Daily Financial News Analysis – 19th Dec’19

Table of Contents

GST Council

GST Council departed from its practice of consensus-based decision-making.
For the 1st time voting system was used by the council.
The council has decided to impose a single rate of 28% on state-run and authorised lottery.
At present, lotteries run by state governments are taxed at 12%, while those authorized by states and operated by private players as well as interstate suppliers of lotteries are taxed at 28%.
The council refrained from any generalised rate increase or removal of exemptions.

The Council also took a few steps to curb tax evasion.
The Council also decided to exempt entities in which either the central or state government owns 20% or more from paying an upfront amount for long-term lease of industrial or financial infrastructure plots.
Also, businesses will get an extra month for filing annual returns and tax audit report for the first year of GST, 2017-18.

Commerce & Industry Minister Piyush Goyal will meet trade ministers of four states on Thursday to prepare a roadmap to make every district in the country a hub of exports.
The consultations come at a time when the government is trying to boost investment, both domestic and foreign, amid a slowing economy.

November exports were down 0.34% to $25.98 billion from a year earlier and imports fell 12.7% to $38.11 billion.
Goyal also met Confederation of Indian Industry (CII) president Vikram Kirloskar, and is also likely to meet various export promotion councils this week to discuss the upcoming foreign trade policy as the country’s outward shipments contracted for the third month in a row in November.

Medical Devices (Safety, Effectiveness and Innovation) Bill, 2019
India currently doesn’t have a law to compensate patients facing health problems due to faulty implants or medical devices.
The National Health Policy 2017 envisages strengthening the regulation of medical devices and establishing a regulatory body for medical devices to unleash innovation and the entrepreneurial spirit for medical devices in India.
Currently, there is no distinction between the regulatory treatment of drugs and medical devices.
Both are regulated by the Central Drugs Standard Control Organisation under the health ministry.
Health Ministry: is averse to the idea of a separate regulator for medical devices.
Niti Aayog has gone ahead and started consultations with stakeholders.
The first consultation on Wednesday will be attended by civil society groups, medical device lobby groups, former drug controllers, current state drug controllers and patients from the J&J case.
Devices are engineering items and not medicines.

Union Minister for Electronics and IT Ravi Shankar Prasad
The government has expanded a programme to reskill the IT industry workforce in emerging technologies.
Target: to train 4,00,000 professionals in the next 3 years.
Earmarked: Rs 426 crore for the programme.
In a digital world, a trained workforce will become India’s biggest competitive advantage.
Prime Minister Narendra Modi had announced the Future Skills Initiative in 2018.
By 2030, India will have more than 90 million people joining the workforce due to its existing demographic dividend.
Indian IT giants have been investing over Rs 1,000 crore every year to address the reskilling/upskilling requirements of their employees, given the magnitude of the challenges.
Ministry of Electronics and IT and Nasscom have worked with the IT industry to reskill and upskill over 2,00,000 IT employees, leveraging the Future Skills platform.

India’s civil aviation authority has selected the applications of Google-backed hyperlocal delivery startup Dunzo and Bengaluru-based drone maker Throttle Aerospace Systems to test long-range and autonomous drone use.
Beyond visual line of sight (BVLOS) drone operations.

Defence Minister Rajnath Singh visited Naval Air Station base at Norfolk in the US.
DM observed a static display and a Boeing fighter jet demonstration.
DM hoped that the “strong defence ties” between the two countries will further strengthen in the near future.

USS Dwight D. Eisenhower, the Nimitz-class aircraft carrier
F/A-18 Super Hornets
India and the US continue to build defence cooperation ties through military exercises, defence trade and official visits and exchanges, including this visit to the largest US naval base in the world.

Some states on Wednesday suggested Finance Minister Nirmala Sitharaman to go for fiscal expansion and relax the deficit target to 4 per cent of the gross domestic product (GDP).
The finance minister in her July Budget reduced the fiscal deficit target for 2019-20 to 3.3 per cent from 3.4 per cent earlier.
Reserve Bank of India governor Shaktikanta Das: The prevailing economic conditions were apt for the Centre to invoke the escape clause in the Fiscal Responsibility and Budget Management (FRBM) Act that tolerates a deviation from the fiscal target of up to half a percent of GDP a year under exceptional circumstances.