The draft bill, titled The Personal Data Protection Bill, 2018 was modelled by an expert group headed by former Supreme Court judge BN Srikrishna.

The Union Cabinet has cleared the Personal Data Protection Bill for introduction in the current session of Parliament.

Addressing the media, Prakash Javadekar said that it is a very important Bill. “The Bill deals with data protection of citizens. It will look at how the interests of Bharat and the interests of everybody is handled,” he said.

The Bill could be introduced in either house of the Parliament in the current Winter Session which will conclude on December 13.

The Bill will provide details on collection and storage of personal data and its usage, individual users’ consent and the penalties for misuse of data.

The draft bill, titled The Personal Data Protection Bill, 2018 was modelled by an expert group headed by former Supreme Court judge BN Srikrishna.

In an earlier chat with ET, Justice Srikrishna also called for speedy enactment of the proposed personal data protection bill.

Here are all the other decisions taken today in the Union Cabinet:
1. Approved Bharat Bond Exchange Traded Fund
2. Approves the withdrawal of Jammu and Kashmir Reservation (Second Amendment) Bill, 2019
3. Conversion of three Sanskrit deemed to be Universities into Central Universities
4. Conversion of three Sanskrit deemed to be Universities into Central Universities
5. Union Cabinet approves land monetisation at Pragati Maidan (Delhi) to build a 5-star hotel

During the past five years, the government had identified about 33 loss-making state-run companies for disinvestment as well as closure.

Highlights

NEW DELHI: The government will recommend loss-making PSUs identified for strategic stake sale for closure and will not wait endlessly and won’t make repeated attempts to get a bidder. The Centre has taken a political call to accelerate strategic sale of loss-making PSUs as some of them have been waiting for years to get a buyer, sources said.

“There are several cases where the disinvestment process has been going for years. There is very little interest in some of the companies. Keeping all these factors in mind, it has been decided that wherever buyer interest is muted we will recommend for closure of the unit,” said an official, who did not wish to be quoted.

The government has identified several top companies for offloading stake and management control, including Bharat Petroleum Corporation. It aims to raise a large chunk of Rs 1.05 lakh target set for the current year from strategic sale in these companies. The government will also not opt for the insolvency and bankruptcy route for meant has also been hunting for a buyer for the country’s biggest state-run helicopter firm Pawan Hans.

Several extensions have been announced for the sale process but a buyer has not been found. Bharat Pumps and Compressors has been under the disinvestment process for a number of years and a suitor is yet to be found. “The view within the government is that we should move and not let precious government revenue be wasted,” said the official. This is also part of the government’s overall strategy to revamp and restructure public sector enterprises ecosystem in the country and get out of non-viable businesses and sectors. loss-making PSUs, the official said as this will mean workers will lose out in getting their dues.

During the past five years, the government had identified about 33 loss-making state-run companies for disinvestment as well as closure. While only a handful of firms have been under the process of closure, the list of entities identified for sale has remained static. The government has managed to sell some of the loss-making hotel properties and transferred some of the units to state governments. For example, decision for sale of Scooters India was taken in 2016 and expression of interest was unveiled in May 2018. No progress has been made after that.

The government has also been hunting for a buyer for the country’s biggest state-run helicopter firm Pawan Hans. Several extensions have been announced for the sale process but a buyer has not been found. Bharat Pumps and Compressors has been under the disinvestment process for a number of years and a suitor is yet to be found. “The view within the government is that we should move and not let precious government revenue be wasted,” said the official. This is also part of the government’s overall strategy to revamp and restructure public sector enterprises ecosystem in the country and get out of non-viable businesses and sectors.

We must abandon using unadjusted NSSO data, which have drifted far from reality.

By Swaminathan S Anklesaria Aiyar

The government has junked the 2017-18 National Sample Survey Office (NSSO) consumption survey which, accordingly to a leaked report, showed total consumption declining by 3.7% between 2011-12 and 2017-18, and rural consumption falling 8%.

Protests have erupted from Opposition parties and a group of 214 academics. On the other hand, Surjit Bhalla, now India’s executive director in the International Monetary Fund (IMF), has lambasted the NSSO findings as unbelievable. He has shown that between 2011-12 and 2017-18, sales of cars rose 31.5%, of two-wheelers 45.6%, of airline passengers 95.6% and of cellphone users 44.4%.

This is totally incompatible with the NSSO claim of falling consumption.

Diverging Divergence 
Bhalla further says that the ratio of NSSO to GDP estimates (made by the national accounts) of consumption had plunged steadily from 95% in the 1960s to just 55% in 2011-12, and now to an incredible 33% in 2017-18. No economic explanation can explain such a huge, rising divergence. Something may be wrong with GDP data. But, clearly, much more is wrong with the NSSO data.

In a recent interview in Mint ( bit.do/fjrfu), Pronab Sen, the most respected statistical expert in India, says whenever the statistical system throws up bad news, the government tries to suppress or discredit it. He is correct. GoI should not suppress data even when inconvenient. But that does not mean NSSO data are sacrosanct and cannot be questioned, or called incredible.

As I related in this column last fortnight (

, even in the US, household surveys provide serious underestimates so regularly that a recent academic paper was titled ‘Household Surveys in Crisis’. We should accept that NSSO household surveys are flawed, not because the statisticians are liars or saboteurs, but because all such surveys are inherently flawed, more so in India’s circumstances.

We need a drastic overhaul of NSSO survey methodologies. Survey data must not be hidden as being politically embarrassing. Rather, they should be published along with a frank discussion of their flaws. This is happening in the US, where, too, household surveys underestimate consumption by up to 40%. US academics are trying to create models that modify household surveys by incorporating independent production and sales data. India must do the same.

Pronab Sen says critics including the government are “consistently questioning the professionalism of [the government’s] statisticians”. No, I am questioning the credibility of their models and methods, which are also under question in other countries like the US. Sen says GDP data (national accounts) are drawn mainly from the corporate sector. But the non-corporate sector accounts for half the economy. So, maybe the corporate sector is doing well, but non-corporate sectors are doing badly, which is why consumption is falling.

This will not wash. First, production in the organised and unorganised sectors is closely linked. Unorganised producers use inputs from the organised sector — electricity, steel, aluminium, yarn, plastics, commercial vehicles. Second, the country is steadily getting more formalised, which is why the ratio of corporate tax to GDP has tripled since 1991despite a cut in the tax rate.

Lie Lie Land
Third, the government has given over Rs 3 lakh crore of Micro Units Development and Refinance Agency (MUDRA) small business loans to the unorganised sector, and non-banking financial companies (NBFCs) lending to microcredit groups and small businesses has grown explosively. Sen’s thesis of a collapse of the unincorporated sector is contradicted by independent data.

Sen says NSSO data do not fully capture the upper income groups, who refuse to participate in surveys. “But that does not mean that it is not capturing data for the lower income groups accurately,” he states. Sorry, but independent data such as Bhalla’s show that the NSSO fails even in lower income data.

I looked up sales data of top FMCG companies, which cater to the lower and middle classes. Between 2011-12 and 2017-18, sales of Hindustan Unilever rose by 52%, of Nestlé by 32%, of Britannia Industries 85%, and of Venky’s (the top chicken producer) by 171%. No sign here of falling consumption among the lower and middle classes.

I argued in this column last fortnight that the total inability of opinion polls and exit polls to predict election results proved conclusively that people lie to surveyors. They will not say anything they think might harm their personal interest. In the last two decades, subsidies and benefits from both the Centre and states have often been targeted at the lower sections of the population.

It makes no sense for people to honestly declare their true consumption, and risk being graduated out of income categories from which they could get current or future benefit.

I am certain that this is the key reason for the consistently growing gap between what the national accounts and NSSO surveys show. Neither Sen nor any other critic is able to counter my thesis. That simply strengthens it.

The government is certainly wrong to try and hide NSSO data. But that does not make the data any less incredible.

We must abandon using unadjusted NSSO data, which have drifted far from reality. Instead, we must develop models using other data sources (such as production, sales and tax receipts) to adjust the NSSO data. The US is attempting this. We should not lag behind.

DISCLAIMER: Views expressed are author’s own.

Sitharaman said India has a decisive leadership, which has undertaken radical structural reforms in various sectors of the economy.

New Delhi: Finance minister Nirmala Sitharaman on Tuesday said the government is open to further reforms for making India a more attractive investment destination.

The government has taken various steps, including reduction of corporate tax, she said at the India-Sweden Business Summit here.

“I only can invite and assure that the government of India is committed for further reforms in various sectors — whether it is banking, mining or insurance and so on,” she said.

Sitharaman, in a surprise move, had on September 20 slashed the corporate tax rate to 22% from 30% sans any exemptions and holidays and to 15% for new manufacturing entities to spur investments into the country.

She said India plans to spend Rs 100 lakh crore on building and upgrading public infrastructure over the next five years and invited Swedish companies to participate in various greenfield and brownfield projects.

“We are looking at building more smart cities where Swedish businesses can contribute,” FM said, adding that the government has appointed a task force to track the pipeline of big-ticket projects.

Sitharaman said India has a decisive leadership, which has undertaken radical structural reforms in various sectors of the economy.

The country is determined to further improve the ease of doing business, she added. India moved 14 places to be 63rd among 190 nations in the World Bank’s ease of doing business ranking on the back of multiple reforms.

The minister said the country offers a huge market with a large middle-class, which is aspirational and has real purchasing power.

“This offers immense opportunities for businesses,” said Sitharaman.

India and Sweden have seen concrete outcomes in life sciences and other sectors, which have benefited both the countries, she said.

In the pre-election interim budget, the government had announced full tax rebate to taxpayers earning up to Rs 5 lakh a year.

The middle-class tax payers may finally get to cheer lower tax rates on their hard-earned income that are likely to be implemented as part of the Budget proposals to be presented by Finance Minister Nirmala Sitharaman in February 2020.

Sources said that the Budget 2020-21 will take the sops announced in the pre-election interim budget further by changing the personal income tax rates for the salaried in lower and middle income groups. This may be done through changes in the tax slabs.

Accordingly, the sources said, those having annual income between Rs 2.5-Rs 10 lakh may be taxed at the rate of 10 per cent while individuals earning between Rs 10-20 lakh may get to pay tax at a lower rate of 20 per cent. The tax exemption limit may, however, remain unchanged at Rs 2.5 lakh.

The changes are being considered to provide relief to salaried middle income class individuals that were left out from the government’s stimulus measures announced in September that reduced income tax rate for the corporate sector to prop up investment climate in a slowing economy.

It is being designed partially on the lines of recommendations given by a task force on the New Direct Tax Code which submitted its report to the Finance Minister in August. The report is still being examined by the ministry.

At present, basic exemption limit is Rs 2.5 lakh per annum and income between Rs 2.5-5 lakh is taxed at 5 per cent. Those in the income bracket of Rs 5-10 lakh are taxed at 20 per cent and those above Rs 10 lakh are taxed at 30 per cent rate. There is also a three-layered surcharge for the super rich in the salary brackets of Rs 1 crore, Rs 2 crore and Rs 5 crore.

Though the task force has recommended a major overhaul in the tax administration including sweeping changes in the tax slabs and rates, sources said that government may implement the recommendations partially to prevent any major slippages in tax collection that is already under strain on account of the slowdown.

So, the changes in tax slabs are being considered only for salaried with annual income upto Rs 20 lakh, with continuation of the super rich tax by way of surcharges for some time more. Apart from slabs for income upto Rs 20 lakh, the task force on Direct tax Code has also suggested tax rate of 30 per cent for income between Rs 20 lakh and Rs 2 crore and a new tax rate of 35 per cent without surcharges for all those earning over Rs 2 crore. Its implementation may, however, be kept in abeyance.

The proposed changes in tax slab are expected to benefit a large section of the middle income salaried class. According to the Central Board of Direct Taxes (CBDT), more than 27 per cent of the 5.52 crore individual taxpayers who filed returns for 2017-18 had an income between Rs 5 lakh and Rs 10 lakh. If the recommendations of the task force are implemented, these 1.47 crore taxpayers would move from the 20 per cent slab to the 10 per cent slab.

In the pre-election interim budget, the government had announced full tax rebate to taxpayers earning up to Rs 5 lakh a year. But the subsequent post election budget did not offer income tax sops for the middle income salaried class.

The government’s welfare measures for individual tax payers are expected to add further stress to its finances. This is expected to be reflected in the budget that is may reset the fiscal deficit target for FY21 again. But the roadmap towards fiscal consolidation may be drawn in a way that 3 per cent fiscal deficit is reached in subsequent year.

Government finance, that is constrained by lower growth in tax collections, is expected to be augmented in a big way through disinvestment and higher dividend receipts from the RBI. The spectrum auctions and sale of non-core assets of PSUs including their prized land bank may fill the coffers to the extent that deficit may be prevented from going completely out of hand.