The increase in TDS receipts and buoyancy in corporate profits led to an increase in the direct tax collection, including corporate and personal income tax, by 46.95% to Rs 71,648 crore in April-July this year.

A finance ministry statement said, “Robust growth in direct tax collections is a result of tax education and compliance mechanism put in place by the Income Tax department in the area of tax deducted at source (TDS) and tax collection at source (TCS) and indicates further improvement in tax administration and tax compliance levels.”

Reliance Capital Ltd., a financial ser

Despite the fear of economic slowdown as a result of continuous rise in the crude oil prices, the net direct tax collections increased by 38.61 per cent in the first quarter.

According to a statement released by the Finance Ministry, the growth in direct tax collections in Nagpur and Kochi witnessed as high as 74.08 % and 68.98% respectively, in the direct tax collection, whereas, it was less than 50% in cities like Mumbai, Bangalore and Kolkata. In the capital city Delhi, the direct tax collection increased to 53.57%.

The Reserve Bank of India (RBI) said on Thursday that the flow of credit from scheduled commercial banks has increased between April and June 20 this year. The credit flow has increased by 25.4% during this period. The growth is slower than the corresponding period of last year.

The rise in credit is due to high demand from public sector oil firms. The oil firms are under-recovery due to subsidy on oil products. They are forced to sell petroleum products at the rate below the prevailing global rates.

The economic growth rate of India may moderate to 8% during the current (2008-09) fiscal year.

Planning Commission Deputy Chairman Montek Singh Ahluwalia said that the 13-year high inflation rate of 11.42 percent may result into a little lower growth rate but if necessary steps to control inflation are taken, the growth objective of 9% will not be difficult to achieve.

On the other hand the central bank expects the economy to clock a 8-8.5 percent growth in 2008/09.

Reserve Bank of India (RBI) and Bank of Japan (BOJ) has signed a bilateral swap arrangement (BSA) on Monday. The BSA was signed by BOJ governor Masaaki Shirakawa and RBI governor Yaga Venugopal Reddy in Basel, Switzerland. It will pave a way for swapping local currencies against the US dollar for up to $3 billion. The agreement will also sort out problem of short-term liquidity and strengthen existing international financial arrangements

The agreement was come into effect on Sunday (June 29). Both Japan and India can now swap Yen and rupee against the US dollar up to $3 billion. They will hold biannual consultations on economic and financial conditions of each country with the BSA in effect.