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The revocation of birthright citizenship could have far-reaching implications on immigrant communities, particularly the Indian diaspora, and may alter the global perception of the US as a destination for opportunities and inclusive immigration policies.

E.) State of India’s Digital Economy Report 2024

WHY IN NEWS The Ministry of Electronics & Information Technology (MeitY) has released the "State of India’s Digital Economy Report 2024," making India the first developing country to employ the Organization for Economic Cooperation and Development (OECD) framework for assessing the size of its digital economy.
Key Highlights
1. Scope of the Report:
o Expands beyond the OECD framework to include the digital share of traditional industries like trade, BFSI, and education.
2. Key Findings:
o Digital Economy Contribution:
 Contributed 11.74% to the national income in 2022-23.
 Expected to grow to 13.42% by 2024-25.
o Global Position:
 India is the third-largest digitalized country globally.
o Sectoral Contributions:
 Digitally Enabling Industries: Major contributor at 7.83% of GVA, including ICT services and telecommunications.
 New Digital Industries: Includes big tech firms and digital platforms.
 Digitalization of Traditional Sectors: Contributed an additional 2% to the national GVA.
o Employment:
 In 2022-23, provided jobs to 14.67 million workers, constituting 2.55% of the workforce.
o Projected Growth:
 By 2029-30, the digital economy is anticipated to contribute one-fifth of India's national income, surpassing agriculture and manufacturing.
3. Key Recommendations:
o Universal Broadband Access:
 Focus on ensuring high-quality broadband access for all.
o Data Collection Improvements:
 Address existing data gaps by harmonizing and collecting new data.
Significance
• Economic Growth:
o The report highlights the digital economy as a major driver of growth, expected to play a pivotal role in India's transition to a developed economy.
• Employment Creation:
o Significant potential for generating jobs, particularly in ICT and emerging technologies.
• Global Leadership:
o Demonstrates India's digital leadership among developing countries, setting an example for others to follow.
This report underlines the central role of the digital economy in India's growth story, emphasizing the need for sustained efforts to expand access, enhance infrastructure, and refine data collection for effective policy implementation.

F.) Updates on the Principal Purpose Test (PPT) under Double Taxation Avoidance Agreements (DTAAs)

WHY IN NEWS – The Central Board of Direct Taxes (CBDT) has issued updated guidance for applying the Principal Purpose Test (PPT) under India's Double Taxation Avoidance Agreements (DTAAs) to curb revenue leakages.
Key Highlights
1. Principal Purpose Test (PPT):
o PPT is a key provision under the Multilateral Convention to Implement Tax Treaty-Related Provisions (part of the BEPS framework) to prevent Base Erosion and Profit Shifting (BEPS).
o The test determines whether a business arrangement is genuinely commercial or created mainly to avoid taxes.
o PPT has been applicable in India since October 1, 2019, after the Multilateral Instrument (MLI) came into force.
2. New Guidance:
o Exemptions for Specific DTAAs:
 Certain provisions under the India-Cyprus DTAA, India-Mauritius DTAA, and India-Singapore DTAA have been exempted.
o Alignment with BEPS and UN Model Tax Convention:
 Tax authorities are encouraged to refer to BEPS Action Plan 6 and the UN Model Tax Convention for supplementary guidance.
3. BEPS Action Plan 6:
o Aims to address treaty shopping, where investors exploit tax treaties by routing investments through countries with favorable tax agreements.
o Introduces treaty provisions to combat abuse, ensuring that tax treaties are used for genuine cross-border investments.

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