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Prasanta Sahu

Articles By Prasanta Sahu

555 Articles

Disinvestment: BPCL, Air India deals to conclude by July-August

Even though the department of investment and public asset management (Dipam) had set a target to complete the transactions by June-end, the government may have to give shortlisted bidders a little bit of extra time if needed

On November 16, three bidders showed interest for BPCL buyout — Vedanta, Apollo Global Management and Think Gas.

New performance related pay criteria for CPSEs: Revised pay matrix for employees seen to aid privatisation

The revised MoU guidelines are aimed at building skin in the game for the management of the CPSEs while aiding the Centre to fetch more non-debt receipts from disinvestment, a source said.

The combined salary bill of around 250 CPSEs stood at Rs 1.53 lakh crore in FY19; these firms employ over 15 lakh people.

Apr-Dec FY21: States’ budgetary capital expenditure down nearly a quarter

In contrast, Centre sees a 30% rise in capex in FY21, and budgets a 26% jump for FY22

As per all state budgets, their combined fiscal deficit stood at 2.6% of GDP in FY20 and 2.4% in FY19. According to India Ratings, the states’ fiscal deficit may come in at about 4.6% of GDP in FY21.

Covid-19 impact: CPSEs weather blow, regain capex pace

67% of capex target achieved till January end; depleting internal investible resources could reflect in FY22

The National Highways Authority of India (NHAI) invested Rs 90,000 crore or 84% of its FY21 target in April-January.

FY22: Budget spend seen above recent trend

Union Budget 2021 India: Sharp increases in outlays are seen for FY22, in many areas including grants in aid to states, 'water supply and sanitation”, 'medical and public heath', and transfers to the north-eastern states (s

‘Revised spending target within reach’

Nomura had termed the government plans to spend 1.6% of GDP in Q4 “an ambitious target”, as it requires an 18% y-o-y growth in Q4, compared with 8% in April-December.

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Disinvestment: Strategic-sector sales to boost Centre’s non-debt receipts

He said the disinvestment receipts target of Rs 1.75 lakh crore for the next fiscal would surely be met, if not exceeded. The process has already commenced for big-ticket sales, so achieving the target won't be difficult at a

This makes a lot of sense, and as the finance minister spoke of the concept during the Atmanirbhar series, it does appear that the government is keen on moving out of some companies.

Finance Commission: Tax devolution unchanged at 41% for FY22-FY26

Union Budget 2021 India: In the Commission’s assessment, gross tax revenues for the FY22-FY26 period are expected to be Rs135.2 lakh crore, of which divisible pool (after deducting cess and surcharges & cost of collection)

The Commission has also retained the weights assigned to various parameters for FY22-FY26 as was recommended for FY21.

Union Budget 2021: Privatisation high on agenda, FY22 target conservative

Union Budget 2021: Privatisation of two public sector banks and one general insurance company to be taken up in FY22.

FIIs could be allowed to purchase shares so that there would be no need to list these companies in international stock exchanges.

CPSEs may raise capex target by 50% in FY22

“While a smaller part of this enhanced investments next year will be supported by budget, a large part will likely be funded via enhanced borrowings and asset monetisation proceeds of the CPSEs, such as railways, NHAI, GAIL

Disinvestment: FY22 target to be around Rs 2 lakh crore

FY21 receipts to be barely a fifth of target; BPCL sale, LIC IPO unlikely to materialise this fiscal

LIC is believed to be worth Rs 8-11.5 lakh crore, meaning a 10% IPO could fetch the government Rs 80,000-110,000 crore.

DBT scheme for fertiliser subsidy may be rolled out in FY22

The department of fertilisers and the ministry of agriculture are working out the details of the DBT scheme, which may be announced in the Budget for FY22, sources told FE.

Currently, the government releases subsidy amount to fertiliser manufactures periodically, based on Aadhaar-authenticated sales via point of sale (PoS) machines, which was rolled out from April 1, 2018, in the first phase of DBT.

Tax transfer to states down a fifth

The Centre hiked special additional excise/cess levied on petrol and diesel sharply in October 2019, March 2020 and then in May. These taxes are not part of divisible pool, only the basic excise is.

The moot point is how the tax department can win the confidence of taxpayers.

Big jump in CPSE capex, Q3 matches H1

State governments have slowed down investments significantly in the current fiscal year and the Centre's Budget capex also looks constrained, due to the pandemic-induced revenue shortfalls.

Three dozen CPSEs, with capex plan of at least Rs 500 crore, invested Rs 2.9 lakh crore or about 60% of their annual capex target of Rs 4.95 lakh crore in April-December of FY21.

CAG to improve audit of local bodies

Currently, these entities are audited by state government appointed organisations/local fund examiners.

o control the level of these impurities, the Assam renewal plan was conceptualised way back in December 2005.

Sharp Drop: States’ capex seen down a quarter

To be sure, many states have in recent months seen a rise in own tax revenues (OTR) from the lows witnessed in the lock-down period.

From the range of 25-50% of normal in May, OTR of most states in October either surpassed or was on a par with the same in the year-ago month.

EBRs, PPP power investments into infra despite Budget squeeze

While infrastructure investment was predominantly made by the public sector (the Centre and state governments had a share of over 70%) between FY08 and FY17, the share of private sector was ~30%.

Privatisation plan: Concor land lease to be longer, rentals to halve

The government is planning to sell 30.8% out of its 54.8% holding in Concor, a railway PSU, along with management control to a strategic buyer.

Public capex seen at Rs 7.5 lakh crore in H2, 80 percent higher than H1

Overall spending, including revenue expenditure, by the Centre and states will, however, rise only 15% or thereabouts on year to over Rs 33 lakh crore in H2.

Funds

Amid acute budget constraints, states slash capex to focus on Covid spend

Borrowings by the twelve states whose finances were reviewed by FE rose 50% on-year to Rs 2.28 lakh crore in April-October of this fiscal compared with 2.6% increase in the year ago period.

Centre cuts tax transfers to states by a fifth in October

Despite a sharp revenue slump, the Centre transferred budgeted amounts to state governments as their tax share from divisible pool in April-May, but has since found this practice unsustainable – October transfers were a fif

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Ease of doing biz: More minor offences to be decriminalised

Income tax, customs, excise, pharma, labour acts are also being reviewed. Certain ministries feel that some aspects of criminalisation is necessary for efficient enforcement.

In this context, NITI Aayog has undertaken an exercise the with ministries concerned to identify the specific provisions under different Acts where decriminalization can be attempted.

Tight budget: Outlays for most ministries slashed

In Q4 last year, the government lowered spending ceiling from 33% to 25%, keeping in mind the weak cash position of the government.

An analysis by FE revealed that despite the three rounds of stimulus measures announced so far, the FY21 Budget size would at best be the same as the budget estimate (BE) of Rs 30 lakh crore.

Steep capex targets being set for 3 dozen public sector companies

The idea is to soften the blow to the economy from the sharp drop in private investments and slashing of capital expenditures by revenue-starved states.

State capex down nearly a quarter in the first half of the current fiscal

If public-sector fixed capital formation has held up in recent years even amid a worrisome, prolonged decline in private investments, the contribution of state governments have been vital; state capex is also seen to have a h

Festival advance For employees of Autonomous Bodies

H1 spend: Farm and rural ministries record huge jump

Overall budget expenditure in April-Sept was flat on year, spending seen picking up in H2

Changing matrix: CPSE staff’s pay to depend on M-cap too, greater role for asset sales

CPSE heavyweight ONGC’s stock (the CPSE in terms of highest M-cap), has lost 57% value between March 29, 2019, and August 24, 2020. Similarly, NTPC has lost 37% and PowerGrid 18% during the period.

The department of investment and public asset management (Dipam) and department of public enterprises (DPE) are working on revising PRP guidelines on these lines, the sources added.
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