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SEBI strengthens algo trading rules; co-location services The market regulator directed all exchanges to provide "managed colocation services"The Securities and Exchange Board of India (Sebi) on Monday issued new measures to provide “fair and equitable access” to the colocation facilities offered by the bourses.The market regulator directed all exchanges to provide “managed colocation services”, under which small brokers get access to colocation services without having to rent the entire space or rack. Currently, the service is largely out of bounds for small traders due to high cost and lack of technical know-how. Going ahead, small brokers get access to the technical knowledge, hardware, software, and other associated expertise from third-party vendors. To increase transparency, Sebi directed all stock exchanges to publish minimum, maximum and mean latencies and latencies at 50th and 99th percentile. Latency is the time taken to complete the round trip from the core

Rupee has Big Worrie: External debt at half-a-trillion dollars A chunk of it due next year, may put pressure on currency The Indian Rupee faces a new threat – soaring external debt. India’s external debt, the amount of money Indians have to repay in US dollars and other foreign currencies, have soared past the half-a-trillion dollar mark that may begin to worry investors about the strength of the local currency. That more than half the amount owed is coming up for repayment next year is a bigger cause of worry for investors and could lead to volatility in a market that is already getting whipsawed by the global trade wars and normalisation of interest rates in the developed world after a decade. At first the situation may not appear to be in a crisis state as it was in 2013 when the currency was pummelled, absence of corrective measures could see Indian financial markets witness wild swings.“The Indian rupee has clearly underperformed other EM currencies in 2018 so far and is d

Imported Solar Equipment Won’t Attract Customs Duty Central Board of Indirect Taxes and Customs clarifies 2016 order, reclassifies panels and modules Much to the relief of solar project developers, the Central Board of Indirect Taxes and Customs (CBITC) has clarified that the bulk of imported solar panels and modules will not attract customs duty, putting to rest a controversy raging for more than six months. Around 90% of panels used in Indian solar projects are imported.In September 2016, the CBITC passed an order saying that since solar panels and modules generate power, they should be classified along with “electrical motors and generators” under the Customs Act (HS Code 8501), which attract 7.5% import duty, apart from various kinds of cess, amounting to a total of around 10%. The order’s implementation, however, began only in the middle of 2017. Till then, solar equipment had always been grouped with “diodes, transistors and similar semiconductor devices, photosensitive

Govt begins move to increase stake in GST Network The demand that the state take control of GSTN is a long-pending one, and is also prompted by fears that sensitive GST data should not reside in private hands.The process of the government acquiring controlling stake in the Goods and Service Tax Network (GSTN) has been put in motion, government officials familiar with the matter said, asking not to  be identified. According to them, finance minister Arun Jaitley has approved the increase of the stake of the central government and the state governments in GSTN to at least 60% from the current 49%, to address fears that the ownership of a company that handles the IT infrastructure and systems related to the Goods and Services Tax, should reside with the state.Currently, 51% of the ownership of GSTN is with private financial institutions. The demand that the state take control of GSTN is a long-pending one, and is also prompted by fears that sensitive GST data should not reside in

Tank full of issues in bringing petrol and diesel under GST state governments derive a lion’s share of revenues from sale of these fuels and bringing them under the GST ambit would mean a sharp  decline in revenue, which then will have to be compensated. Union petroleum minister Dharmendra Pradhan said last week that petroleum products should be included under the goods and services tax (GST). That should help consumers pay a rational price at a time w hen diesel and petrol prices are touching multi-year highs.This makes sense. Even if petrol and diesel are taxed at the highest GST slab of 28%, it would be lower than taxes already being paid and result in lower retail prices, helping consumers. Also, those industries which might be using them as inputs could claim input tax credit if these are bought under GST.Cast your eyes on Chart 1 below. CARE Ratings assumes that instead of an effective tax rate of 100% on petrol and 66% on diesel, GST of 90% and 80% are applied on petrol

Regulators may extend timings of currency derivatives trading Longer trading hours seen helping investors hedge their currency risks better and mitigate losses India’s market regulators are in talks to extend timings of currency derivatives trading, two people aware of the discussions said, a move expected to help investors hedge their currency risks better. Currency derivatives trading in India now starts at 9am, offering futures and options contracts in dollar-rupee, euro-rupee, pound-rupee, yen-rupee, T-Bills and interest rate futures, and closes at 5pm. Trading in cross-currency derivatives such as euro-dollar, pound-dollar and dollar-yen is open until 7.30pm. The Securities and Exchange Board of India (Sebi) and the Reserve Bank of India (RBI) are in discussions to extend these timings to 9.30pm and 11.30pm respectively. “Longer trading hours should help clients better in hedging their risks arising from investments or transactions made in foreign currency denominations.

 E-way bill portal down for 2 hours  The e-way bill portal was down on Sunday night for close to two hours and then went slow, leading to disruptions in cargo carriage by road.  The portal blanked out at 9:30 pm and came back around 11 pm but was slow, said industry executives. E-way bill is a digital tracker of cargo transportion by road and an integral part of the goods and service tax compliance process.  The e-way bill was first implemented on February 1. The portal had crashed within a few hours then leading to a halt in billing.  The Economic Times, New Delhi, 09th April 2018