Categories
9 PM Daily NEWS Brief

9 PM Daily Current Affairs Brief – 17 February 2017



Front Page / NATIONAL

[1]. Talaq case may go to Constitution Bench

[2]. Set up mechanism to delete sex determination ads: SC

[3]. India, Afghanistan take a hard line on Taliban at Moscow conference

[4]. Potent malaria vaccine on the anvil

Editorial/OPINION

[1]. The bumps ahead

ECONOMY

[1]. ‘Low solar tariff viability depends on cost of debt’

Indian Express

[1]. Costs of denial: The State of Global Air report is another warning

Live Mint

[1]. A fiscal-consolidation budget that falls short on reforms


Click here to Download 9 PM Daily Brief PDF (17th Feb. 2017)

Front Page / NATIONAL


[1]. Talaq case may go to Constitution Bench

Talaq case may go to Constitution Bench


The Hindu

Context

The Centre’s question as to “whether personal law is ‘law’ under Article 13” is significant

What has happened?

Indicating that a Constitution Bench may hear the question whether triple talaq and polygamy violate the fundamental rights of Muslim women, the Supreme Court has said it had to examine if these personal law practices were the “fundamental traits” of the minority religion

Centre’s question: Whether personal law comes under the ambit of Article 13

The Centre asked the Supreme Court to determine whether personal laws can be brought under the ambit of Article 13 (laws inconsistent with or in derogation of the fundamental rights) of the Constitution

All-India Muslim Personal Law Board (AIMPLB)’s stance

The All India Muslim Personal Law Board had submitted that the Supreme Court had no jurisdiction to strike down any provisions of personal law, but organisations and Muslim women from various walks of life across the country urged the court to strike down triple talaq and polygamy as “un-Islamic.”

Significance

This is the first time that aggrieved persons — individual Muslim women — themselves have approached the Supreme Court in person to settle the law on whether religious law is immune from constitutional standards enshrined in the fundamental rights

What happens if petition succeeds in the SC?

If the Supreme Court agrees that personal laws are included in the definition of laws under Article 13, the door will be opened wide for an aggrieved person to challenge in court a particular personal law of a religion as violative of the fundamental rights. In case the challenge succeeds in court, the personal law, to the extent of its inconsistency, shall become void

Conflicting decisions of the court

The courts have made conflicting observations about the immunity enjoyed by personal laws

  • The Bombay High Court in State of Bombay versus NarasuAppa Mali had held that personal law is not ‘law’ under Article 13.
  • The court had observed that reformation of personal laws is best left to the legislature as “chosen representatives of the people” and not the judiciary. It said the phrase ‘customs and usages’ in Article 13 does not include personal laws of various religions. It held that Article 44 acquiesced the existence of varied personal laws. This 1951 judgment was never challenged in the Supreme Court.
  • In Ahmedabad Women Action Group versus Union of India , the Supreme Court was asked to consider whether unilateral divorce by triple talaq and polygamy were violative of Articles 14 and 15. The court rejected the claim, saying it was for the legislature to determine.

 


[2]. Set up mechanism to delete sex determination ads: SC

Set up mechanism to delete sex determination ads: SC


The Hindu

Context

‘Order to Internet giants is to make search engines responsive to Indian law’

What has happened?

The Supreme Court has ordered three Internet giants — Google, Microsoft and Yahoo — to immediately set up their own in-house expert bodies to keep tabs on and delete online pre-natal sex determination advertisements

  • A Nodal Agency: This step is in addition to the Ministry of Health and Family Welfare’s move to set up a nodal agency to receive complaints on violation of Section 22 of the 1994 Act

Legal clause

Section 22 of the Pre-conception and Pre-natal Diagnostic Techniques (Prohibition of Sex Selection) Act of 1994 prohibits advertisements relating to pre-natal determination of sex and imposes punishment. However, ads continue to appear online, rendering the law toothless

Directions by the court

  • Appoint in-house experts: The court ordered that the search engines “shall appoint their ‘In-House Expert Body’ which shall take steps to see that if any words or any key words that can be shown on the Internet which has the potentiality to go counter to Section 22 of the 1994 Act, should be deleted forthwith
    • The in-house expert body “shall on its own understanding” delete anything that violates the letter and spirit of language of Section 22 of the 1994 Act. In case of doubt, they are free to approach the Ministry’s nodal agency and be guided by the latter


[3]. India, Afghanistan take a hard line on Taliban at Moscow conference

India, Afghanistan take a hard line on Taliban at Moscow conference


The Hindu

Context

Oppose view of Russia, China, Pakistan to involve Taliban in reconciliation efforts

What has happened?

India and Afghanistan took a hard line at the six-nation talks in Moscow, opposing the dominant view from Russia, China and Pakistan to involve the Taliban in reconciliation efforts

Occasion

Russia hosted representatives from six countries for discussions aimed at encouraging the Taliban to negotiate with the Afghan government

  • Officials from Afghanistan, Pakistan, Russia, China, Iran and India took part in the gathering, which came less than two months after a similar meeting between Russia, China and Pakistan.
  • The United States, for the second time in a row, was not invited

India’s stance

  • Denying “safe havens or sanctuaries to any terrorist group or individual in countries of our region,” was essential to stabilizing the situation in Afghanistan
  • Reconciliation efforts must be driven by the Afghanistan government and could only be facilitated by “friends and well-wishers of Afghanistan

Afghanistan’s stance

  • Referring to Pakistan’s stand on “good/bad Taliban” echoed by officials in Moscow, and the talks between China and Taliban officials last year, Afghanistan’s representative said
    • The key challenge to the process remains a policy selectivity by some to distinguish between good and bad terrorists, even though terrorism is a common threat that confronts the whole region, where if one of us doesn’t stand firm against it, others’ counter-terrorism efforts will not bear the results we all seek
  • Afghanistan also made a strong pitch for the United States to be included as one of its most important partners

 


[4]. Potent malaria vaccine on the anvil

Potent malaria vaccine on the anvil


The Hindu

Context

Encouraged by the trials, researchers say the registered vaccine will reached the market in two years

What has happened?

A malaria vaccine that mimics a mosquito bite yielded encouraging results in human trials, raising hopes for thwarting a parasite that kills a child every two minutes.

Name of the drug

The candidate drug, called PfSPZ, provided up to 100% protection for 10 weeks in a trial in Germany, although a trial in real life conditions in Mali gave a lower level of defence, they reported in two separate studies

  • PfSPZ is being developed against the Plasmodium falciparum mosquito-borne parasite, by far the deadliest type. Further trials are to follow in Mali, Ghana, the U.S. and Gabon.

Working

PfSPZ uses a live, immature form of the malaria parasite, called a sporozoite, to stimulate an immune reaction in humans. Two types of vaccine is there,

  • One, in which sporozites are radiated before being injected (Irradiated sporozites). In this case a high dosage of live malaria parasites i.e. sporozites was administered to volunteers. The highest dose conferred up to 100% immunity
  • Second is the one in which Sporozites are not exposed to radiation. These are injected along with Chloroquine. In this case a low dosage was administered to volunteers

Observations

All the volunteers in the high-dose group enjoyed malaria protection 10 weeks after the last dose, compared to six out of nine in the medium and three out of nine in the low-dose groups

Another vaccine

Another vaccine called RTS,S, developed by GlaxoSmithKline, is being tested in children — the most affected population.It is considered the most advanced candidate, but results last year from a Kenyan trial showed it was only about four per cent effective after seven years


 


Editorial/OPINION


[1]. The bumps ahead

The bumps ahead


The Hindu

Context

Assessing inflation risk in the time of spiking prices and damp consumer sentiment

Nothing relevant in particular. Article talks about increasing wholesale inflation and future risks that might destabilize government’s fiscal calculations.

Give it a light read


 


ECONOMY


[1]. ‘Low solar tariff viability depends on cost of debt’

‘Low solar tariff viability depends on cost of debt’


The Hindu

Context

Article talks about the observations made in the recently released ICRA report

 What has happened?

The recently-concluded bid for three 250 MW units in the Rewa plant in Madhya Pradesh saw tariffs falling below ₹3 per unit, sparking some concern in the industry that tariffs were becoming unviably low

ICRA (Investment Information and Credit Rating Agency)
After CRISIL, ICRA is India’s second credit rating agency which was set up in 1991

Observations

  • Major improvement in cost competitiveness: The recently-concluded bid for three 250 MW units in the Rewa plant in Madhya Pradesh signifies a major improvement in the cost competitiveness of solar energy against both alternate renewable as well as conventional energy sources
    • With competitive bidding route adopted for award of solar projects &fall in PV module price levels, cost competitiveness of solar PV bid tariff has thus significantly improved as evident in decline from ₹6.5/kwh in calendar year 2014 to ₹5.0/kwh in calendar year 2016, and further to ₹3.3/kwh for bidding of project capacity in the Rewa Solar Park

What is competitive bidding?

Transparent’ procurement method in which bids from competing contractors, suppliers, or vendors are invited by openly advertising the scope, specifications, and terms and conditions of the proposed contract as well as the criteria by which the bids will be evaluated

  • Such low tariffs in Madhya Pradesh were enabled by a few favourable factors in the project power purchase agreements such as a
    • State government guarantee for the contracted capacity by the utility
    • Compensation for deemed generation(This means the producer is paid even if the electricity is not taken due to grid issues)in case of non-availability of the grid

 What is deemed generation?

The energy which a station was capable of generating but could not generate due to the conditions of grid or power system, beyond the control of generating station

Wind vs Thermal plants

The average feed-in tariff for wind energy and competitively bid thermal plants in the last 24 months has remained at ₹ 4.8/kwh and ₹4-5/kwh, respectively


 


Indian Express


[1]. Costs of denial: The State of Global Air report is another warning

Costs of denial: The State of Global Air report is another warning


Indian Express

Context

Article talks about the perverse effects of air pollution referring particularly to the recently released State of Global Air report prepared by the Boston-based Health Effects Institute and the Institute for Health Metrics and Evaluation at the Washington University

Observations from the report

  • Premature deaths: Polluted air caused 91 early deaths out of 1 lakh Indians in 2015 while China, the world’s most populous country, lost 85 of its citizens
  1. Globally, there was 60 per cent rise in ozone attributable deaths, with a striking 67 per cent of this increase occurring in India.
  2. In 2015, long-term exposure to PM2.5 contributed to 4.2 million deaths and to a loss of 103 million years of healthy life. China and India together accounted for 52 per cent of the total global deaths attributable to PM2.5.
  3. It found that increasing exposure and a growing and aging population have meant that India now rivals China for among the highest air pollution health burdens in the world, with both countries facing some 1.1 million early deaths due to it in 2015.
  4. According to the report, while 1108100 deaths were attributed to PM2.5 exposure in China in 2015, in India, it was 10,90,400
  5. Around 92 per cent of the world’s population lives in areas with “unhealthy” air.
  6. Bangladesh and India, have experienced the steepest rise in air pollution levels since 2010 and now have the highest PM2.5 concentrations among the countries.
  7. Among the world’s 10 most populous countries and the EU, the biggest increase (14 per cent to 25 per cent) in seasonal average population-weighted concentrations of ozone over the last 25 years were experienced in China, India, Pakistan, Bangladesh, and Brazil.
  8. China, India, Bangladesh, and Japan increases in exposure, combined with increases in population growth and aging, resulted in net increases in attributable mortality.
  9. Meanwhile, Pakistan, Bangladesh and India had PM2.5 attributable Disability Adjusted Life Years (DALYs) rates that were 5 to 10 times the lowest rates, which were found in the US and Japan.

Source: KSG

Ignorance is not bliss

Author states that governments in India have largely been indifferent when it comes to environmental reports. But the government would be well-advised to not ignore the State of the Global Air report for several reasons.

  • GBD Data: The report draws on the Global Burden of Diseases data which is becoming an important tracker of health trends the world over. The State of Global Air Report ranks outdoor air pollution as the third leading health risk in the country

Graded Action Plan

The report comes a month after government announced its plan for a graded response to pollution

  • The plan involves upgradation of the Central Pollution Control Board infrastructure and additional monitoring stations within six months
  • Roadmap for rest of the country: The plan is intended towards Delhi-NCR region but it will provide a roadmap to the rest of the country
  • Including Ozone: Author states that the plan should take into account a new pollutant mentioned in the report i.e. Ozone, as the increasing rate of Ozone-related deaths are alarming. The report notes a 148 per cent increase in ozone-related deaths since 1990
    • Ozone monitoring stations: Graded action plan should establish ozone monitoring stations as a first step towards addressing Ozone-related pollution

Read More: You can read the report here, GBD


 


Live Mint


[1]. A fiscal-consolidation budget that falls short on reforms

A fiscal-consolidation budget that falls short on reforms


Live Mint

Context

The most urgent reform unfortunately omitted is the resolution of non-performing loans and the clean-up of corporate and bank balance sheets

Article talks about the budgetary measures, things which could have been done and positives that budget tries to accomplish.

You can give it a light read, as positives and negatives of the budget has been dealt in ample detail in previous briefs.


 


 

 

 

 

Categories
9 PM Daily NEWS Brief

9 PM Daily Current Affairs Brief – 9 February



Front Page / NATIONAL

[1]. In a first, SC issues contempt notice against HC Judge Karnan

[2]. Centre to install 150 quake sensors in Uttarakhand

Editorial/OPINION

[1]. Growing insecurity in Afghanistan

[2]. Getting back home, safely 

ECONOMY

[1]. RBI opts for flexibility to ‘move in either direction’

[2]. Credit Policy: Is it a hit, miss or well left?

[3]. India to pitch global services accord to WTO chief Azevedo

[4]. Digital payment costs are a hindrance

Indian Express

[1]. Salt to the wound

Live Mint

[1]. RBI signals end of rate cut cycle


Front Page / NATIONAL


[1]. In a first, SC issues contempt notice against HC Judge Karnan


In a first, SC issues contempt notice against HC Judge Karnan


The Hindu

Context

Bench directs him to forthwith refrain from undertaking any judicial or administrative work and return all his official files to the Calcutta HC Registry

What has happened?

A seven-judge Bench of the seniormost judges of the Supreme Court, in an unprecedented move, issued contempt of court notice against sitting Calcutta HC judge C.S. Karnan for impeding justice administration and bringing discredit to the judicial institution of the country by writing scurrilous (making scandalous claims) letters about sitting and retired judges

  • The Bench has directed Justice Karnan to forthwith refrain from undertaking any judicial or administrative work and return all his official files to the Calcutta HC Registry.

Show-cause notice

The Bench, led by Chief Justice of India J.S. Khehar, ordered Justice Karnan to appear in person before it on February 13 to show cause to the court why contempt proceedings should not be taken against him.

Constitutional power

Supreme Court as the apex judiciary is empowered under Articles 129 read with its extraordinary powers under Article 142 (2) to punish a member of the High Court and subordinate judiciary for contempt.

Article 129: The Supreme Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself

Article 142: Enforcement of decrees and orders of Supreme Court and unless as to discovery, etc

  1. The Supreme Court in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree so passed or orders so made shall be enforceable throughout the territory of India in such manner as may be prescribed by or under any law made by Parliament and, until provision in that behalf is so made, in such manner as the President may by order prescribe
  2. Subject to the provisions of any law made in this behalf by Parliament, the Supreme Court shall, as respects the whole of the territory of India, have all and every power to make any order for the purpose of securing the attendance of any person, the discovery or production of any documents, or the investigation or punishment of any contempt of itself

 


[2]. Centre to install 150 quake sensors in Uttarakhand


Centre to install 150 quake sensors in Uttarakhand


The Hindu

Context

India is looking to have more than six times the number of earthquake sensors in Uttarakhand to better understand the geology of the region and the evolution of Himalayan earthquakes

What has happened?

The National Centre for Seismology has got the approvalfor a project to install 100-150 seismometers in the Garhwal-Kumaon region [the key region in the Himalayas and known to be seismically active] for testing purposes and to better understand the geology of the region and the evolution of Himalayan earthquakes.

  • Cost: Though funds were still not available, the entire project would unlikely exceed ₹10 crore

Present situation

Currently, there are only about 20 stations, maintained by different research agencies that track earthquake activity

Garhwal-Kumaon region

This region is known to be seismically active because it lies at the junction of two tectonic plates — the Himalayan and the Eurasian Plate — pushing against each other

  • Major quakes in the region include the 1991 Uttarkashi quake of magnitude 6.8 that killed 700. It was followed by a quake of similar intensity that hit Chamoli in 1991 and killed 100.

Backdrop

On 6th Feb 2017, Rudraprayag district of Uttarakhand registered a 5.8 magnitude earthquake. Though it didn’t cause damage, seismologists say its magnitude was “significant,” and residents in several parts of north India felt the tremors. The latest development can be seen in this context.

 

 


Editorial/OPINION


[1]. Growing insecurity in Afghanistan


Growing insecurity in Afghanistan


The Hindu

Context

The blast near the Supreme Court premises in Kabul that left at least 20 people dead, underscores the growing insecurity in Afghanistan

Article highlights the increasing frequency of attacks by Taliban in Afghanistan, its gradual consolidation as a strong insurgent force and the consequent inability of the elected government to stand against it

Author suggests

To turn its fortunes around in the 15-year-old civil war,

  • Afghanistan needs to strengthen the administration: Mr. Ghani should initiate the administrative reforms he had promised and put up a stronger, united fight against terrorist groups
  • Seek out help: Kabul should seek more help and a higher level of commitment from other countries, including the U.S., in combating terror

 


[2]. Getting back home, safely 


Getting back home, safely


The Hindu

Context

Despite extensive experience in conducting evacuation operations of its citizens abroad, India still needs to institutionalize best practices

Issue: Capacity building in conducting evacuation operations

A stark improvement

In the first few paragraphs, author cites the extraordinary evacuation conducted in April 2015 under Operation Raahat& compares it with the shoddy evacuation scenario of 850 Indian nationals during civil war in South Yemen in 1986, describing how far we have come

 Significance of capacity building

The increasing size and complexity of the diaspora requires the government to expand capacity and improve procedures.

  • Size of diaspora: More than 11 million Indians now reside abroad and 20 million travel internationally every year
  • Political instability:As political instability rattles the West Asian region, which hosts more than seven million Indians, the government can no longer rely on heroic efforts by individual officials or quick-fix solutions

What needs to be done?

  • Learning from the experience: The government will need to build on its rich experience in conducting more than 30 evacuation operations since the 1950s.
    • Policy-oriented research: By supporting policy-oriented research at universities and think tanks to document the memory of senior officials, the government would also facilitate the transmission of their expertise to younger officials
  • Avoiding a jugaad: The government must avoid the jugaad approach. Every evacuation case is unique, given the specific nature and location of the crisis, but this should not preclude an analytical attempt to formulate a blueprint that lists core tasks for all operations
    • Preparing a manual: An inter-ministerial committee should prepare a manual with guidelines that establish a clear chain of command and division of competencies; identify regional support bases, assembly points and routes for evacuation; develop country-specific warden systems to communicate with expatriates; and establish evacuation priority and embarkation criteria

 Embarkation: Itis the process of loading a passenger ship or an airplane with passengers or military personnel, related to and overlapping with individual boarding on aircraft and ships

  • Training India’s diplomats: India’s diplomatic cadre must be given specific training to operate in hostile environments
    • To achieve this, the government could instruct the police or army to train Indian Foreign Service probationers to operate in war zones; conduct frequent evacuation simulations and emergency drills; and create rapid reaction teams of Indian security personnel to be deployed to protect diplomatic staff and installations abroad
  • Working closely with countries having a sizeable expatriate population: The success of future operations will also rely on New Delhi’s willingness to work together with friendly governments. India will have to invest in cooperative frameworks that facilitate coordination among countries that have large expatriate populations in West Asia, in particular Nepal, Bangladesh and Sri Lanka, and among leading powers with evacuation capacity in the Indian Ocean region.
  • Assigning a greater role to army: The government will have to assign a greater role to its armed forces, in particular by strengthening the Navy and Air Force’s capacity to operate in tandem with civilian authorities
    • Developing a NEO doctrine: It should, for example, direct the military to develop a non-combatant evacuation (NEO) doctrine, designate the Integrated Defence Staff as the nodal organisation to improve inter-services and civil-military coordination, direct the services to conduct more multilateral NEO exercises, and adapt military modernization plans to increase capacity for out-of-area deployment and evacuation.

Using technology

  • Inter-ministerial coordinating mechanism: To minimize redundancies, the government must institutionalize a permanent inter-ministerial coordinating mechanism for emergency evacuations, incentivise inter-agency cross-posting of officials dealing with diaspora affairs, and encourage State governments to create regional contingency plans.

 

  • Establishing a permanent civil reserve fleet: To avoid cost inflation and delays, the government must establish a permanent civil reserve air fleet that pools aircraft from all Indian airlines based on pre-established requisition and reimbursement procedures.
  • Monitoring the diaspora: The government will have to invest in new technologies to better monitor the diaspora’s profile and mobility. This can be achieved by
    • Encouraging more diplomatic missions to provide online consular registration forms
    • Developing an online registration system for overseas travelers
    • Utilizing social media
    • By making the Aadhaar card compulsory to facilitate biometric identity verification and reduce identity fraud during evacuation

 Managing public opinion during crisis: The government must expand efforts to manage public opinion and be able to conduct a quiet diplomacy that is crucial to safely extricate Overseas Indians from conflict zones. To reduce domestic pressures,

    • It should embed media representatives more frequently in such missions
    • Reassure the diaspora by ensuring that high-level political representatives are personally engaged
    • Avoid raising expectations by clearly distinguishing Indian citizens from people of Indian origin

Conclusion

Author concludes by stating that India has extensive experience in conducting evacuation operations, but to secure the lives and assets of Indians abroad, the government must avoid an ad hoc approach and seek to institutionalize best practices, improvecoordination and capabilities, both diplomatic and military


 


ECONOMY


[1]. RBI opts for flexibility to ‘move in either direction’


RBI opts for flexibility to ‘move in either direction’


The Hindu

Context

Bond yields climb after debt market participants are surprised by central bank’s shift to ‘neutral’ monetary stance

What has happened?

The Monetary Policy Committee of the Reserve Bank of India (RBI) has decided to keep the key policy rate, the repo rate, unchanged at 6.25% citing uncertainties caused by demonetisation

Rest of the article covers general points. You can give it a go-through


 


[2]. Credit Policy: Is it a hit, miss or well left?


Credit Policy: Is it a hit, miss or well left?


The Hindu

Context

For the already available beneficial impact of liquidity on cost of funds, RBI’s stance of no cut would have seemed harder on the economy

Highlights of the bimonthly policy

  • Accommodative to neutral: The tweaking of stance to “neutral” is this policy’s headline and is being seen as reducing the chances of a future rate cut
  • RBI’s formula: The other interesting highlight is RBI’s formula for transmission of policy rate to banks which lays stress on bank NPA resolution, recapitalization of banks and making small savings rates responsive to Government market borrowing rates

Liquidity

Author states that on the liquidity front, India has witnessed a sea of liquidity at banks courtesy DeMo, taking the excess liquidity in the system to a staggering 2 lac crappx


 


[3]. India to pitch global services accord to WTO chief Azevedo


India to pitch global services accord to WTO chief Azevedo


The Hindu

Context

India will make a presentation to World Trade Organisation (WTO) Director General Roberto Azevedo and India Inc. on New Delhi’s proposal for a global pact to boost services trade

Trade Facilitation in Services (TFS) Agreement

The proposed Trade Facilitation in Services (TFS) Agreement at the WTO-level aims to ease norms including those relating to movement of foreign skilled workers/professionals across borders for short-term work

Objectives of TFS

  • Portability of social security contributions: Ensuring portability of social security contributions
  • Ensuring non-restrictive fees: Making sure fees or charges for immigration or visas are reasonable, transparent, and non-restrictive (or impairing the supply of services) in nature
  • Creation of a single window mechanism for foreign investment approvals
  • Cross-border insurance coverage: Ensure cross-border insurance coverage to boost medical tourism, publication of measures impacting services trade and timely availability of relevant information in all the WTO official languages as well as free flow of data/information for cross-border supply of services

FA vs TFS

Government will specify that the proposed services pact is similar to the Trade Facilitation Agreement (TFA) in Goods adopted by the WTO Members in 2014 to ease customs norms for boosting global goods trade.

  • The proposed TFS pact is also about ‘facilitation’ – that is “making market access ‘effective’ and commercially meaningful and not about ‘new’ (or greater) market access.”

Barriers to services

World Bank data shows the growing share of services in the world economy, however, global trade flows in services remain subject to numerous border and behind-the-border barriers.

Read More: TFA


 


[4]. Digital payment costs are a hindrance


Digital payment costs are a hindrance


The Hindu

Context

Article lists the views of the TRAI chief that he expressed during the India Digital summit hosted by the Internet and Mobile Association of India

Views

  • The surge in digital payments in the country, driven largely by short-term incentives, will become sustainable if the costs of making such payments are addressed
  • No cost for cash: Everyone can provide incentives in the short run and see a rise and once those incentives go, they will decline. What is important from a citizen’s perspective is that cash doesn’t have any costs. If I have ₹100 in my pocket, I get ₹100 worth of goods. But if I have to pay somebody ₹1 or ₹2 for paying the same digitally, it’s not fair
  • Issue of cost: Digital financial transactions are not sustainable unless you address the issues of cost, convenience and confidence
  • Referring to the merchant discount rate (MDR) levied on transactions done through credit and debit cards, TRAI chief said there is no relationship between the charges and the ‘work done’ to justify them.
    • Drawing a parallel with the telecom sector, the regulator drew attention to ‘the work done principle’ used to determine how much one operator pays another as termination charges.
  • Building confidence: While people are getting more comfortable with digital payments, the TRAI chief said it is important to build confidence in the systems and ensure that all relevant software is tested for cyber-security and other security risks.
  • Reduced charges: The regulator has reduced the charges of USSD (Unstructured Supplementary Service Data)-based payments made on mobile phones.


Indian Express


[1]. Salt to the wound


Salt to the wound


Indian Express

Context

Government could have undone the damage of demonetisation through the budget. The opportunity has been missed in deference to the whims of global finance

 In the first few paragraphs, author has conveyed the sentiment that the Union Budget could have partially undone the damage inflicted by demonetization but it has failed to do so

Damage by demonetization

Author states the damage that has been done by demonetization move of the government

  • Contraction in aggregate demand
  • Slowdown of overall growth
  • Impact on the informal sector

Contractionary budget: An opportunity lost

Author states that by boosting demand in the economy through larger government expenditure, budget could have provided some relief but instead it took following step,

  • Rate of Growth halved: The rate of growth of total government expenditure has been halved, from about 12 per cent between 2015-16 and 2016-17 (RE) to just 6 per cent b/w 2016-17 (RE) to 2017-18 (BE). As a proportion of GDP, total expenditure is slated to fall between 2016-17 and 2017-18.

 Author’s contention

Union Budget could have given a spur to the economy by utilizing the deposits lying idle with the banks, as credit demand from borrowers has not picked up. Government should have issued fresh securities to the banks and used the money for spending but it would have contributed to the fiscal deficit (as govt needs to pay interest for the money borrowed from the banks in lieu of securities) and hence government didn’t do so

  • Donald Trump is busy imposing trade restrictions, and hence snatching employment through a “beggar-my-neighbour” policy from other countries, including India.
  • Countering Trump: Our country should be countering Trump’s protectionism and preventing job losses by imposing trade restrictions of its own, and in the shadow of such restrictions, increasing the domestic market through larger fiscal deficits, backed by requisite capital controls

 


Live Mint


[1]. RBI signals end of rate cut cycle


RBI signals end of rate cut cycle


Live Mint

Context

RBI has restored its credibility by emphasising its determination to bring down inflation closer to 4% and focus on macroeconomic stability

Issue: RBI keeps the repo rate unchanged in the 6th Bimonthly policy review

Right decision

As per author, RBI, emphasizing its determination to bring down inflation closer to 4% on a durable basis and focus on macroeconomic stability, has restored its credibility, which many felt the Indian central bank was losing

Backdrop

Since January 2015, the RBI has cut its policy rate by 175 basis points to 6.25%.

Ground for a rate cut

Author states that the biggest push for yet another rate cut at this point has been a sharp drop in retail inflation. It dropped to 3.41% in December from 3.63% in the previous month—its lowest since November 2014

Why RBI stuck to the previous policy rate?

  • Deflation: The drop in inflation has been primarily driven by deflation in the prices of vegetables and pulses and excluding food and fuel, inflation remained at 4.9% for four months at a stretch, since September
  • Crude prices: Among others, a rise in international crude prices has contributed to this. The MPC did not want to take any chances

Give the rest of the article a go-through


 


 

Categories
Uncategorized

China’s increasing engagement with Afghanistan

“Almost every great power in history, when they were rising, was deeply involved in Afghanistan, and China will not be an exception.”-  Prof Wang Lian.

China  launched  a new official forum in Kabul, the ‘China-Pakistan-Afghanistan Strategic Dialogue’.  This triangular engagement is likely to emerge as a major force shaping India’s north western frontiers.

What was the outcome of the dialogue ?

· Major commitments to promote regional cooperation.

·  Finance a 1500 MW hydro-electric power project in the Kunar province in eastern Afghanistan. To be managed jointly by Pakistan and Afghanistan and the project will feed into the power grids of both countries.

· Intent to promote two important trans-border transport corridors—a motorway linking Kabul with Peshawar and a rail link between Quetta and Kandahar. These infrastructure projects would complement China’s Silk Road projects and the China-Pakistan Economic Corridor.

· Afghanistan , China , Pakistan sought to increase mutual strategic trust as well as enhance mutually beneficial cooperation. They also reaffirmed that terrorism, extremism and separatism pose a major threat to the security and stability of the region and agreed to deepen counter-terrorism and security cooperation.

Why China might succeed ?

·  Convergence of China’s interests with that of Pakistan

·  After USA’s withdrawal, Kabul looks upon China as a hope to stabilize Pakistan army’s overt gestures.

·  Russia is engaging with China, and is warming up to Pakistan as well. It might back China’s leadership role in Afghanistan.

· The Chinese emphasize that non-­interference in the internal politics of other countries is a pillar of their foreign policy. China’s main motivations are denying sanctuary to terrorist and separatist groups. It looks to encourage investment, expand trade to develop its interior and western regions. This will help China in catering to domestic demand rather than solely relying on export­-led growth that has primarily benefited its coastal cities.

How does India see it ?

·  Indians and Afghanistan share a common history, common foes of fundamentalism and Pakistan-backed terrorism, as well as a common future in South Asia. India must also recognize that there is widespread international and regional support for China’s strategic entry into Afghanistan. China’s approach may be important in re-energizing the region and providing the opportunities for the prosperity and security that will underpin Afghanistan’s future.