjoyment of, any immovable property.
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BW Online Bureau Two days after the Bihar Poll debacle, the NDA Government has announced easing of foreign direct investment or FDI in mining, civil aviation, defence, broadcasting, construction. It has also relaxed norms related to investment by companies owned and controlled by NRIs. "To further boost this entire investment environment and to bring in foreign investments in the country, the Government has brought in FDI related reforms and liberalisation touching upon 15 major sectors of the economy," the government said in a press release. "The crux of these reforms is to further ease, rationalise and simplify the process of foreign investments in the country and to put more and more FDI proposals on automatic route instead of government route where time and energy of the investors is wasted. It is one more proof of minimum government and maximum governance," the press release said. Broadcasting: News Channels See FDI Going Up To 49% On Automatic RouteIn a major move, the FDI cap on news channels has been moved up to 49 per cent and that too on an automatic route. Which means, any Indian news channels can attract FDI up to 49 per cent without applying for permission from the foreign investment promotion board or FIPB. Similarly, giving a big push to the ongoing digitization initiative of the central government, FDI cap across direct to home (DTH) and the digital Cable distribution services has been hiked to 100 per cent (up to 49 per cent via automatic route; beyond 49 per cent through government approval), Finance Minister Arun Jaitley said. FDI In Regional Air Transport ServiceIn order to give a fillip to regional connectivity and to make 30 crore middle class citizens fly by 2022, the government has allowed 49 per cent foreign investment in Regional Air Transport Services. Already, the FDI norms in civil aviation allows up to 49 FDI in Scheduled Air Transport Service and Domestic Scheduled Passenger Airline. "It has now been decided that Regional Air Transport Service will also be eligible for foreign investment up to 49 per cent under automatic route," the finance minister said. In a bid to give a boost to the overall civil aviation sector in India, the Government on Friday, October 30, 2015 announced the Draft Civil Aviation policy which lays down framework to boost regional connectivity by utilising over 300 unused airstrips. The policy proposed to cap airfares for regional connectivity to Rs 2,500 per hour of flying, imposition of 2 per cent surcharge on domestic and foreign tickets to fund regional connectivity, providing Rs 15,000 crore support to the operationalisation of unused airstrips into no-frills airports The government also increased the foreign equity caps of Non-Scheduled Air Transport Service, Ground Handling Services, Satellites-establishment and operation and Credit Information Companies from 74 per cent to 100 per cent. Sectors other than Satellites-establishment and Operation have been placed under the automatic route, the government said. In the draft civil aviation policy the government has already proposed at least three ground handling agencies including Air India's subsidiary/JV at an airport. Under the proposed policy, domestic airlines and charter operators will be free to carry out self-handling themselves or through their subsidiaries or will be free to outsource the same to other airlines. However, the ground handling staff will have to be on the rolls of the airlines or their subsidiaries who will be permitted to take contract employees provided such employment contracts will be for a period of at least one year for security reasons. UK-based economist and member of Parliament Lord Meghnad Desai was quoted in the media saying this will go down as an important economic reforms. "It's good that government started early on reforms process," he was quoted by some news websites. Foreign Investment Promotion Board (FIPB) Threshold IncreasedSo far, the FIPB was authorised to take up and consider proposals having total foreign equity inflow up to Rs 3000 crore. Proposals above Rs 3000 crore had to be placed for consideration before the Cabinet Committee on Economic Affairs. This will not be the case going forward as the government has also decided that the threshold limit for FIPB approval will be increased to Rs 5000 crore. "The amendments to the FDI Policy are meant to liberalise and simplify the FDI policy so as to provide ease of doing business in the country leading to larger FDI inflows contributing to growth of investment, incomes and employment," a detailed notification by the DIPP said.
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BW Online BureauAs Union Finance Minister Arun Jaitley had said that the pace of economic reforms won’t be affected by the Bihar rout, the Narendra Modi government on Tuesday (10 November) announced foreign direct investment (FDI) in as many as 15 sectors.Govt's commitment to development and reforms is unequivocal and unwavering, said Prime Minister Narendra Modi. Saying "today's reforms are another example of emphasis on Minimum Govt, Maximum Governance, Modi said India is unstoppable on path of economic progress. Govt wants the world to see the tremendous opportunities India has to offer. "These decisions come into force with immediate effect," Economic Affairs Secretary Shaktikanta Das said. DIPP Secretary Amitabh Kant said: "This is Diwali gift for investors. This is the biggest bang reform of the government." “The Government’s comprehensive announcement today on easing FDI norms in 15 major sectors of the economy is one of the boldest reform moves yet, even from this government and as CII, we congratulate the government and wholeheartedly welcome this initiative. This is a clear and strong message that reforms are not only on track but are going to be aggressive. For the markets and for industry, there could not have been a better Diwali gift,” said Chandrajit Banerjee, Director General, CII. Simplifying Foreign InvestmentA government release said: “The crux of these reforms is to further ease, rationalise and simplify the process of foreign investments in the country and to put more and more FDI proposals on automatic route instead of Government route where time and energy of the investors is wasted”. The sectors to benefit by the FDI push include agriculture and animal husbandry, mining, defence, broadcasting, construction development sector, and manufacturing sector. The FDI push comes ahead of PM Modi’s visit to the UK, and Turkey where he will attend the G 20 conference. “It is one more proof of minimum government and maximum governance. Further refining of foreign investments in key Sectors like Construction where 50 million houses for poor are to be built. Opening up the manufacturing Sector for wholesale, retail and E-Commerce so that the Industries are motivated to Make in India and sell it to the customers here instead of importing from other countries. The proposed reforms also enhance the limit of Foreign Investment Promotion Board (FIPB) from current Rupees 3000 crores to 5000 crores,” the government release added. Along with these sectoral reforms, DIPP has also been advised to consolidate all FDI related instructions contained in various notifications and press notes and prepare a booklet so that the investors don't have to refer to several documents of different timeframes. This exercise is intended on the one hand to further open up the Sectors for more foreign investments in the country and also to make it easy to invest in India. In the normal course, the policy corrections in 16 areas would have taken at least one year to process and get approvals. Thus, this action is a very dynamic step in terms of integrating the Indian Economy with the rest of the World for attracting investments and technology and generating employment for enhancement of income of the people of India. FDI In Single-brand RetailThe government relaxed conditions for FDI in single-brand retail and allowed 100 per cent FDI under automatic route in duty-free shops and Limited Liability Partnerships (LLP) and eased foreign investment norms in the defence sector. It has also raised the FIPB's monetary limit to Rs 5,000 crore from Rs 3,000 crore for approving FDI proposals. In the construction development sector, minimum capitalisation norms and floor area restrictions have been removed. The government has also eased exit norms for foreign players in the sector. "Hundred per cent FDI under automatic route has been allowed in completed projects for operation and management of townships, malls/shopping complexes and business centres," the commerce and industry ministry said in a statement. In the defence sector, 49 per cent foreign investment has been allowed under the automatic route and anything beyond through the Foreign Investment Promotion Board (FIPB) nod. Earlier, the investors were required to take approval of Cabinet Committee on Security for foreign investment above 49 per cent. "Portfolio investment and investment by Foreign Venture Capital Investor (FVCIs) will be allowed up to permitted automatic route level of 49 per cent," it clarified. In case of infusion of fresh foreign investment within the permitted automatic route level, resulting in a change in the ownership pattern or transfer of stake by existing investor to new foreign investor, government approval will be required." In the broadcasting sector, 100 per cent FDI has been allowed in DTH, teleports, mobile TV and cable networks. Of this, 49 per cent will be allowed under automatic route and beyond that will need FIPB nod. In the case of terrestrial broadcasting FM (FM radio) and uplinking of news and current affairs' TV channels, the foreign investment limit has been raised from 26 per cent to 49 per cent under the approval route. As for the up-linking of non-news and current affairs' TV channels, 100 per cent FDI has been now permitted under the automatic route. Earlier, it was allowed under the government approval route. In the private banking sector, the government has introduced full fungibility of foreign investment and accordingly, "FIIs/FPIs/QFIs, following due procedure, can now invest up to sectoral limit of 74 per cent, provided there is no change of control and management of the investee company". Earlier, portfolio investment was permitted up to 49 per cent. It may be mentioned, India is the fastest growing economy among major nations. The World Bank has improved India's ranking by 12 places in the 2016 Study of Ease of Doing Business. FDI has gone up by 40 per cent. Several global institutions have projected India as the leading destination for FDI in the World. IMF has branded India as the brightest spot in the Global Economy whereas the World Bank projects India's growth at 7.5 per cent and even better. The salient measures are: Limited Liability Partnerships, downstream investment and approval conditions. Investment by companies owned and controlled by Non-Resident Indians (NRIs) Establishment and transfer of ownership and control of Indian companies Agriculture and Animal Husbandry Plantation Mining and mineral separation of titanium bearing minerals and ores, its value addition and integrated activities DefenceBroadcasting SectorCivil AviationIncrease of sectoral capConstruction development sectorCash and Carry Wholesale Trading / Wholesale Trading (including sourcing from MSEs)Single Brand Retail Trading and Duty free shopsBanking-Private Sector; and Manufacturing Sector
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Union Minister Jayant Sinha has expressed hope that Goods and Services Tax (GST) will be rolled out from next fiscal even as he held Congress Vice President Rahul Gandhi responsible for creating impediments in the implementation of the taxation reform. Regretting at "low" tax payment, the Minister said the Narendra Modi-led government at the Centre, which has a mandate to provide corruption free and transparent regime, had toughened laws to prevent tax evasion and curb black money. "We are hoping to implement GST from 2016... but it will be clear in Winter Session of Parliament. Our efforts will be to get it passed," Sinha, the Union minister of state for finance, said on Saturday in Mohali while holding an interactive session with industry representatives from Punjab, Chandigarh, Haryana and Himachal Pradesh. Describing GST as "boon" for the economy, Sinha hit out at Congress Vice President Rahul Gandhi for allegedly not allowing the roll out of GST. "Why GST is not being implemented. There is only one person in the whole country who has halted the roll out of GST and his name is Rahul Gandhi ji. Rahul Gandhi ji does not want the country to progress... It is sheer injustice on his part (that) if there was voting in Rajya Sabha and it had been allowed for two hours to function then all the votes will be in our favour. "But he does not allow to function Rajya Sabha because he knows if Rajya Sabha functions for two hours and there will be voting and then they will be defeated and GST will be passed," he said. Sinha also lamented at lesser number of people paying tax in the country, saying it is "quite sad". "Our 16 per cent people pay tax in comparison to average 25 per cent people in other countries who pay their due taxes," he said. He said that the Centre, led by BJP government, had made laws tougher to curb black money in foreign countries and practice of tax evasion. "There is no place to hide for those who indulge in stashing black money abroad. We are enforcing laws strictly to stop tax evasion practice. Our efforts is to move towards cashless economy," he added. DisinvestmentSinha said that against the Centre's total expenditure of Rs 18 lakh crore, the revenue generation from taxes and other sources like disinvestment is pegged at Rs 12.5 lakh crore with the shortfall of Rs 5.5 lakh crore. "Can you run your businesses with such a deficit," he asked industry. Sinha, son of former Finance Minister Yashwant Sinha, said there could be three tax rates on different types of goods under GST regime. "There will be concessional rate, standards and then luxury rate in GST," he said. On bringing petrol and diesel into GST fold, Sinha said that states were not on the same page for bringing fuel under GST. "If we keep petrol and diesel items out of GST for two years and there are no revenue losses, then it can be brought under GST regime after two years. As a result of which tax on petrol and diesel in all the state will be uniform," he said. He added that there may be a hike in the excise limit of small industry in next Budget. Lashing out at previous UPA-led central government, Sinha said not even a single paisa of capital expenditure was incurred in Railways in 10 years of their regime. "Our government has targeted to invest Rs 8.5 lakh crore in Railways in next five years," he said. (PTI)
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The government could cut corporate tax to 25 per cent from 30 per cent before a previous deadline of four years, and will provide a roadmap for ending corporate tax exemptions shortly, Revenue Secretary Hasmukh Adhia said on Monday.Finance Minister Arun Jaitley, while presenting his annual budget in February, announced that the government would gradually pare corporate tax by 5 percentage points during the next four years and roll back various tax exemptions.The government will come out with a roadmap by next month for phasing out corporate tax exemptions and a gradual reduction of the tax rate over the next four years, Adhia said. "The roadmap for phasing out of exemptions will be unveiled soon," he said. Asked if it can be out by the end of this calender year, he said, "It should come out." Jaitley had said the basic rate of corporate tax in India at 30 per cent is higher than those prevalent in other major Asian economies, making domestic industry uncompetitive, and it would be brought down to 25 per cent over four years. Asked if the government is open to the idea of out-of-court settlement in the Vodafone case, the Secretary said, "They had invoked arbitration and we have responded to it. And if there is offer for out-of-court, the government will consider it." India is locked in a Rs 20,000-crore tax dispute with the UK telecom major Vodafone. While the basic tax demand was Rs 7,990 crore, the total outstanding, including interest and penalty, is estimated to have risen to Rs 20,000 crore. The case relates to the retrospective amendment of the I-T laws carried out by the UPA government in 2012 to overturn the Supreme Court verdict, which had favoured Vodafone. This case pertains to levy of capital gains tax on sale of India assets by Hong Kong-based Hutchison to Vodafone. Vodafone had initiated arbitration proceedings against India. While both the central government and Vodafone had named their respective arbitrators, the two have not yet been able to agree on a third arbitrator to preside over the proceedings. The government had in June 2014 appointed former chief justice of India RC Lahoti as arbitrator in the tax dispute case. However, in May 2015, Lahoti recused himself. Vodafone has already named Yves Fortier of Canada as its nominee on the panel. After India finalises on its nominee on the panel, both the arbitrators would scout for a neutral judge and only then, the arbitration proceedings will start. (Agencies)
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Simar SinghIn what will be a relief to the sagging workforce in China, the Communist Party announced that it would loosen the infamous one-child policy and allow couples to have two children. The ‘family planning policy’ was introduced by Beijing in 1978, at a time when the Chinese population seemed to be spiralling out of control and the future seemed to hold ever increasing economic and environmental burden for the country. According to a Reuters report, the Communist Party said that this move aimed at alleviating demographic restraints on the company. With a little more than three generations in check, the Chinese government had begun the process relaxing the restriction in 2013, with the announcement that families in which one of the parents was a single child would be allowed to have an additional child. Earlier concessions had also been made for ethnic minorities and the restriction was not strongly imposed in rural areas. This came off the back of reports that surfaced in 2012, which for the first time in decades showed that the working age population had fallen and the trend was likely to continue and possibly exacerbate in the coming decades. What was increasingly becoming apparent was the labour shortage and the sharp slowdown of labour migration from the rural areas to the cities. This was definitely a point of concern for a country like China which rode its way to becoming a manufacturing giant on its massive population. The one-child policy which was originally intended to be applicable to a single generation had been coming under fire from scholars and demographers for some time now, with many concerns about the negative consequences of such an imposition. China has also regularly come under fire from the foreign media because of the human rights violations that occurred as a consequence of the administration’s crackdown on couples who flouted the rule and because of the belief that it was an individual decision to determine the size of one's own family.
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India will apply a 5 per cent withholding tax to offshore rupee bonds for foreign investors, in line with the rate applied to domestic debt, Manoj Joshi, joint secretary at the finance ministry, told reporters on Tuesday.The clarification comes amid some confusion about whether the withholding tax also applied to offshore debt. India had cut the tax for debt investments to the current rate from 20 percent in 2013, which will remain in effect until July 2017.(Reuters)
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BW Online Bureau After the senior officials’ and secretaries’ meeting on Monday (26 October) that took the resolution to strengthen India-Africa trade ties, the India Africa Forum summit will see external affairs ministers meeting on Tuesday (27 October), with Union External Affairs Minister Sushma Swaraj slated to meet her counterparts from several African countries, including Kenya, South Sudan, Malawi and Democratic Republic of Congo. The big summit day is on 29 October when Prime Minister Narendra Modi will interact with the heads of the state in an event touted as unprecedented by the forum coordinator and former MEA spokesperson Syed Akbaruddin “as never in the history of African union, 54 representatives have together attended a meet of this nature.” All the countries invited by India have responded in a positive manner. At least two countries where regime changes happened as recently as a fortnight ago are being represented by their respective state heads. India may have some good news to break on the 29th by way of increasing the quantum of line of credit. “Wait for the next big thing in the summit. India has already disbursed $3.5 billion out of the total committed $7.4 billion. Approvals have already been given for $5 billion,” said Akbaruddin. He, however, refused to put his stamp on any figure, dubbing such reports as speculations. On Monday, the secretaries and senior officials deliberated upon a political document – talking about political partnership between India and Africa, and a framework document of cooperation – talking about developmental partnership between India and Africa. Over the next three days, India has also lined up a bevy of cultural items for the visiting African dignitaries. One capsule, specially designed for their spouses, will have a meeting with some 300 African women who are being trained at Tilonia by Bunker Roy to use solar energy to light up 15,000 of their villages. They have often been described as solar grandmothers. Asked if India was concerned over the growing Chinese footprint in Africa, Akbaruddin said that India was more concerned about people to people exchange, and capacity building. “Our engagement with Africa is in terms of human resources,” he added. He said that India had too had to learn a fair bit from the African countries many of which were far ahead of India in mobile banking. To a question from Businessworld, Akbaruddin said that it was only to be expected that anti-terrorism measures would be part of the talks as this deeply concerned bot the sides.
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