Indian-origin Neil Basu is Scotland Yard's new counter-terror chief

May 11: Saudi Arabia will triple its value-added tax rate and suspend a cost of living allowance for state workers, it said on Monday, seeking to shield finances hit by low oil prices and a slump in demand for its lifeline export worsened by the new coronavirus.

Historic oil output cuts agreed by Riyadh and other major producers have given only limited support to prices after they sank on oversupply caused by a war for petroleum market share between the kingdom and its fellow oil titan Russia.

Saudi Arabia, the world's largest oil exporter, is also being hit hard by measures to fight the new coronavirus, which are likely to curb the pace and scale of economic reforms launched by Crown Prince Mohammed bin Salman.

"The cost of living allowance will be suspended as of June 1, and the value added tax will be increased to 15% from 5% as of July 1," Finance Minister Mohammed al-Jadaan said in a statement reported by the state news agency. "These measures are painful but necessary to maintain financial and economic stability over the medium to long term...and to overcome the unprecedented coronavirus crisis with the least damage possible."

The austerity measures come after the kingdom posted a $9 billion budget deficit in the first quarter.

The minister said non-oil revenues were affected by the suspension and decline in economic activity, while spending had risen due to unplanned strains on the healthcare sector and the initiatives taken to support the economy.

"All these challenges have cut state revenues, pressured public finances to a level that is hard to deal with going forward without affecting the overall economy in the medium to long term, which requires more spending cuts and measures to support non-oil revenues stability," he added.

The government has cancelled and put on hold some operating and capital expenditures for some government agencies, and cut allocations for some reform initiatives and projects worth a total 100 billion riyals ($26.6 billion), the statement said.

Central bank foreign reserves fell in March at their fastest rate in at least 20 years and to their lowest since 2011, while oil revenues in the first three months of the year fell 24% from a year earlier to $34 billion, pulling total revenues down 22%.

"The reforms are positive from a fiscal side as greater adjustment is essential. However, the tripling of VAT is unlikely to help that much in 2020 revenue wise with the expected fall in consumption," said Monica Malik, chief economist at Abu Dhabi Commercial Bank.

She said she kept unchanged her deficit forecast of 16.3% of GDP for this year, which already factors in a greater than previously announced spending cut.

About 1.5 million Saudis are employed in the government sector, according to official figures released in December.

In 2018, Saudi Arabia's King Salman ordered a monthly payment of 1,000 riyals ($267) to every state employee to compensate them for the rising living costs after the government hiked domestic gas prices and introduced value-added tax.

DIFFICULT TIMES

A committee has been formed to study all financial benefits paid to public sector employees and contractors, and will submit recommendations within 30 days, the statement said.

In late 2015, when oil prices fell from record highs, the kingdom slashed lavish bonuses, overtime payments and other benefits once considered routine perks in the public sector.

In a country without elections and with political legitimacy resting partly on distribution of oil revenue, the ability of citizens to adapt to such reforms is crucial for stability.

"Tripling the VAT will test the limits of the balance between revenues and consumption as the economy dives into a deep recession. The move will impact consumption and could also lower the expected revenues," said John Sfakianakis, a Gulf expert at the University of Cambridge.

"These are pro-austerity and pro-revenue moves rather than pro-growth ones," he said.

Hasnain Malik, head of equity strategy at Tellimer, said the VAT rise could bring about $24-$26.5 billion in additional non-oil fiscal revenue. The rise would hit consumer spending further but was a needed step towards fiscal sustainability, he said.

New Delhi, Jul 26: Union Home Minister Amit Shah on Sunday saluted the valour and grit of the Indian soldiers on the occasion of 21st anniversary of the 'Kargil Vijay Diwas'.

Shah took to Twitter and said that 'Kargil Vijay Diwas' is a symbol of India's proud, valour and steadfast leadership.

"Kargil Vijay Diwas is a symbol of India's proud, valor and steadfast leadership. I bow to the soldiers who, with their indomitable courage, drove the enemy from the inaccessible hills of Kargil and waved the tricolor there again. The country is proud of the heroes of India, who are dedicated to protecting the motherland," Shah tweeted (translated from Hindi)
The country is celebrating the anniversary of the 'Kargil Vijay Diwas'.

The Indian armed forces had defeated Pakistan on July 26, 1999. Since then, the day is celebrated as 'Kargil Vijay Diwas' to rekindle the pride and valour of the soldiers who took part in Operation Vijay.

The day marks the victory of Indian soldiers in recapturing the mountain heights that were occupied by the Pakistani Army on July 26, 1999, known as the Kargil War. 

Washington, Jan 10: It is “highly likely” that Iran shot down the civilian Ukrainian jetliner that crashed near Tehran late Tuesday, killing all 176 people on board, U.S., Canadian and British officials declared Thursday.

They said the fiery missile strike could well have been a mistake amid rocket launches and high tension throughout the region.

The crash came just a few hours after Iran launched a ballistic attack against Iraqi military bases housing U.S. troops in its violent confrontation with Washington over the U.S. drone strike that killed an Iranian Revolutionary Guard general. The airliner could have been mistaken for a threat, said four U.S. officials, speaking on condition of anonymity to discuss sensitive intelligence.

Canadian prime minister Justin Trudeau, whose country lost at least 63 citizens in the downing, said in Toronto: “We have intelligence from multiple sources including our allies and our own intelligence. The evidence indicates that the plane was shot down by an Iranian surface-to-air missile.”

Likewise, U.K. prime Minister Boris Johnson and Australian prime minister Scott Morrison offered similar statements. Morrison also said it appeared to be a mistake. “All of the intelligence as presented to us today does not suggest an intentional act,” he said.

The assessment that 176 people were killed as collateral damage in the Iranian-U.S. conflict cast a new pall over what had at first appeared to be a relatively calm aftermath following the U.S. military operation that killed Iranian Gen. Qassem Soleimani.

At the White House, U.S. president Donald Trump suggested he believed Iran was responsible for the shootdown and dismissed Iran's initial claim that it was a mechanical issue with the plane.

“Somebody could have made a mistake on the other side.” Trump said, noting the plane was flying in a “pretty rough neighborhood."