Indian Economy - General awareness questions on current affairs

1)   DIPP has amended the startup definition to include which of the following?
- Published on 26 May 17

a. A startup has a turnover not less than 25 crores
b. It has not completed 7 years from day of incorporation
c. Both of the above
d. Neither of the above
Answer  Explanation  Related Ques

ANSWER: Both of the above

Explanation:
The Department of Industrial Policy and Promotion (DIPP), which is the nodal body for Start-up India, has amended the definition of a start-up.

As per the new definition, an entity will be considered as a Start-Up if its turn over is less than INR 25 crore and has not completed seven years from the date of its incorporation/registration.

In the definition, the change is with respect to the time period which is currently five years. The new definition has increased it to 7 years taking into the consideration the long gestation period involved in establishing start-ups.

The scope of definition of start-up will also be widened to include scalability of business model with potential of employment generation or wealth creation.

An entity that has completed 7 years from the date of its incorporation or if its turnover exceeds INR 25 crore, it will cease to be a start-up.

The process of recognition of an entity as a start-up will be through an online application made over the mobile app/portal set up by the DIPP.

For the Start-Ups in the biotechnology sector, they will be considered as start-ups for a period of up to 10 years from the date of incorporation/registration.

Start-ups will not require a letter of recommendation from an incubator or an industry association to get tax benefits under the Start-up India action plan.

However, the entities should obtain a certificate of an eligible business from an inter- ministerial board of certification as constituted by the DIPP to claim tax benefit

An entity will be deemed as a start-up if it is working towards innovation, development or improvement of products/processes/services, or if it is a scalable business model with potential for employment generation or wealth creation.


2)   Cochin Port Trust has received performance awards for which feat(s) from Ministry of Shipping?
- Published on 24 May 17

a. Highest growth in operating surplus
b. Third highest growth in cargo traffic among major ports in 2016-2017
c. Both of the above
d. Neither of the above
Answer  Explanation 

ANSWER: Both of the above

Explanation:
Cochin Port Trust has received two Best Performance Awards from Ministry of Shipping for the highest growth in operating surplus and also for achieving third highest growth in cargo traffic among the major ports in the year 2016-17.

Cochin Port Trust has registered an operating profit of INR 127.72 crore during 2016-17 as against INR 70.89 crore during 2015-16 recording a growth of 80 per cent.

Operating profit during 2014-15 was INR 19.55 crore.

The Port handled 25.01 MMT cargo during 2016-17 with a growth of 13.2 per cent over 22.10 MMT handled in 2015-16.

The containers handled during 2016-17 is 4.91 lakh TEUs with a growth of 17.0 per cent over 4.20 lakh TEUs in 2015-16.


3)   What rates are the 4 slab service tax structures proposed by the GST council?
- Published on 22 May 17

a. 5,12,18,28
b. 6,13,19, 29
c. 7, 14, 20, 30
d. None of the above
Answer  Explanation  Related Ques

ANSWER: 5,12,18,28

Explanation:
The GST Council headed by finance Minister Arun Jaitley has finalised a 4-slab service tax structure at the rates of 5, 12, 18 and 28 per cent as against the single rate of 15% levied on all taxable services.

GST regime is scheduled to be implemented from July 1.

In the next GST Council meeting, tax rates on gold and other precious metals will be taken up for discussion.

Luxury hotels, gambling, race club betting and cinema services will attract a tax rate of 28%.

Education, healthcare and non-AC rail travel will remain exempted from the GST tax regime.

However, the states will be given the option to levy additional taxes on cinema to compensate for the revenue losses entailed due to merging of entertainment tax with GST.

At present, the total tax incidence on cinema including entertainment and 4-slab service tax is in the range of 55%.

The states need to use the legislative route if it wants to levy additional tax on cinema. States will also be permitted to levy any new tax as the taxation powers of the states have only been restricted and not abolished after the rollout of GST.

Telecom and financial services will be taxed at a rate of 18%. Transport services will be taxed at the rate of 5%.

Cab aggregators like Ola and Uber will have to pay 5% under GST in place of 6%. AC rail travel will attract 5% tax. Economy class air travel will attract 5% GST while business class will attract 12%.

Travelling on metro, local train and religious travel such as Haj Yatra would be exempted from GST.

The e-commerce players like Flipkart and Snapdeal would be required to shell out 1% Tax Collected at Source (TCS).

Non-AC restaurants and AC restaurants will attract a GST of 12% and 18% respectively.

Advertisements published in newspapers will attract 5% GST. At present it is exempt from 4-slab service tax.

GST Council: Know More

  • ST Council is a federal forum with both centre and states in India on board formed in September 2016.
  • It is made of: The Union Finance Minister (as Chairman), The Union Minister of State in charge of Revenue or Finance, and The Minister in charge of Finance or Taxation or any other Minister, nominated by each state government.
  • The decisions of the GST Council are made by three-fourth majority of the votes cast. The centre has one-third of the votes cast, and the states together have two-third of the votes cast.
  • Each state has one vote, irrespective of its size or population.
  • The Secretary (Revenue) will be appointed as the Ex-officio Secretary to the GST Council. The Chairperson, Central Board of Excise and Customs (CBEC), will be included as a permanent invitee (non-voting) to all proceedings of the GST Council.
  • One post of Additional Secretary to the GST Council in the GST Council Secretariat (at the level of Additional Secretary to the Government of India) will be created.
  • Four posts of Commissioner in the GST Council Secretariat (at the level of Joint Secretary to the Government of India) will also be created.


4)   GST council has finalised tax rates and approved ___ rules of the GST regime.
- Published on 19 May 17

a. 5
b. 6
c. 7
d. 8
Answer  Explanation  Related Ques

ANSWER: 7

Explanation:
The GST Council headed by finance Minister Arun Jaitley has finalised tax rates and has approved all the seven rules for the GST regime that is scheduled to be implemented from July 1.

The remaining two rules of the GST pertaining to transition and return is under the examination of the legal committee.

In total, the council has fixed the rates of 1211 items. It will decide rates of some other items and services in the coming days.

Out of 1211 items, 81% of the items will attract tax of 18% or less. Only the remaining 19% of items will attract a highest rate of 28%.

Household items like Sugar, Tea, Coffee and edible oil will attract 5% levy. Cereals and milk will be exempted from the tax.

Manufactured goods will attract 18% levy. Luxury cars will attract 28% GST in addition to a cess of 15%.

Small petrol cars will attract 28% GST plus a 1% cess, and diesel cars will be taxed at 28% plus 3% cess.

Capital goods, a key asset for the manufacturing sector, will be taxed at 28%. Aerated drinks will fall under the 28% tax bracket.

GST Council Overall Tax: Know More

  • The GST Council has not increased the overall tax in any of the 1211 items but have reduced tax on many items.
  • For example, Soap, which is now taxed at the rate of 22-24%, will be taxed at 18%. The present tax incidence in excess of 28% on luxury items will be treated as cess and will be deposited in the corpus for compensating states if they suffer any revenue loss.
  • Food items are expected to become cheaper. Daily use items like hair oil, toothpaste, and soap are kept in the 18% tax slab instead of 28%.
  • The cost of energy generation is expected to become less as tax incidence on coal has been reduced from 11% to 5%.
  • GST regime is expected to unify the whole of the country into a common market eliminating both Central and State levies.
  • GST is also expected to increase state and federal tax revenues, ease inflation and boost economic growth by 1-2% points in the medium term.


5)   Which new portal has ITD launched in May 2017?
- Published on 19 May 17

a. Operation Clear Money
b. Operation Clean Money
c. Operation Constant Money
d. Operation Circulation Money
Answer  Explanation  Related Ques

ANSWER: Operation Clean Money

Explanation:
Income Tax Department (ITD) has initiated Operation Clean Money to investigate tax evaders. As a part of the operation, the government has launched a website on ‘Operation Clean Money’ operation.

The Operation Clean Money’ portal has been designed by the Central Board of Direct Taxes (CBDT). Initial phase of the operation involves identification of around 18 lakh persons who have made large deposits or purchases between 9th November to 30th December 2016, which do not appear to be in line with the tax payer’s profile.

The provision of online verification of these transactions is aimed at reducing the compliance cost for the taxpayers while optimising the resources of the Income Tax department.

The PAN holders can view the information in the portal. The taxpayers would be allowed to submit online explanation without the need to visit the Income Tax Office.

As a reminder, e-mail and SMS will also be sent to the taxpayers for submission of online response on the portal. The IT department will make use of the data analytics to select cases for verification.

After selection of cases, additional information requested would be communicated electronically. On getting the information, the portal will get dynamically updated.

The taxpayers covered under this phase are required to submit their responses within 10 days in order to avoid further notice and enforcement actions under the Income Tax Act. The response provided by the tax payer would be analyzed against available information with the department.

If response found justified, the verification would be closed. The verification will also be closed if the cash deposit has been declared under Pradhan Mantri Garib Kalyan Yojna (PMGKY).

Operation Clean Money: Know More

  • Operation Clean Money was launched immediately after government’s demonetisation drive in order to bring the tax evaders with undeclared incomes under the tax net.
  • The income tax department has so far identified about 1.8 million persons and asked them to explain their deposits, pay tax or disclose past undisclosed income through the Pradhan Mantri Garib Kalyan Yojana.


6)   Which sector's revenue from exports touched an all time high of INR 2282 crore this fiscal?
- Published on 17 May 17

a. Jute
b. Coir
c. Rubber
d. Cotton
Answer  Explanation  Related Ques

ANSWER: Coir

Explanation:
The Indian Coir sector’s revenue from exports touched an all time high of INR 2282 Cr by value and 9.57 Metric Tonnes in quantity in the 2016-17 financial year.

The Coir Board Chairman is C P Radhakrishnan.

The coir sector had fetched export revenue of Rs 1630 Cr in the financial year 2015-16 against INR 1,476 Cr achieved in fiscal year 2014-15.

Indian coir sector has tremendous potential to grow and provide employment to a large number of people.

Coir Board is going ahead with a project to fabricate a versatile spinning machine capable of producing yarn with uniform thickness in large quantity.

The government is considering to introduce a scheme that would extend financial support upto INR 2.50 Cr to the sector in order to promote larger investments by entrepreneurs.


7)   Organisations with turnover of how much will have to specify PAN while filing the Udyog Aadhaar Memo for registration?
- Published on 16 May 17

a. INR 20 lakhs
b. INR 50 lakhs
c. INR 75 lakhs
d. None of the above
Answer  Explanation 

ANSWER: INR 20 lakhs

Explanation:
Organisations with over Rs 20 lakh turnover will have to specify the PAN while filling the Udyog Aadhaar Memorandum for registration.

These organisations include companies, limited liability partnerships, cooperative societies, societies and trusts.

The decision, taken at a meeting chaired by the MSME Secretary K K Jalan recently.

This will be implemented after two months of the Goods and Services Tax coming into operation.

The GST regime is likely to come into force on July 1.

Presently, it is not mandatory for these organisations to mention the PAN number in the Udyog Aadhaar Memorandum.

However, since it will be compulsory for firms with turnover above INR 20 lakh to have a PAN number under the GST, this decision has been taken.

Apart from the Permanent Account Number (PAN) and Aadhaar, micro, small and medium enterprises (MSMEs) will also have to attach a chartered accountant's certificate for participating in public tenders.

Udyog Aadhaar is for existing firms. The upcoming units do not need to apply for its registration.

The meeting of the Advisory Committee under the MSMED Act decided that there could be a ministry sponsored MSME specific M Tech course, which will focus mainly on practical shop-floor training, the business model that can be worked out among the MSME Associations present in the meeting, a suggestion mooted by the All India Council for Technical Education.

In the course curriculum, 20-30 specific activities can be listed after due deliberations.

The MSME ministry had earlier issued a one-page Udyog Aadhaar Memorandum, which must be filled online by all micro, small and medium enterprises (MSMEs), for simplifying the registration procedure for entrepreneurs and promoting ease of doing business.


8)   India has jumped ___ spots to be 26th on World Bank's electricity accessibility index.
- Published on 16 May 17

a. 13
b. 33
c. 73
d. 93
Answer  Explanation 

ANSWER: 73

Explanation:
India has jumped 73 spots to be ranked 26th in World Bank’s electricity accessibility list. The country was ranked 99th in 2014.

Out of the 18,452 villages which lacked electricity, over 13,000 has been provided access to electricity.

In addition, a person applying for new electricity connection would be able to get the connection within 24 hours in areas where power infrastructure is available and in areas where there is no power infrastructure, electricity connection would be given in a week.

The government’s rural electrification programme is on track for completion within the targeted 1,000 days.

The flagship scheme Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) was launched by Prime Minister Narendra Modi with an aim to provide 24/7 uninterrupted electricity supply to each rural household across the country by 2022.

It aims to strengthen sub-transmission and distribution network to prevent power losses.

It focuses on feeder separation for rural households and agricultural purpose.

The Ministry of Power has also launched a new app, GARV-II to provide real-time data of all six lakh villages of the country.

Ministry of Power

  • Formed: 2 July 1992
  • Preceding Ministry: Ministry of Energy Sources
  • Jurisdiction: Government of India
  • Headquarters: Shram Shakti Bhawan, Rafi Marg, New Delhi, India
  • Annual budget: INR 13,881.14 crore (US$2.2 billion) (2017-18 est.)
  • Minister responsible: Piyush Goyal, Minister of State (Independent Charge)
  • Website: www.powermin.nic.in


9)   What is the new base year for IIP and the WPI?
- Published on 15 May 17

a. 2011-2012
b. 2004-2005
c. 2007-2008
d. None of the above
Answer  Explanation  Related Ques

ANSWER: 2011-2012

Explanation:
The government has released new-look index of industrial production (IIP) and the wholesale price index (WPI) , which have been built on the new series of data.

The new IIP and WPI series has been released by Chief Statistician of India and Secretary, Ministry of Statistics & Programme Implementation, and Secretary, Department of Industrial Policy and Promotion to usher in greater accuracy and improved synchronisation leading to better policies.

Instead of the earlier 2004-05, base year for the IIP and the WPI will be 2011-12.

Already, the Consumer Price Index (CPI), the Gross Domestic Product (GDP) and gross value addition etc., have 2011-12 as the base year.

The common base year of 2011-12 is aimed at reducing discrepancies.

WPI

The number of items covered in the new series of the WPI has increased from 676 to 697.

Overall, 199 new items have been added and 146 old items have been dropped.

Under the primary articles, new vegetables and fruits like radish, carrot, cucumber, bitter gourd, mosambi (sweet lime), pomegranate, jackfruit, and pear have been added.

Under the mineral group, new items like copper concentrate, lead concentrate and garnet have been added and other items like copper ore, gypsum, kaolin, dolomite, and magnesite have been dropped.

Under the manufacturing items, 173 new items including conveyer belt, rubber tread, steel cables, tissue paper, and wooden splint have been added, while 135 items like khandsari, poppadom, and video CD players have been taken out.

Under the new series of WPI, weight of manufactured items has decreased to 64.2 per cent from 64.9 per cent in old series.

Similarly, the weight of fuel and power has decreased to 13.1 per cent from 14.9 per cent. On the other hand, the weight of primary items have increased to 22.6 per cent from 20.1 per cent.

IIP

The IIP has been revised after a gap of 13 years and the obsolete items which are no longer in production in the index have been replaced with contemporary products in the new index making it to be more comprehensive in nature.

Introduction of the new series would make all the key macroeconomic indicators such as IIP, WPI, CPI and national accounts to have a common base of 2011-12, paving way for easier comparisons among them. The new series indices have painted a healthier picture of the Indian economy in 2016-17 than that of the old series.

The new series of IIP will include 809 manufacturing products and 55 mining products that are re-grouped into 521 item groups.

The new series of IIP will include technology items like smart phones, tablets, LED television etc.

A technical review committee has also been established to identify new items by ensuring that the series remains relevant.

The committee is slated to meet at least once a year.


10)   NITI Aayog has set up a task force to _________.
- Published on 11 May 17

a. Generate timely employment data
b. Generate reliable employment information
c. Both of the above
d. Neither of the above
Answer  Explanation  Related Ques

ANSWER: Both of the above

Explanation:
The government has set up a task force headed by NITI Aayog vice-chairman Arvind Panagariya to come up with a methodology to generate timely and reliable employment data.

The Prime Minister Narendra Modi himself has initiated the process and has asked the task force to submit its recommendations at the earliest.

The other members of the task force are labour secretary M. Sathiyavathy, secretary of the statistics department T.C.A. Ananth, NITI Aayog’s Pulak Ghosh and Manish Sabharwal, chairman and co-founder of staffing firm Teamlease Services Ltd.

India lacks reliable data on jobs. The available data is currently outdated.

The data on jobs in the informal sector which employs country’s majority of the workforce is not easily available.

Also, the data released by the Labour Bureau is restricted to the organized sector. National Sample Survey Office (NSSO) data which is the most comprehensive data available on jobs is generated with a time lag.

Better data on jobs data will help policy planners assess the impact of policies on jobs and will shed light on the actual size of the informal economy

India’s Labour Market

  • India’s labour market constitutes of over 470 million people.
  • According to CRISIL, around 18 million people enter the workforce every year.
  • As per the data with the NSSO, India had created around 59.9 million jobs between 1999-2000 and 2004-05 and created nearly two million jobs between 2004-05 and 2009-10.
  • Between 2009-10 and 2011-12, 13.9 million jobs were created in the country.


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