About: India Briefing
By Melissa Cyrill
The government recently published the Employees’ State Insurance (Central) Amendment Rules, 2017. The amendment rules improve the existing maternity welfare benefits for women who have insurance, expanding the ESI (Central) Amendment Rules, 2016.
Previously, the ESI (Central) Amendment Rules, 2016 – notified on December 22, 2016 – expanded the coverage of the ESI Act with effect from January 1, 2017. The ESI (Central) Amendment Rules, 2016 allowed employees earning Rs 21,000 (US$313.53) or less in a month to subscribe to this scheme. Prior to that, the wage limit for ESI subscribers was at Rs 15,000 (US$223.95) per month.
Startups in Delhi winning in race for investors
According to data collected by LetsVenture, startups in the Delhi National Capital Region (NCR) – which includes the capital Delhi and its satellites Gurgaon and Noida – have closed more investment deals over the past year than their counterparts in Bangalore. According to the data, 328 startups in the NCR received investments, in comparison to only 261 in Bangalore. However, the investments in the NCR totaled US$2.50 billion, in contrast to the US$2.52 billion that startups in Bangalore received.
By Koushan Das
India will adopt the General Anti-Avoidance Rules (GAAR) with effect from April 1, 2017. GAAR is an anti-avoidance regulation that allows tax authorities to deny tax benefits on transactions conducted with the purpose of avoiding taxes.
While tax avoidance regulation in India is currently governed by the Specific Anti-Avoidance Rules (SAAR), it was not considered comprehensive enough by the government, leading to the formulation of GAAR. However, SAAR regulations will continue to be applicable in addition to GAAR provisions: GAAR will cover those avoidance cases which fall short of SAAR regulations.
The Ministry of Health and Family Welfare recently notified the Medical Devices Rules, 2017. Many medical device businesses have welcomed the new regulations; the Drugs and Cosmetics Act, 1940 – designed for the pharmaceutical industry – had previously regulated the fast growing industry.
Industry experts estimate that approximately 80 percent of the medical devices in India are imported, a significant share of a market that is valued at over US$10 billion. While this market has grown from a US$6.3 billion value in 2013, the industry’s dependence on imports has gotten worse: India imported 70 percent of its medical devices in 2015.
India Regulatory Brief: Ola, Uber Strikes, TCS Clause under GST Worries E-tailers, and Government Tackles H-1B Visa Debate
Ola, Uber face new challenge with driver strikes
Following initial protests in Hyderabad and Bengaluru last year, widespread strikes by drivers associated with cab aggregators are taking place this month across India. While Ola and Uber drivers partially called off their indefinite strike in the National Capital Region after meeting with Delhi transport minister Satyendar Jain on Sunday, not all drivers’ unions are convinced. Further, a planned joint strike is scheduled for February 15 across the southern states of Andhra Pradesh, Karnataka, and Tamil Nadu. Ola and Uber drivers will participate in the upcoming strike according to their union representatives.
Russia and India are becoming closer partners both politically and in trade. India is negotiating a Free Trade Agreement (FTA) with the Eurasian Economic Union (EAEU) and will become a full member of the Shanghai Co-Operation Organization (SCO).
The SCO provides a uniquely eastern and central Asian political and development platform for India. Founding members China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan will be joined by India, Iran, and Pakistan. Observer states include Afghanistan, Belarus, and Mongolia, while dialogue partners Armenia, Azerbaijan, Cambodia, Nepal, Sri Lanka, and Turkey also participate. As can be seen, many of these states are within India’s sphere of interest.
By Pritesh Samuel
In another sign that the government is keen to allow to foreign law firms and accountants in India, the government on January 3 amended the Special Economic Zone (SEZ) rules which may make legal and accountancy services from foreign companies possible in SEZs.
The amendment was published in the Official Gazette, which says, “In the Special Economic Zones Rules, 2006, in Rule 76, for the words “professional services (excluding legal services and accounting) rental/leasing services without operators”, the words “professional services, rental/leasing services without operators” shall be removed. In other words, such services may be outsourced to foreign entities in such SEZs.