Though analysts are not sure whether any further tightening of interest rate can check the price rise, the central bank seems to have few options but to hike rates
New Delhi: Amidst high food inflation, falling industry output and uncertain crude oil prices, the Reserve Bank of India (RBI) is likely to raise key policy rates by 25 basis points in its mid-quarterly review tomorrow, reports PTI.
The RBI is expected to hike interest rates by 25 basis points, said State Bank of India (SBI) chief finance officer (CFO) Hemant Contractor.
Despite moderation, food inflation is still high at 9.52% on account of rising prices of essential items. At the same time, factory output grew by 3.7% in January compared to 16.7% in the same month a year ago.
"Current growth and inflation trends clearly warrant that we persist with the anti-inflationary monetary stance. Looking beyond 2010-11, the Reserve Bank expects the domestic growth momentum to stabilise," RBI governor D Subbarao had said in the last policy review announced on 25 January 2011.
"Inflation is expected to moderate from the first quarter of 2011-12, but several upside risks are already visible. The monetary stance will be determined by how these factors impact the overall inflationary scenario," the governor had said.
Wholesale price based inflation inched up to 8.31% in February, against 8.23% in January.
The central bank has raised policy rates seven times since March 2010, with a hike of 175 basis points in short-term lending (repo) rate and 225 basis points in short-term borrowing (reverse) repo rate in its bid to arrest inflation.
Though analysts are not sure whether any further tightening of interest rate can check the price rise, the central bank seems to have few options but to hike rates.
"RBI is unlikely to raise rates in the upcoming policy review," said Corporation Bank chairman and managing director Ramnath Pradeep.
It is to be noted that RBI chose not to tinker with the policy rates in its December 2010 review, even though food inflation was in double digits.
"RBI till now has clearly communicated the stance that they want to balance between growth and inflation. That's why they want to take a calibrated stance to raise rates. From that perspective, 25 basis points hike seems to be on the cards," said Standard Chartered head (research) Samiran Chakrabarty.
Echoing a similar view, Crisil chief economist DK Joshi said: "RBI may raise key policy rates by 25 basis points to arrest food inflation spreading to the manufacturing sector."
Uncertainty in the international market and in the legal framework governing SEZs are seen as the main reasons for the time extension. Besides, doubts over tax exemptions to new SEZs has led to declining interest in the tax-free enclaves as the revised DTC draft seeks to offer tax exemptions only to existing units
New Delhi: Reflecting lack of enthusiasm for the special economic zones (SEZs), over 40 developers including Parsvnath SEZ and Ranbaxy Laboratories have sought more time from the government for implementing their projects, reports PTI.
Reliance Haryana SEZ Ltd has also requested for additional time from the Board of Approval (BoA), headed by commerce secretary Rahul Khullar, the BoA agenda said.
BoA, a 19-member inter-ministerial body that deals with special economic zones (SEZs) related matters, is scheduled to meet on 25th March.
Three other promoters have approached the commerce ministry for surrendering their projects, citing global economic uncertainty as the reason.
Maharashtra Industrial Development Corporation has approached the BoA for surrendering its sector specific tax free enclave at Solapur, the agenda said.
Gujarat Hydrocarbons and Power SEZ, which was planning to set up a sector specific SEZ in Gujarat sought "...withdrawal of formal approval due to uncertainty in the international market and in the legal framework governing SEZs".
According to an industry expert, uncertainty over tax exemptions to new SEZs has also led to declining interest in the tax free enclaves. Investors are very apprehensive about the new draft Direct Taxes Code (DTC).
According to the revised DTC draft, which will replace the Income Tax Act of 1961, tax exemptions for SEZs will be confined to the existing units.
The developers, who have sought more time to implement their projects, include Mangalore SEZ, Ansal IT City and Parks and IFFCO Kisan SEZ.
Reliance Haryana SEZ, which is in the process of land acquisition, has requested for extension of in-principle approval up to March 2015 stating that land acquisition is a time consuming process.
It has requested Haryana government to acquire balance land for enabling contiguous land parcel of minimum 1,000 hectares so as to start development activity.
Reliance Haryana SEZ, which is planning to set up multi-product SEZ at Gurgaon at an area of 5,000 hectare, has acquired 1,060 hectares of land.
"In this case the validity of the in-principle approval has expired on March 2009. The developer has become due (for) fifth extension. BoA is to consider granting extension...," the agenda added.
Minister of state for commerce and industry Jyotiraditya Scindia in a written reply to Rajya Sabha recently said that as much as 203 special economic zone developers have been given more time to execute their projects.
The minister had also said that 23 SEZ developers have surrendered their projects due to the impact of global economic meltdown.
The BoA would also consider four new proposals including that of Raheja Builders Pvt Ltd to set up an IT/ITeS tax-free zone in Mumbai and Sterling Port's proposal to set up port based tax-free enclave in Gujarat.
SEZs have emerged as major route for attracting investments and increasing exports. So far 582 SEZs have been formally approved of which 130 are in operation.
The SEZs contributed about 26% to the country's overall exports. Exports from these zones grew by 47% to Rs 2,23,132 crore during April-December 2010-11 over the same period last fiscal.
Shipments from SEZs increased from Rs22,840 crore in 2005-06 to Rs2,20,711 crore in 2009-10.
SEZ units are eligible for 100% tax exemption for first five years and 50% for the next five. The developers of the zones also avail 100% income tax exemption for 10 years.
While it is not mandatory to write a letter to request inspection of files it is nice to be courteous. Here are some other guidelines to follow in this process
It is pertinent to understand and use Section 4 thoroughly as it is the most powerful section of the RTI Act. Its potency lies in the user's right to procure information almost instantly. That is, once you have access to inspection of files, you have the right to get Photostat copies of the documents/maps etc. Section 4 is also significant in that, besides citizens having the right to inspect files in public offices, all government departments have to mandatorily put information of all their functions, duties, proposals, decisions, etc, in the public domain (preferably on the website) and update it from time to time. The deadline given to all these public offices was 120 days from the day of the implementation of the RTI Act on 12 October 2005 and to thereafter update the information on a regular basis. Since many government departments have not followed this mandate, citizens have to take the trouble of physically visiting the offices and conducting inspection of files.
So, the first rule to remember is that, we, as citizens, are doing a big favour to the government department by taking out our precious time to visit the office for checking the documents, as we are covering up for their inefficiency of not putting the information in the public domain. So, the first rule for inspection of files is not to feel awkward, guilty or even feel inhibited. We should make that particular government official feel so, as he has faltered in his duty. In fact, he should be paying us for our conveyance. (Chuckle!)
The most common question that is asked is: "Do I need to send an application under Section 4?" The answer is `No, but it is courteous to send a letter in advance, so that the government official is aware that you are coming to his office for inspection of files and he can make himself free accordingly. When I invoked Section 4 of the RTI Act in the case of Dow, at the office of the secretary of the environment department at the Mantralaya state headquarters in Mumbai, I not only sent a letter, but also sent an SMS, as well as an e-mail, to let the officer know that I would be there the next day at 11am for file inspection.
The second question commonly asked is: "So what kind of letter should it be? And should I wait for a reply? Should I wait for a fixed appointment from the officer after I have sent the letter?" Since inspection of files under Section 4 was incidentally pioneered in Pune, with RTI activist Vijay Kumbhar being the first citizen to invoke it, activists spearheaded by the late Prakash Kardaley have made a format for the letter for Section 4. It has held us in good stead and in fact opened the eyes of government officials as well. In the sense that, you will be surprised to know that many government officers are ignorant of Section 4, so a letter had to be drafted comprehensively.
Remember, once you send off the letter, you do not have to wait for a reply from the officer. Simply because, a citizen has a right to inspect files during any working hours of a government office, but he or she is being kind enough to let the officer know in advance. Yes, if the officer particularly wants another time, he or she should call up and tell you that. If he or she hasn't, then you simply walk into the office at the time requested by you. It is always a good idea to take someone along with you as a witness.
The third question often asked is: "Can I demand Photostat copies of the documents I have inspected?" The answer is, yes very much so. You have the right to have copies of documents, maps, CDs, etc. Once you have gone through the documents, ask the officer for Photostat copies. I have encountered that most of the times the Xerox machines are under repair, and I overhear clerks complaining that the budget for the cartridge has not been sanctioned! In such cases, officers have been kind enough to send their peons along with us to a private outfit and give us the Xeroxes. At best, the officer might say that he promises to give you the Photostat copies by the next day, which should be okay unless you are in great urgency.
The fourth question is: "Do I have to pay for the Photostat copies?" Yes, at the rate of Rs2 per page. If it is maps, then it would depend on the actual cost of xeroxing. When we procured the voluminous document of one of the DP (Development Plan) of Pune, we paid Rs3,000 as it involved several coloured maps of large sizes and colour xeroxing is comparatively expensive.
VERY IMPORTANT NOTE: Your letter under Section 4 should be addressed to the top authority of the government department (meaning the municipal commissioner, if it is a municipal corporation) unlike an application under Section 6 which is addressed to the public information officer (PIO).
For the moment, I think I have cleared most of the doubts regarding Section 4. Do feel free to write to me for any other query. In the meanwhile, following is the format/sample of the letter for Section 4 which was actually sent to the concerned office. In this case, RTI activist Vijay Kumbhar wanted to inspect whether the Pune Municipal Corporation was following the procedures of keeping records of official documents. Please note this inspection was for larger public interest. This sample will give you an idea of how to write the letter for inspecting documents for whatever purpose you have.
From: Vijay Krishna Kumbhar
A/6 Anupama Co-Op Hsg Society,
Pune 411 007
Email: - [email protected]
Dt: 1 January 2008
Mr Pravinsinh Paradeshi
Commissioner,Pune Municipal Corporation,
Head of the "Public Authority" under RTI 2005,
Pune 411 005.
Dear Mr Commissioner,
1. Your kind attention is drawn to Section 4 of the Right to Information Act, 2005 under Chapter II on `Right to Information and Obligation of Public Authorities'.
2. As per the provision, it is obligatory for every public authority (including Pune Municipal Corporation) to publish certain categories of documents so as to make voluntary disclosure of information so that citizens have ``minimum resort to the use of this Act to obtain information''.
3. Information covered by Section 4, in fact, should have been published on October 12, 2005 and disseminated widely in such form and manner which is easily accessible to the public and should have been updated at regular intervals later.
4. It is further explained in the provision that "disseminated" means 'making known or communicated "the information to the public through notice boards, newspapers, public announcements, media broadcasts, the internet or any other means, including inspection of offices of any public authority." I am enclosing here the full text of Section 4 as adopted by the Parliament of India for your reference.
5. I regret to bring to your notice that no information covered under this Section 4 has been disseminated yet by the Pune Municipal Corporation, a public authority under the state government, through notice boards, newspapers, public announcements, media broadcasts and internet.
6. Nevertheless, citizens have a right to inspect these documents in the office of the public authority, including the Pune Municipal Corporation, as explicitly mentioned in the provision under Section 4.
7. It may be noticed that a citizen desiring to inspect the documents containing information covered under Section 4 of the Right to Information Act, 2005, need not make any formal requisition under Section 6 of the Act because these documents should have already been published by the public authority (including the Pune Municipal Corporation) so that citizens have ``minimum resort to the use of this Act to obtain information''.
8. Provision under 4 (1) (a), 4 (1) (b), 4 (1) (c) and 4 (1) (d) of the Act incorporates various duties and obligations for public authorities, including Pune Municipal Corporation, regarding suo motto dissemination of records and various documents.
9. As per resolution No. 6/692, dated 20th August 1956. then Municipal Commissioner of Pune Municipal Corporation had approved to preserve various registers and documents of departments of the corporation by circular no AMC/CR/34 dated 20th August 1956 under the A,B,C,D system.
10. Registers and documents preserved as per circular no AMC/CR/34 dated 20th August 1956 fall under section 4(1)(a) and 4(1)(b) of The Right to Information Act, 2005, and these registers and documents should have been pro-actively published by Pune Municipal Corporation.
11. However, since those have not been pro-actively published by the corporation, I intend to exercise my right as a citizen to inspect these documents in the relevant offices of the corporation.
12. I intend to bring other well informed citizens to assist me in the inspection, whose names are: 1) Mr. Vivek Velanlar 2) Mr. Sandeep Khardekar 3) Mr. Vihar Durve.
13. We will call on
a) The General Record Keeper's office, on 7th January 2008, at 11.30 A.M.
b) The Municipal Commissioner's Office, on 8th January 2008, at 11.30 A.M.
c) Lands and Estate Department's office, on 9th January 2008, at 11.30 A.M.
d) The Garden Department's office, on 10th January 2008, at 11.30 A.M.
e) The Health Department's office, on 11th January 2008, at 11.30 A.M.
demanding inspection of registers and documents preserved as per circular no AMC/CR/34 dated 20th August 1956 and registers and documents covered under section 4 of The Right to Information Act 2005
14. Please note that it is not necessary for us under the Act to give such notice before inspection of documents covered under Section 4 of the Act. However, being responsible citizens, we thought it preferable to intimate you beforehand.
15. Implementation of this provision of the Act (under Section 4) is the direct responsibility of the head of the public authority. In this specific instance, it is your direct responsibility as the municipal commissioner and the administrative head of the Pune Municipal Corporation. Hence this letter is addressed to you and not to any public information officer (PIO) since no formal requisition is needed to be filed, please note.
1) The General Record Keeper, Pune Municipal Corporation
2) Dy Commissioner, Lands and Estate Department, Pune Municipal Corporation
3) The Chief Garden Superintendent, Pune Municipal Corporation
4) Medical officer of health, Health Department, Pune Municipal Corporation
FOLLOWING is the text of Section 4 of the Right to Information Act, 2005
4. (1) every public authority shall
(a) maintain all its records duly catalogued and indexed in a manner and form which facilitates the right to information under this Act and ensure that all records that are appropriate to be computerised are, within a reasonable time and subject to availability of resources, computerised and connected through a network all over the country on different systems so that access to such records is facilitated;
(b) Publish within one hundred and twenty days from the enactment of this Act,
(i) the particulars of its organisation, functions and duties;
(ii) the powers and duties of its officers and employees;
(iii) the procedure followed in the decision making process, including channels of supervision and accountability;
(iv) the norms set by it for the discharge of its functions;
(v) the rules, regulations, instructions, manuals and records, held by it or under its control or used by its employees for discharging its functions;
(vi) a statement of the categories of documents that are held by it or under its control;
(vii) the particulars of any arrangement that exists for consultation with, or representation by, the members of the public in relation to the formulation of its policy or implementation thereof;
(viii) a statement of the boards, councils, committees and other bodies consisting of two or more persons constituted as its part or for the purpose of its advise, and as to whether meetings of those boards, councils, committees and other bodies are open to the public, or the minutes of such meetings are accessible for public;
(ix) a directory of its officers and employees;
(x) the monthly remuneration received by each of its officers and employees, including the system of compensation as provided in its regulations;
(xi) the budget allocated to each of its agency, indicating the particulars of all plans, proposed expenditures and reports on disbursements made;
(xii) the manner of execution of subsidy programmes, including the amounts allocated and the details of beneficiaries of such programmes;
(xiii) particulars of recipients of concessions, permits or authorisations granted by it;
(xiv) details in respect of the information, available to or held by it, reduced in an electronic form;
(xv ) the particulars of facilities available to citizens for obtaining information, including the working hours of a library or reading room, if maintained for public use;
(xvi) the names, designations and other particulars of the Public Information Officers;
(xvii) such other information as may be prescribed; and thereafter update these publications every year;
(c) Publish all relevant facts while formulating important policies or announcing the decisions which affect public;
(d) Provide reasons for its administrative or quasi judicial decisions to affected persons;
(2) It shall be a constant endeavour of every public authority to take steps in accordance with the requirements of clause (b) of sub-section (1) to provide as much information suo motto to the public at regular intervals through various means of communications, including internet, so that the public have minimum resort to the use of this Act to obtain information.
(3) For the purpose of sub-section (1), every information shall be disseminated widely and in such form and manner which is easily accessible to the public.
(4) All materials shall be disseminated taking into consideration the cost, effectiveness, local language and the most effective method of communication in that local area and the information should be easily accessible, to the extent possible in electronic format with the Central Public Information Officer, or State Public Information Officer, as the case may be, available fee or at such cost of the medium or the print cost price as may be prescribed.
Explanation: For the purposes of sub-sections (3) and ( 4 ), "disseminated" means making known or communicated the information to the public through notice boards, newspapers, public announcements, media broadcasts, the internet or any other means, including inspection of offices of any public authority.
(Next week: There are some types of information which cannot be made public. Such information comes under Section 8 of the RTI Act. We will discuss Section 8 in detail so you can gauge whether the authorities are hoodwinking you under the garb of Section 8.)
Vinita Deshmukh is a senior editor, author and convener of Pune Metro Jagruti Abhiyaan. She can be reached at [email protected].