The answer to companies not incurring capex may lie in stock markets
In 2019, Finance Minister Nirmala Sitharaman decided to sacrifice INR1.45 lakh crore in what was one of her boldest moves to boost corporate investments. Six years later, the private sector belies her expectations. A recent survey by the government on private capital expenditure for the current fiscal wasn't any different from the past few years when policy makers were complaining that corporates aren't keeping pace with the government that
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News18
6 hours ago
- News18
DA Arrears: When Will Central Govt Employees Receive 18-Month Frozen Amount?
Last Updated: The arrears pertain to 3 installments of DA hikes -- spanning the period from January 2020-June 2021 -- which were frozen as part of fiscal tightening measures during the pandemic. DA Hike: The long-standing demand for the restoration of 18 months of dearness allowance (DA) and dearness relief (DR) arrears has once again come to the forefront, as central government employees continue to press for the release of the frozen dues. The issue was raised afresh during the 63rd meeting of the Standing Committee of the National Council of the Joint Consultative Machinery (NC-JCM), held on April 23, 2025. The staff side of the NC-JCM strongly reiterated its demand for the payment of arrears that were withheld during the COVID-19 pandemic. The arrears pertain to three installments of DA/DR hikes — spanning the period from January 2020 to June 2021 — which were frozen as part of fiscal tightening measures during the nationwide crisis. The government has maintained that the fiscal burden resulting from the pandemic and various financial welfare schemes introduced during the crisis made it infeasible to release the withheld amount. The government noted that the economic fallout of COVID-19 extended beyond FY 2020-21, impacting budgetary decisions in subsequent years. This is not the first time that the staff side has raised the issue. Ahead of the Union Budget 2025, representatives of the NC-JCM had written to Finance Minister Nirmala Sitharaman, urging the government to consider releasing the pending arrears, citing both financial justice and rising living costs for employees and pensioners. DA Revision Mechanism Disrupted During COVID-19 Under normal circumstances, DA for government employees and DR for pensioners are revised twice a year—in January and July — based on changes in the Consumer Price Index (CPI). However, amid the uncertainty caused by COVID-19, the government froze DA hikes for 18 months, impacting nearly 50 lakh central government employees and over 60 lakh pensioners. Although DA hikes were resumed from July 2021 onwards, the frozen installments were never retrospectively paid, leading to consistent demands for their restoration by employee unions and staff federations. 8th Pay Commission Formed, But Clarity Awaits The demand for arrears has gained further attention in light of the government's approval of the 8th Pay Commission in January 2025. Scheduled to be implemented from January 1, 2026, the Commission is expected to overhaul salary, pension, and allowance structures for central government employees. However, despite its approval, the Commission's Terms of Reference (ToR) and the official appointment of its members are still pending. This has added to the uncertainty over whether employee concerns — including the unresolved DA arrears — will find a place in the new Commission's mandate. 'We expect the Terms of Reference to get the government's nod soon. It should be approved at the earliest," Shiv Gopal Mishra, secretary of the Staff Side of NC-JCM, has said in a recent statement to NDTV Profit. No Timeline Yet for Arrears Restoration While the demand for the release of DA/DR arrears continues to gather steam, no official commitment or timeline has been announced by the government so far. For now, employee unions remain hopeful that the matter will be addressed either through the 8th Pay Commission process or via separate financial consideration by the Centre. Until then, the 18-month DA/DR freeze remains an unresolved chapter in the post-pandemic financial landscape for lakhs of central government employees and pensioners. First Published: June 06, 2025, 14:49 IST
The Hindu
7 hours ago
- The Hindu
Same page: on monetary policy, the RBI, the Government
The Reserve Bank of India (RBI) Monetary Policy Committee's decisions, on Friday, show that the central bank is now unequivocally choosing growth in the perennial growth-inflation trade-off. This is the correct approach at this time. The first major decision was to cut the repo rate by 50 basis points to 5.5%. It comes on the back of two cuts of 25 basis points each, in February and April. With the latest retail inflation coming in at a 69-month low, and generally exhibiting a subdued trend, price stability has now been relegated as a secondary concern. These rate cuts will, once the banks transmit them to borrowers, make it cheaper for companies and consumers to borrow to invest and purchase. The second major decision, of slashing the cash reserve ratio by 100 basis points, will help with the transmission of the rate cuts. The less that banks have to keep with themselves, as stipulated by the cash reserve ratio, the more they can lend out — and now at lower rates. It is worth noting, however, that the central bank has again changed its stance. In April, it had moved from being neutral to being accommodative, indicating that it was inclined to cut rates further. It has now moved back to neutral, meaning more rate cuts in the short term are unlikely, unless growth falls well short of expectations. This is a sensible stance to take, given the vast uncertainties that the Indian and global economies are facing. The neutral stance also means that the RBI is equally predisposed to raise rates again in the event of an unforeseen and sustained spike in prices. The monsoon is yet to fully play out, after all. The timing of these decisions is sound. Inflation is low and not likely to jump any time soon if current factors remain unchanged. Further, there are no major elections now that would otherwise have necessitated a pre-emptive strong grip on price levels. On the other hand, growth is lower than it could be. The RBI has projected growth in the current financial year 2025-26 to be 6.5%, which is no faster than what the government provisionally estimated for the previous year. Fiscal policy in terms of government spending has reached the limit of the stimulus it can provide. After a decade of increasing outlays, government capital expenditure can at best be maintained at the level it is at, but cannot reasonably be expected to grow much further. Finance Minister Nirmala Sitharaman and officials in the Ministry of Finance have indicated as much. Apart from developmental and social priorities, the government now has additional defence spending to account for. Monetary policy has to step up and boost growth, and it is good to see the RBI and the government on the same page.
Hans India
13 hours ago
- Hans India
India now has 1.76 lakh registered startups, 118 unicorns: FM Sitharaman
New Delhi: The number of registered startups has reached 1.76 lakh in the last 11 years, with 118 unicorns (startups with $1 billion valuation and above), thus fueling youth entrepreneurship, Finance Minister Nirmala Sitharaman said on Friday. In a post on social media platform X, the Finance Minister said that "youth in India are building startups and creating jobs". This is "a glimpse of the work done for the youth in the last 11 years under the guidance of Prime Minister Narendra Modi", she posted. Union Minister of Petroleum and Natural Gas, Hardeep Singh Puri, said in a separate X post that in the last 11 years, seven new IITs have been opened, along with eight new IIMs and 16 new AIIMS. "1.6 crore+ youth trained under PMKVY (Pradhan Mantri Kaushal Vikas Yojana) and 17.6 lakh+ direct jobs created from 1.6 lakh startups. Nearly 30,000 vocational education schools established, with more than 30 lakh students enrolled," the minister said. In the last 11 years, "52.5+ crore collateral free Mudra loans disbursed to small businesses and up to Rs 33 crore loans worth Rs 1 lakh+ crore given. Under the PM Internship Scheme, internship opportunities were provided to 1 crore youth in the top 500 companies. About 490 new universities were established to spread higher education in every corner of the country", Puri mentioned. Last month, the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry, notified the expansion of the Credit Guarantee Scheme for Startups (CGSS), which increases the ceiling on guarantee cover per borrower from Rs 10 crore to Rs 20 crore. According to the government, the extent of guarantee cover provided has also been increased to 85 per cent of the amount in default for loan amounts up to Rs 10 crore and 75 per cent of the amount in default for loan amounts exceeding Rs 10 crore. In line with PM Modi's vision for transforming India into an innovation-driven self-reliant economy, the notified expansions aim to address the financing needs of innovation-driven startups. The expanded scheme will further reduce the perceived risks associated with lending to startups in established financial institutions, enabling greater financial flow and runway for startups to undertake research and development experimentation, and create cutting-edge innovation and technologies.
