Let us understand 'Liquidity Coverage Ratio (LCR)' first.
LCR is calculated by dividing an institution (Banks/NBFCs) high-quality liquid assets (for example cash, govt. securities, securities issued or guaranteed by foreign governments etc.) by its total net cash flows, over a 30-day period.
Suppose a bank's expected cash outflow/spending for the next 30 days is Rs. 150 and cash inflow is expected to be Rs. 50, that means net cash outflow for next 30-day period is Rs. 100. In such a case if bank is holding cash and govt. securities (which are called High Quality Liquid Assets) of Rs. 60 only, then LCR = (High Quality Liquid Asset)/ (Banks Net cash outflow for 30-day period) = Rs. 60/ Rs. 100 = 60%. And in this case banks may face cash/liquidity problem if depositors withdraw money. So, RBI requires that Banks (and NBFCs also) maintain 100% LCR
But retail deposits which are enabled with internet and mobile banking can withdraw funds more quickly, so there was an additional requirement of 5% 'run-off factor' for stable deposits and a run off factor of 10% for less stable deposits on top of 100% LCR. Now this has been further increased by 2.5% for banks from 1st April 2026 onwards.
So, for Banks, the LCR framework (as proposed under BASEL III) will be as follows from 1st April 2026.
*In general for all deposits = 100%
*Stable retail and small business deposits (with mobile and internet banking) = 100% + 5% + 2.5% =107.5%
*Less stable retail and small business deposits (with mobile and internet banking) = 100% + 10% + 2.5% = 112.5%
LCR is calculated by dividing an institution (Banks/NBFCs) high-quality liquid assets (for example cash, govt. securities, securities issued or guaranteed by foreign governments etc.) by its total net cash flows, over a 30-day period.
Suppose a bank's expected cash outflow/spending for the next 30 days is Rs. 150 and cash inflow is expected to be Rs. 50, that means net cash outflow for next 30-day period is Rs. 100. In such a case if bank is holding cash and govt. securities (which are called High Quality Liquid Assets) of Rs. 60 only, then LCR = (High Quality Liquid Asset)/ (Banks Net cash outflow for 30-day period) = Rs. 60/ Rs. 100 = 60%. And in this case banks may face cash/liquidity problem if depositors withdraw money. So, RBI requires that Banks (and NBFCs also) maintain 100% LCR
But retail deposits which are enabled with internet and mobile banking can withdraw funds more quickly, so there was an additional requirement of 5% 'run-off factor' for stable deposits and a run off factor of 10% for less stable deposits on top of 100% LCR. Now this has been further increased by 2.5% for banks from 1st April 2026 onwards.
So, for Banks, the LCR framework (as proposed under BASEL III) will be as follows from 1st April 2026.
*In general for all deposits = 100%
*Stable retail and small business deposits (with mobile and internet banking) = 100% + 5% + 2.5% =107.5%
*Less stable retail and small business deposits (with mobile and internet banking) = 100% + 10% + 2.5% = 112.5%
Tax Collected at Source (TCS)
TCS is a tax that sellers are required to collect from their buyers on certain specific items. TCS is collected by the seller as a means to track buyers and minimize tax evasion. Till now, it used to be collected on timber wood, Tendu leaves, Motor vehicles exceeding Rs. 10 lakhs etc. NOW Govt. has expanded the list on various other luxory items like wrist watches, handbags, antiques, paintings, sculptures, home theaters, shoes and sportswear etc. priced above Rs. 10 lakh.
Example:
Suppose I am purchasing a car whose price is Rs. 15 lakh (it already includes GST) then on this 1% TCS (Rs. 15000) will be charged and the total price of the car would become Rs. 15.15 lakh. So this Rs. 15000 TCS will be deposited by the Seller in Govt. account against the buyers PAN i.e. on behalf of buyer. This TCS will be part of my income tax and while I will be paying my income tax, this amount of Rs. 15000 will get adjusted there i.e. it will be reduced from my total (income) tax liability because this amount has already been collected from me during that transaction/purchase.
TCS comes under Income Tax Act 1961 and considered as a tax on my income and hence is direct tax.
Benefit:
This notification operationalises the government’s intent to enhance monitoring of high-value discretionary expenditure and strengthen the audit trail in the luxury goods segment.
It reflects a broader policy objective of expanding the tax base and promoting greater financial transparency.
Sellers will now be required to ensure timely compliance with TCS provisions, while buyers of notified luxury goods may experience enhanced KYC requirements and documentation at the time of purchase.
Tax Deducted at Source (TDS): When my employer deducts tax from my salary and deposits in Govt. account on my behalf then it is called TDS. That is also part of income tax (under Income Tax Act 1961) and gets adjusted in my total tax liability.
TCS is a tax that sellers are required to collect from their buyers on certain specific items. TCS is collected by the seller as a means to track buyers and minimize tax evasion. Till now, it used to be collected on timber wood, Tendu leaves, Motor vehicles exceeding Rs. 10 lakhs etc. NOW Govt. has expanded the list on various other luxory items like wrist watches, handbags, antiques, paintings, sculptures, home theaters, shoes and sportswear etc. priced above Rs. 10 lakh.
Example:
Suppose I am purchasing a car whose price is Rs. 15 lakh (it already includes GST) then on this 1% TCS (Rs. 15000) will be charged and the total price of the car would become Rs. 15.15 lakh. So this Rs. 15000 TCS will be deposited by the Seller in Govt. account against the buyers PAN i.e. on behalf of buyer. This TCS will be part of my income tax and while I will be paying my income tax, this amount of Rs. 15000 will get adjusted there i.e. it will be reduced from my total (income) tax liability because this amount has already been collected from me during that transaction/purchase.
TCS comes under Income Tax Act 1961 and considered as a tax on my income and hence is direct tax.
Benefit:
This notification operationalises the government’s intent to enhance monitoring of high-value discretionary expenditure and strengthen the audit trail in the luxury goods segment.
It reflects a broader policy objective of expanding the tax base and promoting greater financial transparency.
Sellers will now be required to ensure timely compliance with TCS provisions, while buyers of notified luxury goods may experience enhanced KYC requirements and documentation at the time of purchase.
Tax Deducted at Source (TDS): When my employer deducts tax from my salary and deposits in Govt. account on my behalf then it is called TDS. That is also part of income tax (under Income Tax Act 1961) and gets adjusted in my total tax liability.
This media is not supported in your browser
VIEW IN TELEGRAM
Video from Vivek Singh
Since liberalization in 1991, India's trade/GDP ratio (openness of economy) has almost tripled.
Final Results
78%
(a) TRUE
22%
(b) FALSE
The above statement is True.
India's trade/GDP ratio in in 1991 was 16% of GDP and now it is around 47% of GDP
India's trade/GDP ratio in in 1991 was 16% of GDP and now it is around 47% of GDP
A bear market is associated with price declines in an overall market or index (like NIFTY 50) of ................. or more. Fill in the blank with suitable options:
Final Results
33%
(a) 10%
28%
(b) 15%
25%
(c) 20%
13%
(d) 25%
The correct answer to the above question is (c) 20%
No explanation needed
No explanation needed
Term of the day: 'Orange Economy'
‘Orange economy’, also known as the creative economy, refers to economic activities that leverage creativity, culture, and intellectual property to generate wealth and jobs.
‘Orange economy’, also known as the creative economy, refers to economic activities that leverage creativity, culture, and intellectual property to generate wealth and jobs.
Source: Indian Express
In the last few years, RBI has increased its gold holdings. As of March 2025, RBI 879.59 Tonnes of Gold out of which 511.99 Tonnes is domestically stored, 348.62 Tonnes is held with Bank of England and Bank of International Settlement and 18.98 tonnes are in form of Gold Deposits.
Share of Gold in our Forex reserves has increased to 11.7% as of March 2025.
Countries with highest gold reserves are USA, Germany, Italy, France, China, India, Japan...
In the last few years, RBI has increased its gold holdings. As of March 2025, RBI 879.59 Tonnes of Gold out of which 511.99 Tonnes is domestically stored, 348.62 Tonnes is held with Bank of England and Bank of International Settlement and 18.98 tonnes are in form of Gold Deposits.
Share of Gold in our Forex reserves has increased to 11.7% as of March 2025.
Countries with highest gold reserves are USA, Germany, Italy, France, China, India, Japan...
📚 *भारतीय अर्थव्यवस्था (मराठी संस्करण)*
*Author:*
✍️ Vivek Singh
*Key Features:*
🔹 Includes the 2025-26 Union Budget and Economic Survey 2024-25
🔹 Updated statistical data for accurate insights
🔹 Coverage of previous exam questions for effective practice
🔹 Reports from RBI, NABARD, and SEBI included
🔹 Focus on exam-relevant key topics for better preparation
🔹 In-depth analysis of Maharashtra's economy
💥 *Sale Price:* ₹480
💥 *MRP:* ₹650
💥 *FLAT 26% OFF*
🛒 *BUY NOW*
*Amazon Link* - https://shorturl.at/4TRZP
*Flipkart Link* - https://shorturl.at/CBFrD
📖 Perfect for competitive exams!
#IndianEconomy #MarathiEdition #UPSC #MaharashtraExams
*Author:*
✍️ Vivek Singh
*Key Features:*
🔹 Includes the 2025-26 Union Budget and Economic Survey 2024-25
🔹 Updated statistical data for accurate insights
🔹 Coverage of previous exam questions for effective practice
🔹 Reports from RBI, NABARD, and SEBI included
🔹 Focus on exam-relevant key topics for better preparation
🔹 In-depth analysis of Maharashtra's economy
💥 *Sale Price:* ₹480
💥 *MRP:* ₹650
💥 *FLAT 26% OFF*
🛒 *BUY NOW*
*Amazon Link* - https://shorturl.at/4TRZP
*Flipkart Link* - https://shorturl.at/CBFrD
📖 Perfect for competitive exams!
#IndianEconomy #MarathiEdition #UPSC #MaharashtraExams
Source: Indian Express
India and UK signed Free Trade Agreement. Just have a look on which products will benefit under FTA.
Clarification: For Animal products it is written Duty Range 20% and Under FTA 99.3%. It means the present duty is up to 20% on different Animal products but under FTA for 99.3% of the animal products duty will become zero.
India and UK signed Free Trade Agreement. Just have a look on which products will benefit under FTA.
Clarification: For Animal products it is written Duty Range 20% and Under FTA 99.3%. It means the present duty is up to 20% on different Animal products but under FTA for 99.3% of the animal products duty will become zero.
Source: Indian Express
Pls read the highlighted portion to understand 'Extended Fund Facility (EFF)' offered to Pakistan. Its for handling BoP crisis by country's facing structural weaknesses.
Indian Economy is presently 10.5 times bigger in size than Pakistan. Indian Economy is $4 Trillion while Pakistan is $380 billion.
Pls read the highlighted portion to understand 'Extended Fund Facility (EFF)' offered to Pakistan. Its for handling BoP crisis by country's facing structural weaknesses.
Indian Economy is presently 10.5 times bigger in size than Pakistan. Indian Economy is $4 Trillion while Pakistan is $380 billion.