PM highlights the need for all stakeholders to work together towards making India a self-reliant economic powerhouse
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Business Standard
16 minutes ago
- Business Standard
GST on life, health insurance may be scrapped as Centre pushes exemption
The Centre has suggested removing the Goods and Services Tax (GST) on life and health insurance premiums, Bihar Deputy Chief Minister Samrat Choudhary said on Wednesday. Choudhary, who is the convenor of the Group of Ministers (GoM) on insurance, confirmed that the proposal was discussed during the panel's meeting. The 13-member GoM deliberated on the proposal to exempt individual and family insurance policies from GST. 'The Centre's proposal is clear that the insurance sector's individual and family (policies) should be exempt from GST. This has been discussed and the GoM report will be presented to the Council,' Choudhary said after the meeting. He added that 'all members have given their approval for lowering rates. Some states have given their own views,' while clarifying that the final decision rests with the GST Council. At present, both life and health insurance premiums attract 18 per cent GST. Next steps in the decision-making process The GoM was constituted in September with ministers from Uttar Pradesh, Rajasthan, West Bengal, Karnataka, Kerala, Andhra Pradesh, Goa, Gujarat, Meghalaya, Punjab, Tamil Nadu and Telangana, besides Bihar. The panel has been tasked with submitting its recommendations to the GST Council by October-end. The panel will now submit its report, including suggestions and reservations voiced by state finance ministers, to the GST Council. The Council will take the final call on whether GST exemption should apply to life and health insurance. How the proposal fits into larger GST reforms The move to ease taxes on insurance is part of a wider reform package under consideration by the Centre. Under the proposed next-generation GST framework, the tax would be streamlined into two rates: 5 per cent and 18 per cent, depending on whether products fall into the merit or standard category. Revenue from GST on insurance In FY24, the Centre and states collected ₹8,262.94 crore from GST on health insurance premiums. Additionally, ₹1,484.36 crore came from GST on health reinsurance premiums, underscoring the significant revenue implications of any exemption. On Wednesday, Finance Minister Nirmala Sitharaman also interacted with various GoMs formed by the GST Council. These included groups working on compensation cess, rate rationalisation, and taxation of health and life insurance, all part of the broader effort to revamp the indirect tax system. PM Modi on GST overhaul During his Independence Day address at the Red Fort, Prime Minister Narendra Modi announced a drastic cut in GST on common household items, hinting at sweeping changes in the indirect tax regime. 'GST rates will be reduced drastically. Tax will be reduced for the common people,' he said.
Mint
16 minutes ago
- Mint
Online marketplaces influence 73% of purchases: Deloitte-Ficci report
Mumbai: Consumers are increasingly relying on digital channels for their purchases, with online marketplaces being the most influential in shaping buying decisions, according to a report by Deloitte and industry body Ficci. While physical stores remain relevant, a growing number of people also rely on peer recommendations and social media advertisements to make purchasing decisions, the report, released on Wednesday, noted. Online marketplaces are the top choice for categories like electronics and apparel, driven by their convenience and competitive pricing. The findings indicate that online marketplaces influence 73% of purchasing decisions, while offline stores remain relevant for 53% of consumers surveyed by Deloitte. Peer recommendations (51%) and social media ads (49%) also shape choices. Further, consumers prefer authentic content, such as YouTube reviews (40%), over influencer endorsements, reflecting a shift toward trust-based, informed decision-making. Quick commerce is gaining traction in the food, beverages, and home and personal care sectors, while social media-led shopping has minimal influence. The report projects that online commerce is expected to account for 16% of the total retail market by 2030. This growth is driven by the convenience and wide product assortment that digital platforms offer. Companies said the market is changing quickly, requiring brands to be present across all channels. 'Today's retail landscape is evolving at an unprecedented rate—no matter what corner of the country we talk about," said V Kumar, Chairman, FMCG Committee, FICCI and CEO, P&G India, at a FICCI event in the capital on Wednesday. In India, digital platforms already drive about 17% of total FMCG consumption, with quick commerce (ultra-fast delivery) generating 35% of FMCG brands' e-commerce revenue. "As per Deloitte-Ficci report, the quick commerce segment is projected to reach $35 billion gross merchandise value (GMV) by 2030, supported by lakhs of delivery partners and an increasingly electric fleet—demonstrating a growth in demand for immediacy. This ongoing growth of models like quick commerce and e-commerce, powered by a surge in digital payments, has created unprecedented opportunities for enhancing consumer experience. It is imperative for us to ensure our products remain available where and when consumers want them,' he said. The report also highlights a clear preference for online marketplaces for categories such as consumer durables (39%) and apparel (30%). In contrast, multi-brand retail stores dominate high-involvement or tactile categories like jewellery (44%) and consumer health (29%). Meanwhile, local and unbranded stores still hold a significant share in food (24%) and home décor (33%), reflecting consumer trust and accessibility. To be sure, offline retail has long held sway on how consumers buy goods in India. However, over the last decade this has changed with more digital channels chipping away market share from traditional trade prompting companies to diversify the ways in which they reach shoppers. Despite that, companies are continuing to expand their offline presence, with fast-moving consumer goods makers and retailers strengthening distribution in untapped markets. 'While digital adoption is growing, physical expansion will only increase further—tier 2 and 3 cities will see more go-to-market expansion, be it within FMCG or retail. What will be critical is whether the service channel and after-sales is keeping in step with the sales channel,' said Anand Ramanathan, Partner, Consumer Industry Leader, Deloitte India. Retailers are adapting by creating an omni-channel presence to bridge the gap between online and offline. Recently, footwear retailer Bata India said it is set to intensify efforts to scale its online commerce business while maintaining its store opening targets. 'For the last three years, e-commerce has been our fastest-growing business. In the next about, you know, medium term two to three years. It's basically low double digits right now—it should be about 20% of our turnover,' said Gunjan Shah, MD and CEO of Bata India Ltd, in a recent interview with Mint. Shah said the company will maintain its annual store opening guidance of about 100 to 150 stores per year. Last year, FMCG company Marico Ltd launched a program Project Setu, a three-year project, to expand its direct reach from 1 million outlets currently to 1.5 million outlets by FY27—this includes tapping channels such as pharmacies as well as speciality food outlets and standalone beauty stores. The company's general trade system is a source of competitive advantage because digital brands are never going to be able to crack general trade, per Saugata Gupta, managing director and chief executive at the edible oil maker. Ramanathan also noted that quick commerce is entering a phase where pricing intensity is increasing. 'This festive season, companies are moving toward discounting and building volumes via dynamic pricing. This will also help companies reach mid-market households beyond affluent consumers in large metro areas,' he said. However, he added that profitability will depend on how well these platforms can sweat their assets. The quick commerce market in India is expected to touch $35-40 billion by 2030, up from $5.2 billion in 2024. India is also the first country where quick commerce has scaled as a viable channel, now operating in over 80 cities and expanding product categories from essentials to fashion, wellness, and electronics. P&G's Kumar said the company has been co-creating more premium products along with quick commerce platforms such as Zepto to cater to consumers who value convenience.
India.com
16 minutes ago
- India.com
Bad news for China, Pakistan as India to become self-reliant in defence, Modi govt approves purchase of 97 Tejas Mark 1A fighter jets for Rs...
Tejas MK1A is India's homegrown 4.5 generation fighter aircraft. (File) Tejas MK1A: In a significant development that would provide a major boost to indigenous defence manufacturing, the Narendra Modi government Tuesday approved the purchase of an additional 97 Tejas Mark 1A fighter jets for Rs 62,000 crore from Hindustan Aeronautics Limited (HAL) to aid efforts by the Indian Air Force (IAF) in phasing out its MiG-21 fleet. Why Tejas MK1A deal is a major boost of homegrown defence tech? The approval, which will allow HAL to start manufacturing, was cleared at a high-level meeting on Tuesday, defence officials said, according to news agency ANI. Notably, this is HAL's second major order for the LCA Tejas Mark 1A fighter jets, the first being the Rs 48,000 crore order for 83 aircraft, placed a few years ago. Notably, the Prime Minister Narendra Modi is a vocal supporter of HAL and boosting India's indigenous defence manufacturing capabilities. The Tejas fighter jet program, backed by the Ministry of Defence and Air Force Headquarters, is seen more than as a military upgrade, but a major push forward for the ambitious Make in India and Atmanirbhar Bharat initiatives, that aim to make the country self-reliant in defence manufacturing. Additionally, the HAL's Tejas program will create thousands of jobs in numerous small and medium enterprises (SMEs) who are involved in manufacturing defence components across India. How powerful is Tejas MK1A fighter jet? The Tejas MK1A fighter jet is equipped with a wide array of offensive and defensive armaments, including the the indigenously-built Astra Mk1 BVR air-to-air missile with 100+ km range, the ASRAAM missile for close aerial combat, the Rudram anti-radiation missile, SAAW Smart Anti-Airfield Weapon, in addition to laser-guided bombs for precision ground strikes. The aircraft is powered by a General Electric F404-IN20 engine, which churns out 84 kN thrust, enabling the Tejas MK1A to reach a speed of up to Mach 1.8 and altitude of 52,000 feet. The warplane also has mid-air refuelling capability, which increases its flight duration and range. Tejas MK1 has a maximum takeoff weight of 13,500 kg, and is capable of carrying up to 8-9 tons of weapons. Story highlights The Narendra Modi govt has approved the purchase of 97 Tejas MK1A fighter jets from HAL. The latest Tejas MK1A fighter jet deal is worth Rs 62,000 crore. This is HAL's second major order for the LCA Tejas Mark 1A fighter jets. The Tejas MK1A powered by a General Electric F404-IN20 engine. According to details, the Tejas Mark 1A has advanced radars and avionics than its predecessor, and the latest batch will have over 65 indigenous components compared to the earlier 40 jets.
