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 RBI to inject Rs 1 lakh cr cash into banking system in March  The Reserve Bank of India will inject Rs 1 lakh crore short term money into the banking system ahead of the financial year-end that normally sees cash crunch.  The move is likely to keep short term rates under check benefiting borrowing companies.  “In order to address additional demand for liquidity and with a view to provide flexibility to the banking system in its liquidity management towards March-end, it is prepared to inject adequate additional liquidity….,” RBI said in a release.  The central bank will use a combination of appropriate instruments for such fund infusion, while continuing with its normal liquidity adjustment facility (LAF) operations.  Beginning Tuesday RBI will conduct four variable repo operations of Rs 25,000 crore each.  After reviewing the current and evolving liquidity conditions in the banking system it has been decided to conduct additional variable rate repo operations for longer tenor

 Delhi-Jaipur E-way: Land Prices Rise 40% The long-held theory that infrastructure creation leads to spike in realty rates can find no better demonstration than just outside Delhi. Manesar and Rewari in Haryana, and Neemrana and Ajeetgarh in Rajasthan, are not just the names of semi-urbanised industrial belts en route the proposed Delhi-Jaipur expressway but are the latest hotspots for realtors that are seeing as much as 40 per cent appreciation in land rates. The interesting part, however, is officials in the National Highways Authority of India (NHAI) and the Ministry of Road Transport and Highways say the new alignment has been almost finalised but is yet to be officially notified or announced. Sometimes the source of such challenge for project cost that comes with spike in land rates lies in the ministry itself. Union road transport and highway minister Nitin Gadkari had, in the past, announced development of new projects in some states and the land prices in the area went

Services sector contracts, putting pressure on govt A private survey showed that India’s dominant services sector contracted for the first time in three months, adding pressure on Prime Minister Narendra Modi to undertake reforms to boost growth amid a hawkish turn from the Reserve Bank of India (RBI). The Nikkei India Services Purchasing Managers’ Index slid to 47.8 in February from 51.7 in January, as business conditions deteriorated due to poor demand. A number below 50 indicates a contraction. A dip in the services sector, which contributes about 60% to the Indian economy, could hurt an economy that’s forecast to grow at its slowest pace in four years. Sluggish growth, coupled with a lack of adequate job creation, is building pressure on Modi to jumpstart economic activity before seeking re-election in 2019. RBI, which will review interest rates on 5 April, has flagged risks to inflation from higher crude oil prices and the budget, which widened fiscal deficit goals to boos

Banks to bear extra cost due to 18% GST on priority lending certificate Banks have to give 40% of net lending to priority sector such as agriculture, micro enterprises, weaker sections, etc A recent circular by the indirect tax department to impose 18 per cent goods and services tax (GST) for certificates issued on excess priority sector lending by banks would increase lenders’ cost, as these are not eligible for full input tax credit. The Central Board of Excise and Customs (CBEC) recently clarified that Priority Sector Lending Certificates (PSLCs) would not be treated as securities but as goods. Hence, would draw an 18 per cent tax. PSLCs are a tool for promoting priority sector lending obligations. Banks have to give 40 per cent of net lending to priority sector such as agriculture, micro enterprises, weaker sections, etc. If a bank gives an excessive amount of priority lending, it will earn these certificates. Banks falling short of the target would be required to buy these

Rent on electricity meter comes under GST, move may draw criticism The department also clarifed that retreading of tyres is a service, against the popular notion that it is both goods and servicesIndirect tax department has clarified that rent on electricity meter draws goods and service tax (GST), a development which is likely to draw criticism from the industry. The Central Board of Excise and Customs (CBEC) said even though electricity is exempted from GST, rent on electricity meter is not. Pratik Jain, partner PwC, said there was a contrary circular under the service tax laws. “Industry is likely to pitch in for an exemption on these ancillary charges else consumers will have to bear the additional burden,” he said. He said industry view is that it should not be taxable and should be treated as an incidental to transmission and distribution of electricity. Besides, GST will also be imposed on application fee for releasing connection of electricity; testing fee formeters, tr

India To Retain Its Position As Fastest Growing Economy In Coming Decades: Arun Jaitley Finance Minister Arun Jaitley today exhorted confidence that India will retain its position of fastest growing economy in the coming decades like China did in the last three decades."The way the situation in the world is changing there is a great opportunity that has come in the way of India. The world keep facing its challenges and (in) the last  few years India has started leaving its footprints behind. "And when India is leaving its footprints behind, becoming one of the faster economies in the world, it obviously means that the opportunity for India and Indians is going to increase," Mr Jaitley said while addressing the 17th convocation of University of Jammu.The university conferred 185 degrees to candidates, who have qualified for the award of doctor of philosophy in 2015-16 up to December 31, 2016, besides 59 students were awarded gold medals, cash awards and certificates

RBI gets tough on MNC banks on priority sector lending The RBI move, directed at foreign banks with over 20 branches will impact the likes of Standard Chartered, Citi and HSBC and will come into force from the next financial yearThe Reserve Bank of India (RBI) has further tightened the priority sector lending (PSL) norms for foreign banks by directing them to mandatorily create sub-targets so that they lend a portion of their loans to small and marginal farmers as well as micro enterprises from April. The move, directed at foreign banks with over 20 branches will impact the likes of Standard Chartered, Citi and HSBC, which much higher branch presence, and will come into force from the next financial year. The PSL norms mandate foreign banks to eventually lend 40% of their total loan book to the priority sector, such as agriculture, rural infra, and medium, small and micro enterprises (MSMEs) among others from April 2020.In a notification over the weekend, RBI has said a sub-tar