The Reserve Bank on Tuesday permitted resident individuals to make remittances under the Liberalised Remittance Scheme (LRS) to International Financial Services Centres (IFSCs) in the country.

The decision of the RBI is aimed at deepening the financial markets in the IFSCs and providing an opportunity to resident individuals to diversify their portfolios.

The RBI, in a notification, said it has reviewed the extant guidelines on LRS and decided to permit resident individuals to make remittances under LRS to IFSCs set up in India under the Special Economic Zone Act, 2005. "The remittance shall be made only for making investments in IFSCs in securities, other than those issued by entities/companies resident (outside IFSC) in India," the central bank said.

Further, resident individuals may also open a non-interest bearing Foreign Currency Account (FCA) in IFSCs, for making the above permissible investments under LRS. "Any funds lying idle in the account for a period upto 15 days from the date of its receipt into the account shall be immediately repatriated to domestic INR account of the investor in India," RBI said.

India is set to see investments to the tune of around $500 billion in the renewables sector if the country has to achieve the target of 450 gigawatts (GW) of capacity by 2030, said a report by the Institute for Energy Economics and Financial Analysis (IEEFA).

The report highlighted that a huge global capital pool is mobilising to invest in renewable energy and grid projects in India, with pull factors including solar power tariffs hitting record lows, plunging solar module costs, record low-interest rates, and the security of government-backed, 25-year power purchase agreements (PPAs). The renewable energy sector in India has received more than $42 billion in investment since 2014.

“We estimate that striving for 450 gigawatts of renewable energy by 2030 would require deploying $500 billion of investment over the coming decade – $300 billion for wind and solar infrastructure, $50 billion on grid firming investments such as gas-peakers, hydro and batteries, and $150 billion on expanding and modernising transmission and distribution,” said Tim Buckley, Director Energy Finance Studies, South Asia, at the IEEFA.The country’s untapped renewable potential at 900 gigawatt (GW) is the most in the world. It is estimated that India’s peak power demand will rise to 295GW by 2021-22 and 690GW by 2035.

“Domestic and global institutions across the financial, corporate, energy, utility and government sectors are primed to deploy a wall of capital that India needs to fund its ambitious renewable energy targets,” he added.This includes the capital cost of adding more than 300GW of new renewables infrastructure, firming low-cost but intermittent renewable power generation, and expanding and modernising grid transmission and distribution.

The sources of capital range from private equity, global pensions funds and sovereign wealth funds, to oil and gas majors, multinational development banks and Indian state-owned enterprises and power billionaires, the report added.The report stated that the Indian renewables sector is increasingly dominated by the major independent power producers (IPPs):ReNew Power, Greenko, Adani Green, Tata Power, ACME, SB Energy, Azure Power, Sembcorp Green Infra and Hero Future Energies, and that each has invested strongly in building capacity in international debt and equity markets.

But, these renewable energy giants face growing competition from the likes of Vena Energy/Vector Green, O2 Power, Ayana Renewable Power, Torrent Power and Sprng Energy, as well as Government of India fossil fuel majors starting to rise to the decarbonisation challenge such as NTPC and NLC, with Coal India Limited and Indian Railways increasingly looking to pivot aggressively as well, it said.

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The report said due to the economic downturn, even the union government finances are under pressure, leading to a lower-than-budgeted devolution of Rs 5.50 lakh crore to states in FY21 (revised estimate: RE) as against the budget estimate (BE) of Rs 8.03 lakh crore.

This is Rs 2.53 lakh crore lower-than-budgeted states’ share in central taxes and accounts for nearly 92 percent increase in fiscal deficit in FY21(forecast) over FY21 (BE).

The agency now estimates the aggregate revenue deficit to come in at 3.2 percent, higher than the earlier forecast of 2.8 percent of GDP in FY21.

The union government in its FY22 budget has committed to retaining the vertical share of states in central taxes at 41 percent, as per the recommendations of 15th Finance Commission (FC).

The Union Budget for FY22 has budgeted Rs 6.66 lakh crore for distribution out of the net proceeds of central taxes (FY21RE: Rs 5.50 lakh crore).

The agency said although it estimates the aggregate revenue receipt of the states to grow 8.4 percent y-o-y in FY22 from a decline of 0.6 percent in FY21 (f), the revenue deficit would persist in FY22.

It expects the aggregate revenue deficit of states to come in at 1.5 percent of GDP in FY22 as against FY21 (f) of 3.2 percent.

The pressure on the debt burden is likely to persist in FY22 due to a combination of revenue deficit, some pick-up in capex and repayment of past market borrowings, the agency said.

It estimates the states’ aggregate debt/GDP to rise to 33.9 percent in FY22 from 32.8 percent in FY21 (f).States’ fiscal deficit is now financed mainly through market borrowings and the report estimates the gross market borrowings of states will increase to Rs 8.38 lakh crore in FY22 from Rs 8.2 lakh crore in FY21 (f).

This special FD scheme was launched in May to safeguard the interests of senior citizens as the interest rates were falling rapidly amid the coronavirus pandemic. This special FD scheme is available for senior citizens till March 31.

Bank of Baroda special FD scheme for senior citizens

BoB offers 100 bps higher on deposits by senior citizens. If a senior citizen puts a fixed deposit, the interest rate applicable to the FD will be 6.25 percent under the special FD scheme.

ICICI Bank offers 80 bps higher interest rates on deposits. Senior citizens get an interest rate of 6.30 percent per annum under ICICI Bank Golden Years FD scheme.

HDFC Bank special FD scheme for senior citizens

HDFC Bank offers 75 bps higher interest rates on these deposits. The interest rate applicable to the FD will be 6.25 percent.

SBI special FD scheme for senior citizens

SBI special FD scheme for senior citizens will fetch 80 basis points (bps) interest rate above the rate applicable to the general public. Currently, SBI gives 5.4 percent interest rate on five years FD for the general public. If a senior citizen puts a fixed deposit under the special FD scheme, then the interest rate applicable to the FD will be 6.20 percent.

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In a written reply to the Rajya Sabha, Minister of State for Commerce and Industry Hardeep Singh Puri said the equalisation levy collection stood at Rs 338.6 crore in 2016-17, Rs 589.4 crore in 2017-18 and Rs 938.9 crore in 2018-19.

The collection was Rs 1,136.5 crore in 2019-20 and Rs 1,492.7 crore in 2020-21 (up to January 30).Equalisation levy was first introduced by Finance Act, 2016, at the rate of 6 per cent on payments for digital advertisement services received by non-resident companies without a permanent establishment in India, if these exceeded Rs 1 lakh a year.

He also said the US has put out investigation reports on Digital Services Tax (DST) against three countries -- India, Italy and Turkey -- on January 6. The findings are that the DST in these countries discriminates against US companies and burdens or restricts US commerce.

To a query on whether the government is taking steps to remedy the concerns raised, Puri said "such issues are a part of an economic relationship, and feature in the regular bilateral engagements between India and the US".

Replying to another question, he said India is presently "not" negotiating any FTA (Free Trade Agreement) with the US but was engaged with America to arrive at a 'shared understanding' on some of the market access issues faced by exporters on both sides.Separately, the minister said that to support Indian rice bran oil processors to improve technology and equipment for optimum extraction of rice bran oil in the country, the Department of Food and Public Distribution is working with other ministries concerned.

The country's import of rice bran oil stood at 71,580 tonnes during April-November 2020-21.

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India is actually a red-hot investment opportunity for its clean energy transition, top US official John Kerry said on Thursday as he praised Prime Minister Narendra Modi for his commitment to addressing the challenge posed by climate change which the Biden Administration believes poses an existential threat to humanity.

Kerry, the Special Presidential Envoy for Climate, said he intends to work "very, very closely with" with Indian leadership including Prime Minister Modi and External Minister S Jaishankar.

"We believe India can be one of the most critical transitional countries in this entire endeavour. I am confident that just as we have worked very closely on any number of issues in these last years, our two nations -- the world's two biggest democracies -- have a great deal to gain from joining hands in our global leadership and confronting the climate crisis to meet this moment," he said.

"India is actually a red-hot investment opportunity for its clean energy transition," Kerry, the first official on climate to be inside the US National Security Council, said in his address to the World Sustainable Development Summit 2021.

Looking forward to visiting India soon, Kerry said that the prime minister has made a very important contribution to this dialogue. Needless to say, India is deeply committed to this challenge and it has been for a considerable number of years, he said.

You are indisputably a world leader in the deployment of renewable energy and your leadership of the International Solar Alliance, which Minister Jaishankar referred to, is absolutely critical for not just India, but for other dynamic, growing economies in the world, Kerry said.

Prime Minister Modi's announcement of a target of 450 gigawatts of renewables by 2030 is a strong, terrific example of how to power a growing economy with clean energy, and it's going to be one of the most important contributions because India today is already the third largest emitter in the world behind the United States and China, he said.

Referring to a latest report of the International Energy Agency, he said India's down payment on the clean energy transition puts it on pace to become the global market leader in solar and storage by 2040. "And thanks to your rapid scale-up, it's already cheaper to build solar in India than anywhere else in the world. That kind of urgency is exactly what we need in order to confront the crisis that we confront today," he said.

After coming to power, the Biden Administration has quickly established contacts with the Indian leadership. The leadership of the two countries at the top level have known each other for long and have put the relationship on fast-track. In a recent interview, India's Ambassador to the US, Taranjit Singh Sandhu, had identified climate change as one of the key pillars of collaboration between the two countries.

It was one of the topics of discussion between Prime Minister Modi and President Joe Biden earlier this week and also when they spoke in November soon after the US election results were announced.

In his speech, Kerry made it clear that India is a key partner of the US under the Biden Administration and would take it over from where the relationship was left by the previous Trump Administration.

On climate change, Kerry said that he knows that Prime Minister Modi is committed to this and seized by it, and so are Indian businesses."I was also very heartened to see the recent government budget focussed heavily on clean energy and propose a very specific hydrogen energy mission, he said.

By 2030, the International Energy Agency forecasts that if India drives even more aggressively towards this clean energy transition, it will create half a million additional jobs than business as usual would create. Indian industry is obviously already stepping up and showing leadership. I was very pleased to hear that dozens of India's biggest companies recently signed a declaration on climate change, pledging to go carbon neutral," Kerry said.

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At a time when the global energy market is facing a drop in demand due to COVID-19 pandemic, turning immune to the situation, the renewable sector has seen a growth. An India Energy Outlook report for 2021 by the International Energy Agency (IEA) highlights that going by the current momentum, the electricity sector in India is on the cusp of a solar revolution. 

In an exclusive interview with Moneycontrol, Fatih Birol, IEA’s Executive Director expressed hope that solar energy will overtake coal within the next ten years. He also batted for the usage of hydrogen, carbon capture storage and clean natural gas to reduce the dependency on coal.

Edited excerpts: 

Q. India is talking about introducing a hydrogen mission. A lot of focus is there on solar too. How are you seeing this scenario? 

Hydrogen can make the decarbonised system much more cleaner. When it comes to solar, India is set for explosive growth. Today, less than 5 percent of India’s electricity generation is coming from solar and 70 percent from coal. Our numbers show that due to extra-ordinary cost-competitiveness of solar and right policies, renewables, mainly solar can overtake coal within the next ten years. 

It is a huge change and wonderful news for India in terms of its economy and air pollution in the cities. 

Q. What is your take on India’s steps towards making energy accessible to the common man? 

When people ask me whether or not India will be able to steer its economy and energy sector in a successful way, I say absolutely yes. I have two reasons to say this. First, when I released our first India Energy Outlook in 2015, I said India is moving to the Centre stage of world energy. Today, without hesitation I can say that India has arrived at the centre stage of the world energy. The second reason is that India added 900 million electricity connections since 2000, it has never been the case in the history of any country. In my view, it is a history written in the world energy sector. 

Implementation of LED is a big step towards energy efficiency improvement and an example for many countries and the Ujjwala program that brought clean fuel for millions of people are the reasons why I believe that India can have a much brighter, affordable and cleaner energy future. 

Q. India is targeting to become a gas-based economy. Is it a strategy in the right direction? 

Today, the share of gas in India’s energy mix is 6 percent. It is one of the lowest in the world. There are ambitions of the government to increase this. We expect growth, mainly in industry and city gas distribution, for cooking and transport sector. This can definitely improve the air quality and displace coal, which is good news. 

It is very important that this gas comes from the countries where we have control over methane emissions. I believe the share of gas in India will increase significantly. When we talk about coal, we talk about the electricity sector. But a lot of coal is used in iron and steel, cement and others, we have to decarbonise them and make them environment friendly. Gas can play an important role here. 

Q. How can India bring down the share of coal in its energy basket? 

Coal has a huge share of 70 per cent of electricity generation in India. For electricity generation, continuous support for renewables, especially solar, coupled with battery storage is needed to decarbonise the power sector. We use a lot of coal in India also for iron and steel and cement, here we can use, hydrogen, carbon capture storage and clean natural gas to reduce the dependency on coal. 

If India goes in this direction, it will not only be god for the Indian economy and energy sector, but the country can be a pioneer by setting a new model of clean growth. 

Q. With vaccines in place, do you see the global energy demand recovering?  

If we can bring the pandemic under control, we can see recovery in the global energy sector. I believe coal is very difficult to recover because of lesser emphasis on coal. The oil will recover in a few years, but renewables proved to be Covid immune in 2020. Although global energy declined by 5 per cent in 2020, renewable energy saw an increase. In 2021, it will increase significantly. 

Q. How do you rate India’s steps towards ensuring energy security? 

India is making good steps in the right direction. For example, I can remember that during the low oil prices, India was one of the countries that put a lot of oil in their stocks. Our numbers show that the reliance on imported oil in India will go up substantially as a result of road transport, especially trucks, which is a major contributor to oil imports in India. Trucks in many countries, we use for freight. I think it may be a very good idea to transfer a big chunk of it to railways, which can run by electricity. It will be good for energy security, reducing pollution and will be good for the Indian economy. 

I am following the developments in the Indian Railways sector, I can say it is an outstanding success in terms of logistical transformation to what kind of energy it is using and the way it is modernised. It can be a model for many countries. 

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The government will soon bring a bill on crypto currencies as existing laws are inadequate to deal with issues concerning them, Minister of State For Finance Anurag Thakur told Rajya Sabha on Tuesday.

Replying to a question in the Upper House, Thakur said regulatory bodies like RBI and SEBI do not have any legal framework to directly regulate crypto currencies as they are not currencies, assets, securities or commodities issued by identifiable users.

"The existing laws are inadequate to deal with the subject,” he said.

The government had formed an Inter-Ministerial Committee which has given its report on issues related to virtual currencies.

There was also a meeting of the Empowered Technology Group.The Committee of Secretaries chaired by the Cabinet Secretary has also given its report.

"A bill (on crypto currencies) is being finalised and it will soon be send to the Cabinet. We will soon be bringing a bill,” Thakur said.

In view of the risks associated with Virtual Currencies (VCs), including Bitcoins, the Reserve Bank of India (RBI) through a circular in April 2018, had advised all the entities regulated by it not to deal in VCs or provide services for facilitating any person or entity in dealing with or settling VCs.However, Supreme Court, vide judgement dated March 4, 2020, had set aside the RBI’s circular.To another question regarding Chinese companies in the country, the minister said as of now, there are around 92 companies registered in the country.