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  • What is Angel Tax?

    angel

    Central idea: The article provides an overview of the angel tax provisions in the Finance Bill, which were introduced in the Budget. It highlights the concerns raised by the start-up community regarding the impact of these provisions on their operations.

    Angel Investment

    • An angel investor is an individual who provides financial backing to early-stage startups or entrepreneurs, typically in exchange for equity in the company.
    • Angel investors are typically high-net-worth individuals who invest their own personal funds, rather than investing on behalf of a firm or institution.
    • Features of Angel Investing:
    1. Early-stage funding
    2. Equity investment
    3. High-risk, high-reward
    4. Active involvement
    5. Personal investment
    6. Flexible terms
    7. Shorter investment horizon

     

    What is Angel Tax?

    • Referred to as Angel Tax, this rule is described in Section 56(2)(viib) of the Income Tax Act, 1961.
    • Essentially it’s a tax on capital receipts, unique to India in the global context.
    • This clause was inserted into the act in 2012 to prevent laundering of black money, round-tripping via investments with a large premium into unlisted companies.
    • The tax covers investment in any private business entity, but only in 2016 was it applied to startups.

    Why was angel tax introduced?

    • The complicated nature of VC fundraising with offshore entities, multiple limited partners and blind pools is contentious.
    • There has been some element of money laundering or round-tripping under guise.

    Details of its levy

    • The Angel Tax is being levied on startups at 9% on net investments in excess of the fair market value.
    • For angel investors, the amount of investment that exceeds the fair market value can be claimed for a 100% tax exemption.
    • However, the investor must have a net worth of ₹2 crores or an income of more than ₹25 Lakh in the past 3 fiscal years.

    Startups under scrutiny

    • As more and more new-age tech startups started raising VC funding, they came under the IT department scrutiny.
    • These funding deals often saw investors paying a premium above the face value or the fair market value of securities, and therefore were taxed as income for the startup.
    • Between 2016 and 2019, startups urged the government to add exceptions that would allow them to be exempt from the Angel Tax.

    Which startups are exempted?

    • There is a clear provision that says that start-ups which are recognized by DPIIT are out of the proposal’s purview.
    • The start-up recognition process is also very simple where any applicant gets it automatically.
    • However, the key condition for exemption is that the aggregate amount of paid up share capital and share premium of the startup after issue or proposed issue of share does not exceed INR 25 Cr.

    Concerns raised by startup

    • Compliance burden: Even beyond the issue of taxation, the compliance burden on startups will potentially increase significantly under the new rules.
    • Persisting slowdown: The timing of this potential tax is most worrying since it coincides with the ongoing startup funding slowdown.
    • Fear of off-shoring: Entrepreneurs and investors are concerned that applying strict taxes on capital receipts without adequate exceptions will lead to startups moving overseas.

    Back2Basics: Startups in India

    • Startups are young companies founded to develop a unique product or service, bring it to market and make it irresistible and irreplaceable for customers.
    • In India, start-up should be incorporated as a private limited company or registered as a partnership firm or a limited liability partnership.
    • Turnover should be less than INR 100 Crores in any of the previous fiscal years.
    • An entity shall be considered a Start-up up to 10 years from the date of its incorporation.
    • The Start-up should be working towards innovation/ improvement of existing products, services, and processes and should have the potential to generate employment/ create wealth.
    • An entity formed by splitting up or reconstruction of an existing business shall not be considered a “Startup”.

     

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  • Corrupt Practices according to Representation of People Act, 1951

    Central idea: The article provides an overview of Sections 123 (2) and Section 123 (4) of the Representation of People’s Act, 1951. It highlights how the section makes it illegal for candidates who have been convicted of certain offenses to contest elections to Parliament and state legislatures.

    Recent context: Promise of Freebies

    • Recently, the Supreme Court directed to look into prayers for reconsidering its 2013 judgment in ‘S. Subramaniam Balaji vs. State of Tamil Nadu’ Case.
    • The court held that promises of freebies cannot be termed a corrupt practice. However, the matter is still yet to be decided.

    Illicit Practices under the RPA, 1951

    corrupt

    • Under the provisions of the Act, an elected representative can be disqualified if convicted of certain offences on grounds of-
    1. Corrupt practices
    2. Failing to declare election expenses
    3. Interests in government contracts or works

    What amounts to Corrupt Practices?

    • Section 123 of the Act defines ‘corrupt practices’: It includes bribery, undue influence, false information, and promotion or attempted promotion of “feelings of enmity or hatred between different classes of the citizens of India on grounds of religion, race, caste, community, or language” by a candidate for the furtherance of his prospects in the election.
    • Section 123 (2) deals with ‘undue influence’: It defines as “any direct or indirect interference or attempt to interfere on the part of the candidate or his agent, or of any other person, with the consent of the candidate or his election agent, with the free exercise of any electoral right.” This could also include threats of injury, social ostracism and expulsion from any caste or community.
    • Section 123 (4) extends ambit of “corrupt practices”: It covers the intentional publication of false statements which can prejudice the outcome of the candidate’s election.

    What practices has the court held as corrupt practices in the past?

    • Jamuna Prasad Mukhariya v. Lacchi Ram, 1995: The encroachment of religion into secular activities is strictly prohibited, the court stated while adding that the same is clear from Section 123(3). However, even as far back as 1955, the Apex Court in Jamuna Prasad Mukhariya Case upheld the constitutional validity of Section 123 (3).
    • SR Bommai v. Union of India, 1994: In this case, otherwise held secularism to be a part of the ‘basic structure’, the court said, “whatever the attitude of the State towards the religions, religious sects, and denominations, religion cannot be mixed with any secular activity of the State.”
    • Abhiram Singh v C.D. Commachen, 2017: In 2017, a seven-judge constitution bench of the apex court held that an election will be annulled if votes are sought in the name of a candidate’s religion, race, caste, community, or language, as per Section 123 (3) which prohibits the same.

     

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  • ‘HD 3226’ Wheat can beat the heat

    wheat

    Scientists at the Indian Council of Agricultural Research (ICAR) have developed a new variety of wheat ‘HD 3226’ that can withstand high temperatures.

    HD 3226 Wheat

    • The wheat, known as “HD 3226”, has been developed specifically for cultivation in the northwest region of India, where temperatures can reach up to 42 degrees Celsius.
    • It took 10 years for ICAR to develop this variety.
    • It has been specifically developed for cultivation in the northwest region of India.

    Features of HD 3226 Wheat

    • More resilient to heat stress: The HD 3226 wheat variety is reportedly more resilient to heat stress than other varieties of wheat.
    • Higher yields: The HD 3226 wheat variety can produce up to 12-15% higher yields in high-temperature conditions.

    Significance

    • The development of this new wheat variety is particularly important given the increasing frequency of heatwaves in the region due to climate change.
    • With rising temperatures, it is becoming more challenging for farmers to grow crops.

    Government approval and availability

    • The HD 3226 wheat variety has now been submitted to the Indian government for approval.
    • Once approved, it is expected to be available to farmers in the coming years.

     

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  • Dickinsonia Fossil found in Bhimbetka turns out to be decayed beehive

    bhim

    A Dickinsonia fossil found at Bhimbetka, previously believed to be one of the world’s earliest animals, and has been identified as a decayed beehive.

    About Bhimbetka

    bhim

    • The Bhimbetka rock shelters are an archaeological site in central India that spans the prehistoric Paleolithic and Mesolithic periods, as well as the historic period.
    • It exhibits the earliest traces of human life in India and evidence of Stone Age starting at the site in Acheulian times.
    • It is located in the Raisen District in Madhya Pradesh about 45 kilometres (28 mi) south-east of Bhopal.
    • It is a UNESCO World Heritage Site that consists of seven hills and over 750 rock shelters distributed over 10 km (6.2 mi).
    • At least some of the shelters were inhabited more than 100,000 years ago.
    • Some of the Bhimbetka rock shelters feature prehistoric cave paintings and the earliest are about 10,000 years old (c. 8,000 BCE), corresponding to the Indian Mesolithic.
    • These cave paintings show themes such as animals, early evidence of dance and hunting.
    • The Bhimbetka rock shelters were found by V S Wakankar 64 years ago. Since then, thousands of researchers have visited the site, but this rare fossil went undetected.

    What is Dickinsonia?

    bhim

    • Dickinsonia is an extinct genus of basal animal that lived during the late Ediacaran period in what is now Australia, Russia and Ukraine.
    • The individual Dickinsonia typically resembles a bilaterally symmetrical ribbed oval.
    • Its affinities are presently unknown; its mode of growth is consistent with a stem-group bilaterian affinity, though some have suggested that it belongs to the fungi or even an “extinct kingdom”.
    • The discovery of cholesterol molecules in fossils of Dickinsonia lends support to the idea that Dickinsonia was an animal.

    Cambrian Explosion and Dickinsonia

    • The ‘Cambrian Explosion’ is the term given to the period of time in history when complex animals and other macroscopic organisms such as molluscs, worms, arthropods and sponges began to dominate the fossil record.
    • Researchers from Australian found the Dickinsonia fossil since its tissue contained molecules of cholesterol a type of fat that is the hallmark of animal life.

     

    Try this PYQ:

    Q. Which one of the following statements is correct?

    (a) Ajanta Caves lie in the gorge of Waghora River

    (b) Sanchi Stupa lies in the gorge of Chambal River

    (c) Pandu-lena Cave Shrines lie in the gorge of Narmada River

    (d) Amaravati Stupa lies in the gorge of Godavari River

     

    [wpdiscuz-feedback id=”2pwq42fb8z” question=”Please leave a feedback on this” opened=”1″]Post your answers here.[/wpdiscuz-feedback]

     

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  • Deputy Speaker Is An Officer of Parliament

    Officer

    Central Idea

    • The present Lok Sabha has not elected a Deputy Speaker even after three years and seven months of its term, and the non-election has reached the Supreme Court, which has reportedly sent notice to the Union government; historically, a Deputy Speaker is as important as the Speaker for the House.

    What is the practice?

    • Two presiding officers in Lok Sabha: There are two presiding officers for the Lok Sabha, namely the Speaker and the Deputy Speaker, who are elected by the members of the House.
    • Article 93 of the constitution: Under Article 93 of the Constitution, as soon as the House meets after the election these two presiding officers are elected one after the other.
    • Practice of electing speaker and deputy speaker: The practice followed so far has been to elect the Speaker after the oath-taking. Thereafter, within a few days, the Deputy Speaker is also elected.

    Officer

    Office of Deputy Speake Speaker of the Lok Sabha

    • The Deputy Speaker of the Lok Sabha is not subordinate to the speaker of Lok Sabha; is responsible for the Lok Sabha. and
    • He/she is the second-highest-ranking legislative officer of the Lok Sabha.
    • He/ She acts as the presiding officer in case of leave of absence caused by death or illness of the Speaker of the Lok Sabha.

    Pin this Note

    • It is by convention that the position of Deputy Speaker is offered to the opposition party in India.
    • But if a government does not favour an Opposition member for political reasons, it is free to choose a member from its own party.

    The Historical Significance of the office

    • Government of India Act of 1919: The history of the office of Deputy Speaker goes back to the government of India Act of 1919 when he was called Deputy President as the Speaker was known as the president of the central legislative assembly.
    • Role is necessary to share the responsibility of running the House: Although the main functions of a Deputy Speaker were to preside over the sittings of the assembly in the absence of the Speaker and chair the select committees etc., the position was considered necessary to share the responsibility of running the House with the Speaker and guide the nascent committees.

    Did you know?

    • The first Speaker was G V Mavalankar and the first Deputy Speaker was M Ananthasayanam Ayyangar who was elected by the Constituent Assembly (Legislative) on September 3, 1948.
    • Later under the new Constitution, M Ananthasayanam Ayyangar was elected the first Deputy Speaker of the House of the people on May 28, 1952.

    Officer

    Importance of the Office

    • Powers Under Article 95(1) of the Constitution: The Deputy Speaker gets all the powers of the Speaker when the office of the Speaker is vacant, so the Deputy Speaker can also determine the petitions relating to disqualification under the 10th Schedule of the Constitution.
    • Speaker is powerless in matters of revising: The Speaker is powerless in the matter of revising or overruling a decision of the Deputy Speaker. No appeal lies to the Speaker against a ruling given by the Deputy Speaker.

    Conclusion

    • Although the Deputy Speaker gets to exercise these powers only in the absence of the Speaker his decisions are final and binding when he gives a ruling. In the eventuality of the Speaker remaining absent for a longer time due to illness or otherwise the government will have to grapple with the unpredictability of a ruling or an adverse decision by a Deputy Speaker who comes from the Opposition ranks. Article 93 contains a mandatory provision which needs to be carried out by the House.

    Officer

    Mains Question

    Q. Speaker and Deputy speaker of Lok Sabha are known as Officers of the parliament. In this context discuss the importance Deputy speaker.

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  • The India-US ICET: Transformative Impact On Bilateral Relations

    ICET

    Centra Idea

    • Earlier this month, the U.S. and India inaugurated their initiative on critical and emerging technologies (ICET). The promise of this initiative, if fulfilled, could have a transformative impact on India-U.S. relations. On the eve of the dialogue, National Security Adviser Ajit Doval said that the big need was to convert intentions and ideas into deliverables. This is where there has usually been a slip.

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    Background

    • India’s attempts towards US Technology Parallels: Since the 1960s, India has made many attempts to jump on the U.S. technology bandwagon.
    • Failed because of mismatch: But all of them have failed, primarily because of the mismatch between the two countries on the purposes for which they collaborated.
    • The ICET is perhaps better positioned: Unlike the earlier iterations, it comes at a time when India, too, has developed technological and managerial capacities and is emerging as a major economic power.

    ICET

    What is Initiative on Critical and Emerging Technologies (ICET)?

    • Launched by PM Modi and President Joe Biden: The ICET initiative was launched by Indian Prime Minister Narendra Modi and U.S. President Joe Biden in May 2022.
    • Goal to elevate and expand Indo-US Partnership: strategic technology partnership and defense industrial cooperation between the governments, businesses, and academic institutions of the two countries.
    • Directly monitored by PMO and White house: The Prime Minister’s Office in Delhi and the White House in Washington will oversee and direct the ICET.
    • Six focus areas of co-development and co-production: Strengthening innovation ecosystems, defence innovation and technology cooperation, resilient semiconductor supply chains, space, STEM talent, and next generation telecom.

    American aid so far

    • Significant role in India’s development efforts and quest for technological capability: A major driver of the process was the Cold War which persuaded the U.S. to provide sweeping assistance in a range of areas to India. While the Soviet Union emerged as a major player in areas like steel, heavy electricals, petroleum and mining, the U.S. focused on modernising engineering and management education, science and technology (S&T), and agriculture.
    • Nuclear energy cooperation: US helped build India’s first reactors for research and power. An entire generation of Indian nuclear scientists were trained in the U.S., including some who subsequently helped in making nuclear weapons.
    • Aid in Education in initial phase and vice versa: The massive aid provided by the U.S. to modernise Indian education, especially engineering and management, should have led to a growing industrial sector, but the Indian economy stalled in the 1960s and India ended up with a system where IIT and IIM graduates ended up benefiting the U.S. economy.
    • Aid in agriculture: The one area in which India did get lasting and important benefits was agriculture where American S&T helped trigger the Green Revolution and end an era of food shortages.
    • Gandhi-Reagan Science and Technology Initiative: The Gandhi-Reagan Science and Technology Initiative led to the 1984 India-U.S. MoU on sensitive technologies, commodities and information.
    • New American willingness to promote Indian S&T and the arms industry: In 1987, the U.S. agreed to assist India’s Light Combat Aircraft (Tejas) programme and allowed the sale of front-line GE 404 engine to India.

    ICET

    Current Status

    • India has steadily advanced in status as a friend of the U.S. and has purchased U.S. weapons and systems worth billions of dollars.
    • It is now deemed to be a Major Defence Partner, though not a Major Non-Nato Ally, a much more useful designation that Pakistan still retains.
    • The course has not been problem-free witness the pressure India faced under CAATSA and on account of its oil trade with Russia.

    Ambitious goals

    • Great deal for India: The ICET has set up a range of ambitious goals which mean a great deal for India. Some of them are aspirational, others political. A few are over the top, such as the belief that the U.S. will help India to develop advanced jet engines.
    • Licence for jet engines: As of now, all that is on the table is the possible licence manufacture of GE-404/414 engines for the LCA. This is not new. But cutting-edge jet engines are the crown jewels of the U.S., which the country will not part with.

    ICET

    Conclusion

    • After presenting the Union Budget, the finance minister said in an interview, “This is a golden opportunity for India. We should really not miss the bus this time.” The remark is truer of the technology and industrialisation bus that the ICET could be.

    Mains question

    Q. What is Initiative on Critical and Emerging Technologies (ICET)? Highlight the significance of ICET for India while noting down the American cooperation so far.

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  • Live transcription of Supreme Court proceedings introduced

    live

    Central idea: The Supreme Court introduced live transcription of court proceedings for the first time in the country, employing artificial intelligence (AI) and high-tech tools.

    Fun fact!

    The CJI announced that the live transcription will commence on an experimental basis with the constitution bench hearing on the vertical political split in a mainstream Maharashtrian political party.

     

    How does AI-based transcription work?

    • AI-based transcription works by using advanced machine learning algorithms to automatically transcribe audio or video content into written text.
    • The software uses natural language processing (NLP) and speech recognition technology to identify and transcribe spoken words, which are then formatted into a text document.

    What is Natural Language Processing (NLP)?

    • Natural Language Processing (NLP) is a subfield of computer science, artificial intelligence, and computational linguistics concerned with the interactions between computers and human (natural) languages.
    • It involves developing algorithms and computational models that can understand, interpret, and generate human language.
    • NLP is used in a variety of applications, including language translation, sentiment analysis, text summarization, speech recognition, and more.
    • It combines techniques from computer science, linguistics, and psychology to enable computers to process and understand natural language.

    Benefits of the move

    • Improved access to justice: For the hearing impaired and those with limited understanding of English.
    • Enhanced transparency and accountability: The transcripts can be reviewed and analyzed.
    • Reduced errors and inaccuracies: AI-based technology is more efficient and reliable than human transcriptionists.
    • Time-saving and cost-saving: For the court system and litigants, as live transcription eliminates the need for manual transcription and subsequent editing making justice dispensation faster than ever.
    • Legal awareness in public domain: Availability of real-time transcripts can help journalists and researchers report on court proceedings more accurately and quickly.

    Other AI solutions used in Indian Judiciary

    • E-SCR project: The electronic Supreme Court Reports (e-SCR) has more than 34,000 judgments available, accords free access to the official law reports of the Supreme Court’s reported Judgments to the law students, lawyers, and other legal professionals and to the public at large with special tools for the accessibility to those with visual disabilities as well.
    • SUPACE: Supreme Court Portal for Assistance in Courts Efficiency (SUPACE) is a tool that collects relevant facts and laws and makes them available to a judge.
    • SCI-Interact: In 2020, the Supreme Court developed a software called, SCI-Interact, to make all its 17 benches paperless. This software helps judges’ access files, annexures to petitions and make notes on computers.
    • LIMBS: Earlier, the Department of Legal Affairs has introduced a web-based application called LIMBS or Legal Information Management & Briefing System. The idea is to track the entire life cycle of a case efficiently.
    • SUVAAS: In November 2019, the Apex Court launched an indigenously engineered neural translation tool, SUVAAS, to translate judicial orders and rulings from English to vernacular languages faster and efficiently.

    Challenges for the AI breakthrough

    • Cost and Resources: The implementation of live transcription would require significant financial and technological resources.
    • Accuracy of Transcription: The accuracy of the live transcription is an important issue as any errors in the transcription could have significant implications, particularly in legal proceedings.
    • Privacy and Security: The live transcription of court proceedings could raise concerns about privacy and security as sensitive information could be disclosed or key judicial interpretations could be tampered.

    Way forward

    • The ethical and responsible use of AI and ML for the advancement of efficiency enhancing can be increasingly embedded in legal and judicial processes.
    • The Supreme Court has laid a strong foundation basis which efficiency enhancement can be accelerated across functional processes.
    • This is one of the key reasons why justice delivery in India is poised for transformative change.

     

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  • What is Open Market Sale Scheme (OMSS)?

    market

    The government has announced its plan to sell 20 lakh tonnes of wheat from its buffer stock in the market under the Open Market Sale Scheme (OMSS).

    Why such move?

    • The purpose of the move is to cool down the surge in wholesale prices of grain.
    • It will be sold in the open market to stabilize grain prices.

    Do you know?

    During the COVID-19 pandemic, the Indian government increased the allocation of rice and wheat for the OMSS to ensure that the supply of food grains remained stable and that people had access to affordable food.

    Open Market Sale Scheme (OMSS)

    • OMSS refers to the selling of food grains by the government/government agencies at predetermined prices in the open market from time to time.
    • This scheme aims to enhance the supply of grains, especially during the lean season and thereby to moderate the general open market prices, especially in the deficit regions.
    • The Food Corporation of India (FCI) on instructions from the Government, sells wheat and rice in the open market from time to time.
    • This enhances the supply of wheat and rice especially during the lean season and moderates the open market prices, especially in the deficit regions.

    Components of the scheme

    The present form of OMSS comprises 3 schemes as under:

    1. Sale of wheat to bulk consumers/private traders through e-auction.
    2. Sale of wheat to bulk consumers/private traders through e-auction by dedicated movement.
    3. Sale of Raw Rice Grade ‘A’ to bulk consumers/private traders through e-auction.

    Selling through a transparent process

    • For transparency in operations, the Corporation has switched over to e-auction for sale under Open Market Sale Scheme (Domestic).
    • The FCI conducts a weekly auction to conduct this scheme in the open market using the platform of commodity exchange NCDEX (National Commodity and Derivatives Exchange Limited).
    • The State Governments/ Union Territory Administrations are also allowed to participate in the e-auction if they require wheat and rice outside TPDS & OWS.

     

    Answer this PYQ in the comment box:

    Q.The economic cost of food grains to the Food Corporation of India is Minimum Support Price and bonus (if any) paid to the farmers plus:

    (a) Transportation cost only

    (b) Interest cost only

    (c) Procurement incidentals and distribution cost

    (d) Procurement incidentals and charges for godowns

     

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  • Children have a Right to protect their Genetic Information from DNA tests: SC

    dna

    Central idea: The Supreme Court of India has ruled that children have the right to protect their genetic information from being revealed in DNA tests without their consent.

    Right to protect Genetic Information

    • The right to protect genetic information is a fundamental right that recognizes an individual’s autonomy and control over their own personal and intimate genetic data.
    • It allows individuals to make informed decisions about their health, privacy, and identity.
    • In India, the Supreme Court has also held that children have the right to protect their genetic information from DNA testing in divorce proceedings, as it is part of their fundamental right to privacy.
    • This is guaranteed under Article 21 of Indian Constitution.
    • This right is recognized under various international human rights instruments, including the Universal Declaration of Human Rights and the International Covenant on Civil and Political Rights.

    Key takeaways from the Judgment

    • The court ruled that-
    1. Genetic information is personal and intimate
    2. Children have the right to privacy and bodily integrity
    3. Children are not to be regarded like material objects and should not become the focal point of the battle between spouses
    4. Allowing DNA tests would also harm the reputation and dignity of the mother

    Basis of this judgment

    • The court drew attention to the rights of privacy, autonomy and identity recognised under the United Nations’ Convention on the Rights of the Child.
    • It acknowledged the control that individuals, including children, have over their own personal boundaries and the means by which they define who they are in relation to other people.
    • Children are not to be deprived of this entitlement to influence and understand their sense of self simply by virtue of being children.

    How can one get the tests done?

    • Family courts should direct for a DNA test only in expedient situations and in the interest of justice, as a last resort, said the judgment.
    • This should be practised as the option of last resort.

     

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  • India, Singapore launch UPI-PayNow Linkage

    upi

    India’s Unified Payments Interface (UPI) and Singapore’s PayNow were officially connected to allow a “real-time payment linkage”.

    What are UPI and PayNow?

    [A] Unified Payments Interface (UPI)

    • UPI is India’s mobile-based fast payment system, which facilitates customers to make round-the-clock payments instantly, using a Virtual Payment Address (VPA) created by the customer.
    • It eliminates the risk of sharing bank account details by the remitter.
    • UPI supports both Person-to-Person (P2P) and Person-to-Merchant (P2M) payments and it also enables a user to send or receive money.

    [B] PayNow

    • It is a fast payment system in Singapore.
    • It enables peer-to-peer funds transfer service, available to retail customers through participating banks and Non-Bank Financial Institutions (NFIs) in Singapore.
    • It allows users to send and receive instant funds from one bank or e-wallet account to another in Singapore by using just their mobile number, Singapore National Registration Identity Card (NRIC)/Foreign Identification Number (FIN), or VPA.

    What is the UPI-PayNow linkage?

    • Cross-border retail payments are generally less transparent and more expensive than domestic transactions.
    • The project to link both the fast payment systems was initiated in September 2021 to facilitate faster, more efficient and transparent cross-border transactions relating to trade, travel and remittances between the two countries.

    Significance of the integration

    • Enhanced cross-border transactions: The integration will enable easier cross-border transactions between India and Singapore, reducing the need for intermediaries and associated costs.
    • Easier remittances: The integration will make it easier for Indian workers in Singapore to send money back home to their families.
    • Boost to trade and investment: The integration will facilitate smoother transactions between businesses in the two countries, potentially increasing trade and investment.
    • Strengthening of diplomatic ties: The integration is expected to improve diplomatic ties between India and Singapore.

    How the integration works?

    • The integration is made possible through the use of standardized QR codes.
    • The QR codes will allow users to transfer funds between the two systems in real-time, without the need for intermediaries.

    Implications for the future

    • More integrations: The success of the UPI-PayNow integration could pave the way for similar integrations between other countries.
    • Increased use of digital payments: The integration is expected to encourage the adoption of digital payments in both India and Singapore, potentially reducing the use of cash.

     

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