9 PM Daily Brief – 21 May 2016

Brief of newspaper articles for the day bearing
relevance to Civil Services preparation

What is 9 PM brief?

• GS PAPER 2
  1. Ordinance cleared to keep States out of NEET this year {Bills and Laws – Paper II}
  2. Iran, Qatar, U.S. on Modi’s next itinerary {Foreign Policy – Paper II}
• GS PAPER 3
  1. Budget support not needed for Rs.25 lakh cr. plan: Gadkari {Economy – Paper III}
  2. Intermediate mechanism for NPAs on anvil {Economy – Paper III}

GS PAPER 2

[1] Ordinance cleared to keep States out of NEET this year

The Hindu

What happened?

• Union Cabinet has cleared an ordinance bypassing the Supreme Court’s decision on the National Eligibility-cum-Entrance Test (NEET), a common test for admission to medical and dental courses.

Why did it passed the ordinance?

• The Union Government was facing pressure from the State governments.

Clarification

• The exception is only for this academic session. From next year, students will have a common entrance test nationwide.

[2] Iran, Qatar, U.S. on Modi’s next itinerary

The Hindu

News

• Next visits of PM Modi.

Iran

• He will sign the trilateral India-Afghanistan-Iran transit trade agreement along with Afghan President Ashraf Ghani.
• The trilateral agreement using Chabahar-Zahedan-Zaranj as a corridor will be a game changer for regional connectivity, especially for Afghanistan, to find an assured and reliable alternative access to India via sea.
• The route will also significantly enhance prospects for India’s connectivity with Afghanistan, Central Asia and beyond through synergies with other initiatives such as North South Transport Corridor.
  
• Among the other agreements expected to be discussed are the one to develop the Chabahar port and the ongoing negotiations for the Farzad-B oilfields. 

Qatar

• Energy will be one of the key subjects of talks in Doha, with Qatar accounting for 65 per cent of India’s LNG imports last year.

US

• He will travel to Washington for a “farewell” visit to the outgoing President, Barack Obama.
• the final details are still being negotiated for the Logistics Exchange Memorandum of Agreement that would help Indian and U.S. militaries access each others’ bases and key installations.
• In addition, the first commercial nuclear deal between the two countries, which would seal the deal announced by the two leaders last January, could also be signed during the visit.

GS PAPER 3

[1] Budget support not needed for Rs.25 lakh cr. plan: Gadkari

The Hindu

Issue

• The government has lined up a Rs 25 lakh crore plan for investments in the infrastructure sector over the next five years.

Analysis

• The investments, could be funded without depending on budgetary support from the Finance Ministry.
• Government has also proposed a new Infrastructure Finance Corporation on the lines of Power Trading Corporation to raise foreign funds for investments in highways, ports and shipping.
• Power Trading Corporation was set up in 1999 in a bid to provide credit risk mitigation to private power project developers.

[2] Intermediate mechanism for NPAs on anvil

The Hindu

What is NPA?

• A non performing asset (NPA) is a loan or advance for which the principal or interest payment remained overdue for a period of 90 days.
• However, in terms of Agriculture / Farm Loans; the NPA is defined as under:

            For short duration crop if the loan (installment / interest) is not paid for 2 crop seasons                  it would be termed as a NPA.

              For Long Duration Crops, the above would be 1 Crop season from the due date.

What is Bank Board Bureau?

• With a view to improve the governance of public sector banks, the government had decided to set up an autonomous Bank Board Bureau. The bureau will recommend for selection the heads of public sector banks and financial institutions and help banks in developing strategies and capital raising plans and how to go ahead with mergers and acquisitions.

Analysis

• Worried over mounting bad loans, the Bank Board Bureau (BBB) is working out an “intermediate mechanism” to ensure early resolution of the problem and also to provide comfort to the bank management with regard to settlement of dues.
• That intermediate mechanism will provide a certain degree of comfort to the management of the bank.
• There are two kind of issues, one is process of resolution, the other is the pricing at which the resolution takes place.
• It will be outside BBB and would be in domain of banks.
• Much detail about this is not in public domain and the entire thing will be rolled out in a fortnight, as said by BBB Chairman Vinod Rai.