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RBI Governor for farmers’ income growth, reasonable food prices

According to him, an efficient domestic supply chain becomes critical in such circumstances.

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Shaktikanta Das

New Delhi, July 27 : Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday said that the country now requires policies to ensure a sustained increase in the income of farmers along with maintaining “reasonable’ food prices for the consumers.

Addressing Confederation of Indian Industry (CII’s) National Council, Das said that price incentives have been costly, inefficient and distortive.

He noted that shifting the terms of trade in favour of agriculture is the key to generating positive supply responses in agriculture. Experience shows that in periods when terms of trade remained favourable to agriculture, the annual average growth in agricultural gross value added (GVA) exceeds 3 per cent, the Governor said.

“Hitherto, the main instrument has been minimum support prices, but the experience has been that price incentives have been costly, inefficient and even distortive. India has now reached a stage in which surplus management has become a major challenge. We need to move now to policy strategies that ensure a sustained increase in farmers’ income alongside reasonable food prices for consumers,” he said.

According to him, an efficient domestic supply chain becomes critical in such circumstances.

He said that the focus must now turn to capitalising on the major reforms that are underway to facilitate domestic free trade in agriculture including the amendment of the Essential Commodities Act (ECA).

Das was of the view that Indian agriculture has witnessed a distinct transformation as the total production of food grains reached a record 296 million tonnes in 2019-20, registering an annual average growth of 3.6 per cent over the last decade, along with production growth in horticulture.

He also noted the changing pattern of energy production in favour of renewable energy and shifts in supply chains, domestic and global.

“In a competitive market economy, an efficient supply chain can enhance economic welfare. Investment in sectors with strong forward and backward linkages in the supply chain can generate higher production, income and employment,” Das said.

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Most of additional budget spending for people-centric schemes: FM Sitharaman

The government expenses have increased of late and are likely to increase further due to the coronavirus pandemic and the eventual economic slowdown.

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Nirmala Sitharaman

New Delhi, Sep 19 : Finance Minister Nirmala Sitharman on Friday said that the majority of the additional resources in the first batch of the Supplementary Demands for Grants would be spent on people-centric schemes amid the coronavirus pandemic.

In her reply to the debate on the Supplementary Demands for Grants for 2020-21 and the Demands for Excess Grants for 2016-17 in the Lok Sabha, she said it is probably for the first time that the government has sought such a huge amount in the first batch of the Supplementary Demands for Grants.

Late on Friday evening, the Lok Sabha approved the supplementary demands for additional spending of Rs 2.35 lakh crore, including a cash outgo of Rs 1.66 lakh crore.

The Centre has sought Rs 40,000 crore for providing grants for the creation of capital assets under the Mahatma Gandhi National Rural Employment Guarantee Scheme and for the transfer of funds to the National Employment Guarantee Fund.

It has sought an additional expenditure of Rs 30,956.98 crore for providing Grants-in-Aid General for Direct Benefit Transfer to Pradhan Mantri Jan Dhan Yojana’s women bank account holders.

Further, to meet the expenditure towards recapitalisation of the Public Sector Banks through the issue of government securities, it has sought an approval for the expenditure of Rs 20,000 crore.

Approval for expenditure of Rs 4,000 crore has been sought for meeting an additional expenditure towards Grants-in-Aid General to National Credit Guarantee Trustee Company Ltd (NCGTC) for the Guarantee Emergency Credit Line (GECL) facility to eligible MSME borrowers.

The first batch of Supplementary Demands for Grants for financial year 2020-21, among other things, included a sum of Rs 46,602.43 crore required for providing additional allocations under the Post-Devolution Revenue Deficit Grant (Rs 44,340 crore) and Grants-in-Aid General for States Disaster Response Fund (Rs 2,262.43 crore) as per the accepted recommendations for the 15th Finance Commission.

The government expenses have increased of late and are likely to increase further due to the coronavirus pandemic and the eventual economic slowdown.

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Paytm App Removed From Google Play Store

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Paytm APP

Google has pulled the popular Indian financial services app Paytm from the Play Store for violating its gambling policies. Paytm is India’s most valuable startup and claims over 50 million monthly active users. Its marquee app, which competes with Google Pay in India, disappeared from the Play Store in the country earlier Friday.

Google said that Play Store prohibits online casinos and other unregulated gambling apps that facilitate sports betting in India. Paytm, which has promoted fantasy sports service within its marquee app, repeatedly violated Play Store’s policies, two people familiar with the matter told TechCrunch. Paytm’s fantasy sports service, called Paytm First Games, was also available as a standalone app and it has been pulled from the Play Store, too.

The Android-maker, which maintains similar guidelines around gambling in most other markets, additionally noted that if an app leads consumers to an external website that allows them to participate in paid tournaments to win real money or cash prizes will also be deemed in violation of its Play Store policies.

In an email Google has sent to many firms in India, and was reviewed by TechCrunch, the company has asked developers to pause all advertising campaigns in their apps to drive users to websites that offer installation files of sports betting apps.

Google’s Pay app currently dominates the payments market in India, and Android commands about 99% of the smartphone market share in the country.

The announcement today from Google is also a preemptive attempt from the company to remind other developers about its gambling policies ahead of the popular cricket tournament Indian Premier League, which is scheduled to kick off tomorrow.

Previous seasons of IPL, which last for nearly two months and attract the attention of hundreds of millions of Indians, have seen a surge in apps that look to promote or participate in sports betting.

While sports betting is banned in India, fantasy sports, where users select their favorite players and win if their preferred teams or players play well, is not illegal in most Indian states.

A person familiar with the matter told TechCrunch that Google has also asked Disney+ Hotstar, one of the most popular on-demand video streaming services in India, to display a warning before running ads about fantasy sports apps.

“We have these policies to protect users from potential harm. When an app violates these policies, we notify the developer of the violation and remove the app from Google Play until the developer brings the app into compliance,” wrote Suzanne Frey, Vice President, Product, Android Security and Privacy, in a blog post.

“And in the case where there are repeated policy violations, we may take more serious action which may include terminating Google Play Developer accounts. Our policies are applied and enforced on all developers consistently,” she added.

In a televised interview with CNBC TV18, Paytm co-founder and chief executive Vijay Shekhar Sharma accused Google of not allowing Paytm to acquire new users.

He acknowledged that Google had reached out to Paytm before and raised concerns about Paytm First Games, but the incident with Paytm’s main app, he said, is over “nothing but” paying cashback to customers.

The cashbacks were issued in ways of cricket-themed scratch cards, he said, adding that if Paytm isn’t allowed to issue cashback to customers, the same rule should be applied to every player. Google Pay, as well as Walmart’s PhonePe give customers similar incentives in India.

“This is the problem of India’s app ecosystem. So many founders have reached out to us… if we believe this country can build digital business, we must know that it is at somebody else’s hand to bless that business and not this country’s rules and regulations,” he said.

In an interview with TechCrunch, Madhur Deora, President of Paytm, said Google did not raise any issue about Paytm First Games app today. He said Paytm had rolled out the cricket-themed sticker for cashbacks early Friday. Hours later Google raised objection about it and suspended the app.

Meanwhile, the Federation of Indian Fantasy Sports (FIFS), an “industry body” that represents some fantasy sports firms, claims it complained to Google to take action on companies that distribute or promote fantasy sports through Play Store.

Dream Sports, the parent firm of India’s most popular fantasy sports app Dream 11, is the founding member of FIFS. Dream11 app is not available on the Play Store. In a message to their members, FIFS said the following:

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Govt’s stake divestment to be credit negative for PSBs: ICRA

Furthermore, ICRA expects the deposit franchise for these banks will be monitorable as these deposits could be highly sensitive to their ownership.

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Centre proposes Disinvestment

New Delhi, Sep 17 : The proposed divestment of the Centre’s majority stake in certain PSBs will be credit negative for these lenders, ratings agency ICRA said on Thursday.

Citing recent reports which suggest a possible divestment of majority stake in few PSBs that were left out of the PSBs consolidation exercise announced last year, ICRA said that most of these PSBs have weak credit profile and their credit ratings are primarily supported by their sovereign ownership and a stable deposit base, which in turn is supported by their ownership.

“The existing ratings are also notched up from the standalone credit profile and going forward, the ratings on these PSBs would reflect their standalone credit profile depending on their new ownership of these banks,” it said in a statement.

Furthermore, ICRA expects the deposit franchise for these banks will be monitorable as these deposits could be highly sensitive to their ownership.

The ratings agency noted that the proposed divestment of these PSBs will require amendment to the Banking Companies (Acquisition And Transfer Of Undertakings) Act, 1970/1980, which mandates the Centre to hold no less than 51 per cent of the paid-up capital of these lenders.

Commenting on these developments, Karthik Srinivasan, Group Head – Financial Sector Ratings, ICRA said: “The financial profile of these PSBs is very weak and the standalone profiles of these banks could be low within investment grades rating given their weak asset quality, profitability, capital and solvency profile.”

“The liability profile for these banks will become a key monitorable in the immediate term.”

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