GS Paper III-Infrastructure: Energy, Ports, Roads, Airports, Railways etc.

Draft steel policy to enable ₨10 lakh crore investments

What’s Happening-
The Steel Ministry has proposed setting up greenfield steel plants along India’s coastline to tap cheap imported raw materials such as coking coal and export the output in a more cost-effective manner, as part of the new draft National Steel Policy of 2017.

Key sectors discussed were:

  • The policy, which envisages to more than double India’s domestic steel production capacity to 300 million tonnes by 2030-31
  • It anticipates a requirement of ₹10 lakh crore of fresh investments.
  • To meet that goal and expects at least 11 lakh new jobs being created in the process.
  • The draft policy lays out two alternatives of its vision
  • To create a globally competitive steel industry that promotes inter-sectoral growth or
  1. To create a self-sufficient steel industry that is technologically advanced, globally competitive and promotes inclusive growth.

PSU units:

  • Public sector firms in the steel sector should aim for economies of scale and will be encouraged to divest their non-core assets through mergers and restructuring, according to the policy.
  • Establishment of steel plants along the coast under the aegis of Sagarmala project will be undertaken.
  • Such plants would be based on the idea of importing scarce raw materials and exporting steel products.
  • cluster-based approach: will be pursued, especially for micro, small and medium enterprises to ensure optimum land use, easy availability of raw materials and economies of scale.

Background-
The steel sector presently employs about 25 lakh people and has a capacity of little over 120 million tonnes.
Present problems in steel sector like high input costs, availability of raw materials, import dependency and financial stress plaguing the sector.

Way Ahead: India needs
To cut down reliance on expensive imports of coking coal.
Along with –
The policy should address gas-based steel plants and technologies such as electric furnaces to bring down the use of coking coal in blast furnaces.

Sources- The Indian Express, The Hindu. Page 17

GS Paper I- Issues relating to poverty and hunger.

Co-operative banks cannot take deposits under PMGKY

What’s Happening-

  • The government has barred co-operative banks from accepting deposits under the Pradhan Mantri Garib Kalyan Yojana, 2016. This comes in the backdrop of the Income Tax department finding that a number of such banks were suspected of converting black money into white, during the demonetisation drive.

Key Points discussed were:

  • Under the PMGKY scheme, taxpayers have to deposit 25 per cent of the declared amount as interest-free deposits for four years.
  • This is apart from the 50 per cent tax that have to paid by declarants under the scheme.
  • The RBI had earlier said this deposit could be made with any banks.
  • But now, cooperative banks have been barred from accepting such deposits.
  • The scheme is open till March 31.
  • The finance ministry did not give details on why it amended the rules to prevent cooperative banks from accepting deposits under the scheme.
  • Under the scheme, holders of unaccounted cash willing to avail the offer will have to first pay the tax amount and then fill up a challan form provided by the bank for availing the four-year deposit scheme.

Why Cooperative Banks are Excluded:

  • During the 50-day demonetisation period, the income tax department had found various irregularities in co-operative banks’ operations such as backdating of cash deposits, structuring deposits in multiple accounts to escape reporting norms, their management using the bank to launder personal unaccounted cash.

Tax department steps up scrutiny:

  • Income Declaration Scheme (IDS) last year, the tax department has stepped up its investigations for deposits of unaccounted cash post demonetisation, prompting many people to come clean under the (PMGKY).
  • Based on information about deposits worth Rs 140 crore, the Pune Investigation.
  • The Hyderabad Investigation Directorate has also conducted several searches and surveys, among which a jeweller was found to have deposited cash over Rs 100 crore in the scrapped currency of Rs 500 and Rs 1,000 notes.
  • Others…