Taxation
Dr Subramanian Swamy seeks complete stay on GSTN operations
Dr Subramanian Swamy, a member of Parliament (MP) and leader of Bharatiya Janata Party (BJP) has requested Prime Minister Narendra Modi to stay operations of Goods and Service Tax Network (GSTN). 
 
Dr Swamy, in a letter says, "...the GSTN, which is a data processing and tax revenue collection private limited company, which was never security cleared by the Home Ministry, whose clearance is mandatorily required. I strongly urge you to therefore to direct the complete stay of all operations of the presently constituted GSTN and that it remains in operational till it is reconstructed according to our national interest and after security certification by the Home Ministry."
 
The BJP leader also accused certain officials from the Ministry of Finance and the Chairman of GSTN of telling the media that the entity as constituted will continue without hindrance. 
 
Arguing that the department of electronics and the finance ministry are fully capable of handling GST data, Dr Swamy says "...in effect, GSTN (with the current shareholding) is foreign controlled" and hence, needs to be restructured in national interest. 
 
The central government holds 24.5% stake in GSTN while state governments together hold another 24.5%. The balance 51% equity is with non-government financial institutions like HDFC Bank, HDFC Ltd, ICICI Bank, NSE Strategic Investment Corp and LIC Housing Finance Ltd.
 
Here is the letter sent by Dr Swamy to the Prime Minister...
 
 
 

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COMMENTS

Suketu Shah

3 months ago

It seems what we know is a small fraction of what we donot know of GSTN.The determination of Dr Swamy on this matter and his tweets clearly indicate this was possibly the biggest scam ever which would have sold our country in 5 yrs time economically.On this point alone,Dr Swamy urgently needs to replace current FM.GSTN is much more serious than it seems.How shocking it is to see Infosys involved in this as well.

R Balakrishnan

3 months ago

Privatisation is a better option than trusting government babus to do this work. As regards ownership, the GOI can always put conditions. And yes, CAG is a good suggestion, on the presumption that the CAG has the capabilities to delve in to all this. The problem with being govt run is that it will be corrupt. Interesting debate, but I do not see any national security or secrets in this- GST should be a publicly available data .

REPLY

Nilesh KAMERKAR

In Reply to R Balakrishnan 3 months ago

Sir, Inside every HDFC, a Satyam is dormant, no?

R Balakrishnan

3 months ago

Privatisation is a better option than trusting government babus to do this work. As regards ownership, the GOI can always put conditions. And yes, CAG is a good suggestion, on the presumption that the CAG has the capabilities to delve in to all this. The problem with being govt run is that it will be corrupt. Interesting debate, but I do not see any national security or secrets in this- GST should be a publicly available data .

Nilesh KAMERKAR

3 months ago

Those who were against Dr. Swamy when he spoke/wrote against RRR . . . will surely start liking Dr. Swamy for what he is doing.

It is just amazing how much single handedly he can achieve. . .

Suketu Shah

3 months ago

During Dr Swamy's recent visit to USA,Boston community explained to him how via GSTN to private companies they were going to thoroughly expkoit India stock market.This speaks about hos intensely seriously this GSTN issue is and no one except Dr Swamy has highlighted this.What is the FM doing -he wasnt even aware of this?

Suketu Shah

3 months ago

If it wasnt for Dr Swamy India would have been sold to Goldman Sachs via GST.What is our FM doing-he didnot even know this about GSTN?No wodner since Dr Swamy has become MP,things have improved drastically at the top political level.

Simple Indian

3 months ago

While the issues raised by Dr. Swamy in his alleged letter to PM Modi are genuine concerns which many Indians would share, the typos and bad grammar in the letter indicates it may be a fake letter. Moreover, it is surprising that much of media is silent on this issue, perhaps due to the all-powerful FM Arun Jaitley being at the helm of affairs on GST project of GoI. Will PM Modi take cognizance of such letters and act ?

Parimal Shah

3 months ago

Though this man may have been responsible for many unusual comments this one is certainly important and the Finance Minister MUST take note of it and act accordingly to put things in proper order.

MG Warrier

3 months ago

One wonders whether Swamy doesn't have any access to BJP forums or PMO to share his brilliant ideas on current issues. Shooting out letters to PM and sharing the same with media doesn't make much sense, because if Swamy is not able to convince his own men, what we can do by reading his letters?

SRINIVAS SHENOY

3 months ago

What do you think?... Write your comments. I am of the opinion that the objections to the implementation of GSTN, if any should normally have been made at the initial stages.

REPLY

MG Warrier

In Reply to SRINIVAS SHENOY 3 months ago

That is the "Swamy way" of doing things. Poor Swamy isjusttrying to get some media space...

SBI Index shows a decline in growth in September 2016
The yearly State Bank of India (SBI) Composite Index, an indicator for tracking India’s manufacturing activity, is indicating downward momentum in September 2016 and just above 50 at 50.2 (low growth), compared to last month's index of 52.7 (moderate growth), portending a decline in growth.
 
"We expect that the credit cycle will turn for the better in a gradual manner. The good thing is that a part of the slowdown in corporate credit growth in the current fiscal is because of deleveraging by corporates and subsequent repayments. Retail credit growth continues to be strong. Additionally, about 48% of the credit upgrades in second half of FY2016 was due to better order book and healthy demand, improvement in profit margins and efficient management of working capital," says SBI in its Ecowrap report.
 
 
The fortnightly data of all scheduled commercial banks (ASCB) indicates that credit off-take is in a single digit at 9.8% as on 2 August 2016. SBI says, the bad thing is that debt weighted credit ratio (DWCR) worsens in FY2016 (all rating agencies) - the ratio declined below 1 in FY2016 - from 1.24 to 0.79 in FY2016. Hopefully, there should be a medium term course correction, it added.
 
According to the report, even as year-on-year growth has improved in recent weeks, but the year till date (YTD) growth is actually showing a decline. This YTD decline is possibly attributed to repayments made by oil companies, non-banking finance companies (NBFCs) and some corporates to the banks since March 2016.
 
 
It says, "The banking sector loan book is not showing significant traction as of now, on the back of a stagnant pipeline of projects. In our view, the year is likely to see a 13-14% credit growth, but mostly on the back of refinancing by banks on completed infrastructure projects in sectors like power, roads, where there are no risks. In the coming months, there may be some demand from the retail side due to the festive season. We also believe oil companies and NBFCs may avail of credit growth in the second half current fiscal."
 
"Overall, demand still remains a significant laggard in the system. With the pay commission arrears implemented from August 2016, bank deposits have shown a sizeable growth in September (over 20% of the incremental addition in current fiscal is attributable to such). This will lead to increased consumer demand ahead of festive season. We are pencilling in a 50 basis points rate cut by Reserve Bank of India (RBI) in its monetary policy during the current fiscal," SBI Ecowrap report concludes.

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COMMENTS

Dr. Shyam

3 months ago

SBI collected insurance money on over Rs.50 Lacs stock of my company STPL but never given any insurance policy or a method of making any claim for damages was simply a money taking mechanism. SBI finally closed my Rs.25 Lacs CC Limit even though we never defaulted in any payment of interest ever since. Obviously they were rude to companies and caused huge loss to companies by demanding return of loan in just few days. Such banks must fail for sure as they are in wrong hand and most of the GM come from South India who are extremely bad in behaviour in Northern States. SSI was really made to suffer in North by SBI officials. I reported this matter but none took it seriously and never admitted they did wrong for decades to companies. They often blocked CC Limit and only on complaits to head office, they used to respond. Horrible experience.

Nifty, Sensex may rally a bit – Thursday closing report
We had mentioned in Wednesday’s closing report that Sensex, Nifty await Fed actions. The major indices of the Indian stock markets rallied strongly on Thursday, as the Federal Reserve maintained interest rates unchanged, to close around 1% higher than Wednesday’s close. The trends of the major indices in Thursday’s trading are given in the table below:
 
 
Indian equity markets soared on the back of positive global cues on Thursday. The key indices gained around a percentage each during the mid-afternoon trade session, as healthy buying was witnessed in stocks of banking, automobile, and capital goods. The BSE market breadth was tilted in favour of the bulls -- with 1,695 advances and 1,044 declines. On the NSE, there were 993 advances, 471 declines and 74 unchanged.
 
The Fed's decision to hold interest rates fuelled a rally in the equity markets globally leading to a sharp gap up move in our markets as well, according to market analysts. Initially on Thursday, the benchmark indices opened in the green following positive global cues. Investors' sentiments were buoyed on the US Federal Reserve's decision to keep its key interest rates unchanged for September. Besides, domestic cues such as the proposal to merge the general and railway budget, along with consultations to advance the budget presentation date, gave a positive momentum to the equity markets.
 
Union Finance Minister Arun Jaitley on Thursday said that infrastructure is the key to economic growth. Jaitley said this in his inaugural address at the BRICS (Brazil, Russia, India, China and South Africa) India 2016 seminar on "Best Practices in Public Private Partnerships (PPPs) and Long-term Infrastructure Financing".  The one day seminar was organised in the national capital by the Department of Economic Affairs, Ministry of Finance, with organisational support from the Confederation of Indian Industries (CII). Delegates from BRICS countries and senior officials of the Finance Ministry, along with senior executives of private sector companies participated in the seminar. It was organised in the run up to the BRICS Summit scheduled for October, 2016. India assumed the chairmanship of BRICS in 2016. According to Jaitley, an institutionalised forum amongst BRICS countries could serve as a regional knowledge hub with exchange of information facilitated through cloud sharing, and other electronic methods.  He pointed out that development projects in transportation sector like highways, ports and railways will be the area of mega economic activities as far as the infrastructure sector in India is concerned. The Finance Minister further said that investment from both the public and private sector will be required for financing projects in the areas of health, education, sanitation, renewable energy, highways, ports and railways among others. There is likely to be a good opportunity for investors in India in the infrastructure sector.
 
The US dollar decreased against other major currencies as investors were digesting the latest Federal Reserve statement. In the statement released on Wednesday after Fed's two-day policy meeting, the US central bank decided to keep its federal funds rate unchanged amid recent weak economic data and tepid inflation. "The Committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives," said the statement.
 
As the global financial markets waited nervously, the US Federal Reserve kept its key interest rates unchanged -- a move that should bring some cheer when Indian markets open on Thursday. "The committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives," said a statement by the Federal Open Market Committee after a much-watched, two-day meeting. The committee said even though unemployment rate is little changed in recent months, the job gains have been solid, even as household spending has been growing strongly. But business investment has remained soft, while inflation has continued to run below the 2 per cent long-term target. "Against this backdrop, the committee decided to maintain the target range for the federal funds rate at 0.25% to 0.50%."
 
The top gainers and top losers of the major indices are given in the table below:
 
 
The closing values of the major Asian indices are given in the table below:
 

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