Current Affairs - January 2017

Finance Ministry to aid Rashtriya Rail Sanraksha Kosh for rail safety

The Union Finance Ministry has agreed to contribute partially to a new dedicated railway safety fund named as ‘Rashtriya Rail Sanraksha Kosh’ in the upcoming Union Budget 2017-18.

The proposed safety fund will be utilised for track improvement, bridge rehabilitation, rolling stock replacement, human resource development, improved inspection system and safety work at level crossing, among other things.

Key Facts
  • The Finance Ministry is likely to grant a fresh infusion of only Rs. 5,000 crore in the upcoming financial year out of the initial proposed corpus of Rs. 20,000 crore.
  • About Rs. 10,000 crore will be earmarked from the Central Road Fund (CRF) that is collected by levying a cess on diesel and petrol at present for safety-related work.
  • Railways may now be asked to fund the remaining Rs. 5,000 crore for the initial corpus from its own resources.
  • For this Indian Railway’s may either have to bring back a cess on rail tickets to finance its share of Rail Safety Fund or look to fund it from non-budgetary resources. 
Background

The Railway Ministry had requested the Union Finance Ministry to create ‘Rashtriya Rail Sanraksha Kosh’, a ‘non-lapsable’ safety fund of Rs. 20,000 crore over five years. Its request was based on the recommendations of a high-level safety review committee headed by Dr. Anil Kakodkar, former Chairman Atomic Energy Commission.  The Committee, in its report submitted in 2012, had projected an investment requirement of Rs. 1 lakh crore on safety over five years.

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IT Ministry urges tax incentives for PC manufacturers too

The Ministry of Electronics and Information Technology (MeitY) in its key recommendations for Union Budget 2017-18, has suggested differential excise duty regime and tax exemptions to be expanded to personal computers and servers.

Ministry’s suggestions were as per the Phased Manufacturing Roadmap, it had worked out in consultation with the NITI Aayog.

Recommendations for Budget
  • Retain differential excise duty regime and tax exemptions granted for the manufacture of mobile handsets and tablets, under the impending GST regime, to boost domestic manufacturing of electronic products.
  • The current differential duty makes imports of mobile handsets more expensive compared with making them locally, encouraging smartphone players to set up manufacturing units in India.
  • Specified capital goods for the manufacture of electronic goods be exempted from basic customs duty and countervailing duties to increase the competitiveness of the Indian electronics Industry.
  • Specified key raw materials and inputs for the boosting manufacture of LCD and LED panels should be permitted at 0% customs duty.
  • Extension of income tax benefit for research and development (R&D) to software products and the chip design industry. The proposal is expected to boost the generation of intellectual property in the country.

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