Digital Economy Current Affairs - 2019
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The Union Government has shifted the responsibility of promoting digital transactions in the country to the Union Ministry of IT and Electronics (MEITY) from NITI (National Institution for Transforming India) Aayog.
In this regard, Government already has changed the business transaction rules to enable MEITY to promote digital transactions, including digital payments.
- This decision was taken in view of the core competence of MEITY to promote digital means for various transactions.
- NITI Aayog which is a think-tank is more focused on monitoring and suggesting ways to improve various government schemes rather than getting involved with implementation.
- MEITY is responsible for promotion of e-governance schemes for empowering citizens as well as promoting inclusive and also sustainable growth of electronics and IT sector and IT-enabled services industries.
Earlier, the Central Government had set up a committee under the chairmanship of NITI Aayog CEO Amitabh Kant to push adoption of e-transactions amid the cash crunch faced by citizens due demonetisation. NITI Aayog also implemented two programmes Lucky Grahak Yojana and Digi-Dhan Vyapar Yojana to promote e-payments. Transfer of the business to Ministry will help Government to effectively promote digital transactions to achieve its target of reducing cash to GDP ratio to around 8%, which is at present hovering over 13% in the country.
The Union Cabinet has approved a draft ordinance to empower states and allow industries to pay workers’ wages digitally, through a direct bank transfer to accounts or by cheque in a bid to encourage cashless transactions.
The draft ordinance proposes changes to the Section 6 of the Payment of Wages Act, 1936 to encourage cashless transactions. It will need the President’s assent to become law as per article 123 of the Constitution.
- It will allow industries to pay wages to workers earning up to Rs. 18,000/ month, without taking their explicit consent as required under present Act.
- However, wage payment through the banking system will only be optional, until State governments or Union Government come up with a notification for specific industries since Labour is in the concurrent list.
- The present law (1936 Act) states that all payment of wages should be in cash. Under it has mandatory provision asking employers to obtain written permission of the worker to pay either by cheque or by crediting wages to his or her bank account.
The payment of wages through cheque or DBT of employed persons has twin motives i.e. it will reduce complaints regarding non-payment or less payment of minimum wages and serve purpose of digital and less cash economy. The move is significant in view of the Union Government is promoting cashless transactions after its decision to scrap the old high value Rs. 500 and Rs. 1,000 currency notes. Earlier Payment of Wages (Amendment) Bill, 2016 introduced in the Lok Sabha during 2016 winter session but was not cleared owing to the impasse in Parliament.