Daily News - Monday, 13 January 2025
Govt eyes revamp of revival scheme for MSMEs in debt (mint)
The government is revamping the Framework for Revival and Rehabilitation (FRR) of MSMEs, introducing FRR 2.0 to simplify loan restructuring for small businesses, which currently face significant challenges in accessing and repaying credit, unlike larger enterprises. MSMEs, which employ over 216 million people and contribute to 45% of exports and a third of India’s gross value added annually, have consistently struggled with non-performing assets and limited financial relief, prompting calls for better mechanisms such as extended credit periods and reduced penalties. The revamped framework, supported by a ₹20,000-crore subordinate debt fund announced in August 2024, aims to address systemic gaps, safeguard up to 1.2 million jobs, and ensure sustained access to credit for MSMEs in financial distress.
Budget FY26 may introduce amnesty scheme for customs (Financial Express)
The government is considering an amnesty scheme for customs in the upcoming Budget to reduce litigation and improve ease of doing business, potentially resolving over 40,000 pending cases related to legacy pre-GST taxes like additional and special additional duties. Industry experts, including Price Waterhouse & Co LLP and EY India, emphasize that such a scheme, similar to “Sabka Vishwas,” would alleviate the judicial backlog, provide small businesses with a clean slate, and align with objectives like litigation reduction and regulatory upgrades. Additionally, the industry is advocating for customs duty rate rationalization to support the “Make in India” initiative and boost manufacturing competitiveness.
CIL eyes Argentina presence to focus on critical minerals, lithium (Financial Chronicle)
Coal India Ltd (CIL) is diversifying into critical minerals like lithium, nickel, and cobalt, with a focus on lithium brine assets in resource-rich nations such as Argentina, Australia, and Chile, to support India’s transition to clean energy. The state-owned company has invited expressions of interest for technical due diligence on lithium assets in Argentina to evaluate their financial, strategic, and geological viability, aligning with its shift from coal dependency. This initiative follows the government’s identification of 30 critical minerals essential for clean energy technologies, positioning CIL to secure a sustainable supply chain for India’s green economy goals.
‘Weakening rupee puts pressure on Air India's cost structure' (Business Standard)
Air India plans to retrofit its widebody planes by July while opposing increased bilateral rights for Gulf nations like the UAE and Qatar, focusing instead on expanding direct flights to North America and Europe and strengthening domestic hubs such as Delhi and Mumbai. Despite challenges from the rupee’s depreciation, which increases costs and affects demand, Air India leverages its international operations by charging in foreign currencies, with 20% of international sales made directly via its website or app and 40% through domestic points of sale. The airline has ruled out wet leasing due to operational challenges and is focusing on its new aircraft orders to build a sustainable flight network and improve profitability through productivity enhancements and strategic fare management.
Govt asks industries to identify import prospects from US (Business Standard)
India is assessing opportunities and challenges in increasing imports from the US, focusing on high-value sectors like petroleum, aviation, defense, and medical equipment, as imports of US crude oil rose from 0.7% in FY18 to 9% in FY21. The government has sought industry feedback on trade impacts, including tariffs, to mitigate risks while balancing the $35.3 billion trade surplus India held with the US in 2023-24. With Trump’s emphasis on “America First” policies and trade deficit concerns, India aims to strategically navigate potential pressures to expand procurement from the US while ensuring trade relations remain mutually beneficial.
