RBI fears for portfolio inflows; wants more FDI

RBI would issue draft guidelines on new banking licences in the next couple of weeks

The Reserve Bank of India today pitched for increased foreign direct investment (FDI) into the country, even as it expressed apprehension over the quality of portfolio inflows.

RBI deputy governor Shyamala Gopinath said India has been able to absorb capital inflows because it has a current account deficit.

“But we have expressed apprehension on the quality of inflows in terms of portfolio inflows,” she said. “But as we see today, we are not seeing too much volatility in that sense. But we would want more of FDI to come in so that quality of the flows do alter,” she added.

Gopinath also said the RBI would issue draft guidelines on new banking licences in the next couple of weeks.

“We are in consultation with the government (in regard to draft guidelines). There is no tussle with the government as such,” she said in response to a question, adding that the RBI and the government converge on many issues vis-a-vis these guidelines.

Gopinath also said rising commodity prices, particularly oil and gas, would add to the inflationary pressures, adding that the other factor driving inflation is that the price rise has not been factored in the administrative price of items like fuel.

“So, yes, we would be impacted if commodity prices go up substantially,” she added.

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Karnataka launches e-payment system for commercial tax payers

The e-payment system enables dealers to remit their commercial taxes anytime, anywhere, without physically approaching an office of the commercial taxes department

Karnataka has launched an e-payment system for commercial tax payers. The system enables dealers to remit their commercial taxes anytime, anywhere, without physically approaching an office of the commercial taxes department (CTD).

Right now, e-remittances can be made from six banks—SBI, SBM, SBH, Syndicate Bank, Canara Bank and Union Bank of India.

Chief minister BS Yeddyurappa said more public sector banks would be added to the list going forward. He said the system would also help curb tax evasion. Gopinath launched the reconciliation portal of the CTD.

Commercial taxes department officials said the new model was a “comprehensive e-payment reconciliation system” that would “run seamlessly from the dealer up to the government treasury”.

The CTD collects more than Rs2,000 crore per month and till now, these collections were by way of cheques by the dealers.

Every month on average, more than one lakh cheques were received by various offices of the CTD and these are then sent to the agency bank, which in turn processed them and remitted to the government account.

This involved a huge amount of manual work and at the same time, delay in realisations of amount and some cases of bounced cheques also. The reconciliation process was very difficult. Also, dealers were inconvenienced as they had to come to the respective offices and wait in a long queue to remit the tax.

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ICICI Lombard partners with Air India Express for travel insurance

The tie-up would enable customers to take advantage of group travel insurance facility provided by the insurer, valid for a period of 15 days or the return to India, whichever is earlier

Leading private insurer ICICI Lombard today said it has partnered Air India Express to provide travel insurance to its domestic and overseas travellers.

“This would be an exclusive tie-up, where Air India Express customers can avail travel insurance as a part of our bundle product,” its national manager (retail products and strategy) Amit Madhan said.

The tie-up would enable customers to take advantage of group travel insurance facility provided by the insurer, valid for a period of 15 days or the return to India, whichever is earlier.

“The policy will also cover pre-existing diseases in the case of life threatening situations, like heart attack, if it is proved that the hospitalisation was not planned,” he added.

The policy cover includes expenses due to accidents, loss from trip delay, loss or delay of checked-in baggage, and loss of passport.

The insurance company already has a partnership with Jet Airways, Kingfisher Airlines, Ezeego and Akbar Travels.

The overseas travel insurance market is estimated to be Rs400 crore, of which ICICI Lombard claims to enjoy a share of 15%.

ICICI Lombard, a joint venture between India’s largest private sector bank ICICI Bank, and Canadian financial company Fairfax Financial Holdings, has over 44 lakh policies with gross written premium of Rs3,694 crore.

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