The government told Parliament on Tuesday that the overall debt as a proportion of GDP will rise to 61.7 percent (provisional) in 2021-22, up from 60.5 percent (provisional) the previous fiscal year. At the same time, the public debt will rise to 54.2 percent in the current fiscal year, from 52 percent in 2020-21.
Minister of State for Finance Pankaj Chaudhary said in a written reply to the Rajya Sabha that the government’s amendments of the FRBM Act will aim to put the country on a path of fiscal consolidation; with a fiscal deficit of less than 4.5 percent of GDP by 2025-26.
The government anticipates the fiscal deficit to fall to 6.8% in the current fiscal year, down from 9.3% in 2020-21.
He noted that any changes to the FRBM debt targets will be in line with the overall fiscal deficit trend.
RBI's circular on debt for Payment System Providers
In response to another question, the Minister of State for Finance Dr. Bhagwat Karad said the RBI issued a circular on “Storage of Payment System Data“; issued in 2018. The circular bounds, all system providers to ensure that all data relating to payment systems is stored solely in India. The storage data includes complete end-to-end transaction details collected, carried, and processed as part of the message/payment instruction.
System providers are also required to submit a compliance report to RBI. Along with, a board-approved System Audit Report (SAR) conducted by an impaneled auditor of CERT-In (Computer Emergency Response Team India).
In response to requests for clarifications on various issues from Payment System Operators (PSOs) on the above announcement. As well as for prompt compliance by all PSOs. He said the RBI published Frequently Asked Questions (FAQs) on the subject on June 26, 2019.
The RBI has notified that American Express Banking Corp (Amex), Diners Club International Ltd (Diners), and Mastercard Asia/Pacific Pte Ltd (Mastercard) failed to comply with the guidelines of the above circular.
Accordingly, RBI has barred Amex and Diners from onboarding new domestic consumers onto their card networks. Beginning from 01.05.2021, until full compliance with the circular’s provisions and the submission of satisfactory SAR. Moreover, a similar prohibition was introduced on Mastercard from July 22, 2021.
Domestic banks already operate a sizable credit card business in the country. They have no restrictions on doing so. For more such updates, keep watching this space!