Money & Banking
Modi launches bank for small firms with Rs20,000 crore corpus

The move is aimed at benefiting some 58 million small businesses in the country, who account for a mere four percent of institutional funding, despite employing over 120 million people, many from unprivileged strata of society, the officials said

 

Prime Minister Narendra Modi on Wednesday launched a bank with a corpus of Rs20,000 crore to extend credit of up to Rs10 lakh to small businesses and regulate micro-finance institutions, to promote their growth, add to the country's output and create jobs.
 
The move is aimed at benefiting some 58 million small businesses in the country, who account for a mere four percent of institutional funding, despite employing over 120 million people, many from unprivileged strata of society, the officials said.
 
"After 'banking the un-banked' with the Jan Dhan Yojana, it's time to 'fund the unfunded'," the prime minister said at an event to launch what is called Micro Units Development and Refinance Agency - Mudra.
 
"Mudra is our innovation of funding the unfunded," the prime minister said.
 
"Millions of common men and women in this country, who run small businesses, have almost remained outside the net of formal institutional finance, in spite of their large contributions to the economy," he said at the event, attended, among others by Finance Minister Arun Jaitley.
 
"Providing access to institutional finance to such micro and small business units and enterprises will not only help in improving the quality of life of these entrepreneurs, but also turn them into strong instruments of growth and employment generation," the finance ministry said.
 
The initiative will also lay down the norms for responsible financing practices for micro-finance institutions so that the small businesses do not face hardship over indebtedness, while getting a fair environment for repayment.
 
In his budget speech delivered on February 28, the finance minister had said that while are were 5.77 crore small businesses in India, mostly individual proprietorships, these bottom-of-the-pyramid entrepreneurs found it difficult, if not impossible, to access formal systems of credit.
 
"I, therefore, propose to create a Micro Units Development Refinance Agency (Mudra) Bank, with a corpus of Rs20,000 crore and a credit guarantee corpus of Rs.3,000 crore. Mudra Bank will refinance micro-finance institutions through a Pradhan Mantri Mudra Yojana," he added.
 
"These measures will greatly increase the confidence of young, educated or skilled workers who would now be able to aspire to become first generation entrepreneurs; existing small businesses, too, will be able to expand their activities."
 

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Four-mn tonne shortfall in food grains production likely

The country's food grains production was 266 million tonnes in fiscal 2013-14

 

Food grains production in just-concluded fiscal (2014-15) is likely to be 257 million tonnes against the target of 261 million tonnes, resulting in a shortfall of four million tonnes, according to the agriculture ministry's second advanced estimates released here on Tuesday.
 
The country's food grains production was 266 million tonnes in fiscal 2013-14.
 
The Indian agriculture season is from July 1 to June 30 in the next year.
 
"Though rainfall deficit was 12 percent in the monsoon period last year (June-September 2014), overall production decline was not much, as decrease in the sowing area was only two percent," Agriculture Minister Radha Mohan Singh said at a national conference on agriculture for kharif campaign here.
 
To provide relief to thousands of farmers affected by recent unseasonal rains in some state across the country, the central government is considering more norms for the National Disaster Response Fund (NDRF).
 
"We are considering to increase norms for the NDRF to compensate farmers affected by unseasonal rains," Singh said.
 
Earlier in the day, the Reserve Bank of India (RBI) said in Mumbai that the contraction in food gains production in 2014-15 may turn out to be less than earlier anticipated.
 
"The adverse impact of unseasonal rains and hailstorms in March is still unfolding. Initial estimates indicate that 17 percent of the sown area under the rabi crop may have been affected though the precise extent of the damage remains to be determined," the central bank said in its first bi-monthly monetary policy statement.
 
At the same time, Singh urged the concerned state governments to first compensate the affected farmers from their respective State Disaster Response Fund (SDRF).
 
"State governments are authorised to notify disaster and expenditure for relief can be met from their response fund (SDRF) up to 10 percent of it (fund)," Singh said.
 
The minister also advised the concerned states to send a report on the area affected by the unseasonal rain to his ministry for assessment.
 
Unseasonal rains and hailstorms have affected Bihar, Gujarat Haryana, Jammu and Kashmir, Maharashtra, Madhya Pradesh, Punjab, Rajasthan and Uttar Pradesh.
 
The day-long conference was organised at the National Agriculture Science Centre in the capital to review rabi crop production and assess preparedness of states for ensuing kharif crop.
 
Kharif season starts in June with sowing when monsoon begins and its crop is harvested in November, while the rabi season begins with sowing in November and the crop, especially wheat, is harvested in April-May.
 
In a related development, the ministry of consumer affairs, food and public distribution decided to relax quality norms for wheat procurement.
 
"We have asked Haryana, Rajasthan and Uttar Pradesh governments to test samples of wheat jointly with FCI (Food Corporation of India) on arrival to relaxing quality norms for procurement," the ministry said in a statement.
 
Quality norms for wheat procurement have been relaxed up to 10 percent in Gujarat and Madhya Pradesh for the rabi season, as the shrunk and broken grain had lost shine.
 
As per Food Safety and Standards Act, 2006 relaxation in norms is allowed in the case of broken and shrunk grains and if grains lost shine.

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Siti cable directed to pay Rs33 crore as fine

According to an official of the Delhi government, the company has been committing major entertainment tax fraud since 2013

 

The Delhi government on Tuesday directed Essel Group owned Siti Cable Network Limited to deposit Rs33.12 crore as outstanding entertainment tax for two years, along with interest and penalty within 15 days.
 
According to an official of the Delhi government, the company has been committing major entertainment tax fraud since 2013.
 
"The company has been collecting entertainment tax from 5,36,616 customers at the rate of Rs20 per month and had earned around Rs13 crore as entertainment tax in 2013-14 but deposited only Rs4.63 crore as tax."
 
"It is clear that this company simply pocketed the remaining Rs8.32 crore which should have been deposited on a monthly basis in the government exchequer."
 
The Delhi government has levied a 100 percent penalty on Rs8.32 crore and an interest of Rs3.06 crore under the relevant provisions of the Delhi Entertainments and Betting Tax Act 1996.
 
The complete assessment including additional tax, penalty and interest for the financial year 2013-14, which this company now has to pay to the government, stands at Rs19.71 crore.
 
Similarly, it has been found that SITI Cable continued tax evasion during the financial year of 2014-15 also. The government has assessed the tax, interest and penalty for 2014-15 at Rs13.41 crore.
 

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