Demands of the Bank Unions/Associations



Demands of the Bank Unions/Associations

The total strikes observed by the Bank Unions/Associations in Public Sector Banks during the last three years and the current year are eighteen (18). The demands of bank’s unions/associations mostly relate to immediate wage settlement, stop outsourcing of bank jobs, stop banking sector reforms, improvement in pension schemes, provide compassionate appointments in banks etc. The estimated loss suffered from such strikes is not quantified.


The settlements arrived at between Unions of the workmen employees and Indian Banks’ Association (IBA) on behalf of member banks are bound on all the parties to the settlements as per the Industrial Disputes Act, 1947. As such, all member banks including Associate Banks of SBI, parties of Settlements are to implement the said settlements without violating the agreed terms and conditions of the settlement.

Conciliation meetings were held with the representatives of the Unions/Association at the office of Chief Labour Commissioner to avert the strike.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Issue of RuPay Cards

The number of RuPay Cards issued till 31.1.2016 are 24,85,79,824 as informed by the National Payments Corporation of India (NPCI).

In order to promote RuPay Card the Government of India has launched Pradhan Mantri Jan Dhan Yojana (PMJDY) on 28th August, 2014. The Yojana envisages universal access to banking facilities with at least one basic banking account for every household, financial literacy, access to credit, insurance and pension. The bank account holders of PMJDY also get a RuPay Debit Card having inbuilt accident insurance over of Rs. 1.00 lakh.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Growth Rate

The growth rate of Gross Domestic Product (GDP) at constant (2011-12) market prices increased from 6.6% in 2013-14 to 7.2% in 2014-15 and is estimated to increase to 7.6% in 2015-16, indicating that the growth rate of the Indian economy has improved int eh last three years. Economic Survey 2015-16 observes, “as per the estimates of the International Monetary Fund (IMF), global growth averaged 3.1% registered in 2015, declining from 3.4% in 2014. While growth in advanced economies has improved modestly since 2013, the emerging economies have witnessed a consistently declining trend in growth rate since 2010. It is against this background that the recent Indian growth story appears particularly bright”.

The Economic Survey 2015-16 tabled in the Parliament on 26.2.2016 gives a comprehensive account of the state of the Indian economy. Economic reforms have a high priority on the agenda of the Government. The Government of India has taken various steps to boost the growth of the economy which, inter-alia, include administrative and regulatory measures to accelerate growth in manufacturing sector, initiatives for industrial corridor development; measures to debottleneck the supply of key raw materials; “make in India” initiative along with the attendant facilitatory measures intended to create a more conducive environment for investment; and skill India initiative. Start-up India initiative has been launched to boost entrepreneurship and creation of jobs, Pradhan mantra Jan Dhan Yojana aim at financial inclusion and boost to household financial savings. Micro Units Development and Refinance Agency Ltd, and “Stand Up India” schemes have also been launched to promote entrepreneurship, the later focusing on SC/ST and women entrepreneurs. Steps have also been taken to improve clarity and transparency in economic policies. The Budget 2016-17 continued the Government’s growth promoting agenda with many measures which, among others, include: continued push to domestic demand; measures to improve agricultural growth and infrastructure, particularly rural infrastructure; and, time-bound plans for rural electrification and connectivity; boost to manufacturing with rationalization of customs and excise duties; liberalized FDI policy in various sectors; and improved ease of doing business for start-ups.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Online Application for Withdrawal under New Pension Scheme

The Pension Fund Regulatory and Development Authority (PFRDA) had issued a Circular dated February 25, 2015, making it mandatory for all the Nodal Offices to process the withdrawal claims of their underlying subscribers on the online platform made available on the Central Recordkeeping Agency (CRA) system from April 1, 2015. However, it was observed that majority of the withdrawal requests were still being received in physical form (without capturing online withdrawal request) resulting in delay in processing of withdrawal claims of the subscribers. Therefore, it has been decided that with effect from April 1, 2016 only such withdrawal requests raised on online platform will be accepted at CRA for further processing and settlement.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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National Investment and Manufacturing Zones (NIMZs)

The Government has announced eight Investment Regions along the Delhi Mumbai Industrial Corridor (DMIC) project as National Investment and Manufacturing Zones (NIMZs). The details are as under:

i)                    Ahmedabad-Dholera Investment Region, Gujarat
ii)                  Shendra-Bidkin Industrial Part city near Aurangabad, Maharashtra
iii)                Manesar-Bawal Investment Region, Haryana
iv)                Khushkhera-Bhiwadi-Neemrana Investment Region, Rajasthan
v)                  Pithampur-Dhar-Mhow Investment Regioin, Madhya Pradesh
vi)                Dadri-Noida-Ghaziabad investment Region, Uttar Pradesh
vii)              Dighi Port Industrial Area, Maharashtra, and
viii)            Jodhpur-Pali-Marwar Region in Rajasthan.

Fourteen NIMZs outside the DMIC region have also been given in-principle approval (i) Nagpur in Maharashtra, (ii) Prakasam in Andhra Pradesh, (iii) Chittoor in Andhra Pradesh, (iv) Medak in Telangana, (v) Hyderabad Pharma NIM in Rangareddy and Mahbubnagar Districts of Telangana, (vi) Tumkur in Karnataka, (vii) Kolar in Karnataka, (viii) Bidar in Karnataka, (ix) Gulbarga in Karnataka, (x) Kalinganagar, Jajpur District in Odisha, (xi) Ramanathapuram District of Tamil Nadu, (xii) Ponneri, Thiruvallur District, Tamil Nadu, (xiii) Auraiya District in Uttar Pradesh, and (xiv) Jhansi District in Uttar Pradesh.

Out of these NIMZs, the NIMZs at (i) Prakasam in Andhra Pradesh and (ii) Medak in Telangana have been granted final approval. The National Manufacturing Policy is based on the principle of industrial growth in partnership with the States. It is the prerogative of the States to adopt the instrumentalities provided by the policy.

For the Financial Year 2016-17, Rs. 3.35 crores has been earmarked under the ‘Scheme for Implementation of National Manufacturing Policy’ for ‘Master Planning of NIMZs’ and Technology Acquisition and Development Fund (TADF).


This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Levy of Minimum Alternate Tax

Section 115JB of the Income-tax Act, 1961 (the Act) provides that in case of a company, if the tax payable on the total income as computed under the Act in respect of any previous year relevant to the assessment year commencing on or after 1.4.2012, is less than eighteen and one-half per cent of its book profit, such book profit shall be deemed to be the total income of the assessee and the tax payable by the assessee for the relevant previous hear shall be eighteen and one-half per cent of its book profit. This is called Minimum Alternate Tax (MAT).

The spirit behind levy of MAT is that every person participating in the economy must contribute to the exchequer. As a result of various exemptions, deductions and other tax incentives in the corporate sector, the revenue forgone has been climbing up significantly. MAT is aimed at recouping a part of the loss in revenue collection on account of exemptions, deductions and other tax incentives in the corporate sector. MAT was introduced to address inequity in taxation of corporate tax payers and to promote inter-se equity among them.

There were representations received from various stakeholders on the issue of levy of MAT. In the wake of representations, the Government constituted Justice Shah Committee to look into the issue which submitted its report to the Government on 25.8.2015. Taking into account all relevant facts, it was decided by the Government that MAT shall not be applicable to a foreign company, if the foreign company does not have a permanent establishment under relevant Double Taxation Avoidance Agreement (DTAA) or a place of business in India. Accordingly, Finance Bill 2016 proposes to amend the law with retrospective effect from 1.4.2001 to give effect to the above decisions.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Start-up Action Plan

The Reserve bank of India (RBI) has launched a Start-up Action Plan to enable easy access of foreign funds for Indian Start-up. In keeping with the Government’s Start-up initiative, the RBI has taken steps to ease doing business and contribute to an ecosystem that is conducive for growth of start-ups. These measures are directed towards enabling framework with respect of cross border transactions (including foreign investments, external commercial borrowings, trade etc.,) to start-ups for receiving foreign venture capital, differing contractual structures embedded in investment instruments, deferring receipt of considerations for transfer of ownership, facilities for escrow arrangements and simplification of documentation and reporting procedures.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Bank Loan to Women

Reserve Bank of India (RBI) vide circular dated May 5, 2003 has issued Guidelines on Fair Practices Cod for Lenders which inter-alia provide that lender must not discriminate on grounds of sex, caste and religion in the matter of lending and as such public and private sector banks cannot deny a single woman/unmarried female home loan products, insisting that single women applicants to bring along a co-applicant.

Banks have reported that home loans to individuals need to comply with their respective eligibility criteria irrespective of gender and marital status. Bhartiya Mahila Bank offers single woman home loan products without co-applicant/guarantor, depending on the viability of the proposal.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Rationalization of Interest Rates of Small Savings Scheme

The Pension Fund Regulatory and Development Authority (Pension Fund) Regulations, 2015 has been formulated and notified on 19th May, 2015. PFRDA regulations have not specifically stipulated any fixed investment management fee. However, Regulation 20 of the Pension Fund Regulatory and Development Authority (Pension Fund) Regulations, 2015 states that the rate and manner of charging the investment management fee shall be determined in accordance with the procedure as may be laid down by the Authority from time to time and shall be subject to such revision as deemed necessary in subscribers interest and for orderly growth of the pension sector.

Thus, the Pension Fund Regulatory and Development Authority (Pension Fund) Regulations, 2015 provide sufficient flexibility to the PFRDA to lay down the process of selection of pension funds, wherein the determination of investment management fee can be laid down taking into account the interest of subscribers, the orderly growth of pension industry including suitable incentives for the intermediaries (Pension Funds).

In terms of A.P. (DIR Series) Circular No. 17 dated September 29, 2015, issued by the Reserve Bank of India (RBI), any corporate or body corporate, Real Estate Investment Trusts and Infrastructure Investment Trusts are eligible to issue Rupee denominated bonds overseas. However, banks incorporated in India have not been allowed access to these bonds in any manner whatsoever.

In the context of easing the transmission of the lower interest rates in the economy, the Government has taken a comprehensive view on the social goals of certain National Small Savings Schemes. Accordingly, the following would eb effective from 1.4.2016:

i. The 25bps spread that 1 year, 2 year and 3 year term deposits, KVPs and five year Recurring Deposits have over comparable tenure Government securities, shall stand removed.

ii. Further, the interest rates of all small saving schemes would be recalibrated on a quarterly basis, to align the small saving interest rates with the current market rates of the relevant Government securities.

iii. The compounding of interest which is bi-annual in the case of 10 year National Savings Certificate (discontinued since 20.12.2015), 5 year National Savings Certificate and Kisan Vikas Patra, shall be done on an annual basis from 1.4.2016.

This is expected to help the economy move to a lower overall interest rate regime eventually and thereby help all, particularly low income and salaried classes.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Custom Clearances through 24x7 Electronic Data Interchange (EDI) Systems

There are 17 Air Cargo Complexes at airports in India that facilitate customs clearances through 24x7 Electronic Data Interchange (EDI). Despite having a 24x7 clearances system, bulk of trade clearances happens in the morning while the facilities at night is underutilized. The factors responsible for this are additional costs to be borne by trade on account of service charges by clearing agents, availability of staff of other regulatory agencies, banks etc, which are not providing 24x7 services.

Steps taken to ensure faster clearances through EDI during day time to facilitate ease of business are:

i) The Customs applications have been upgraded to quicken the processing of the electronically filed documents and also to increase the speed of message exchange with the custodians at the Air Cargo Complexes at the Airports.

ii) The information provided by Customs through the messages to the custodians at Delhi and Mumbai i.e, DIAL and MIAL respectively, are being used by them to provide various services through mobile applications to speed up the clearances.

iii) Central Board of Excise and Customs has already introduced a system of Risk Management System whereby the consignments are selectively interdicted for assessment and examination on the basis of risk involved. Majority of the consignments are facilitated. This decreases dwell time.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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India ranked 22nd of 60 Countries in the Best Countries Report 2016

            India has been ranked 22nd out of 60 counties in the Best Countries Report 2015, summary of which is available at http://www.usnews.com/ness/best-countries/articles/methodology. The countries were ranked based on the data from a proprietary perception survey developed by U.S. News, BAV Consulting and the Wharton School of University of Pennsylvania. The sample fo the survey included 16,248 respondents – general population, informed elite and business decision makers – across 36 countries in four regions: the Americas, Europe, Middle East/North Africa and Asia. The 60 countries were selected based n a composite performance ranking of key business, economic and quality of life data. To be included in the Best Countries rankings, a country had to be ranked in the United Nation’s Top 100 countries in terms of 2013 GDP, the World Bank’s Top 100 Countries in terms of international tourism, the United Nation’s top 150 countries in the 2014 Human Development Index and the United Nation’s Top 100 Foreign Direct Investment Inflows 2013 report.

            To determine the rank, the qualitative attributes from the perception data were used to categorise sub rankings for the countries. The weight of each sub ranking score was correlated to 2014 gross domestic product purchasing power parity per capita, a measure of inclusive prosperity, as reported by the International Monetary Fund. However, the score on the attributes will determine the sub ranking scores which will add to the aggregate score for ranking. Therefore, the low rank cannot be attributed to one singe variable like the population of the country. The rankings are based on how global perceptions define countries in terms of a number of qualitative attributes and may differ from actual ground realities.

            Each country was scored n each of the 65 country attributes based on a collection of individual survey responses to arrive at the rankings. The qualitative attributes for each country were grouped into nine sub rankings to rank the Best Countries. The nine country attributes for the sub rankings are: Adventure, Citizenship, Cultural Influence, Entrepreneurship, Heritage, Movers, Open for Business, Power and Quality of Life. The relative importance, or weight, given to each of the nine sub rankings was based o n the magnitude of that sub ranking’s correlation with per capita purchasing power gross domestic product.

            To arrive at a country’s rank, each country received nine sub ranking scores by averaging its scores for the country attributes grouped into that sub ranking. A country’s overall score reflects the weighted sum of its sub ranking scores. The sub ranking and overall scores were rescaled so that the top country in each category received a value of 100, and others were calculated as a proportion of that top score.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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Recovery of Loans 
            The Government does not have any proposal to form National Asset Reconstruction Company (NARC) for bad loans of stressed banks. However, Debt Recovery Tribunals (DRTs) have been set up by the Government for facilitating recovery of Banks/Financial Institutions’ dues under Recovery of Debts due to Banks and Financial Institutions Act (RDDBFI), 1993. Under Section 19 (24) of the Act, DRTs have been mandated to dispose off the applications filed by Banks/FIs within a period of 180 days from the date of receipt of application.

            The reasons for increase in NPAs include slowdown in recovery in global economy and continuing uncertainty in the global markets leading to lower exports of various products like textiles, engineering goods, leather and gems etc, factors like volatility in prices of raw material and the shortage in availability of power to some sectors. The details of Gross Advances and Gross NPAs to corporate by Scheduled Commercial Banks (SCBs) are as under:

Rs. in Crore
Corporate Lending
Year
Gross Advances
Gross NPAs
GNPA Ratio
2012-13
31,11,761
1,00,118
3.22
2013-14
34,06,025
1,54,955
4.55
2014-15
36,15,133
1,93,123
5.34
2015-16 (till Dec. 15)
38,41,836
2,60,653
6.78

            The Government has taken specific measures to address issues in sectors such as infrastructure (power, roads etc.), steel and textiles, where incidence of NPAs is high. The Government has also approved establishment of six new DRTs to speed up the recovery of bad loans of the banking sector, in addition to existing 33. Reserve Bank of India has also undertaken steps which include (i) formation of Joint Lenders’ Forum (JLF) for revitalizing stressed assets in the system, (ii) flexible structuring for long term project loans to Infrastructure and Core industries, and (iii) Strategic Debt Restructuring (SDR) Scheme.


This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

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