The Evening Wrap: Most small savings plans to yield more in new quarter

The Central government on December 30 raised interest rates on eight of the 12 small savings schemes by 20 to 110 basis points for the January to March 2023 quarter, but left the returns on the popular Public Provident Fund (PPF) unchanged at 7.1% for the eleventh quarter in a row. One basis point or bps equals 0.01%. The Sukanya Samriddhi Account Scheme’s return was also retained at 7.6%, prevailing since April 2020 when small savings schemes’ rates were cut across the board. The returns on Kisan Vikas Patra (KVP) and the National Savings Certificate (NSC) were raised by just 20 bps each, to 7.2% and 7%, respectively. This is the second successive quarter that the government has effected selective hikes in small savings rates. Economists said that the increases were lower than expected, given the increase in interest rates and high inflation in recent quarters. For the ongoing October to December quarter, rates were raised — for the first time since January 2019 — by a marginal 10 to 30 bps for just five of the 12 schemes. As per Reserve Bank of India calculations, the small savings rates which are pegged by a formula to the yields on government securities, were 44 to 77 bps below their formula-implied rates for nine of the 12 schemes this quarter. The PPF return for October to December, as per the formula, should have been 7.72% instead of the existing 7.1%, while the Sukanya Samriddhi Account should have been paid 8.22% instead of 7.6%. Returns on the Senior Citizens’ Savings Scheme and the Monthly Income Account Scheme have been raised by 40 bps each, taking them to 8% and 7.1%, respectively. “The size of the upward revision in rates of some small savings schemes is smaller than what we had anticipated,” ICRA chief economist Aditi Nayar told The Hindu. The Senior Citizens’ Savings Scheme’s returns were raised from 7.4% to 7.6% for this quarter, while the formula-determined rate was 8.04%. Thus, its rate hike to 8% for the coming quarter almost bridges the entire deviation from the formula-based rate. However, there was a higher gap between the formula-based rate of 7.5% for the October to December quarter and the new rates for the next quarter in the case of the NSC (7.1%) and KVP (7.2%). Time deposits for one, two and three years have been granted the sharpest 110 bps increase in returns, lifting their returns to 6.6%, 6.8% and 6.9%, respectively. Five year time deposits will earn 7% in the first quarter of 2023 instead of 6.7% in the current quarter, while five year recurring deposits will continue to earn a 5.8% return, the same rate as before. PM Modi virtually flags off Howrah-NJP Vande Bharat express Hours after taking part in the last rites of his mother Hiraben Modi in Gandhinagar, Prime Minister Narendra Modi on December 30 virtually inaugurated developmental projects to the tune of ₹7,800 crore in West Bengal, in the presence of Chief Minister Mamata Banerjee. Hiraben passed away at a hospital in Ahmedabad at 3:30 a.m. She was 100. The Prime Minister was scheduled to attend a number of events in Kolkata, which included Vande Bharat Express connecting Howrah to New Jalpaiguri, the Joka-Taratala stretch of the purple line. Leaders from across the political spectrum lauded the PM for going ahead with his official engagement despite suffering a personal loss just a few hours back. “It is a very sad day for you but you are coming virtually. It is your great honour and you pay respect through your activities to your mother. Thank you so much,” Chief Minister Mamata Banerjee said. Speaking at the event the Prime Minister said that the Centre was making a record investment in the Indian Railways, and the latter was on the path of transformation in a new avatar. Modi pointed out that the launch of the Vande Bharat Express on December 30 was significant as Netaji Subhas Chandra Bose had hoisted the tricolour in the Andamans, on the same day in 1943. “In the past eight years the Indian Railways has worked on the foundations of modernisation and in the next eight years the Indian Railways will start a new journey towards modernisation,” PM Modi said. Modi said the proposed 475 Vande Bharat trains would play a crucial role in a new avatar, and added that trains such as Vande Bharat and Tejas were being made in the country. The PM who also laid the foundation stone of New Jalpaiguri Railway Station said it would be modernised like airports along with other stations. Speaking about the metro railway services in the country, the PM said that in the past eight years the services had been extended to two dozen cities and the metro railway tracks were operating across 800 km. “The Joka BBG Metro project is a result of this initiative,” Modi said. During the day, metro services along the Joka BBG route were flagged off between the Joka-Taratala stations. The PM said that the Joka-Taratala metro services would ensure ease of living for Kolkata residents. He said that the PM Gati Shakti initiative was trying to connect and bring a synergy in the different modes of transportation in the country. Railway Minister Ashwini Vaishnaw said that projects worth ₹7600 crore were dedicated to the people of West Bengal by the Prime Minister. ED freezes ₹42.21 crore in e-nuggets gaming app case The Enforcement Directorate (ED) has frozen funds worth ₹42.21 crore lying in the 1,548 bank accounts in connection with the money laundering investigation related to mobile gaming application, e-nuggets, said a statement on Friday. The ED has so far seized or frozen ₹110.76 crore in the case. The investigation is based on the First Information Report (FIR) registered by the Kolkata Police against accused Aamir Khan and others, based on a complaint lodged by the authorities of the Federal Bank in the court of Chief Metropolitan Magistrate. According to the ED, it has found that Khan had launched the gaming application, which was designed for the purpose of “defrauding public”. After collecting substantial amounts from the users, withdrawal from the app was disallowed under various pretexts. Thereafter, all the data, including profile information, was “wiped off from the app servers”. The agency alleged that multiple accounts were used to launder the money. The proceeds were also used to purchase crypto currencies. Khan is currently under judicial custody. Earlier, the ED had arrested one Romen Agarwal on the charge of his involvement in inter/intra country transactions and a chargesheet has been filed in the case. U.S. House committee releases Trump tax returns, capping years-long battle A Democratic-controlled U.S. House of Representatives committee released six years of former President Donald Trump’s tax returns to the public in an extraordinary move days before Republicans are due to take control of the chamber. Release of Trump’s redacted returns for 2015 through 2020 caps a multi-year battle between the Republican former president and Democratic lawmakers that was settled only last month by the U.S. Supreme Court. It is the latest blow for Trump, 76, who was impeached twice by the Democratic-led House only to be acquitted both times by the U.S. Senate, and now faces multiple legal woes as he mounts a 2024 reelection bid. Earlier this month, the House committee investigating the January 6, 2021, attack on the U.S. Capitol by his supporters asked federal prosecutors to charge him with four crimes including obstruction and insurrection for his role in the deadly riot. House Ways and Means Committee Chairman Richard Neal requested the returns in 2019, arguing that Congress needed them to determine if legislation on presidential tax returns was warranted. Republicans said the move could lead to the political weaponization of individual tax returns and warned that party members who take over the panel next month would face pressure to pursue a similar path against high-profile Democrats. Trump, who took office in 2017, was the first presidential candidate in decades not to release his taxes. He sued the committee to try to keep them private but the U.S. high court ruled in the committee’s favour. In a report last week, the committee outlined its findings from its examination of the documents, saying the Internal Revenue Service broke its own rules by not auditing Trump for three out of four years while he was president. Details previously released by the panel showed Trump paid no income tax in 2020, his final full year in office, despite millions of dollars in earnings from his sprawling business empire. The records show Trump’s income and tax liability fluctuated dramatically from 2015 through 2020, during his first presidential bid and subsequent term in office. They show Trump and his wife Melania Trump claimed large deductions and losses and paid little or no income tax in several of those years. Democrats were on a tight timeline to find a way to handle the returns once they obtained them, given that Republicans will take control of the House on Tuesday after winning a slim majority in November’s midterm elections. The Democratic-controlled House passed a bill before it left on its winter recess that would mandate that the tax-collecting Internal Revenue Service complete audits of presidents’ tax filings within 90 days of their inaugurations. In brief Russian President Vladimir Putin and Chinese President Xi Jinping hailed a close relationship that they described as “enjoying the best period in their history” and committed to deepening strategic ties amid their respective tensions with the West. “In the context of growing geopolitical tensions, the importance of the Russian-Chinese strategic partnership as a stability factor is growing,” Putin told Xi in a video call, according to a Kremlin readout. Both discussed Ukraine, and Xi “stressed that China has noted Russia’s statement that it has never refused to resolve the conflict through diplomatic negotiations and China commends that,” the Foreign Ministry in Beijing said. [logo] The Evening Wrap 30 DECEMBER 2022 [The Hindu logo] Welcome to the Evening Wrap newsletter, your guide to the day’s biggest stories with concise analysis from The Hindu. [[Arrow]Open in browser]( [[Mail icon]More newsletters]( Most small savings plans to yield more in new quarter; PPF, Sukanya rates static The Central government on December 30 [raised interest rates on eight of the 12 small savings schemes]( by 20 to 110 basis points for the January to March 2023 quarter, but left the returns on the popular Public Provident Fund (PPF) unchanged at 7.1% for the eleventh quarter in a row. One basis point or bps equals 0.01%. The Sukanya Samriddhi Account Scheme’s return was also retained at 7.6%, prevailing since April 2020 when small savings schemes’ rates were cut across the board. The returns on Kisan Vikas Patra (KVP) and the National Savings Certificate (NSC) were raised by just 20 bps each, to 7.2% and 7%, respectively. This is the second successive quarter that the government has effected selective hikes in small savings rates. Economists said that the increases were lower than expected, given the increase in interest rates and high inflation in recent quarters. For the ongoing October to December quarter, rates were raised — for the first time since January 2019 — by a marginal 10 to 30 bps for just five of the 12 schemes. As per Reserve Bank of India calculations, the small savings rates which are pegged by a formula to the yields on government securities, were 44 to 77 bps below their formula-implied rates for nine of the 12 schemes this quarter. The PPF return for October to December, as per the formula, should have been 7.72% instead of the existing 7.1%, while the Sukanya Samriddhi Account should have been paid 8.22% instead of 7.6%. Returns on the Senior Citizens’ Savings Scheme and the Monthly Income Account Scheme have been raised by 40 bps each, taking them to 8% and 7.1%, respectively. “The size of the upward revision in rates of some small savings schemes is smaller than what we had anticipated,” ICRA chief economist Aditi Nayar told The Hindu. The Senior Citizens’ Savings Scheme’s returns were raised from 7.4% to 7.6% for this quarter, while the formula-determined rate was 8.04%. Thus, its rate hike to 8% for the coming quarter almost bridges the entire deviation from the formula-based rate. However, there was a higher gap between the formula-based rate of 7.5% for the October to December quarter and the new rates for the next quarter in the case of the NSC (7.1%) and KVP (7.2%). Time deposits for one, two and three years have been granted the sharpest 110 bps increase in returns, lifting their returns to 6.6%, 6.8% and 6.9%, respectively. Five year time deposits will earn 7% in the first quarter of 2023 instead of 6.7% in the current quarter, while five year recurring deposits will continue to earn a 5.8% return, the same rate as before. PM Modi virtually flags off Howrah-NJP Vande Bharat express Hours after taking part in the last rites of his mother Hiraben Modi in Gandhinagar, [Prime Minister Narendra Modi on December 30 virtually inaugurated developmental projects to the tune of ₹7,800 crore in West Bengal]( in the presence of Chief Minister Mamata Banerjee. Hiraben passed away at a hospital in Ahmedabad at 3:30 a.m. She was 100. The Prime Minister was scheduled to attend a number of events in Kolkata, which included Vande Bharat Express connecting Howrah to New Jalpaiguri, the Joka-Taratala stretch of the purple line. Leaders from across the political spectrum lauded the PM for going ahead with his official engagement despite suffering a personal loss just a few hours back. “It is a very sad day for you but you are coming virtually. It is your great honour and you pay respect through your activities to your mother. Thank you so much,” Chief Minister Mamata Banerjee said. Speaking at the event the Prime Minister said that the Centre was making a record investment in the Indian Railways, and the latter was on the path of transformation in a new avatar. Modi pointed out that the launch of the Vande Bharat Express on December 30 was significant as Netaji Subhas Chandra Bose had hoisted the tricolour in the Andamans, on the same day in 1943. “In the past eight years the Indian Railways has worked on the foundations of modernisation and in the next eight years the Indian Railways will start a new journey towards modernisation,” PM Modi said. Modi said the proposed 475 Vande Bharat trains would play a crucial role in a new avatar, and added that trains such as Vande Bharat and Tejas were being made in the country. The PM who also laid the foundation stone of New Jalpaiguri Railway Station said it would be modernised like airports along with other stations. Speaking about the metro railway services in the country, the PM said that in the past eight years the services had been extended to two dozen cities and the metro railway tracks were operating across 800 km. “The Joka BBG Metro project is a result of this initiative,” Modi said. During the day, metro services along the Joka BBG route were flagged off between the Joka-Taratala stations. The PM said that the Joka-Taratala metro services would ensure ease of living for Kolkata residents. He said that the PM Gati Shakti initiative was trying to connect and bring a synergy in the different modes of transportation in the country. Railway Minister Ashwini Vaishnaw said that projects worth ₹7600 crore were dedicated to the people of West Bengal by the Prime Minister. ED freezes ₹42.21 crore in e-nuggets gaming app case The [Enforcement Directorate (ED) has frozen funds worth ₹42.21 crore lying in the 1,548 bank accounts in connection with the money laundering investigation related to mobile gaming application, e-nuggets]( said a statement on Friday. The ED has so far seized or frozen ₹110.76 crore in the case. The investigation is based on the First Information Report (FIR) registered by the Kolkata Police against accused Aamir Khan and others, based on a complaint lodged by the authorities of the Federal Bank in the court of Chief Metropolitan Magistrate. According to the ED, it has found that Khan had launched the gaming application, which was designed for the purpose of “defrauding public”. After collecting substantial amounts from the users, withdrawal from the app was disallowed under various pretexts. Thereafter, all the data, including profile information, was “wiped off from the app servers”. The agency alleged that multiple accounts were used to launder the money. The proceeds were also used to purchase crypto currencies. Khan is currently under judicial custody. Earlier, the ED had arrested one Romen Agarwal on the charge of his involvement in inter/intra country transactions and a chargesheet has been filed in the case. U.S. House committee releases Trump tax returns, capping years-long battle A Democratic-controlled [U.S. House of Representatives committee released six years of former President Donald Trump’s tax returns to the public]( in an extraordinary move days before Republicans are due to take control of the chamber. Release of Trump’s redacted returns for 2015 through 2020 caps a multi-year battle between the Republican former president and Democratic lawmakers that was settled only last month by the U.S. Supreme Court. It is the latest blow for Trump, 76, who was impeached twice by the Democratic-led House only to be acquitted both times by the U.S. Senate, and now faces multiple legal woes as he mounts a 2024 reelection bid. Earlier this month, the House committee investigating the January 6, 2021, attack on the U.S. Capitol by his supporters asked federal prosecutors to charge him with four crimes including obstruction and insurrection for his role in the deadly riot. House Ways and Means Committee Chairman Richard Neal requested the returns in 2019, arguing that Congress needed them to determine if legislation on presidential tax returns was warranted. Republicans said the move could lead to the political weaponization of individual tax returns and warned that party members who take over the panel next month would face pressure to pursue a similar path against high-profile Democrats. Trump, who took office in 2017, was the first presidential candidate in decades not to release his taxes. He sued the committee to try to keep them private but the U.S. high court ruled in the committee’s favour. In a report last week, the committee outlined its findings from its examination of the documents, saying the Internal Revenue Service broke its own rules by not auditing Trump for three out of four years while he was president. Details previously released by the panel showed Trump paid no income tax in 2020, his final full year in office, despite millions of dollars in earnings from his sprawling business empire. The records show Trump’s income and tax liability fluctuated dramatically from 2015 through 2020, during his first presidential bid and subsequent term in office. They show Trump and his wife Melania Trump claimed large deductions and losses and paid little or no income tax in several of those years. Democrats were on a tight timeline to find a way to handle the returns once they obtained them, given that Republicans will take control of the House on Tuesday after winning a slim majority in November’s midterm elections. The Democratic-controlled House passed a bill before it left on its winter recess that would mandate that the tax-collecting Internal Revenue Service complete audits of presidents’ tax filings within 90 days of their inaugurations. In brief [Russian President Vladimir Putin and Chinese President Xi Jinping hailed a close relationship]( that they described as “enjoying the best period in their history” and committed to deepening strategic ties amid their respective tensions with the West. “In the context of growing geopolitical tensions, the importance of the Russian-Chinese strategic partnership as a stability factor is growing,” Putin told Xi in a video call, according to a Kremlin readout. Both discussed Ukraine, and Xi “stressed that China has noted Russia’s statement that it has never refused to resolve the conflict through diplomatic negotiations and China commends that,” the Foreign Ministry in Beijing said. Interested in Science? Our "Science For All" weekly newsletter takes the jargon out of science and puts the fun in! 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