Some good news from our taxman


News In Numbers: September 13

 Rs 153,000 crore

What is it? Central excise tax collections between April and August this year, registering a growth of 49%.

Why is it important? This is a lead indicator of the health of themanufacturing sector, which accounts for around 15% of Indian economy. Latest GDP numbers showed investments have declined in three months between April and June 2016. Combining these two numbers, we could say demand for manufacturing has picked up but not to an extent where producers think it would outstrip their spare production capacity.

Tell me more: Services sector too did well, reporting a 23% growth in April – August 2016. Services account for more than half of Asia’s third largest economy.


What is it? The decline in share price of Cairn India since December 8, 2011, when metals and mining major Vedanta acquired 58.5% in it for $8.67 billion.

Why is it important? Yesterday, shareholders of Cairn India finally gave a nod to merge their company into Vedanta. This ended a multi-year period of uncertainty for Vedanta’s prized entry into the oil and gas sector, which first afoul of the government and then of Cairn shareholders.

Tell me more: During the same period, the BSE Sensex was up 72% and the BSE Energy Index was up 35%.

 2 million tonnes

What is it? India’s planned buffer stock of pulses up from 800,000 tonnes at present.

Why is it important? It will cost the government Rs 18,500 crore, twenty times more than the current allocation of Rs 900 crore in price stabilisation fund. It has to bridge the gap through other internal resources or from the market. The move is aimed at reducing the price of pulses which has shot up on the back of low domestic production in the last two drought ridden years.

Tell me more: Food Minister Ram Vilas Paswan said on Monday that if the retail prices of pulses and certain other food commodities don’t come down, the government would invoke Essential Commodities Actto impose a cap on prices.

12,000 cusecs

What is it? The volume of Cauvery water that Karnataka has to release to Tamil Nadu every day till 20th September, per Supreme Court’s modified order. Earlier it had directed Karnataka to release 15,000 cusecs per day till 16 September.

Why is it important? This has led to violent protests in Karnataka, resulting in destruction of property, and one death from police firing.  Bengaluru police imposed Section 144 on 16 areas in the city on Monday, restricting public assembly and movements. While Karnataka’s reservoirs were only 30% short of water, compared to 49% in Tamil Nadu, overall reservoir capacity in Karnataka is a fourth lower than Tamil Nadu’s.

Tell me more: In its modified order, the Supreme Court criticised Karnataka government for citing public unrest as a reason for seeking a change. “If we are allowed to say then we must say that the tone and tenor of the application is absolutely disturbing. Agitation, spontaneity or galvanized riot or any kind of catalystic component can never form the foundation for seeking modification of an order,” it said.


What is it? The additional runs scored per test innings by Cheteshwar Pujara, as compared to Rohit Sharma, since India’s tour to Sri Lanka in July 2015.

Why is it important? In the recent past, captain Virat Kohli’s preference to play five bowlers has often resulted in the flamboyant but inconsistent Sharma playing over the dour but effective Pujara. Both were included yesterday in the squad for the tests against New Zealand later this month.

Tell me more: During this period, Pujara has scored 409 runs at an average of 45.44. By comparison, Sharma has scored 278 runs at an average of 23.16. Please share it with your colleagues, friends.

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News in numbers, Jan 4, 2016: Pathankot terror attack, revenue from excise duty hikes…


Rs 10,000 crore

What is it? Additional revenue Indian government expects to earn in 2015-16 from hikes in excise duty on petrol and diesel.


Why is it important? It will partially help in covering for the shortfall in revenue from disinvestments in public sector units (PSUs) and direct tax collections. The government had aimed to raise Rs 69,500 crore from selling shares in PSUs but managed to mop up just over 18% or Rs 12,700 crore so far. Between April and November 2015, the direct tax collections was less than half (46.26%) of the budgeted target of Rs 7.97 lakh crore in 2015-16.


Tell me more: The government on Saturday increased excise duty on petrol by Rs 0.37 per litre and by Rs 2 per litre on diesel. This is the third hike in 2015-16 and since November 2014, the seventh. The three excise duty hikes translate to a total increase of Rs 2.27 per litre on petrol and Rs 3.47 a litre on diesel.




What is it? India’s score in the 11th edition of the South Asian Football Federation (SAFF) Championship. India beat defending champion Afghanistan on Sunday.


Why is it important? With this win, India has lifted the SAFF cup for the seventh time. This is also likely to have an impact on India’s position in the Fédération Internationale de Football Association (FIFA) rankings to be released on January 7. From 121 in 2001, India’s ranking has slid to 166 currently, reaching a low of 171 in 2014 since the start of the new millennium.


Tell me more: India had lost to Afghanistan 0-2 in the final match of the 2013 edition.


$522 billion


What is it? Estimated global oil and gas investments in 2016, according to Oslo-based consultancy Rystad Energy.


Why is it important? If this happens, it would be the lowest in six years. In 2015, global investments in this sector had seen a 22% fall to $595 billion. This would also be the first time that there may be a decline in investments for two straight years since the 1986 oil crash, according to Bjoernar Tonhaugen, vice president of oil and gas markets at Rystad Energy . One of the major fallouts of this is the loss of jobs. In November last year, the number of job losses in oil and gas companies had crossed the 250,000 mark worldwide, according to industry consultant, Graves & Co.


Tell me more: Crude oil prices fell 35% in 2015 and are expected to decline even further in 2016. A combination of factors — global glut, suppliers refusing to cut down on production and engaging in price war to attract customers — are responsible for the rapid decline in oil prices.




What is it? Number of military personnel killed in a terrorist attack on Pathankot air base situated in Punjab, about 30 km from the Pakistan border. As many as 20 have been wounded.


Why is it important? Raises questions about security lapses and how the terrorists managed to enter the air base undetected. This is the second attack on Punjab after the Gurdaspur district attack in July 2015 that killed 10 people including the Gurdaspur Superintendent of Police. In the latest terror attack, militants disguised as soldiers, stormed the base a week after Prime Minister Narendra Modi paid an impromptu visit to his Pakistan counterpart Nawaz Sharif. Four terrorists have been reportedly killed and two more are said to be holed up at the base.


Tell me more: The government claimed the operation successful on Saturday but fresh attacks on Sunday, it said the operation was not over yet.


160 million


What is it? Number of one rupee notes issued in 2014-15 and 2015-16 so far by the government.


Why is it important? The cost of printing a one rupee note at Rs 1.14, exceeds its value – and the life of a paper note is 9 to 10 months. It’s a reason why currencies of lower denominations tend to be in coins. The government had stopped issuing one rupee notes between 1995-96 and 2013-14.


Tell me more: In 2014-15, a total of five million notes of one rupee denomination and in the current fiscal year, 155 million notes were introduced in the market.

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Oil prices: The crude logic of regulated deregulation

This piece originally appeared on


The government freed prices of aviation turbine fuel (ATF) in 2002, petrol in 2010 and diesel in October 2014. Although refiners were given pricing freedom on paper, what this meant in government-speak was that prices of these fuels would be recalibrated periodically to market prices, the key benchmark for which is the price of their raw material—crude oil.

Fuel prices trail crude

In 2014, prices of India’s crude oil basket tumbled 45%, from $105 per barrel to $58. But the only fuel whose price has declined proportionately is the non-subsidized cooking gas. For three other fuels—ATF, petrol and diesel—the fall in price has been significantly less: notably, 14% in petrol (a deregulated fuel in this period) and 7% in diesel (a regulated fuel for most of this period).




Duties over pricing freedom

For petrol and diesel, the government has hiked excise duty thrice since 13 November. And the oil marketing companies—all of them—chose not to absorb this and instead passed it on to the consumer. Even if they had absorbed the duty hike, the differential in the volume of the fall would still be significant.




Diesel is marked to market

It appears the government is keeping some cushion for itself to manage a transition, in this roundabout way, of India’s oil sector from ‘regulated deregulation’ to full and true deregulation. Diesel is the latest fuel to be finally primed for true deregulation, leaving kerosene and subsidized LPG as the only fuels in the subsidy basket.




Refinery stocks beat the market

The market appears to be expecting a move to full deregulation. With diesel prices in India finally pegged to their true cost of production, stocks of state oil refiners have outperformed the market in the past year.



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