Daily Current Affairs

November 2, 2024

Table of content

1. The Cabinet has approved seven schemes of ₹ 14,235.30 crore for the agriculture sector
2. GST receipts’ growth rebounds in October, but still off target
3. Zelenskyy urges allies to take action before North Korean troops reach the front
4. IPO-bound HDB Financial’s valuation faces two hurdles

1. The Cabinet has approved seven schemes totaling ₹ 14,235.30 crore for the agriculture sector:

The Digital Agriculture Mission, funded at ₹2.817 crore, aims to establish a comprehensive database on crop data, enhance nutritional security, and boost livestock production.

Union Cabinet Approves Seven Schemes for Agriculture Sector

• The Union Cabinet approved seven schemes for the agriculture sector, of amount ₹14,235.30 crore.
• The most significant scheme is the ‘Digital Agriculture Mission’ (DAM), a consolidated database linking multiple databases and platforms.
• The DAM comprises an ‘Agri Stack’, a geospatial set-up, and ‘Soil Profile Mapping’.
• A Memorandum of Understanding (MoU) is being signed between the Centre and State governments to create and implement the ‘Digital Public Infrastructure’ (DPI) for agriculture.
• The ‘Crop Science for Food and Nutritional Security’ scheme has a total outlay of ₹3,979 crore, aiming to prepare farmers for climate resilience and food security by 2047.
• Another scheme, ‘Sustainable Livestock Health and Production’, aims to increase farmers’ income from livestock and dairy.
• The ‘Sustainable Development of Horticulture’ scheme aims to promote tropical, sub-tropical, and temperate horticulture crops.
• Krishi Vigyan Kendras will receive ₹1,202 crore, while ₹1,115 crore will be spent on ‘Natural Resource Management’.

2. GST receipts’ growth rebounds in October, but still off target:

October collections reached ₹1.87 lakh crore, marking the second highest monthly collection on record, with growth reaching 8.9% from September’s 6.5% increase.

India’s Gross Goods and Services Tax (GST) Collections and Net Revenues

• India’s GST collections surpassed ₹1.87 lakh crore in October, marking the second highest monthly collections on record.
• Net revenues grew at a slower pace of 7.9% to over ₹1.68 lakh crore, a recovery from September’s slowest growth rate of 3.9%.
• Despite improved growth, GST revenues continue to undershoot the Budget 2024-25 math, which factored in a rise of about 11% in net revenues.
• Gross revenues from domestic transactions improved to 10.6% in October, while import revenues grew at a milder pace of 3.9%.
• Net domestic receipts from transactions taken up in September were up 8.7%, almost double the 4.5% growth recorded in the previous month.
• GST Revenues in India Rise by 9.4% in First Seven Months
• GST revenues before refunds reached ₹12.74 lakh crore, a 9.4% increase from 2023-24.
• Net revenues post-refunds are also up 9% at over ₹11.27 lakh crore.
• State variations in GST revenues widened, with some growing faster than the national average, others underperforming, and five recording contractions.
• Uttarakhand saw flat revenues, while Arunachal Pradesh, Nagaland, and Manipur saw a 33% shrinkage.
• Kerala recorded the highest growth at 20%, followed by Gujarat, Haryana, West Bengal, Maharashtra, and Bihar.
• The poorest performance was seen in Jammu and Kashmir, Sikkim, Jharkhand, and Tamil Nadu.
• Refunds to domestic taxpayers jumped 42.8% in October, improving for the third consecutive month.
• Export-related refunds of GST collections contracted 2% in October, compared to a 39.2% spike in the preceding month.
• Despite slowing, the overall refund levels are healthy, indicating stabilization of the refund process and reduction in rejections due to interpretative issues.

GST Overview in India

• Replaces excise duty, VAT, services tax.
• Passed on 29th March 2017 and came into effect on 1st July 2017.
• Levied on supply of goods and services.
• Comprehensive, multi-stage, destination-based tax levied on every value addition.
• GST is a multi-stage, destination-based tax that is levied on every value addition, making it a single domestic indirect tax for the entire country.

3. Zelenskyy urges allies to take action before North Korean troops reach the front:

Ukraine’s President Volodymyr Zelenskyy has urged allies to stop “watching” and take action before North Korean troops in Russia reach the battlefield.

• Zelenskyy suggests a preemptive strike on North Korean training camps.
• He insists Ukraine needs permission from allies to use Western-made long-range weapons to target deep inside Russia.
• Zelenskyy argues that America, Britain, and Germany are waiting for North Korea to attack Ukrainians.

North Korean Troops Deployment in Russia

• Biden administration reports 8,000 North Korean soldiers in Russia’s Kursk region.
• Troops are preparing to aid Kremlin against Ukrainian troops.
• Western leaders view this deployment as an escalation, potentially impacting Indo-Pacific relations.
• Potential technology transfers from Moscow to Pyongyang could escalate North Korea’s nuclear weapons and missile program.
• North Korean Foreign Minister met with Russian counterpart in Moscow.
• Ukrainian Leaders Demand Western Weapons for Border Strikes
• U.S. defense argues limited missiles and Ukraine’s own drones are used.
• Moscow views such strikes as escalation, warning of “at war” if approved.

Russia-Ukrainian War Overview

• Started in February 2014, Russia occupied and annexed Crimea, supporting pro-Russian separatists in the Donbas War.
• Initial eight years of conflict included naval incidents and cyberwarfare.
• In February 2022, Russia launched a full-scale invasion of Ukraine, marking the biggest conflict in Europe since World War II.
• The war has resulted in a refugee crisis and tens of thousands of deaths.
• In 2014, the Euromaidan protests led to the Revolution of Dignity and the ousting of Ukraine’s pro-Russian president Viktor Yanukovych.
• In April 2014, Russian-backed militants seized towns in Ukraine’s eastern Donbas region and proclaimed the Donetsk People’s Republic (DPR) and the Luhansk People’s Republic (LPR) as independent states.
• In February 2022, Russia recognized the DPR and LPR as independent states.
• In February 2022, Putin announced a “special military operation” to “demilitarize and denazify” Ukraine, leading to international condemnation and sanctions.
• Since then, Russian offensives and Ukrainian counteroffensives have gained only small amounts of territory.
• Russia has carried out deliberate and indiscriminate attacks on civilians far from the frontline.

4. IPO-bound HDB Financial’s valuation faces two hurdles:

HDB Financial Services Ltd’s IPO and Valuation Concerns

• HDB Financial Services Ltd is preparing for a nearly $1.5 billion IPO, with two key factors potentially impacting its valuation: a proposal to regulate banks’ group businesses and HDB’s rising bad loans.
• HDFC Bank Ltd, India’s biggest private lender, may have to reduce its stake in the company to below 20% if the Reserve Bank of India implements its draft proposal.
• HDB Financial Services and HDFC Bank offer similar products but to different borrowers.
• The RBI’s proposals aim to remove overlap in businesses carried out by a bank and its subsidiaries.
• The IPO of HDB Financial Services will include fresh issues of shares and an offer for sale by HDFC Bank.
• HDB’s bad loans have increased over the last year since RBI increased the risk weights on unsecured loans.
• HDB’s net non-performing assets rose to 0.83% at the end of September from 0.63% at the end of March.
• HDB’s unsecured consumer finance book grew sharply, accounting for nearly 23% of its total loan book.

HDB Financial Services Overview

• Leading Non-Banking Financial Company (NBFC) serving Aspirational India.
• Established in 2007, with strong capitalization.