Cabinet Extends EPF Contribution of 24% for Another 3 Months till August
The union cabinet chaired by prime minister Narendra Modi on Wednesday approved extension for the contribution, both 12% employees' share and 12% employers' share under Employees Provident Fund (EPF), totalling 24% for another three months from June to August 2020. This extension was given as part of the package announced by the government under Pradhan Mantri Garib Kalyan Yojana (PMGKY) or Aatmanirbhar Bharat in the light of COVID-19, a Pandemic. 
 
For the wage months of June, July and August 2020, the scheme will cover all establishments having up to 100 employees and 90% of such employees earning less than Rs15,000 monthly wage. 
 
This approval is in addition to the existing scheme for the wage months of March to May 2020 approved on 15 April 2020.  The total estimated expenditure for this is of Rs4,860 crore. Over 72 lakh employees in 3.67 lakh establishments will be benefitted.
 
Salient Features:
 
The salient features of the proposal are as under: 
 
i. About 72.22 lakh workers working in 3.67 lakh establishments will be benefited and would likely to continue on their payrolls despite disruptions.
 
ii. Government will provide Budgetary Support of Rs.4800 crore for the year 2020-21 for this purpose.
 
iii. The beneficiaries entitled for 12% employers' contribution for the months of June to August 2020 under Pradhan Mantri Rozgar Protsahan Yojana (PMRPY) will be excluded to prevent overlapping benefit.
 
iv. Due to prolonged lockdown, it was felt that businesses continue to face financial crisis as they get back to work. On 13 May 2020, the finance minister had announced extension of EPF support for business and workers for another three months or for the wage months of June, July, and August 2020.
     
The steps taken by the government from time to time to ameliorate the hardships faced by the low paid workers are well accepted by the stakeholders, a release from Press Information Bureau (PIB) says.
 
 
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    COVID-19: Govt Removes Masks-Sanitisers from Essential Commodities List; Wide Variation in Govt Procurement
    Following a public interest litigation (PIL) in the Bombay High Court seeking a cap on the prices of N95 mask to curb hoarding and profiteering, the government has stymied the demand by simply removing masks and sanitisers from essential commodities. This essentially means that the manufacturers of masks can continue to charge the high prices that have prevailed since the COVID-19 lock-down and affects health care workers (HWCs) the most.
     
    On 13 March 2020, the Union ministry of consumer affairs, food and public distribution issued an order for regulating production, quality, distribution, logistics of masks (two-ply, three-ply surgical masks and N95 masks) and hand sanitisers and further prevented hoarding, black marketing and profiteering on these items. 
     
    A 1 July 2020 office memorandum (OM) issued by the department of consumer affairs ended this, saying, “...as on date there are no adverse reports from states or union territories (UTs) with respect to price or availability to continue face masks and hand sanitizers as essential commodities. Therefore, this department had decided not to continue these items as essential commodities under the essential commodities under the EC Act beyond 30 June 2020."
     
    Curiously, on that very day, media reports said that the Maharashtra government planned to bring masks under price control. But more on that later. 
     
     
    A PIL filed by Sucheta Dalal and Anjali Damania had already exposed how the regulator argued for not capping prices and had even avoided following its own rules.
     
    In June, the Bombay High Court (BHC) had asked the National Pharmaceutical Pricing Authority (NPPA) to relook and pass appropriate order within 10 days about capping price of N95 masks, in accordance with law, as per clause 20 of the Drug Price Control Order (DPCO). The time limit set by the Court ended on 23rd June. (Read- N95 Masks: Bombay HC Asks Union Govt and NPPA To Cap Prices in 2 Weeks )
     
    The BHC bench of chief justice Dipankar Datta and justice SS Shinde said in their order that “The NPPA cannot allow an increase in the price of a drug beyond 10% of the price in the preceding 12 months, so long as the statute is there. It cannot be left to the manufacturers.”
     
    In fact, NPPA issued an office memorandum permitting manufacturers to use already high prices in April 2020 as the base to pretend a voluntary reduction in prices. This is astonishing, considering that the government-owned Haffkine Institute in Mumbai has purchased N95 masks at Rs17.33 (the wholesale price at which Haffkine Institute had procured N95 masks in February 2020) from Venus and the Mumbai municipal corporation continues to purchase them at Rs 42 (the same price at which Moneylife Foundation had procured them), while NPPA seemed satisfied with a ‘reduced’ price that was significantly higher.  
     
    Ms Damania, in her rejoinder filed in court had said, “Maharashtra Food and Drugs Administration (FDA)’s letter dated 15 May 2020, clearly show that though the MRP of N95 masks have been bloated to Rs199 per mask, the average rate charged of the said masks was Rs28.57 per mask in the fourth quarter of financial year 2019-2020 and had increased to Rs42.95 per mask and Rs46.40 per mask in the months of April and May 2020 respectively. Thus, it is clear that the MRP as set by the manufacturers are almost 300% higher than the average price at which these masks were being sold. Thus, it is no surprise that these manufacturers have been more than willing to reduce these MRP by close to 50% without any protest.”
     
    A newspaper report from Lokmat, revealed that there are 14 different prices of N95 masks being sold at 14 different places in Maharashtra. The Latur district administration bought 10,000 N95 masks at Rs42 per piece, while the same mask was bought at Rs230 per piece by Sindhudurg district administration. 
     
    According to the Lokmat report, state government-run Haffkine Institute had bought triple-layer masks at Rs0.84 per piece. However, the lowest price paid by district administrations in Maharashtra is Rs3.20 paid by Satara. Mira Bhayandar Municipal Corp bought 10,000 triple layer masks at a whopping price of Rs40 per mask. 
     
     
    (Source: Lokmat)
                                               
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    COMMENTS

    m.prabhu.shankar

    4 weeks ago

    What kind of Government is this ? In a pandemic like COVID-19 where masks, sanitizers, face shields are the key components required for every citizen to protect him or herself from death, govt says its not an essential item. Meaning my crony industrialists need to benefit through which I will also benefit from the money through electoral bonds irrespective of the death of the citizens who actually voted this government to power. God, please save my country from this government.

    Need calibrated call in reducing import dependence from China: SBI Ecowrap
    India needs to take a calibrated call in reducing import dependence from China and not through sudden stops.
     
    At present, a huge clamour has grown about banning imports from China, after the border standoff. 
     
    According to the SBI Ecowrap report, India must go for imposing restrictions on certain products in which it has a revealed comparative advantage over China, and which will provide support to the country's MSMEs. 
     
    "However, demanding to curtail all imports at one go from a country which is so entrenched in our economic system is unreasonable and might disrupt the local supply chain when looked at, either from the producers' side or consumers' side," the report said.
     
    Accordingly, the report cited that India is dependent on China for a lot of products at the lower end of manufacturing. 
     
    In FY97, at 2 digit classification basis, there were 22 categories in which India did not import any- thing from China, whose value of imports in FY20 is around $500 million. 
     
    "In principle, China has spread out in all other categories, including low value manufacturing to high value capital and electrical goods," the report said.
     
    "Although value wise the import is miniscule in the categories in which China has started importing over the years, these are some labour intensive and small scale industries like, prepared products of vegetables, fruits, cereals, flour, meat and fish, products of milling industry, wood and articles of wood, headgear and parts."
     
    As per the report, utmost caution has to be exercised to see that the rights of consumers in the form of variety of choice are protected, while making sure that China does not eat away the local industries which can easily build capabilities in these areas, so that India does not have to import these products.
     
    Besides, the report pointed out that China's biggest capabilities also lie in capital goods and high value consumer goods export and in case of India too China's machinery and electronics imports dwarf the rest of the industries. 
     
    "When we sum the 84 and 85 HS Classifications', they accounted for 49.7 per cent of the total imports from China in FY20,a the report said.
     
    "This share was just 14 per cent in FY97. The sudden spike came in FY 03, when the share went from 24.8 per cent to in the previous fiscal to 35.3 per cent. The growth rate of these imports was an astonishing 94.6 per cent for FY03. The time period from FY03 to FY08, saw more than 60 per cent increase every year in these imports, helping China slowly and steadily build a solid base in machinery and electronics imports in India."
     
    Nevertheless, the report mentions that beginning FY08 the growth rate has moderated. 
     
    "However, some years have seen sudden jumps in growth rate. But these are not as high as the period mentioned before. In fact FY19 saw the highest decline of 19.4 per cent in imports of these commodities," the re port said.
     
    "FY20 data also shows negative growth rate. However, for India to make a significant dent, it will have to substantially bring down these imports over the years. Given the productive nature of capital and electronic goods, the decline in these imports has to be gradual as India builds domestic capacity to fulfill the needs of domestic population, as well as meet export demand."
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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