Karol Bagh nd1/8-B, 2 Floor, Apsara Arcade, Near Gate 6, Karol Bagh Metro, Delhi-110005 Mukherjee Nagar:

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Text of Karol Bagh nd1/8-B, 2 Floor, Apsara Arcade, Near Gate 6, Karol Bagh Metro, Delhi-110005 Mukherjee...

  • VISIONIAS www.visionias.in

    Classroom Study Material

    ECONOMY October 2016 – June 2017

    Note: July, August and September material will be updated in September last week.

    Copyright © by Vision IAS

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  • Karol Bagh 1/8-B, 2nd Floor, Apsara Arcade, Near Gate 6, Karol Bagh Metro, Delhi-110005 Mukherjee Nagar: 103, 1st Floor, B/1-2, Ansal Building, Behind UCO Bank, Delhi-110009

    8468022022 1 www.visionias.in ©Vision IAS

    Student Notes:

    TABLE OF CONTENTS 1. EMPLOYMENT AND SKILL DEVELOPMENT ....................................................................................... 5

    1.1. Employment Status ............................................................................................................. 5 1.2. Job Creation ........................................................................................................................ 5 1.3. Reforms Undertaken by Government-Labour reforms ....................................................... 6 1.4. Human Capital- Skill Development and Innovation .......................................................... 11 1.5. World Development Report, 2016- Digital Dividends ....................................................... 14

    2. INCLUSIVE GROWTH: POVERTY AND RELATED ISSUES .................................................................. 16

    2.1. Universal Basic Income ..................................................................................................... 17 2.2. Recent Steps by Government ............................................................................................ 18

    2.2.1. Entire Country Under National Food Security Act ..................................................... 18 2.2.2. Hill Area Development Programme ........................................................................... 18 2.2.3. Performance of Pradhan Mantri Ujjawala Yojana ...................................................... 19

    3. EASE OF DOING BUSINESS: REFORMS ........................................................................................... 20

    3.1. Ease of Doing Business Rankings ...................................................................................... 20 3.2. Ease of Doing Business Ranking Among States ................................................................. 21

    4. FINANCE AND BANKING ................................................................................................................. 23

    4.1. Problems of Banking ......................................................................................................... 23 4.2. Finance Inclusion ............................................................................................................... 29

    4.2.1. Issues with financial inclusion .................................................................................... 29 4.2.2. Small Finance Banks ................................................................................................... 30 4.2.3. Priority Sector Lending Norms ................................................................................... 30 4.2.4. Bank Authorization Policy .......................................................................................... 31 4.2.5. Insurance Literacy Programme for School ................................................................. 31

    4.3. Issues with RBI .................................................................................................................. 32 4.3.1. Problems in the Governance of Reserve Bank of India .............................................. 32 4.3.2. Autonomy of RBI ........................................................................................................ 33

    4.4. Proposed Payment Regulatory Board ............................................................................... 33 4.5. Role of Market Stabilisation Scheme Bonds ..................................................................... 34 4.6. Capital and Money Market ............................................................................................... 35

    4.6.1. P-Notes Norms ........................................................................................................... 35 4.6.2. SEBI to Tighten Algo Trading Rules ............................................................................. 35 4.6.3. SEBI Tightens Norms for Credit Rating Companies .................................................... 36

    4.7. Finance: Steps Taken by Government ............................................................................... 36 4.7.1. WPI and IIP Base Year Change .................................................................................... 36 4.7.2. Credit Enhancement Guarantee Fund ....................................................................... 37 4.7.3. Financial Resolution and Deposit Insurance Bill 2017 ............................................... 37

    4.8. Rose Valley Case ................................................................................................................ 38 5. GOVERNMENT BUDGETING ........................................................................................................... 40

    5.1. Budgetary Reforms ............................................................................................................ 40 5.1.1. Railway Budget Scrapped ........................................................................................... 40 5.1.2. Advancement of Budget Date .................................................................................... 40 5.1.3. Merger of Plan and Non-Plan Classification ............................................................... 40

    5.2. Gender Responsive Budgeting/Gender Budgeting ........................................................... 41 6. FISCAL MANAGEMENT ................................................................................................................... 42

    6.1. Fiscal Developments ......................................................................................................... 42 6.2. Public Debt Management Cell (PDMC) ............................................................................. 42 6.3. FRBM Review Committee.................................................................................................. 43

  • Karol Bagh 1/8-B, 2nd Floor, Apsara Arcade, Near Gate 6, Karol Bagh Metro, Delhi-110005 Mukherjee Nagar: 103, 1st Floor, B/1-2, Ansal Building, Behind UCO Bank, Delhi-110009

    8468022022 2 www.visionias.in ©Vision IAS

    Student Notes:

    6.4. Fiscal Consolidation of States ............................................................................................ 43 6.5. Finance Bill 2017 ............................................................................................................... 44

    7. TAXATION ........................................................................................................................................ 46

    7.1. Goods And Services Tax..................................................................................................... 46 7.2. Tax Terrorism ..................................................................................................................... 49 7.3. Direct Tax reforms ............................................................................................................. 49 7.4. General Anti-Avoidance Rules ........................................................................................... 51 7.5. Place of Effective Management (POEM) ........................................................................... 52 7.6. CBDT Signs Four Advance Pricing Agreements ................................................................. 53 7.7. Multilateral Convention to Prevent BEPS .......................................................................... 53 7.8. Capital Gains Tax Rules ...................................................................................................... 54 7.9. Taxing Agricultural Income ................................................................................................ 54 7.10. Demonetisation of ₹ 500 and ₹ 1000 notes .................................................................... 56 7.11. Pradhan Mantri Garib Kalyan Yojana .............................................................................. 58

    8. CASHLESS ECONOMY ...................................................................................................................... 59

    8.1. ‘Less-Cash’ Economy and Cashless Economy .................................................................... 59 8.1.1. Ratan Watal and Chandrababu Naidu committee ..................................................... 62

    8.2. Banking Cash Transaction Tax ........................................................................................... 62 9. AGRICULTURE AND ALLIED SECTOR ............................................................................................... 63

    9.1. Background ..