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Policy & Politics

Launch of NUE by RBI: Boon or bane?




Cash in hand may still be the king, but with the technological development and enormous use of smartphones heading towards a count of more than 1 billion, the use of online payments/digital transactions is in the race at a high pace.  Especially UPI online transactions saw an incredible surge in the lockdown period, the country witnessed around 16% increase in UPI online payment till July-August, 2021. Through UPI more than 300 Cr Rupees happened moreover around 6 Lakh Rupees were transacted using this particular mode of online payment. The growth, usage and advancement when it comes to online transactions have been a trouble-free road with minor bumps of crimes like fraud etc. But the problem at hand is that is a single entity enough to regulate the retail payment system in the country? From Reliance and Tata to Union Bank and Punjab National Bank to Amazon and Paytm, all these big companies are on a way to a straight shot to set up new umbrella entities for payment framework in the country. For what reason the organizations with any role in India’s tech or monetary administrative environment are putting forth an attempt to set up an NUE? What is an NUE, and for what reason are they required?

Recently, there has been a boost in the Retail Payment System (RPS). The demand for the same has increased in recent years especially at the time of the COVID-19 pandemic, due to the lockdown a rise was seen in RPS. Keeping in mind the changes and demands of society, the Reserve Bank of India (RBI) has proposed the idea of New Umbrella Entities (NUE). This is similar to Unified Payments Interface (UPI). The aim for this is to keep up with the security level and also to follow sustainable financial principles. It is expected to fill up the loopholes existing to date in the payment methods, to ensure the authentication and safety of users.

Until now National Payments Corporation of India (NPCI) a non-profit entity that has arisen as an efficiently significant instalment framework element in India because of the plethora of payment method frameworks it operates, like UPI, Bharat Bill Pay, AEPS, RuPay, Fastag, etc. Even though NCPI has been there for more than a decade and has developed as an efficient entity still players have called attention to the different entanglements of NPCI, one of which is that it is the main element dealing with all of India’s retail payment frameworks. From a monetary steadiness outlook, the RBI’s proposal to permit assorted elements to build up New Umbrella Entity (NUE) for the payment method in the country with the aim to increase the competition and technological advancement.


NUE is a system cum licence that will be granted by RBI as it holds the power of authority for the same. The system proposes a new framework for payments with extended standards and technologies. Also, as we know that financial frauds are very common nowadays, the system will prevent the same from happening. When the users start using a new mechanism or system for transactions, they also expect safety. This system has come up with fulfilling such expectations too.

The NUEs’ essential obligations are to work to operate, set up, and oversee new payment frameworks. This will be done in the areas including ATMs, White Label PoS, Aadhaar-based payments etc. Apart from this, NUE can also help in promoting fintech. As the security levels will increase along with technological advancements, it will gear up the scope of fintech. Further, the data storage will also advance by this new entity.


Application for NUE is open for all corporates, groups and promotors. Provided, they have an experience of more than three years in payment mechanism. It can be in the form of promotor, operator, service provider etc. The NUE is also open for foreign investors. They can apply for the same by following the Foreign Direct Investment Policy and related guidelines. It is necessary to comply to the norms of corporate governance and follow the regulations.

The applicant is required to meet the requirements and follow the prescribed procedure. Till now, the corporates have been pairing up with the banks to apply for NUE. In the same manner, other corporates can also form the partnership to comply with the guidelines of RBI. At end, RBI holds the authosrisation for grant of NUE if all the obligations have been fulfilled by entities.


The plan of incorporation of an umbrella entity is as per section 8 of the Companies Act and it will hold the position of a company. The provision states the formation of companies with charitable objectives – under this, NUE can be registered as a company with the motive of easing various aspects of financing that too with increased security. Also, the company registered under this section can convert itself to any other form of the company too. The authorization of the same will be held by RBI as per Section 4 of the Payment and Settlement Systems Act, 2007. Also, apart from this, the regulation will be done by other appropriate provisions of the PSS Act too. Section 4 states the authorization of payment systems. This provision will ensure that the working of NUE is legally authorised so that scope of fraud diminishes. The section will play the role of setting up the regulations for the working of NUE. It will ensure the authenticated working mechanism which will reduce the risk for corporates too.

Further, the entities will be held by the Indian Citizens and this will be regulated as per the foreign exchange Management Act, 1999. This will also get amended from time to time as per the requirements of the Payment System Operator etc. NUE will also be ensured to compel with the norms of corporate governance such as MOA and AOA. The procedure will be similar to that of other business entities. Apart from this, the procedures from the advisory committee will be followed including Supervision of Payment and Settlement Systems (BPSS).


The idea of NUE has been strictly opposed by some corporations and commercial banks. It has been stated by them that instead of this, domestic NPCI can be strengthened. With the launch of new technologies day by day, it will not only make the processes complicated but, will also lead to unfair market competition. Also stating that the recent events cannot only be the sole reason to come up with whole new technology.

The issue has been addressed by RBI and it has been stated that there will be extensive guidelines for keeping everything systematic. The market competition will also flow positively. Also, this will deal with the concerns of commercial banks too. The illusion of adverse impact will fade away with time.


Various legal and commercial aspects are linked with NUE. Some positive yet, some negative. As mentioned above, the legal framework for the NUE has been designed in a way that fulfils all the requirements of a corporate. It also includes performance as a payment option. This states that the launch is well planned and is expected to bring up new technological features. From this aspect, the releases of NUE are highly favourable.

Therefore, it can be concluded that the New Umbrella Entities is a welcome advancement toward permitting private area cooperation in the improvement of India’s retail payment foundation just as the presentation of new frameworks and innovations to the overall population. However, the opposition by corporations and banks puts us in a myth. It is necessary to look after every aspect that too critically. It can be said that the concerns of corporations are also valid but, new launches cannot be stopped with the fear of market competition. It’s conceivable that more cooperative energies and development might arise in the fintech business, moreover, with the ascent of computerized instalments, offering NUE licenses to private players will facilitate the payment burden on NCPI further leading to advancement and better competition. NUE is itself a healthy aspect for keeping up the market on pace and can be seen as a boon to the Indian finance and commercial structure further resolving the problems with better regulatory framework.


Replacement of any traditional system is not an easy task, for over a decade now the NPCI has performed as the sole umbrella association for retail payment frameworks in India and hence the expansion to NUE will take time to cope with. However, all the specifications have been clearly stated by RBI. Till now, Tata Group has teamed up with a private bank to set their own umbrella entity. Likewise, this will have a good pace. The companies that are incorporating the NUE are giving a pathway for foreign investments. The most recent improvements in the retail payment area with the Tata Group, Reliance and Amazon is only the most recent in the competition between the many other organizations, who are now contending in the Indian retail area. The Tata Group is looking at a 68% stake in an Indian basic food item e-retail start-up i.e., Big Basket.

The Indian e-staple area is warming up with the world’s most extravagant man Jeff Bezos wagering on it with Amazon Easy Pantry service, India’s most extravagant man Mukesh Ambani increasing the game with Jio Mart. Tata, Reliance and other multinational companies have been adding their names to the list which is increasing the scope of implementation of NUE. This will also give a boost to e-commerce with safer options for its users. With all the present advancements and more to be added, NUE proves to be a fruitful concept. Not only from the perspective of banks and corporations but, for users too.

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Policy & Politics


Tarun Nangia



Union Minister of Commerce and Industries, Consumer Affairs, Food and Public Distribution and Textiles, Piyush Goyal, met the representatives of Aluminium, Copper, and Chemicals and Petrochemicals Industry here today as part of the ongoing multi-stakeholder consultations related to the India-UAE Comprehensive Economic Partnership Agreement (CEPA) negotiations.

The third round of India-UAE CEPA negotiations are scheduled to be held in New Delhi on 06-10 December 2021 wherein both sides aim to conclude the negotiations. Shri Piyush Goyal apprised the representatives from the Industry about the importance of the CEPA in elevating the overall economic and commercial relations with UAE which in turn will not only benefit bilateral trade but also create new jobs and provide wider social and economic opportunities.

Providing a way forward on these discussions, Goyal appreciated the accommodative spirit of the Industry and urged the Industry representatives to continue to support the CEPA negotiations in the same spirit in the wider interests of the nation contributing to the holistic development of multi-sectoral economic value chains in the country.

The Minister also stressed on the potential benefits from the envisaged CEPA agreement for Industries which are labour intensive in nature and also on the numerous complementary spill-over economic benefits, including increased investments, job creation and employment opportunities. Further, industry representatives were also apprised of the strategic importance of the agreement which encompasses deeper bilateral economic engagement and wider market access.

The stakeholders expressed gratitude to the Minister for taking into consideration concerns of Indian Industry and provided constructive inputs on this matter with a view to ensure overall balance between market access and domestic sensitivities.

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Policy & Politics

Rice has a share of more than 45% in the total APEDA basket of exports in April-November 2021-22

India’s exports of agricultural and processed food products witness an increase of more than 13 per cent in the first eight months of current fiscal notwithstanding logistical challenges posed by COVID-19 pandemic

Tarun Nangia



Notwithstanding logistical challenges posed by COVID19 pandemic, India’s exports of Agricultural and Processed Food products rose by more than 13 per cent in terms of USD in the first eight months of the current fiscal (April-November, 2021-22) compared to the same period of the previous year.

The export of products under the Agricultural and Processed Food Products Export Development Authority (APEDA) ambitincreased from USD 11,671 million in April-November 2020-21to USD 13,261 million in April-November 2021-22.

The target for exports under APEDA basket products has been fixed at USD 23,713 million in 2021-22.

The export of rice was the top forex earner at USD 5937 million during April-November 2021-22, growing 11 per cent over the corresponding period in 2020-21 when it touched USD 5,341million.

Meat, dairy and poultry products exports grew 12 per cent standing at USD 2665 million in April-November 2021-22compared to USD 2371 million in the corresponding eight-month period of 2020-21. Fruits and vegetables exports were up by 12 per cent to touch USD 1720 million during April-November 2021-22 against USD 1536 million in April-November 2020-21.

Exports of cereal preparations and miscellaneous processed items grew by 26 per cent during April-November 2021-22 to touch USD 1418 million against USD 1127 million in April-November, 2020-21. The cashew exports also grew by 29 per cent to USD 302 million in the first eight months of current fiscal compared to same period previous year.

The exports of oil meals declined by 12 per cent to USD 626 million in April-November, 2021-22, compared to same period in 2020-21.

Table: Agricultural and processed food products exports (April-November), 2021-22 vs 2020-21

Exports (April-November 2021-22) in USD million

Exports (April-November 2020-21) in USD million

Note: only oil meals exports declined Year-on-Year

The significant rise in agri-exports is seen as a testimony of the government’s commitment to increase farmers’ income through giving thrust on boosting exports of agricultural and processed food products of the country.

“We continue to focus on creating infrastructure for boosting exports by focusing on clusters in collaboration with state governments while taking into consideration objective of Agriculture Export Policy, 2018,” Dr M Angamuthu, Chairman, APEDA, said.

APEDA has been engaged with State Governments for the implementation of Agriculture Export Policy. Maharashtra, U.P., Kerala, Nagaland, Tamil Nadu, Assam, Punjab, Karnataka, Gujarat, Rajasthan, Andhra Pradesh, Telangana, Manipur, Sikkim, Uttarakhand, M.P., Mizoram and Meghalaya have finalized the State specific Action Plan for exports while the action plans of other States are at different stages of finalization.

The rise in export of agricultural and processed food products has been largely due to the various initiatives taken by APEDA such as organizing B2B exhibitions in different countries, exploring new potential markets through product specific and general marketing campaigns by active involvement of Indian Embassies.

APEDA has also taken several initiatives to promote geographical indications (GI) registered agricultural and processed food products in India by organizing virtual Buyer Seller Meets on agricultural and food products with the major importing countries across the world.

In order to ensure seamless quality certification of products to be exported, APEDA has recognized 220 labs across India to provide services of testing to a wide range of products andexporters.

APEDA also assists in upgradation and strengthening of recognized laboratories for export testing and residue monitoring plans. APEDA also provides assistance under the financial assistance schemes of infrastructure development, quality improvement and market development for boosting export of agricultural products.

APEDA organizes participation of exporters in the International Trade Fairs, which provides a platform to the exporters to market their food products in the global marketplace. APEDA also organizes national events like AAHAR, Organic World Congress, BioFach India etc. to promote agri-exports.

APEDA also initiates registration of pack-houses for horticulture products for meeting the quality requirements of the international market. Registration of export units for peanut shelling and grading and processing units, for instance, is to ensure quality adherence for the EU and non-EU countries.

APEDA carries out registration of meat processing plants and abattoirs for ensuring compliance with global food safety and quality requirements. Another key initiative includes development and implementation of traceability systems which ensure the food safety and quality compliances of the importing countries. For boosting exports, APEDA compiles and disseminates various international trade analytical information, market access information amongst exporters and address trade enquiries.

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Policy & Politics


Public Private Partnership necessary for Disaster Management and mitigation and for protecting lives and livelihoods, said Goyal

Tarun Nangia



Piyush Goyal today reviewed preparedness for mitigation of cyclone Jawad.

Under the guidance of Prime Minister, Shri Narendra Modi, proactive disaster preparation and management are being institutionalized. Prime Minister has personally reviewed the preparation for Disaster Management and has also given instructions to various Ministries to work with State Governments, industry and all other stake holders to ensure minimal damage to life and property.

In line with these efforts, the Minister for Commerce and Industry, Consumer Affairs, Food and Public Distribution and Textiles, Shri Piyush Goyal today reviewed the arrangements and preparations made by the State Governments of Andhra Pradesh, Odisha and West Bengal today in a Video conference with the State Chief Secretaries concerned. National level Industry Associations like CII, FICCI, ASSOCHAM and PHD Chambers were also represented at the Conference.

The Minister took stock of the preparations being made by the respective State governments. He also reviewed the suggestions for successful mitigation made by Ministries, State Governments, industry bodies and other organizations and appreciated the concerted efforts being made to mitigate the cyclone. He said that this collaboration was a worthy example of cooperative federalism at its best. He also underscored the need for the drawing of a comprehensive action plan towards managing this natural disaster in a most effective way by incorporating the inputs and suggestions given by all stakeholders.

Goyal said that public private partnership is necessary for Disaster Management and mitigation and for protecting the lives and livelihoods of those affected. Observing that the cyclone seems to be a milder one, the Minister said that we must constantly upgrade our learnings and keep upgrading our capabilities. He also called for preparedness in the banking and insurance sectors to tackle the effects of the cyclone.

As per the Indian Meteorological Department (IMD), the low-pressure region in the Bay of Bengal is expected to intensify into Cyclone Jawad and is expected to reach the coast of north Andhra Pradesh – Odisha around the afternoon today, with the wind speed ranging up to 100 kmph.

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Policy & Politics

Job generation: Big scope for expansion of labour intensive plastic, footwear and textile sectors, says Goyal

Tarun Nangia



Piyush Goyal

Union Minister of Commerce & Industry, Consumer Affairs, Food & Public Distribution and Textiles, Piyush Goyaltoday called upon the captains of Indian Industry to set ambitious targets as our economy is poised for a sustained spell of rapid growth. Addressing the 5th Meeting of the CII National Council in New Delhi, he said the Industry has a huge role to play in the uplift of the poor and underprivileged.

Goyal encouraged the Industry to have a greater appetite for taking risks, to invest in Industries that may be less profitable at the start, but are labour oriented and create lakhsof jobs. He also urged the Industry to promote tribalhandicraft products as part of their CSR activities.

Goyal said there is big scope in the expansion of labour intensive Plastics, Footwear and Textiles industry. India cannot be truly Aatmanirbhar, without empowering its poor to be Aatmanirbhar, he added.

Goyal conveyed his appreciation for the Industry’s positive approach in FTA consultations. “Right now we are engaged in FTA negotiations with 6/7 countries,” he said. Citing India’s foreign trade as “very, very comfortable”,

Seeking accommodation in trade deals, Goyal said, “On our part, I believe, that it’s time that we engaged more with the world, we look at deeper engagement, – both imports and exports.” “If we (don’t) open our autos or spirits sectors, for example, it will open greater opportunities for India than the other way round,” he said.

Observing that 2020 has been a year of resilience for the Indian economy, Goyal said that in these unprecedentedtimes India has emerged as the ‘World’s Trusted Partner’ andis poised to contribute significantly to global growth. Policies of the Government in the last more than seven years, under the able leadership of the Prime Minister Shri Narendra Modi, have laid a solid foundation for growth of the Indian economy, he said.

Stating that all economic indices hinted at a fast growth trajectory, Goyal said India has Cost advantage as well as Trust advantage. “Services is growing at a fantastic pace, exports also are, of course on Merchandise,… Similarly remittances continue to be strong, FDI is at never before levels for the 7th time in a row, but this year the growth would be even much more, the capital markets are buzzing which means FII investments also and the IPO market is also gaining a lot of traction,” he said.

Goyal said the way we have fast bounced back since Covid, the way Industry geared itself up, Services sector, for example, reoriented their processes, Government supported Industry adopt WFH, we met all our international commitments throughout the Covid period including the lockdown. “Not for a second did any international supply chain, dependent on India, had to suffer, particularly the Services sector and for that matter even in the Goods sector,” he said.

Stressing that India is going through a sharp and strong revival, the Minister said that rising economic indicators point towards “India is shaping up for a growth decade.”

“Apna time aa gya (Our time has come)! This is the time to be in India & invest in India”, Shri Goyal said, adding “If we fail our Young Generation, it will be truly a sad day for India. We are at the cusp (of history). It’s our time to grab now, we’ll probably regret if we miss this opportunity.”

Goyal said that the Government is doing its part byundertaking transformational reforms such as PLI, PM GatiShakti, ODOP, Single Window, Retrospective tax amendment, National Asset Monetisation Pipeline, etc and opening up sectors like Defence, Space & Atomic Energy, Mining & Minerals, etc.

The Minister urged the top 100 CII members, that could comprise 1,000 companies, to onboard the NSWS Single Window clearance system and make full use of IILB Land Bank System. Resolving to use Indian materials to make a truly Aatmanirbhar Bharat, he said this will transform the future of India by making it self-reliant, resilient & competitive and will create jobs.

Shri Goyal said the Government has initiated several schemes for the benefit of the Industry and the public in general, including Power sector, One Nation, One Ration Card, world’s largest health insurance programme, – AyushmanBharat, UPI payments transfer and Jan Dhan banking for each and every home. “Government has focussed on saturating schemes,” he said.

Expressing confidence on the continuous Public-PrivatePartnership, Goyal said the Government is always thinking of how to empower the Industry and urged the entrepreneurs to come up with new ideas in nation-building.

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Policy & Politics

Share of agri-exports in GDP

Tarun Nangia



The year-wise details of value of India’s agri-exports of principal agri commodity group along with its share in our Gross Domestic Product (GDP) at current prices during last five years is as follows:

The agricultural products having exports of more than Rs 10,000 crore over the last five years is given in the table below. Last year we had 22.8% of growth in agri-exports with a share of 1.6% to GDP (highest in terms of growth and share in the last five years).

Source: DGCI&S, Kolkata and CSO, MoSPI

Source: DGCI&S, Kolkata

Government has taken several measures to boost exports, including agri-exports, such as:

(i) A comprehensive “Agriculture Export Policy” has been introduced toharness export potential of Indian agriculture and raise farmers’ income. Twenty One States viz. Maharashtra, U.P., Kerala, Nagaland, Tamil Nadu, Assam, Punjab, Karnataka, Gujarat, Rajasthan, Andhra Pradesh, Telangana, Manipur, Sikkim, Uttarakhand, M.P., Mizoram, Meghalaya, Tripura, Arunachal Pradesh and Himachal Pradesh and the 2 UTs vizLadakh and Andaman & Nicobar Islands have finalized the State specific Action Plans. State Level Monitoring Committees (SLMC) has been formed in 26 States and 4 UTs. 28 States & 4 UTs have nominated Nodal agencies for implementation of this AEPs. As part of the Agriculture Export Policy, 46 unique product-district clusters have been identified for export promotion. Twenty-Nine Cluster Level Committees have been formed in cluster districts of different clusters. Country and product-specific action plans have also been formulated to promote exports.

(ii) Products Specific Export Promotion Forums give impetus to the export of potential products as well as to remove the bottlenecks in the supply chain, Agricultural and Processed Food Products Export Development Authority (APEDA) has formed Export Promotion Forums (EPFs) under the Chairmanship of Chairman, APEDA and having representatives of Department of Commerce, Department of Agriculture, State Governments, National Referral Laboratories and top 10 leading exporters of each product for the products, viz., Grapes, Onions, Mango, Banana, Pomegranate, Floriculture, Rice, Dairy Products and Nutricereals.

(iii) 13 Agri-Cells in Vietnam, USA, Bangladesh, Nepal, UAE, Iran, Saudi Arabia, Malaysia, Indonesia, Singapore, China, Japan and Argentina were created in Indian embassies abroad to provide inputs on real time basis to enable us to improve Indian exports.

(iv) Further, In order to boost honey exports, India has made NMR (Nuclear Magnetic Resonance) testing mandatory for honey exported to USA.

(v) A Farmer Connect Portal has been set up for providing a platform for farmers, Farmer-Producer Organizations (FPOs) and cooperatives to interact with exporters. Buyer-Seller Meets (BSMs) have been organized in the clusters to provide export-market linkages. Regular interactions, through video-conferences, have been held with the Indian Missions abroad to assess and exploit export opportunities. Country specific BSMs, through Indian Missions, have also been organized.

(vi) Assistance provided through several other schemes to promote exports, including food export, viz. Trade Infrastructure for Export Scheme (TIES), Market Access Initiatives (MAI) Scheme, etc. In addition, assistance to the exporters of food products is also available under the export promotion schemes of APEDA, Tea Board, Coffee Board and Spices Board.

(vii) Government has also introduced a Central Sector Scheme –‘Transport and Marketing Assistance for Specified Agriculture Products’ – for providing assistance for the international component of freight to mitigate the freight disadvantage for the export of agriculture products.

(viii) Common Digital Platform for Certificate of Origin has been launched to facilitate trade and increase FTA utilization by exporters.

(ix) Active role of Indian missions abroad towards promoting our trade, tourism, technology and investment goals has been enhanced.

(x) Package announced in light of the COVID-19 pandemic to support domestic industry through various banking and financial sector relief measures, especially for MSMEs, which constitute a major share in exports.

This information was given by the Minister of State for Commerce and Industry, Anupriya Patel, in a written reply in the Rajya Sabha today.

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Policy & Politics

Share of India’s exports in annual GDP

Tarun Nangia



The details of exports of goods and services and Gross Domestic Product (GDP) at current prices, and percentage share of India’s exports to the GDP for the last five years and current year are as follows:

Source: National Accounts Division, CSO, MoSPI Note: RE: Revised Estimate, PE : Provisional Estimate

Source: National Accounts Division, CSO, MoSPI

The share of export of goods and services in GDP has increased to 18.7% during 2020-21 over 18.4% in 2019-20 and 21.7% in 2021-22 (April-September) over 19.4% in 2020-21 (April-September).

The details of the annual rate of growth of exports of goods and services and the corresponding annual rate of growth of GDP at current prices for the last five years and current year are as follows: This information was given by the Minister of State for Commerce and Industry, Anupriya Patel, in a written reply in the Rajya Sabha today.

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