Need coordinated action to lower tax on fuel: RBI guv
MUMBAI: Reserve Bank of India (RBI) governor Shaktikanta Das on Thursday said there is a need for coordinated action between the centre and state governments to reduce taxes on petrol and diesel prices.
“There is a need for coordinated action between the centre and the states because there are inherent taxes levied by both,” the governor said, adding that calibrated reduction of taxes is important.
He, however, said both the centre and the state governments have their revenue pressures and they are required to spend high sums of money to enable the country and the people to come out of the Covid-19 pandemic stress.
“So the revenue requirement and the compulsion of the governments are fully understood. But having said that the impact on inflation also is something, which comes in from the fact that petrol and diesel prices do have an impact on the cost of manufacturing, production…,” the Governor said at an event organised by Bombay Chamber of Commerce.
On the central bank’s digital currency, Das said a lot of work is going on internally in the RBI and some broad guidelines and approach papers will be released on it soon.
The governor said RBI has certain concerns on crypto currencies and it has already been communicated to the government.
He said RBI is looking into strengthening the regulatory architecture for asset reconactivity struction companies (ARCS).
“(We are) refining and further upgrading the regulatory architecture in respect of the ARCS to ensure that they have a skin in the game, and they are very much in business is receiving a lot of attention from us,” Das said.
On setting up of ARC for non-performing asset (NPA) management, as announced in the Budget 2021, he said, “(in) no way will it jeopardise the of the existing ARCS” The governor said there is growing realisation and awareness among banks to dealing with bad assets and they are proactively making provision in their books for stressed assets.
He said RBI has sharpened and deepened its supervisory methods and is doing deep dive into areas of banking which were not done earlier.
“We have a precise idea of build-up of stressed assets in banks and as soon as we see a sign of stress, we immediately enter into a discussion with the banks and proactively deal with the problems,” he said.
Das also asked public and private sector banks to improve their credit appraisal processes and take measures to stop evergreening of loans.
He emphasised that the country’s financial sector currently is in a far much better place than it was earlier.
Tesla Inc. told workers it will temporarily halt some production at its car-assembly plant in California for about two weeks, according to a person familiar with the matter.
Staff on a Model 3 production line in Fremont were told their line would be down from February 22 until March 7, said the person, who asked not to be identified because the information is private. The workers were told they would be paid for February 22 and February 23 and not paid for February 28, March 1, 2 and 3. They were advised to take vacation time, if they had it.
Representatives for the Palo Alto, California-based electriccar maker didn’t immediately respond to messages seeking comment.
Tesla shares fell as much as 3.8% to $713.75 before the start of regular trading Thursday.
While production-line outages aren’t unusual for automakers, they cost the companies revenue. Tesla said last month that it’s trying to mitigate the effects of a global semiconductor shortage on its operations and that it expects to increase global vehicle deliveries by more than 50% this year. The California plant is still the most important part of Tesla’s vehicle-production base, with capacity to make an estimated 600,000 vehicles a year. Chief executive officer Elon Musk also has opened a plant near Shanghai and is constructing facilities outside Berlin and in Texas.
Tesla has cut the price of its various models 14 times in markets including China, Japan and France this year, raising some analysts’ doubts that it has enough demand to meet its goals.
“When considering Tesla had excess inventory in the fourth quarter of 2020, and has never been able to sell-out its production capacity, we see the company as currently demand constrained, rather than production constrained,” GLJ Research LLC founder Gordon Johnson wrote in a note earlier this week.
THERE IS A NEED FOR COORDINATED ACTION BETWEEN THE CENTRE AND THE STATES BECAUSE THERE ARE INHERENT TAXES LEVIED BY BOTH, SAYS DAS