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Sebi outlines role of oversight committee for product design To bring uniformity with respect to the role of the oversight committee on 'product design', Sebi today said the panel will be responsible for introduction of new contracts, modifications of existing product and reviewing the design of the already approved and running contracts. The move comes after Sebi observed that the commodity derivatives exchanges have been adopting varied approach both in terms of constitution as well as the functioning of such oversight committees, the regulator said in a circular.Sebi, in November 2015, had asked all national commodity derivatives exchanges to constitute an oversight committee for 'product design', chaired by a Public Interest Director, within three months. To bring uniformity with respect to the role of the committee on product design, Sebi has decided that the functions of the panel will be to oversee the regulator's inspection observation on product des...

Budget 2018: Government may hike agri-credit target to Rs 11 lakh crore The farm credit target is likely to be raised by a whopping Rs 1 lakh crore to a record Rs 11 lakh crore in the Budget 2018-19 to improve credit flow in the agriculture sector, according to sources.In the current fiscal, the government has kept a credit target of Rs 10 lakh crore. Of which, Rs 6.25 lakh crore has already been disbursed in the first six months till September 2017, the government data showed. "The government's priority is agriculture. There is a possibility that the credit disbursal target for the agriculture sector will further be increased to Rs 11 lakh crore for the next fiscal," sources said.Since credit is a critical input in achieving higher farm output, the institutional credit will help delink farmers from non-institutional sources of credit where they are compelled to borrow at usurious rates of interest, they said. Normally, farm loan attracts an interest rate of 9 per...

Budget 2018: Increase tax exemption limit to Rs 300,000, says SBI report The government has periodically increased the income tax slabs from Rs 22,000 in 1990-91 to Rs 2.5 lakh in 2014-15 The rise in personal disposable income post 7th Pay Commission, the income tax exemption limit needs to be raised by Rs 50,000 to Rs 300,000 a SBI report said today.The move will benefit around 75 lakh people, it said. The SBI's Ecowrap report further said that if the exemption limit of interest payments under housing loan is increased to Rs 250,000 for existing home loan buyers, from Rs 200,000 now, it will benefit 75 lakh home loan buyers and cost the government just about Rs 75 billion Finance Minister Arun Jaitley is set to present the fifth and final full budget of the current government on February 1.The government has periodically increased the income tax slabs from Rs 22,000 in 1990-91 to Rs 2.5 lakh in 2014-15."Due to 7th pay commission, the personal disposable income has b...

IMF Report says India Stays Ahead of China in FY17 Growth Rate World Economic Outlook has revised upwards India’s growth forecast to 6.8% from 6.6%, just ahead of China’s 6.7% India will not have to surrender its fastest growing major economy tag to China in the near future and will record slightly higher growth rate than its bigger neighbour for last year despite a slowdown due to demonetisation, International Monetary Fund says. World Economic Outlook (WEO), the fund’s flagship publication, has revised upwards India’s growth forecast for FY17 to 6.8%, just ahead of China’s 6.7% for 2016 calendar. IMF has retained its India growth forecast for FY18 at 7.2% and FY19 at 7.7%, well ahead of its forecast for China. In its January review, the Fund had slashed India’s growth estimate to 6.6% for FY17, below China’s growth rate for 2016, citing demonetisation disruptions. GLOBAL RECOVERY According to WEO, the global economy is expected to do better with 3.5% growth in 2017 agains...

NSE co-location: EY, ISB audits fail to cut ice with SEBI panel The Securities and Exchange Board of India’s (Sebi’s) technical advisory committee (TAC) is not satisfied with the forensic report findings submitted by the National Stock Exchange (NSE) on co-location, said a regulatory official. According to him, Sebi’s expert panel is of the view that the report findings are not matching with the evidences gathered by them. The panel has submitted their views to the market watchdog and has called for an independent probe. In November 2017, the NSE had submitted two separate audit reports to Sebi, prepared by EY and the Indian School of Business (ISB), Hyderabad, relating to the co-location matter. The NSE entrusted EY to carry out a forensic audit into cash markets, currency derivatives, and interest rate futures platforms. ISB’s audit was to determine whether certain brokers made any undue profits by getting preferential access to the exchange’s platform.Sources say the audit...

Cryptocurrency exchanges face the red flag In some cases, RoC is seeking an undertaking The banking system is not the only one keeping a safe distance from the existing cryptocurrency business players. Opening virtual currency exchanges has become equally tough, especially when words like bit, crypto, coin, virtual are part of a company name. The Registrar of Companies (RoC), under the Ministry of Corporate Affairs, has stopped registering cryptocurrency exchanges under the Companies Act, 2013. In some cases, the RoC is asking for an undertaking from software development- or information technology-related companies that it will not deal with cryptocurrencies such as bitcoins, it is learnt. “I tried to register my company in December, but the RoC didn’t accept my request. The company’s name had the term ‘bitcoin’ and the RoC said it wouldn’t support it,’’ an executive with an upcoming cryptocurrency exchange said.Cryptocurrency exchanges are a platform for buying and selling virtu...

Sebi plans to open consent doors for serious violations The Securities and Exchange Board of India (Sebi) is broadening the scope of the consent mechanism to reduce the number of cases it is handling. According to sources, the regulator is planning to allow serious offences such as insider trading, front running, or fraudulent and unfair practices to be settled under the mechanism. Sources privy to the development said Sebi would take a fresh look at the pricing formulae to decide the settlement amount under consent. Currently, the formulae prescribed by Sebi have too many variables, making the process ambiguousThe regulator is working on simple formulae to arrive at settlement fees, sources say, adding that the new consent framework will be introduced in less than two months During the last board meeting, the Sebi chief had acknowledged the need for tweaking the consent rules.“We are revisiting the settlement norms and have started rewriting certain regulations,” Ajay Tyagi, c...

Ministry Wants SEZ Tax Incentives to Continue In the Budget 2016-17, Finance Minister Arun Jaitley had stated that the income tax benefits to new SEZ units would be available to only those units which commence activity before March 31, 2020. The commerce ministry has pitched for continuation of tax incentives being enjoyed by units in special economic zones (SEZs) with a view to boost shipments and job creation, a government official said. In a letter to the finance ministry, the department of commerce has also asked for removal of minimum alternate tax on SEZs. In the Budget 2016-17, Finance Minister Arun Jaitley had stated that the income tax benefits to new SEZ units would be available to only those units which commence activity before March 31, 2020.The commerce ministry wants removal of this sunset clause as it would negatively impact growth of these zones, the official added. According to industry experts, the clause that indicates the date in advance on which tax incen...

GST composition scheme may come under reverse charge mechanism to curb evasion Worried by apparent goods and services tax (GST) evasion, India is likely to bring the composition scheme under the reverse charge mechanism right away. The government will move an amendment to the GST law in the budget session to introduce an enabling provision to prescribe the mechanism where it deems necessary. The GST Council has already approved about 40 changes to the law. The law will be changed to introduce an enabling provision for you to bring in reverse charge mechanism wherever you want," said a person aware of deliberations in the GST Council. "The thinking is that at least in the case of composition scheme the reverse charge should be done." Under the reverse charge mechanism, a person receiving goods or services collects the GST levied and deposits the tax with the government. The provision, which is suspended for now, was only meant for an unregistered entity supplying ...

Sebi online filing system stumps investors and intermediaries The registration process on an average according to market participants has doubled or become three times as against the earlier timeline of a mont The Securities and Exchange Board of India or Sebi’s online filing and registration system for intermediaries to usher in ease of business has had a mixed effect. The registration process on an average according to market participants has doubled or become three times as against the earlier timeline of a month. This is due to inefficiencies in the recently installed information technology systems which is also leading to double filings once online and then manually, said four people with direct knowledge of the matter including lawyers, consultants, advisors, fund managers on condition of anonymity. The market intermediaries and consultants are planning to write to Sebi on the issues they are facing during the registration processes.In an emailed response to Mint querie...

RBI, govt may give banks more time to switch to IndAS With less than three months to go before the deadline, bankers believe implementing the IndAS accounting norms will be a challenge The government and the Reserve Bank of India (RBI) may postpone the implementation of new accounting standards for banks because of the legislative changes and additional capital requirements the process would entail, according to three senior officials familiar with the matter. Banks and non-banking financial companies are due to switch to Indian Accounting Standards (IndAS) from 1 April 2018. They currently follow Indian generally accepted accounting principles (GAAP) standards. Other corporate entities started complying with IndAS with effect from 1 April 2016. “The implementation of IndAS for public sector banks requires an amendment to the Banking Regulation Act. The schedule in BR Act relating to financial statement disclosures needs to be changed to the IndAS format,” said one of the thr...