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Silver lining: Record wheat, rice stocks
Patel: Air India must remain in govt hands
Forex reserves dip
Investor Guidance |
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Aviation Notes Let a professional head DGCA Should chief of the All-India Institute for Medical Sciences (AIIMS) be any one other than a doctor?
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Silver lining: Record wheat, rice stocks
New Delhi, June 21 “We take comfort in the fact that there has been record production of wheat and paddy. We have adequate stocks of wheat and rice. We have procured 220 lakh tonnes of wheat, and so far, 260 lakh tonnes of rice. We will provide adequate wheat and rice to the PDS and also use our stocks to moderate prices in the open market. Hence, there is no cause for worry regarding wheat and rice,” finance minister P. Chidambaram said. Wheat procurement by government agencies crossed the 220-lakh tonne mark this year as against 11.13 MT last year. The state-wise procurement includes Punjab (9.9 MT), Haryana (5.2 MT), Uttar Pradesh (2.8 MT), Madhya Pradesh (2.3 MT), Rajasthan (0.9 MT), Gujarat (0.4 MT), Bihar (0.36 MT), Uttarakhand (80,000 tonnes), Chandigarh (10,000 tonnes), Delhi (6,500 tonnes), Maharashtra (6,500 tonnes) Jharkhand (1,200 tonnes), Jammu and Kashmir (990 tonnes) and Himachal Pradesh (232 tonnes). Expectations of a good monsoon are also adding to the government’s comfort level. However, persistent rise in oil prices is likely to add to input costs of food production for which the government needs some urgent measures, experts say. Meanwhile, in another respite-providing attempt against inflation, the government will make edible oil available at subsidised rates through ration shops in 15 states from next month. These states are Andhra Pradesh, Chhattisgarh, Gujarat, Himachal Pradesh, Jammu & Kashmir, Madhya Pradesh, Maharashtra, Meghalaya, Nagaland, Orissa, Rajasthan, Sikkim, Tamil Nadu, Tripura and West Bengal. The government scheme included the distribution of 10 lakh tonnes of imported edible oils in 2008-09 at a subsidy of Rs 15 per kg at the rate of one kg per ration card per month. Public Sector Undertakings (PSUs), including PEC, MMTC, STC and NAFED, have been given the job of import, refining, packing and distribution of subsidised edible oils. The subsidy will be around Rs 1,500 crore. PSUs have already contracted import of 1.79 lakh tonnes of edible oils and distribution to the ration cardholders will begin next month. The availability of edible oils from domestic sources is less than the demand. The import dependence on edible oils has been 34 per cent to 39 per cent of the total consumption of edible oils during the last three years. Unprecedented rise in international prices of edible oils in the last two years also affected domestic prices.
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Patel: Air India must remain in govt hands
New Delhi, June 21 Justifying his earlier statements that the merged carrier must “perform or perish”, he said: “It is after more than 15 years that the government has given a signal that the national carrier must be allowed to grow and flourish and must remain in government hands.” Patel said this in reply to a letter by the joint action committee of several unions, associations and guilds of Air India. The minister said: “You will recall the previous government’s decision to sell the carriers. The bidding process had almost reached a state of finality and had bidders not withdrawn at the last moment, our present exchange would have been history.” “Not only that, they never gave the carriers a level-playing field and you will recall my statements that AI and Indian Airlines can not compete with their hands tied,” he added.
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Forex reserves dip
New Delhi, June 21 The Reserve Bank has registered a drop of nearly $4.93 billion for week ended June 13, taking the net position to $310.687 billion. The drop comes as a shock at a time when foreign exchange obligations are rising and will continue to do so on account of high crude oil prices, say experts. They state that the money that is exiting the country is that of Foreign Institutional Investors (FIIs) who
have been pouring billions in bourses and real estate markets till last year. Adding to the woes is also the depreciating dollar in the past few months and this is what needs to be seen as to how far will the world’s most traded currency decline, warn experts. Reserves had jumped to a record $315.66 billion for the week ended June 6, 2008, up by a meager $1.046 billion. The foreign currency assets, which stood at $305.92 billion last week declined to $300.955 billion, the RBI stated. The foreign currency accounts expressed in dollar terms include the effect of appreciation or depreciation of non-US currencies such as euro, sterling and yen held in reserves, the RBI stated. Gold reserves and special drawing rights during the week stood static at $9.202 billion and $11 million respectively, the RBI said.
The country’s reserve position in the International Monetary Fund during the week registered a fall of $8 million. It stood at $519 million as compared to $527 million in the previous week, the |
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Investor Guidance
Q: 1) I read in AMFI (association of mutual funds of India) study material that a foreign citizen is not allowed to invest in mutual funds in India even though he/she may be of Indian origin.
But my question is if a person is a PIO (person of Indian origin) then why such a person is not allowed to invest in India just because he/she is a citizen of some other country. Moreover, it is unfair as all NRIs are allowed to invest in Indian 2) If a foreign citizen of Indian origin gets an OCI (overseas citizenship of India) and comes back to India for good and is working in India, in that case he/she should be eligible for tax benefits under Section 80C but according to bank officials such a person is not eligible to invest in PPF. Is that correct? 3) If an OCI comes to India for good , is he/she allowed to invest in Indian A: (1)) As per the position of law, PIOs can definitely invest in Indian mutual funds. This is as per the Foreign Exchange Management Act
(FEMA). Some MFs do not accept applications from persons with US address. However, this is more to do with SEC (US Securities and Exchange Commission) specifications than Indian laws. (2) NRIs and PIOs can avail of the tax deduction under Section 80C. Individual instruments under 80C may have differing rules. As far as PPF is concerned, NRIs and PIOs aren’t allowed to open a fresh PPF account.
However, already existing PPF accounts may be continued. In the case cited by you, if the PIO were to come to India for employment, he loses the person resident outside India status and becomes a resident as per FEMA. Hence he can invest in PPF. (3) The answer to your third question has already been covered in point (1) above. Whether the OCI comes to India or not, he/she is eligible to invest in ELSS funds. Family pension
Q: I am a senior citizen retired employee getting pension plus family pension of my wife. Please advice if standard deduction is still allowed on family pension. A: Standard deduction on employee salary has been deleted by the Finance Act, 2005, but family pension which attracted a deduction similar to standard deduction has not fortunately been touched. Where any family member of a deceased employee gets a pension after the demise of an employee, Section 57(iia) grants deduction of 33 1/3 per cent with a ceiling This means that your own pension is not eligible for any deductions whereas the family pension is eligible. HRA deduction
Q: I have bought a house some years ago that is jointly owned by my parents. I am a co-applicant in it. Can I claim tax benefit on interest paid? I am already claiming HRA. If yes, then how do I go about it? A: It is not clear when you say that you have bought a house that is jointly owned by parents. It seems from your query that the house is in parents’ name and you are co-applicant for the loan. The interest deduction is available for property purchased using housing finance.
If you are claiming HRA deduction, it implies that you are renting the property from your parents. If so, how can you claim tax benefit on interest? That is paradoxical. Senior citizen
Q: Recently for the new financial year (08-09), tax free limit (income below which tax is not payable) for senior citizen has been increased to Rs. 2.25 lakh. This information was given to me by my cousin in India. I am 68 years of age and have some Indian income in terms of interest from bank deposits and rental income. I wanted to confirm if the information provided by my cousin is correct or not. A: While it is true that for FY 08-09, the basic exemption limit for senior citizens (65 years and above) has been increased to Rs 2.25 lakh, the same is only applicable to resident Indians and not
NRIs. For NRIs, the general limit of Rs 1.50 lakh is applicable. Incidentally, this general limit too has been increased from the erstwhile Rs 1.10 lakh. The authors may be contacted at wonderlandconsultants@yahoo.com |
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Aviation Notes
Should chief of the All-India Institute for Medical Sciences (AIIMS) be any one other than a doctor?
Or, put it more plainly, should director of the AIIMS be an IAS-cadre official, no matter how competent? The opinion of all commanders, pilots, engineers, air-traffic-controllers and airline bosses is that non-technical official, taking over as chief of the directorate-general of civil aviation (DGCA), is nothing but a sure sign of ‘bankruptcy’ of talent in aviation sector. Does this mean boom of aviation or bane of aviation? It is shocking that none of There is at least one who should have been promoted. If he can be joint director-general for years, why can’t he be director-general? Among the three, who were interviewed by the Union Public Service Commission, two belonged to IAS-cadre and third was from Air Force. The DGCA’s functioning is as complex and technical-oriented as that of any specialised medical institute. Apart from licencing of cockpit crews, it also has to consider air-worthiness of civil aircraft. There was a time when regulatory unit on pilots, under Air Marshal Denzor Keeler, was talk of the aviation sector. It has now been virtually non-existent. Former Prime Minister Rajiv Gandhi, Many senior DGCA officials are said to have sent a ‘protest’ letter to the civil |
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