E-comm cos see big boom in smartphone sales in festive season

Source: ETRetail.com, Sept 22, 2017

New Delhi: E-commerce majors Flipkart, Amazon and Paytm Mall have seen a huge spurt in smartphone purchases on the first day of their festive season sales, beating last year’s figures.

Flipkart, which kicked off its ‘The Big Billion Days’ (TBBD) sale yesterday, said it has sold 1.3 million smartphones within the first 20 hours of the category opening for sale.”The mammoth order book is 2 times the number of smartphones Flipkart sold in the same time-frame during Day 1 of TBBD’16, and surpasses the total number of smartphones sold across India in a single day, both through online and offline channels, by a big distance,” it said in a statement.

An Amazon India spokesperson said it saw a massive opening of its festive sales.

“…we have already seen a 100 per cent increase over previous Diwali, even before the end of Day One. For smartphones, we saw an even larger gain,” the spokesperson added.

The boom in sale of smartphones is on account of various offers and discounts being offered on various e-commerce sites, coupled with affordable payment solutions like ‘No Cost EMIs’, exchange and buyback offers.

E-commerce players have also entered into exclusive tie- ups with handset makers to launch new phones on their platform exclusively.Most companies will end their sale around September 24-25 and are likely to commence another round just before Diwali.ShopClues, which focuses on tier II and III towns, has launched a feature phone on its platform — Inovu i7 — priced at Rs 349.

Alibaba-backed Paytm Mall, which was spun off from One97 Communications earlier this year, said it aims to sell 10X the volume of smartphones sold on an average day.

“We are offering the lowest price on smartphones and you can compare it with any other platform. We are confident that the smartphone sales at our platform will grow in leaps and bounds, given the unbeatable offers this festive season, Paytm Mall Chief Operating Officer Amit Sinha said.

 

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Dabur, Amazon set up ayurveda marketplace

download (7).jpgSource: ETRetail.com, Sept 22, 2017

NEW DELHI: Herbal-goods major Dabur has set up an online ayurveda marketplace with Amazon to strengthen its presence in the fast-growing space of ‘natural’ consumer products.

The online store will sell ayurveda brands, while offering consumers valuable insights into the medicinal properties of ayurvedic products for treating various ailments, a company official said.

Dabur will take the lead on the content, while rival ayurveda brands listed with Amazon will be part of the marketplace.

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Rural inflation much higher than urban in the last three years

download (6).jpgSource: LiveMint.com, Sept 22, 2017

While overall inflation has come down substantially over the past three years, inflation for the rural consumer has been significantly higher than for the urban population. The accompanying chart, which has the point-to-point Consumer Price Index (CPI)-based inflation for the last three years (August 2017 compared to August 2014) has the details.

What is intriguing is that even for farm prices, such as for pulses or for milk and even cereals, consumer prices have risen more in rural India. Prices of health and education services too have moved up faster in rural areas.

With farm incomes being under pressure after two years of bad monsoon, the rise in rural prices could explain the sluggishness in rural demand, as well as the relative robustness of urban demand.

The silver lining is that the latest CPI numbers for August show that rural inflation has been slightly slower in the past one year than urban inflation. This trend needs to continue.

 

Railways to expedite electrification

Source: The Hindu Business Line, Sept 21, 2017

New Delhi: The Railways Ministry is looking at ways to speed up the electrification process as it would help reduce the INR16,000-crore bill on diesel, Union Minister Piyush Goyal said on Thursday.

He said the Ministry is holding consultations with all those who are involved in the electrification process. The important things which are involved in the process include availability of equipment and adequate infrastructure.

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Foreign trade policy review may be delayed

Source: The Hindu Business Line, Sept 21, 2017

New Delhi: Exporters may have to wait an extra month, or even more, for the foreign trade policy (FTP) review, earlier scheduled for September, as the government is still grappling with implementation issues related to the Goods and Services Tax (GST).

The Centre has also not taken a call on the future of export incentive schemes that may no longer be permissible under the World Trade Organisation rules as India has graduated out of the list of poorer countries allowed to give export subsidies.

“It is unlikely that the FTP review will be announced before October-end. It may happen even later depending on the pace at which the concerns of exporters are sorted out,” a government official told BusinessLine.The five-year FTP announced on April 1, 2015, which laid an ambitious annual target of touching $900 billion of exports by 2020, provided for a review when the policy was half-way through and not on an annual basis as was the earlier practice. “The idea was not to tinker too much with the policy and instead do an analysis when it was half-way through and do course corrections if required,” the official said.

Two-and-a-half-years after the FTP was announced, the Commerce Ministry finds its hands full with the number of concerns it might need to address while reviewing the policy.

“Addressing the issues arising from implementation of the GST is top priority as it is bothering exporters most. The Centre has to ensure that refund of input taxes happens on time and exemptions may be given where necessary to help exporters maintain their liquidity. This can take time as not only will the Finance Ministry will have to be on board, the GST Council ultimately will have to pass the revisions,” the official said, adding that the Council would next meet only sometime in October.

Sop scheme

Incentive scheme for exporters is another tricky area in the review as earlier this year the WTO declared that India’s per capita Gross National Product (GNP) exceeded $1000 for three years in a row (2013. 2012, 2015) making it ineligible for export incentives that only poorer countries are allowed.

“The Commerce Ministry has to first identify the schemes that could be affected because of India’s new status and then plan how to phase out those schemes and replace them with production subsidies that are allowed under the WTO. This is again an onerous exercise,” the official said.

While the Merchandise Export Incentive Scheme under which incentives based on value of exports is provided to over 7,000 items would no doubt be one of the affected schemes, the government has to examine the validity of other schemes such as interest subvention.

Ambitious target

The ambitious export target of $900 billion fixed for 2020 is also a problem since exports have moved sluggishly over the last two years hovering around $300 billion and there is no scope of reaching the target. “Not only does the target need to be brought down to a realistic level, some more schemes have to be devised to accelerate exports,” the official said.

Stimulus package funding: Govt weighs fiscal push for growth

download (2).jpgSource: Business Standard, Sept 22, 2017

The government is considering increased spending in order to revive the economy and is open to allowing the fiscal deficit to widen beyond its target for the year. A stimulus package in the range of Rs 40,000-50,000 crore is being discussed in the government, though these figures could not be immediately confirmed.

Back-of-the-envelope calculations show that a Rs 40,000-crore increase in capital spending could lead to a fiscal deficit of 3.5 per cent of the gross domestic product, against the Budget estimate of 3.2 per cent. Assuming the budgeted total revenue figure for 2017-18 remains constant, for each additional spending of Rs 10,000 crore, the fiscal deficit as a percentage of GDP roughly increases by a little less than 0.1 per cent.

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GST: Centre, states to divide taxpayer base

download (1)Source: The Economic Times, Sept 22, 2017

NEW DELHI: The Goods and Services Tax (GST) Council has put in place an elaborate framework for division of taxpayers between the state and central tax authorities, in a move aimed at bringing clarity and effectiveness in the administration of the new indirect tax regime.

The guidelines for the division of the taxpayer base between the Centre and states will ensure that a taxpayer faces only one GST authority – either the Centre or the state. “The list of taxpayers will be made public,” said an official, adding that this would clear the air for not just the taxpayers but also the tax authorities.

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