In Parliament: Crypto and banking privatization bills postponed

Thanks to recurring disruptions in parliament and upcoming parliamentary elections in five states, including Uttar Pradesh, three key financial sector bills, due for presentation in the winter session, are unlikely to be tabled before the end of the session next week. . The session can now end earlier than expected on Monday or Tuesday, rather than Thursday, as originally planned. These bills are the first to “ban all private cryptocurrencies”, another to amend banking laws to facilitate the privatization of public sector banks, and a third to amend pension laws to give more flexibility to the government. regulator concerned on how to invest the post-retirement corpus. .

Before the winter session, the government had listed 26 new bills, including the three bills above. However, the three bills as well as the one on reforms in the electricity distribution sector appear to have been withdrawn from the table. The

is only a “remote possibility” of introducing the bills in the current session, sources familiar with the matter told FE. Due to the heckling from the opposition in parliament, approval of an additional request for grants for gross additional expenditure of 3.74 lakh crore has been put on hold and is expected to be taken on Monday or Tuesday.

“Friday was sort of the last day for the introduction of bills,” an official said. Three more bills were tabled in the Lok Sabha on Friday, including the Chartered Accountants, Certified Public Accountants and Company Secretaries (Amendment) Bill, 2021, aimed at reforming and speeding up the mechanism. discipline of professionals in these fields.

On the first day of the November 29 session, the government introduced and passed a bill to withdraw the three laws governing the marketing of agricultural products, in the face of determined and prolonged protests from large sections of farmers.

The government appears to be gaining more time on the bill to ban private cryptocurrencies, which remain unregulated in India. The Cryptocurrency and Official Digital Currency Regulation Bill, 2021 aims to create a framework to facilitate the creation of the official digital currency to be issued by the Reserve Bank of India. The bill also allows certain exceptions to promote the underlying technology of the cryptocurrency and its uses in the private sector. The government also reportedly intends to change income tax laws to bring cryptocurrencies under the tax net, with some changes expected in the next budget. Stock and commodities market watchdog Sebi could oversee cryptocurrencies and regulate the affairs of the exchanges that deal with them as the government plans to classify cryptos as financial assets, industry sources say.

While bank workers’ unions observed two-day strikes on December 16 and 17, and more such protests are planned before the next parliamentary elections, the government appears to have abandoned plans to introduce a bill. amending the laws on banking companies (acquisition and transfer of companies). , 1970 and 1980 and ancillary amendments to the Banking Regulation Act, 1949, to allow for the privatization of two public sector banks. According to sources, NITI Aayog has already recommended the sale of the Indian Overseas Bank and the Central Bank of India to the Core Group of Secretaries on Divestment, headed by the Cabinet Secretary.

The Pension Fund Development and Regulatory Authority (Amendment) Bill seeks to make the PFRDA the regulator of company-run pension funds for their employees in order to fill the regulatory gap . The bill also proposes to relax the rules to allow more products other than annuity products for the mandatory placement of 40% of a subscriber’s corpus upon exit from the national pension scheme (RNP). With declining annuity yields (now around 5% / year), the proposed change would allow the 40% of the corpus (after 60% to be assigned a lump sum upon exit) to be invested in other products such as as systematic withdrawal plans in NPS or inflation-indexed annuity products.

The government intended to introduce the Direct Benefit Transfer (DBT) mechanism through amendments to the Electricity Law to prevent electricity distribution companies (discoms) from making disruptions. requests for arbitrary grants to recover the amount from their respective state governments. The Union Energy Ministry has abandoned plans to provide electricity subsidies to eligible consumers such as farmers and households through the DBT system, fearing a backlash, sources said. The bill could be considered next year.