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Union Budget focuses Rural economy, tax rates, slabs unchanged

Monitor News Bureau

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New Delhi:With an eye on the next Lok Sabha elections, Finance Minister Arun Jaitley in his 2018-19 budget on Thursday proposed a major health insurance scheme for the poor, a higher minimum support price and a step up of Rs 1 lakh crore as institutional credit for farmers along with a spend of nearly Rs 6 lakh crore on infrastructure development.
To pay for this seeming bout of generosity, albeit with votebanks in mind, the finance minister has mopped up huge sums through three or four simple steps, mostly aimed at the middle class. While providing some sops to salaried individuals and pensioners, it has aimed to raise Rs 11,000 crore by increasing cess on income of individuals, from three to four per cent. Additionally, it has aimed to raise money by imposing a 10 per cent Social Welfare Surcharge on all imported goods.
At the same time, the finance minister has eyed the share-owning and investing class by removing an exemption on long term capital gains to possibly raise over Rs 36,000 crore in a full year — by taxing at 10 per cent shares held for more than a year, exempting only profit of up to Rs 1 lakh. The stock markets reacted sharply initially to the move, later recovering.
The four per cent health and eduction cess replaces the 2 per cent cess for primary education and 1 per cent cess for secondary and higher education on individuals and corporates to take care of the needs of education and health of BPL and rural families.
Similarly, the Social Welfare Surcharge of 10 per cent on all customs duties replaces the education cess on imported goods. He also raised the customs duty on mobile phones by 5 per cent to 20 per cent. He also levied a 15 per cent duty on some of the parts and accessories of mobile phones and TV sets to promote creation of more jobs under the “Make in India” programme.
In line with the BJP’s poll promise before coming to power in 2014, the Finance Minister announced that the Minimum Support Price (MSP) for unannounced kharif crops will be 1.5 times the input cost and stepped up the institutional credit for the sector to Rs 11 lakh crore — 1 lakh crore more than last year.
“Now, we have decided to implement this resolution as a principle for the rest of crops. I am pleased to announce that as per pre-determined principle, the government has decided to keep MSP for the all unannounced crops of kharif at least at one and half times of their production cost. I am confident that this historic decision will prove an important step towards doubling the income of our farmers,” Jaitley said.
The opposition reacted sharply to the government’s proposed budget with Congress leader P. Chidambaram saying Jaitley had failed the fiscal consolidation test that will have “serious consequences” on the economic growth rate.
CPI-M leader Sitaram Yechury said the budget was “unconnected to ground realities” and “is a textbook exercise in post-truth”. However, the India Inc largely welcomed Jaitley’s budget.
Leaving the individual taxation slabs and rates untouched, Jaitley in his last full budget before the 2019 elections proposed to reintroduce a standard deduction of Rs 40,000 for salaried tax payers in lieu of present exemption of transport allowance and reimbursement of miscellaneous medical expenses that will involve a revenue sacrifice of Rs 8,000 crore to benefit 2.5 crore people.
In a bid to help senior citizens, the budget proposes to increase the exemption of interest income on deposits with banks and post offices from Rs 10,000 to 50,000 and there will be no TDS deducted on them. The limit for health insurance premium and medical expenditure will go up to Rs 50,000 from Rs 30,000.
For certain illnesses, in case of senior citizens and very senior citizens, the limit will go up to Rs 60,000 and Rs 80,000 respectively, The concessions will cost the government Rs 4,000 crore.
In keeping with his earlier announcement of reducing corporate taxation rate, the Finance Minister reduced the rate for all companies with turnover of up to Rs 250 crore, up from Rs 50 crore. He said this would take care of almost 99 per cent of the companies and would have a negative impact of Rs 7,000 crore on government finances. Only about 250 companies would have a turnover above the cut-off level and would continue to pay 30 per cent tax. An ID on lines of Aadhaar would also be set up for companies, Jaitley said.
For the Railways, whose budget was merged with the general budget since last year, the capital expenditure has been fixed at Rs 1,48,528 crore for 2018-19 with a large part devoted to capacity creation. Some 18,000 km of doubling, third and fourth line works and 5,000 km of guage conversion will be taken up to transform almost the entire network into broad guage.
Prime Minister Narendra Modi hailed the Finance Minister for presenting an all-friendly budget 2018-19 with the focus on agriculture, health and small businesses. “This budget is farmer-friendly, common citizen-friendly, business environment-friendly and development-friendly.”
Announcing the flagship National Health Protection Scheme, which he billed as the world’s largest government funded healthcare programme, Jaitley said the government proposed to cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) providing coverage up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation.
In another populist measure, the Finance Minister announced that as part of Prime Minister’s Ujjwala Scheme the government proposed to increase the target of providing free LPG connections to eight crore poor women, three crore up from the original target.
He said the focus of the government in the next fiscal will be on providing maximum livelihood opportunities in the rural areas by spending more on livelihood, agriculture and allied activities and construction of rural infrastructure.
“In the year 2018-19, for creation of livelihood and infrastructure in rural areas, total amount to be spent by the ministries will be Rs 14.34 lakh crore, including extra-budgetary and non-budgetary resources of Rs 11.98 lakh crore. Apart from employment due to farming activities and self employment, this expenditure will create employment of 321 crore person days, 3.17 lakh km of rural roads, 51 lakh new rural houses, 1.88 crore toilets, and provide 1.75 crore new household electric connections besides boosting agricultural growth.”
In a labour welfare measure, the minister announced extension of contribution of 8.33 per cent of employee provident fund for new employees by the government for three years to all the sectors and raised it to 12 per cent.
In order to create employment and aid growth, the Finance Minister said, the government’s estimated budgetary and extra budgetary expenditure on infrastructure for 2018-19 was being increased to Rs 5.97 lakh crore against estimated expenditure of Rs 4.94 lakh crore last year.
The Finance Minister indicated a slippage in fiscal deficit for the current year revising it from 3.2 per cent to 3.5 per cent and from 3 per cent to 3.3 per cent (Rs 5.95 lakh crore) of the GDP next year, implying that the government will be borrowing more to balance its books.
The government has set a target of Rs 80,000 crore divestment target for 2018-19, the finance minister said adding that target for 2018-19 had exceed the target of Rs 72,500 crore and would touch Rs 1 lakh crore. Despite that, he did keep his aim low for the next year. He announced that the three public sector insurance companies would be merged. The merged entity is expected to be listed at some stage.
The minister started his speech by reading out the achievements made by the government, saying: “We”are now a $2.5 trillion economy, and we are firmly on path to achieve 8 per cent plus growth soon. We hope to grow at 7.2 per cent to 7.5 per cent in the second half of 2017-18. Our exports are expected to grow at about 15 per cent in 2017-18.”


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Northern Army Commander visits Siachen

Monitor News Bureau

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Srinagar, Oct 20:Lieutenant General Ranbir Singh, General Officer Commanding-in-Chief, Northern Command Sunday visited forward posts in Siachen Glacier. He was accompanied by Lieutenant General Harinder Singh, General Officer Commanding, ‘Fire & Fury Corps’.

“Complementing the troops deployed in the Sector for their dedication and perseverance, Lieutenant General Ranbir Singh said that the nation is proud of the valour and sacrifices of the ‘Siachen Warriors’,” an army spokesperson said.

“He exhorted them to continue to uphold the high standards of professionalism and commitment, even while deployed in the face of extreme challenges posed by the highest battlefield in the world. He also laid a wreath at the Siachen War Memorial, as a mark of respect for the martyrs of Operation MEGHDOOT,” he added.

 

Lieutenant General Singh later visited ‘Heritage Abode’ – the residence of one of the greatest heroes of Ladakh, Late Colonel Chhewang Rinchen at Sumur Village in Nubra Valley.

Colonel Chhewang Rinchen was awarded the Maha Vir Chakra twice and a Sena Medal, for his acts of valour during the various battles fought in the Ladakh Sector. Paying his respects, Lieutenant General Ranbir Singh said that Colonel Chhewang Rinchen will continue to inspire future generations of Indians.

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No merger on cards, J&K Bank has strong fundamentals:Chhibber

Monitor News Bureau

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Srinagar, Oct 20: Putting all the speculations about the J&K Bank’s merger at rest, J&K Bank Chairman and Managing Director R K Chhibber today stated, “The recent crisis of Punjab and Maharashtra Cooperative (PMC) Bank in the country has worried bank customers in general but the rumors of J&K bank’s merger by some vested interests has raised apprehensions among our depositors particularly in J&K. Let me put all those speculations at rest by assuring you that no merger is on the cards and the bank’s fundamentals are very strong.”

In a press statement, he further said, “Let me assure all the stakeholders of the bank that their beloved bank is in safe hands of more than 12000 strong J&K Bank family under the supervision and guidance of a professionally strong board of directors with a robust accountability framework in place for transparency and efficiency. The only way to go for the bank is up and above, towards higher levels of accomplishments.”

Commenting upon the effect of recent political developments in J&k upon the bank, he said, “We certainly believe that the recent developments that have taken place in state won’t affect the essence of this institution, which is to financially serve the people of J&K and catalyze the economic development of this region.J&K Bank has witnessed far bigger challenges in the past, and we believe, as always with the emotional equity of the people, support of J&K Government and unmatched commitment of our staff, we shall meet every challenge head-on and come out stronger and more successful.”

 

While reiterating that J&K Bank has strong fundamentals with all its major financial indicators performing well, the Chairman also asserted that few of the large loans, made some years ago that have turned Non Performing Assets (NPAs) and are being investigated; have been adequately provided for by the bank and shall have no impact on the profitability of the bank.

“Let me assure you that we are here to be with you and lead you towards a more promising and fulfilling economic future”, he said.

Reflecting upon the long and eventful journey of the bank, the Chairman said, “It has been a long, eventful and challenging journey of over eighty years that has shaped up not only this great institution but the very structure and the substance of J&K’s economy. For all this, we acknowledge and admit the instrumental role of our shareholders and customers whose unwavering trust and cooperation has been the guiding light for us during eight decades of our existence.”

Expressing his gratitude for the bank’s main stakeholders, Chairman said, “In particular we appreciate the unflinching support of our main stakeholders i.e.the J&K Government, the Board of Directors, and employees at large. J&K Government has always come forward to support the bank in all spheres and have already raised their stake to 59 pc in the bank by providing capital of Rs 532 Crfor business growth and regulatory requirement. Thegovernment has also indicated to extend additional capital support in near future to meet our Basel III capital requirements.”

Notably, thevery reason for the establishment of Jammu & Kashmir Bank by its founders in 1938 has been to empower the people of the state financially so that an era of development could be ushered in.Today we see that vision transformed into reality as J&K Bankleads from the front with market share of more than 65 pc, more than 12 million account holders from two million households and a total business around 1.65 lac Cr.

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Market Intervention Scheme: Govt procures 1.5L apple boxes, disburses Rs 8 cr

Mudassir Kuloo

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Srinagar, Oct 19: Jammu and Kashmir government has procured 1.5 lakh apple boxes and paid around Rs 8 crore to growers under the ambitious Market Intervention Scheme (MIS) so far.

Launched last month in association with the National Agricultural Cooperative Marketing Federation of India (NAFED), MIS was aimed at easing difficulties of the apple growers in the valley.

Director Horticulture, Kashmir, Ajaz Ahmad Bhat, said around 4000 growers have been registered under the scheme so far.

 

“We have procured 1.5 lakh apple boxes, which roughly comes to 2000 metric tonnes of fruit. We did business of around Rs 10 crore and almost Rs 8 crore have been disbursed to apple growers so far,” Bhat told The Kashmir Monitor.

Director Horticulture noted that there has been a good response since October 7, when government revised the rates of apples.

“As per government order, the payment has to be disbursed within three days after procurement of apple. Sometimes it may take five days. We will continue this scheme till December 15. It can be extended if need arises. This scheme is working in a hassle free manner and apple growers are benefitting,” he said.

 The initial rates for A grade apple were Rs 52 per kilo, Rs 36 for B grade and Rs 15.75 for C grade apple. The revised rates for A grade apple are Rs 58 per kilo, Rs 42 for B grade and Rs 22 for C grade apple.

Bhat said six lakh metric tonnes of apple have been exported so far. This includes 2000 metric tonnes exported under market intervention scheme.

“Kashmir grows around 21 lakh metric tonnes of apple and over 25 percent has been exported so far. Most of the growers have exported apples on their own without benefitting from the scheme,” he said.

Kashmir’s fruit season starts in May when first crop of cherry is harvested. It is followed by pears and other fruits which hit the market in the following months. Apple is almost the last crop that hits the market in autumn. Bulk of the apples is exported to the markets in Delhi. Some of the crop is also sold in Bangalore, Mumbai, Ahmadabad and other cities.

Horticulture is the mainstay of Kashmir’s economy with seven lakh families directly and indirectly associated with the sector. The horticulture contributes seven percent to the Gross State Domestic Product of Jammu and Kashmir.

More than 3.38 lakh hectares of land is under the fruit cultivation in the valley. Of which 1.62 lakh hectares is under the apple cultivation. Last year the fruit production including dry fruits touched 23.30 lakh tonnes last year compared to 22.34 lakh tonnes in 2017.

Jammu and Kashmir is the largest producer of apple in the country with production touching 18.28 lakh metric tonnes last year. The apple production was 17.27 lakh metric tonnes in 2017.

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