Chennai: It is cliched to say the year was action-packed in the business world. But action-packed it was, what with RBI governor resigning well before his tenure expired, IL&FS shocking the nation with its management issues, right to the fact that depite efforts, the government found no bidders for Air India.
News Today takes a look at the industry and happenings pertaining to it down the year that was.
Happy anniversary love
The Goods and Service Tax (GST) was launched in 2017 with much furore by the government and faced flak from different entities as well. One year of GST saw many changes take place with ‘the country’s biggest tax reform since independence’.
Various items were moved to lower tax brackets and as the Lok Sabha polls near, Prime Minister Narendra Modi has promised to move 99 per cent of all items within the 18 per cent or below tax brackets.
But the fact that experts and analysts look at is the collections that GST brought in, which on average did not make ends meet. The collections stood at Rs 1.03 lakh crore in April, Rs 94,016 crore in May, Rs 93,960 crore in August, etc, lower than the estimates made by the government earlier. Further, recent tax cuts mean, collections might be hit further, market analysts, state.
Loan in 60 minutes
Might resemble a movie name to an extent, however, Prime Minister on 2 November announced a 12-point action plan for the small and micro enterprises (MSME) sector that will see banks offer Rs 1 crore loan in 59 minutes.
The move is expected to boost the sector but with less than 60 days to the year end, details about the effectiveness of the move will come to light by the end of current financial year.
Non-performing assets have been big trouble makers for the country with new revelations add Nirav Modi, Meghul Choski join the list of Vijay Mallya. Nirav Modi’s PNB scam and his subsequent escape from the country overshadowed other revelations that saw ICICI head Chanda Kochhar’s get into trouble as well.
Two years and effects
Demonetisation completed two years this year and saw its effects lingering, much to the worry of the Centre, who stand by it. The war against black money had different effects on different industries, but the country, as a whole seems to be out of it.
Former RBI governor Urjit Patel’s fallout with the Centre had been well documented as the rulers wanted use of RBI reserves to fend off catastrophe. Bowing out due to ‘personal reasons’ Urjit Patel shocked the country with his decision, but the issue came to rest almost immediately after he was replaced by Shakthikanta Das in a matter of hours.
The tiff between the apex bank and the Centre is expected to move from ceasefire to truce with Das and Finance Ministry coming to terms.
The rupee went on a tumbling spree this year with crude prices jumping up, since output was reduced. The ‘Dollar vs Rupee’ fight saw the former grow stronger and the difference cross the Rs 70 mark for the first time in history.
Various possibilities opened up with the eventuality however, with investors, especially NRIs, looking to invest in the country that gives more returns than any market today.
Interestingly, experts, including former RBI governor Rajan stated that the downfall is not as bad as it was perceived.
Airlines did not have a fruitful year as Air India, Jet Airways, to name two carriers, struggled with debt and operational hurdles. With aviation fuel prices creeping up, along with unstability in the market. Air India has more than Rs 50,000 crore debt and the fact that the government could not sell it meant they are divesting different entities of the airlines to make ends meet. Matters are worse for Jet but Naresh Goyal seems to have plans to keep it afloat.
The year saw telecom players use tactics never before used to get their average revenue per user uo after the Jio debacle. Customers were threatened with termination of services if not recharged and TRAI was told that the telcos had the right to do so.
The year also saw Vodafone and Idea become a single entity and Jio launch itself into new forums like fibrenet, among others.