Photo used for representation purpose only.

Growth in Gross Goods and Services Tax (GST) revenues slowed to 8.5% in November from 8.9% in October, with the indirect tax receipts easing to a little over ₹1.82 lakh crore from ₹1.87 lakh crore in the previous month.

Prior to refunds, collections from domestic transactions were 9.4% higher and those from imports were up 5.9%. It must be noted that November’s tax receipts typically pertain to transactions undertaken in October when the festivals of Dipawali and Dussehra occurred. 

Pointing to the month-on-month decline in GST collections, despite the festive season boost, EY India tax partner Saurabh Agarwal said he expects tax receipts to slow down in the next four months of the year. “The global geopolitical scenario and potential consumer spending cuts could further exacerbate short-term economic growth,” he reckoned.

Net GST revenues, after factoring in refunds to taxpayers, increased at a faster pace of 11.1% to hit ₹1,63,010 crore, with domestic transactions yielding 12.5% higher taxes than a year ago, while revenues from imports were up 5.6%. Net revenues had risen 7.9% in October to a tad above ₹1.68 lakh crore

Much of the gap between the slower growth in gross receipts and the higher uptick in net revenues can be attributed to a sharp 19.6% fall in refunds for domestic transactions which stood at just ₹10,111 crore in November. Refunds related to exports grew 6.8%.

In October, refunds to domestic taxpayers had risen 42.8%, while export-related refunds had contracted 2%. In July this year, GST refunds had also contracted by over 19%

Overall, the first eight months of the financial year have now recorded a 9.2% growth in net GST revenues that stand at almost ₹12.91 lakh crore. While this marks a marginal improvement over the cumulative pace of 9% till October, it is still markedly slower than the growth of about 11% penned in to the Centre’s Budget 2024-25 arithmetic.

While gross domestic revenues were up 9.4%, as many as 15 major States recorded slower growth, with seven of them reporting a contraction in tax collections over last November. Just like October, Arunachal Pradesh recorded the sharpest contraction of 23% last month. Nagaland and strife-ridden Manipur also saw a revenue shrinkage again, with receipts dipping 22% and 4%, respectively.

Andhra Pradesh recorded a 10% decline in revenues, while Chhatisgarh’s revenues contracted 1% for the second straight month. Revenues also dipped 1% in Rajasthan. For eight major States, the growth was tepid despite the festive season – including Haryana (2%), Telangana and Punjab (3% each), Madhya Pradesh and Uttar Pradesh (5% each), West Bengal (6%), and Tamil Nadu (8%).

Sikkim led the pack of high growth States with a 52% surge in revenues, followed by the Union Territory of Jammu and Kashmir (25%), Delhi and Tripura (up 18% each), and Maharashtra (17%). Karnataka clocked a 15% rise in revenues in November, while the growth was 12% for Gujarat and 10% for Kerala, Odisha and Assam.

MS Mani, partner at Deloitte India, termed the slower growth in some large states and the contractions in States like Rajasthan, Andhra Pradesh and Chhattisgarh “an area of concern” as they have a significant manufacturing presence and considerable economic impact.

The move comes amid a recent World Bank report which said women faced a sharp drop in their labour force participation post-marriage in India. Image for representation
| Photo Credit: Getty Images

The Centre will soon bring out a national policy document on female labour force participation with a focus on providing an enabling atmosphere like a viable care economy structure.

An inter-ministerial team from the Ministries of Skill Development, Labour, Rural Development and Women and Child Development is working on it, informed sources told The Hindu.

Care economy is the sector of economic activities related to the provision of care, both paid and unpaid, for the present and future populations. It includes direct care, such as feeding a baby as well as indirect care, such as cooking and cleaning, health care, education and other personal and domestic services.

The move comes amid a recent World Bank report which said women faced a sharp drop in their labour force participation post-marriage in India.

According to the report, it is estimated that in India post-marriage, female employment rates drop by 12 percentage points, about one-third of the female pre-marital employment rate, even in the absence of children.

The sources said deliberations were on between the various ministries and that the document would focus on building a care-giving infrastructure to boost women’s participation in the labour market.

Core skilling package

One of the initiatives being explored is a core skilling package for caregivers for children, the sources said.

The policy paper will also look at providing child care facilities for women in the informal sector such as for workers under the National Rural Employment Guarantee Scheme.

The Ministry of Women and Child Development already runs the ‘Palna’ scheme, or the National Programme on Anganwadi-cum-Crèche, which provides day-care facilities for children of working parents.

The scheme aims to increase the participation of women in the workforce by providing a safe and secure environment for children’s health, nutrition, and cognitive development. The scheme is for children between the ages of 6 months and 6 years. It provides a range of services, including nutritional support, health and cognitive development, growth monitoring, immunisation, and education.

A total of 1,000 Anganwadi creches have been made operational till now as part of this scheme, the sources said.

Union Labour Ministry data say that in 2021-2022, the female labour force participation rate in India was higher in rural areas than in urban areas. In rural areas, 36.6% of women aged 15 years and above were in the labour force, compared to 23.8% in urban areas.

An artificial limb camp organised by Mangalore Refinery and Petrochemicals Ltd., for endosulfan victims on December 20, at Belthangady in Dakshina Kannada district.
| Photo Credit: SPECIAL ARRANGEMENT

Mangalore Refinery and Petrochemicals Limited (MRPL) organised an artificial limb camp for individuals affected by endosulfan exposure in the Puttur and Belthangady regions.

This initiative was undertaken in collaboration with the Jaipur Foot organisation and with the support of the Dakshina Kannada District Health Department. The camps were conducted on December 18 and 19 in Puttur and on December 20 in Belthangady, bringing much-needed aid to those whose lives have been impacted by the adverse effects of endosulfan exposure, said a release.

The initiative, with a budget of ₹12 lakh, was driven by MRPL’s commitment to improving the quality of life of these individuals under its Arogya Samrakshan Scheme. A total of 72 beneficiaries received artificial limbs during the camp, offering them renewed mobility, independence, and hope for a better future.

Speaking on the occasion, MRPL Chief General Manager (HR) Krishna Hegde Miyar said, “At MRPL, we believe that corporate social responsibility is about giving back to the communities we serve. This artificial limb camp reflects our commitment to addressing pressing social issues and enhancing the quality of life for the most vulnerable.”

The event witnessed heartfelt expressions of gratitude from the beneficiaries and their families, who appreciated MRPL’s efforts in extending this life-changing support. The camp not only served as a platform for physical rehabilitation but also symbolised a new hope for the family members of the affected.

Image used for representative purpose only
| Photo Credit: N. Bashkaran

Private sector industrial activity appears to be on a relatively weak wicket even in the third quarter of 2024-25, scotching hopes of a quick rebound from the sharp tumble in the July-September quarter when manufacturing growth slipped to a mere 2.2%, and GDP grew at a seven-quarter low pace of 5.4%.

Factory activity expansion in India’s private sector fell to a joint-11 month low in November, while firms raised prices at the swiftest pace in over 11 years as input cost pressures began to bite, as per the survey-based HSBC India Manufacturing Purchasing Managers’ Index (PMI). The index reading fell to 56.5 from 57.5 in October — a reading of over 50 indicates a rise in activity levels.

Output levels at surveyed factories grew at the slowest pace since December 2023. Incidentally, for the first time since August 2017, factories also reported an uptick in their stocks of finished goods, breaking a seven-odd year sequence of such piled-up stocks declining every month. This signals a mismatch of sorts between production levels and end-users’ demand through last month.

New business orders and production levels increased at a softer pace as favourable demand conditions clashed with fierce competition and price pressures. However, fresh export orders gained pace to surge at the highest pace in four months, spurring some optimism that goods exports may see yet another healthy uptick after October’s 28-month high growth of 17.25%.

Officials had attributed the revival in exports to improved demand from developed markets for the Christmas festivities this year. The 400-odd firms surveyed for the index reported gains in orders from Bangladesh, mainland China, Colombia, Iran, Italy, Japan and Nepal, apart from major markets such as the U.S. and U.K.

These companies also cited higher outlays on freight, labour and materials that they passed on to clients, as input cost inflation intensified to the highest level since July. Pricier chemicals, cotton, leather and rubber were named as important pressure points on the input cost front.

Producers continued to buy additional inputs to build inventories of raw materials, but the rise in such purchases was the weakest in just under a year, S&P Global, which conducts the PMI surveys, noted. Accumulated input stocks thus fell to the weakest level so far in 2024.

Incidentally, employment levels continued to be ramped up for the ninth successive month, albeit at a lower scale than October. Firms reported hiring staff on both permanent and temporary bases

“Business optimism was spurred by predictions that marketing efforts and new product releases will bear fruit. Recent capacity expansion efforts and forecasts of demand strength also underpinned upbeat forecasts for output in 2025,” the firm said.

While the PMI reading was down slightly in November, it was still firmly within expansionary territory, and the four-month peak in new export orders led the manufacturing sector’s growth in November, said Pranjul Bhandari, chief India economist at HSBC.

“The rate of output expansion is decelerating due to intensifying price pressures. Input prices for a variety of intermediate goods — including chemicals, cotton, leather, and rubber — rose in November, while output prices soared to an eleven-year high as rising input, labour, and transportation costs were passed on to consumers,” she reckoned.

India first imposed windfall profit taxes on July 1, 2022 joining a growing number of nations that tax super normal profits of energy companies. Representational file image.
| Photo Credit: Reuters

The government on Monday (December 2, 2024) scrapped 30-month old windfall profit tax on domestically-produced crude oil and on export of jet fuel (ATF), diesel and petrol following a decline in international oil prices.

Minister of State for Finance Pankaj Chaudhary tabled a notification in Rajya Sabha scrapping the levy on crude oil produced by firms like state-owned Oil and Natural Gas Corporation (ONGC) and exports of fuels done by companies like Reliance Industries Ltd.

The notification rescinded June 30, 2022 order and withdrew levy of special additional excise duty (SAED) on production of crude oil (which is refined into fuels like petrol and diesel) and on export of aviation turbine fuel (ATF), diesel and petrol, he said.

Alongside, the road and infrastructure cess (RIC) levied on export of petrol and diesel has also been withdrawn.

India first imposed windfall profit taxes on July 1, 2022 joining a growing number of nations that tax super normal profits of energy companies. At that time, export duties of ₹6 per litre ($12 per barrel) each were levied on petrol and ATF and ₹13 a litre ($26 a barrel) on diesel.

A ₹23,250 per tonne ($40 per barrel) windfall profit tax on domestic crude production was also levied.

The tax rates were reviewed every fortnight based on average oil prices in the previous two weeks.

While the levy on export of petrol became nil in the very first fortnightly review that happened in mid-July 2022, the tax on diesel and ATF exports became nil in mid April 2023 but were back in August that year. There has been no levy on export of ATF and diesel since March this year.

As far as crude oil is concerned, the levy fluctuated every fortnight. It was ₹1,850 per tonne in August 31, 2024 and became nil in the next fortnightly review.

Now, the levies on both domestically produced crude oil and fuel exports have been scrapped.

The government had garnered about ₹25,000 crore from the levy in the first year of its implementation, ₹13,000 crore in 2023-24 and ₹6,000 crore this year.

Reliance Industries Ltd, which operates India’s largest only-for-export oil refinery at Jamnagar in Gujarat, and Rosneft-backed Nayara Energy are primary exporters of fuel in the country.

The government levied tax on windfall profits made by oil producers on any price they get above a threshold of $75 per barrel.

The levy on fuel exports is based on cracks or margins that refiners earn on overseas shipments. These margins are primarily a difference between the international oil price realised and the cost.

The decision to scrap the levy follows softening in international oil prices. The basket of crude oil that India imports averaged $73.02 per barrel in November, down from $75.12 a barrel in the previous month.

The import price was about $90 per barrel in April this year but has continued to slide in subsequent months. It fell to $73.69 per barrel in September but rose marginally in the following month.

Since its levy, the windfall profit tax has been a subject of controversy. While it initially sought to balance government revenue amid fluctuating oil prices, industry players argued that it negatively impacted profitability and disincentive production. For private and foreign players, it brought in an element of uncertainty in the fiscal regime.

The Ministry of Petroleum and Natural Gas too had been lobbying for its removal for some time now.

While doing away with tax on domestically-produced crude oil will benefit ONGC and Oil India Ltd, the scrapping of levy on fuel exports would help Reliance and Nayara.

File picture of former Reserve Bank Governor Duvvuri Subbarao
| Photo Credit: K.V.S. Giri

U.S. President-elect Donald Trump’s warning that BRICS countries will face 100% tariffs if they choose to move away from the U.S. dollar is unclear to what extent he will carry out his threat, as it remains to be seen if the U.S. laws permit such an action, former RBI Governor Duvvuri Subbarao said on Monday (December 2, 2024).

He also said even for BRICS, there are internal differences about bringing out an alternative to the U.S. dollar. The nine-member group that includes India, Russia, China, and Brazil, moving out of the U.S. currency and having a common one remains a non-starter because of both politics and economics.

“Donald Trump has threatened to slap 100% tariffs on imports from countries that try to move out of the dollar. His ire was particularly directed at the BRICS bloc which has been actively talking about developing an alternative to the dollar. Trump is known to bark more than he bites,” Mr. Subbarao told PTI.

BRICS, formed in 2009, is the only major international group of which the U.S. is not a part. Its other members are South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates.

ALSO READ: What Trump 2.0 means for India and South Asia

Over the past few years, a few of its member countries, in particular Russia and China, are seeking an alternative to the U.S. dollar or creating their own BRICS currency. India has so far not been part of the move.

“It’s not clear to what extent he will carry out his threat. What yardstick will America use to determine if a country has moved out of the dollar? And does American law permit imposing sanctions on countries merely because they are de-dollarising?,” the former RBI chief asked.

In theory, a BRICS common currency would shield the bloc from the perils of dollar hegemony. In practice, that project will remain a non-starter because of both politics and economics, he further said.

It is inconceivable that member countries, not least India, would be willing to give up their monetary policy autonomy and become hostage to a common currency that would be vulnerable to instability anywhere in the bloc, he added.

Replying to a query, Subbarao said the costs of moving out of the dollar are high for both China and India, but the former is better placed because of its large trade footprint and its BRI projects in emerging economies.

Over the last decade, China has been fairly successful in internationalising the RMB (its currency) and a significant part of Chinese trade is invoiced and settled in that currency.

A large portion of Chinese loans under the BRI (Belt and Road Initiative) are denominated in RMB and in contrast, India’s share in global trade is low. It still needs investment in hard currencies, particularly the US Dollar. India has a long way to go before the Rupee can become international, Subbarao opined.

Moreover, because of its outsized economic muscle, China would easily dominate the BRICS and hence the fortunes of the common currency.

“No matter the rhetoric about a new world order, it will be ironic if to escape the dominance of the dollar, the BRICS members succumb to the alternative of an authoritarian regime with a dubious reputation for institutional integrity, transparency and rule of law,” he added.

Union Home Minister Amit Shah in Agartala.
| Photo Credit: ANI

“More than 37,500 Bru tribals, who were affected by the ethnic violence in Mizoram in the late 1990s and 2009, have been rehabilitated in Tripura at a cost of ₹821 crore provided by the Union Home Ministry,” officials said in Tripura’s Ambassa. Union Home Minister Amit Shah visited some of these refugees in Tripura, on Sunday (December 22, 2024.)

“On January 16, 2020, a quadripartite agreement was signed among the Governments of India, Tripura, Mizoram and representatives of Bru organisations for the permanent rehabilitation of Bru migrants in Tripura,” officials said.

Who are the Brus, and what are the implications of settling them in Tripura?

While about 70% of the Bru (Reang) tribals are Hindu, the remaining are Christians. Bru migrants from three districts of Mizoram — Mamit, Lunglei and Kolasib districts — moved to the North Tripura district in 1997, 1998 and 2009 due to serious ethnic violence in Mizoram between Bru and Mizo communities.

A total of 12 locations have been identified in Tripura for establishing resettlement colonies for Bru tribals out of which nine locations are in forest land and three locations are on government land. These 12-selected locations are in four districts of North Tripura, Dhalai, Gomati and South Tripura. “A total of 754 acres of land has been made available to resettle these families. Settlement works are going on in these 12 identified locations,” officials said.

“The final figure for families for rehabilitation under the agreement stands at 6,935 with population of 37,584,” the officials said.

Common development works such as laying of power lines, brick soling of internal roads, installation of deep tubewells for providing drinking water, building power infrastructure, connectivity to households, installation of solar street lights, opening of new fair price shops, anganwadi centres, schools and health sub-centres have been almost completed in 11 locations.

While 11 colonies are fully functional, the common developmental works of the last approved resettlement colony — Kala Lawgang in South Tripura district — is going on and likely to be completed by the end of this financial year.

Overall ₹821.98 crore is being spent to resettle these families in 12 colonies, another official said. Out of which, ₹793.65 crore is being borne by the Union Home Ministry and ₹28.34 crore is being borne by the State Government for common development works.

Till date, the Home Ministry has released ₹693.13 crore of which ₹406.42 crore was given directly to the beneficiaries under direct benefit transfer. The pact gives a comprehensive development package for each family being rehabilitated in Tripura.

As per the resettlement package, a one-time financial assistance of ₹4,00,000 per family is given as fixed deposit for two years. A piece of land in clusters measuring 30×40 feet for construction of house and house building assistance of ₹1,50,000 per family in three equal instalments is given.

Monthly cash assistance of ₹5,000 per family per month for a period of two years from the date of shifting to new location is also given.

Free ration to each family for two years from the date of resettlement in Tripura as per the existing norms is also part of the package besides free transportation to move from the present temporary camps to the location of resettlement in Tripura.

“All cash assistance is being provided through the Direct Beneficiary Transfer (DBT) scheme,” the officials said. Through several efforts, 1,244 families comprising 6,367 people were repatriated to Mizoram in eight phases.

However, the remaining 6,935 families comprising 37,584 people did not move to Mizoram and are staying in seven relief camps in North Tripura district.

Currency notes of ₹2,000 denomination remain legal tender even after it was removed from circulation. File photo.
| Photo Credit: Ragu R

The total value of ₹2,000 banknotes in circulation, which was ₹3.56 lakh crore at the close of business on May 19, 2023, when its withdrawal was announced, has declined to ₹6,839 crore at the close of business on November 29, 2024, the Reserve Bank of India (RBI) said on Tuesday (December 3, 2024). 

“Thus, 98.08% of the ₹2000 banknotes in circulation as on May 19, 2023, has since been returned,” it said.

Data | ₹2,000 Banknotes: A fading presence

The RBI had announced the withdrawal of ₹2,000 denomination banknotes from circulation on May 19, 2023. However, it continues to be a legal tender.

The facility for deposit and/or exchange of the ₹2,000 banknotes was available at all bank branches in the country upto October 7, 2023.

The facility for exchange of the ₹2,000 banknotes is available at the 19 Issue Offices of the Reserve Bank (RBI Issue Offices) since May 19, 2023. 

From October 9, 2023, RBI Issue Offices are also accepting ₹2,000 banknotes from individuals and entities for deposit into their bank accounts. Further, members of the public are sending ₹2000 banknotes through India Post from any post office within the country, to any of the RBI Issue Offices for credit to their bank accounts.

It is the GST Council chaired by the Union Finance Minister and including Ministers of all the States/UTs, which is empowered to recommend GST rates including changes to them. 
| Photo Credit: PTI

Statement from the Central Board of Indirect Taxes (CBIT) and Customs on GST rate hike reports that have been doing the rounds since last night

There are various reports in the media regarding the Group of Ministers (GoM) recommendations on GST rate changes regarding various goods and services. The reports in public media on the basis of GoM deliberations are premature and speculative.

A Group of Ministers (GoM) was constituted to look into the GST rate rationalization apart from certain other issues referred by the GST Council. The GoM comprises of Hon’ble Ministers from the States of Bihar, Uttar Pradesh, Rajasthan, West Bengal, Karnataka and Kerala with the deputy Chief Minister of Bihar as the Convenor.

It is the GST Council chaired by the Union Finance Minister and including Ministers of all the States/UTs, which is empowered to recommend GST rates including changes to them.

The GoM is only a recommendatory body. The GST Council has not yet deliberated on any GST rate changes.

The Council has not even received the recommendations of the GoM. In fact the GoM has yet to finalise and present its recommendations to the Council after which the Council will take a final view on the recommendations of the GoM. The reports in the media are thus premature and speculative.

CAD Foundation President Dr. Padmanabha Kamath presents an ECG machine donated by Mangalore Refinery and Petrochemicals Ltd., to a PHC representative in Mangaluru on December 18, 2024.
| Photo Credit: SPECIAL ARRANGEMENT

Mangalore Refinery and Petrochemicals Limited (MRPL), in collaboration with Cardiology at Doorsteps (CAD) Foundation Trust, distributed 64 ECG machines to Primary Health Centres (PHCs) and Namma Clinics across Dakshina Kannada district on Wednesday (December 18, 2024) here.

Distribution of ECG machines to PHCs was an initiative to enhance primary healthcare services in the district, said a release. The project, with an estimated cost of ₹18.8 lakh, aims to improve access to essential diagnostic tools and strengthen the healthcare infrastructure in rural and urban areas.

Zilla Panchayat CEO K. Anandh, CAD Foundation Trust President Padmanabha Kamath, District Health Officer H.R. Thimmaiah, MRPL Chief General Manager Manoj Kumar and others were present.

Mr. Manoj Kumar said MRPL was committed to enhancing community welfare. He said, “Healthcare is a fundamental right and we are proud to contribute towards improving diagnostic capabilities at the grassroot level. We hope this initiative will empower healthcare workers and ensure timely medical interventions.”

Dr. Kamath echoed similar sentiments, highlighting the importance of ECG machines in early detection and management of cardiac conditions, particularly in rural settings.

The release said the initiative underscores MRPL’s dedication to corporate social responsibility and its ongoing efforts to address critical healthcare needs in the region. By equipping PHCs and Namma Clinics with ECG machines, MRPL and CAD Foundation Trust aim to bridge the gap in healthcare delivery and create a lasting impact on community well-being.