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Research and development activity to get hit as WD benefit to cease from FY21

According to experts, R&D activity is a key proponent of the ‘Make in India’ strategy and to further expand the manufacturing sector in the country.

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Research and development activity

New Delhi, Feb 19 : India Inc’s R&D activity might get adversely impacted as weighted deduction (WD) benefits, including those on capital expenses, stand withdrawn from the next fiscal.

Till now, the Income Tax Act allowed for weighted deduction for all R&D activities.

However, four years back a sunset provision was introduced in the Budget on the availability of weighted deduction from April 1, 2020.

This deadline was expected to have been extended in this year’s Budget. However, that did not happen.

“The weighted deduction was a key reason for entities to invest in R&D infra. This withdrawal will impact future investments in this area,” said Amarjeet Singh, Senior Partner, International Tax and Regulatory, KPMG in India.

According to experts, R&D activity is a key proponent of the ‘Make in India’ strategy and to further expand the manufacturing sector in the country.

Besides, R&D investments into India have grown with many MNCs establishing their research bases here.

“The ‘Make in India’ programme has got the booster of a reduced tax rate. Similarly, had the government continued with the weighted deduction for R&D, it would have surely ensured that India marched ahead both in manufacturing and in the corresponding R&D,” said Gukul Chaudhri, Partner, Deloitte India.

“So, while India may not lose its tag as the R&D lab of the world, the availability of weighted deduction would have ensured that India continued as one of the most attractive destinations for R&D in the world,” Chaudhri added.

The Finance Act, 2016, restricted the availability of expenditure incurred on scientific research to 150 per cent from April 1, 2017, and no weighted deduction from April 1, 2020.

“Globally, most countries are encouraging R&D activity as it generates new ‘intellectual property’ (IP), which in turn creates sustainable revenues. Such IP or new product gives rise to a new industry and other supporting activities,” said Samir Kanabar, Partner, Tax and Regulatory Services, Ernst & Young.

“In India, several sectors like auto, pharma etc. have invested substantially in R&D facilities to develop new IPs, patents and hence, a new tax regime to boost R&D was a major expectation,” Kanabar added.

However, Suman Chowdhury, President, Ratings, Acuite Ratings and Research, said that the reduction in weighted tax deduction will not have any significant effect on India Inc’s R&D activity.

“India’s R&D activity has held steady at 0.7 per cent of GDP over 5 years and no visible signs of positive outcomes were seen emanating from private enterprises despite such benefits,” Chowdhury said.

“Nevertheless, corporates now enjoy a reduced effective corporate tax structure, which should more than compensate for the loss, at least for the manufacturing sector. Service oriented enterprises, whose business model thrives on innovation, do not require incentives to do R&D in our opinion,” Chowdhury added.

(Rohit Vaid can be contacted at [email protected])

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Faculty of Johns Hopkins University authored COVID-19 report on India

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Coronavirus outbreak

New Delhi, March 29 : A story by IANS on the impact of coronavirus in India earlier this week was based on a study done by a faculty of Johns Hopkins University, the institution has said in a tweet.

There were some reports about Johns Hopkins disassociating itself from CDDEP’s Covid-19 study.

Johns Hopkins University tweeted on Saturday late night clarifying that the study was done by a faculty of JHU and states that the use of strong scientific modeling based on available data and clear assumptions to help inform the COVID-19 response in India.

“New report co-authored by faculty w/ appointments at @JohnsHopkinsSPH uses strong scientific modelling based on available data & clear assumptions to help inform the #Covid19 response in India. Note: Its findings do not reflect the views of @JohnsHopkins,” said the tweet by The Johns Hopkins Bloomberg School of Public Health’s Department of International Health- focusing on global health research, education, policy and practice.

The research was done by faculty of Johns Hopkins University, it clarified, although the study does not reflect the views of the University.

The study titled Covid 19 for India updates was authored by Eili Klein, Assistant Professor, Department of Emergency Medicine, Johns Hopkins School of Medicine, Gary Lin, Post Doctoral Fellow of the same department, Ramanan Laxminarayan, CDDEP, Senior Associate, Johns Hopkins Bloomberg School of Public Health, Senior Research Scholar, Princeton University and authors from CDDEP.

Following an earlier clarification from JHU, TV channel group, NDTV deleted the IANS report. Similarly, Alt News had also pointed out this clarification.

Furthermore, Laxminarayan has written an op-ed piece for the New York Times on what India should do during the COVID-19 pandemic.

“Senior research scholar at @PrincetonPEI Ramanan Laxminarayan writes an op-ed for @nytimes about what India should do to fight #COVID19,” said a tweet from Princeton University on Saturday.

To put the facts straight, aside from some standards on studies not representing the views of an institution, the IANS report was based on a credible report in the public domain which had faculty from Johns Hopkins University, the pre-eminent research institution as authors and one author who is associated both with Johns Hopkins and Princeton, another premier institution.

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Analysis

Covid-19 world toll crosses 30,000, cases over 640,000

The COVID-19 is affecting 132 countries and territories around the world.

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Patients infected with the novel coronavirus

New Delhi, March 29 : The number of coronavirus cases across the world rose to 640,589 as on Saturday evening, with the US leading with 115,547 cases, while the global death toll rose to 30,249 according to data from the Johns Hopkins University’s Coronavirus Resource Centre.

Italy, with 10,023 fatalities, comprised over one third of the death toll, and was followed by Spain with 5,812 and China’s Hubei with 3,177. Iran with 2,517 deaths, and France with 2,314 were joined in the four-figure category by the UK, where the toll is now 1,019.

As regards the total number of cases, the US was followed by Italy (92,472), China (81,999), Spain (72,248), Germany (56,202), Iran (35,408), France (33,450) and the UK (17,301).

Meanwhile, a total of 137,283 people have recovered from the infection with the bulk — 62,098 — of them from China’s Hubei, the site of the disease outbreak, followed by 12,384 in Italy, 12,285 in Spain, 11,679 in Iran, and 6,658 in Germany.

The death toll had crossed 25,000 on Friday night, with the total number of cases around the world then were 553,244, with the US leading the tally at 86,012, followed by China at 81,897 and Italy at 80,859.

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Indians with OCD should avoid watching news around COVID-19

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OCD and Coronavirus COVID 19

New Delhi, March 27 : At a time when over 1.3 billion Indians have been asked to stay indoors, people who are claustrophobic or suffer from obsessive compulsive disorder (OCD) are finding it difficult to obey the ‘Lakshmana Rekha Prime Minister Narendra Modi has drawn in from of all homes.

According to health experts, such people should first unplug themselves from the news around new coronavirus (COVID-19) and divert their minds towards constructive thoughts and engage in indoor games.

“People with OCD and those who are claustrophobic need to try and avoid reading or seeing too much negative news. Instead, they can opt for completing the work pending for some time which is a constructive channelization of the energy,” said Dr Sameer Malhotra, Director, Department of Mental Health and Behavioural Sciences, Max Super Speciality Hospital, Saket.

“If under treatment, do not stop the medications at this juncture, and if the symptoms are significant, psychiatric intervention may also be required,” Malhotra told IANS.

Indians are currently living with 21-day nationwide lockdown, which started from Tuesday midnight.

According to the World Health Organization (WHO), OCD is the sixth most disabling psychiatric disorder in the world.

Dr Samir Parikh, Psychiatrist and the Director of the Department of Mental Health and Behavioural Sciences, Fortis Healthcare said that in the face of a pandemic, if you have claustrophobia, OCD or any other form of phobia or anxiety, it is important to ensure that you continue to follow your treatment regimen.

“Stay connected to your doctors, take your medications regularly and also ensure that you continue to take regular therapy sessions through teleconsultations,’ Parikh emphasized.

Family too would play a very pertinent role in providing support and being understanding of the challenge being face by the individual.

“Concurrently, it is important to ensure that one engages in maintaining a work-life balance, take care of certain lifestyle-related elements such as the sleep-wake cycle and also engage in activities of interest during this period,” Parikh noted.

Malhotra said that it is time to rationalize negative thoughts into positive and meaningful thoughts.

“Discuss general topics, try and engage in healthy conversations at home. It is also the best time to bond with family members,” he added.

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