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9 PM Daily NEWS Brief

9 PM Daily Current Affairs Brief – 10 February 2017


Archives : 9 PM Briefs



Front Page / NATIONAL

[1]. IEDs kill more commoners than VIPs: NSG

Editorial/OPINION

[1]. Prudence amid uncertainty

[2]. TPP is dead, but its legacy lives on

ECONOMY

[1]. Centre to raise EPFO’s equity investments to 15%

[2]. SEBI to form panel to facilitate crowdfunding

[3]. Centre to send experts to expedite talks at WTO

Indian Express

[1]. Unprepared for Paris

Live Mint

[1]. Charting the near-term policy road map


Front Page / NATIONAL


[1]. IEDs kill more commoners than VIPs: NSG

 

The Hindu

 

Context

Data show 55% of these devices are set off in public places; in 2016, only 7% of the attacks were targeted at VIPs

 

Who are the primary targets of terrorists? VIPs? Security forces? Or ordinary people?

A detailed data analysis carried out by the National Security Guard, a counter-terror and

counter-hijack force, show it is the unarmed civilians who often fall victim to IED (improvised explosive device) blasts set off by terrorists across India. The VIPs are the least targeted.

  • Between 2012 and 2016, anywhere between 49% and 72% of the attacks annually have been targeted at ordinary civilians. In contrast, attacks targeting VIPs were in the range of 1% to 7%

 

Target distribution

In 2016, only 7% of the IED attacks were targeted at the VIPs. In comparison, 55% of all IED explosions across India in 2016 were targeted at public places. The remaining 37% were against security forces

 

Left-wing Extremism: A major contributor

The States affected by Left-wing extremism contributed the most number of IED blasts at 159, followed by the north-eastern States at 59 and Jammu and Kashmir at 31.

 

Justification of VIP security

The Centre justifies VIP security in the name of “security threats”, which are assessments made primarily through the Intelligence Bureau

 


Editorial/OPINION


[1]. Prudence amid uncertainty

 

The Hindu

 

Context

The central bank’s Monetary Policy Committee has opted to sit pat on rates and choose to give itself time to “assess how the transitory effects of demonetisation on inflation and the output gap play out”

 

Issue: Policy change by RBI’s Monetary Policy Committee (MPC) from “accommodative” to “neutral”

 

What has happened?

In the recent bimonthly policy review, MPC decided to keep the policy rates unchanged i.e. a change of stance from accommodative (rate cut) to neutral (no change)

 

What do the RBI’s decision reflect?

A cautionary stance indicates that the economy has not only suffered short-run disruptions but the long-term effect may be far more enduring and hard to predict than anticipated by the government

 

Downward revision of growth

The policy review has also projected the second successive downward revision in economic growth as measured by the Gross Value Added for the current year ending in March, with the pace of increase in GVA now forecast at 6.9%, from 7.1% in December and 7.6% prior to the November demonetisation

 

[2]. TPP is dead, but its legacy lives on

 

The Hindu

 

Context
The Trans-Pacific Partnership was dead long before Donald Trump signed his executive order. But its damaging aspects, like stringent IP provisions, have just migrated to other agreements.

 

Issue: TPP’s damaging provisions wrt access to medicines

 

What is TPP?

Twelve countries that border the Pacific Ocean signed up to the TPP in February 2016, representing roughly 40% of the world’s economic output.

  • Aim: The pact aimed to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth. Members had also hoped to foster a closer relationship on economic policies and regulation
  • The agreement was designed so that it could eventually create a new single market, something like that of the EU
  • But all 12 nations needed to ratify it, before it could come into effect
  • Member states: Japan – the only country to have already ratified the pact – Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.
  • Abandoning TPP was a key element of the election campaign of the new US president elect Donald Trump & as soon as he entered office, US pulled out of TPP

 

How big a deal was TPP?

Pretty big. The 12 countries involved have a collective population of about 800 million – almost double that of the European Union’s single market. The 12-nation would-be bloc is already responsible for 40% of world trade.

  • The deal was seen as a remarkable achievement given the very different approaches and standards within the member countries, including environmental protection, workers’ rights and regulatory coherence – not to mention the special protections that some countries have for certain industries

 

Without the US does TPP definitely fail?

To take effect, the deal would have had to be ratified by February 2018 by at least six countries that account for 85% of the group’s economic output. The US would need to be on board to meet that last condition.

  • Some countries, including New Zealand, have suggested some sort of alternative deal may be possible without the US.
  • But Japan’s Prime Minister Shinzo Abe has said a TPP without the US – and its market of 250 million consumers – would be “meaningless”

 

Is this the same thing as TTIP?

No. The Transatlantic Trade and Investment Partnership, now generally known as TTIP, is a deal to cut tariffs and regulatory barriers to trade between the US and member states of the EU. Negotiations here are at an earlier stage. But given President Trump’s hostility towards trade deals in general it’s unlikely to be plain sailing for that one either.

 

 

TPP’s damaging provisions: IPR

The agreement’s damaging ambitions were most evident in the proposed provisions concerning intellectual property

  • Explicit provision for Biologics: The TPP provided explicit protections for ‘biologics’ (drugs manufactured in a living organism, rather than through chemical synthesis), the first trade agreement to do so
  • Extended data exclusivity: The agreement mandated the protection of clinical test data submitted for marketing approvals, with pharmaceutical data obtaining five to eight years of protection. This provision, called ‘data exclusivity’ or ‘marketing exclusivity’, prevents a generic company from relying on the clinical test results of the originator in order to prove the efficacy of its drug
    • Argument given:It was justified using the argument that clinical trials are the most expensive part of drug development and hence there is a necessity to provide drug developers the ability to limit access to that data so as to incentivise research
  • Weaker patent standards: Such standards would allow a greater number of secondary or ever-greening patents on pharmaceuticals
  • Harsher intellectual property enforcement

 

Note: Many leading public health organisations termed the TPP the worst trade agreement on access to medicines

 

Why Data Exclusivity is hurtful?

Though, on the surface, the provision looks reasonable, data exclusivity is a deeply uncompetitive policy that serves to undermine generic competition.

  • Stronger restriction than patent protection: In fact, it is possibly a stronger restriction than patent protection itself. Patent protection, unlike data exclusivity, can be challenged if the product is not sufficiently novel (new), or violates existing national standards for obtaining patent protection, thereby clearing the way for generic competition. (This is, in fact, what happened to Novartis in India over Glivec, an anti-cancer drug)
  • Unfeasible clinical trials: For the generic version of medicines to be able to come to the market, it is essential that the generic version be able to use the proof of efficacy and safety that is generated by the clinical trial. The restriction on the use of test data would therefore require a generic company to undertake clinical trials by itself, which is both unfeasible (in terms of expense) and unethical (since it would expose patients to trial protocols, during which some patients would have to receive a placebo when a proven cure is available)
    • No generics for the period of data exclusivity:As a result, in a country like India, even in a situation where there is no patent barrier, data exclusivity would allow for a period of five to eight years during which there is no plausible way that market access could be allowed for generics, thereby reducing access to cheaper medicines for the population

 

 

 

The Legacy of TPP

Author states that although US has pulled out of TPP, but the lines along which it was being negotiated reflects poorly on the US trade policy vis-à-vis public health and Intellectual property (IP). TPP can have further damaging impacts,

  • Impact on other agreements: The potentially damaging provisions of TPP can migrate to other global agreements like RCEP. Countries involved in RCEP are now trying to conclude the talks as soon as possible. RCEP includes several of IP provisions included in TPP. This should be of great concern for access to medicines globally, as countries involved in the RCEP negotiations include key generic drug-producing countries, including India
  • Pressure on India’s patent regime likely to continue: U.S. withdrawal from the TPP may change the U.S.’s approach to trade and intellectual property more in form than in substance, by switching from trade agreements that include several countries to bilateral free trade agreements (FTAs). In this process, the U.S. is more than likely to continue its vigorous campaign against perceived “violators” of U.S. intellectual property. The pressure exerted by the Obama administration on the public health safeguards in Indian patent law over the past eight years are likely to continue, if not worsen.
  • Subversive US Trade Policy to continue: Despite the public health impact of the TPP’s provisions, it is unlikely that these concerns will guide U.S. trade or foreign policy. President Trump’s remarks in early January emphasized his desire to end “global freeloading” stating that “foreign price controls reduce the resources of American drug companies to finance drug and R&D innovation… our trade policy will prioritize that foreign countries pay their fair share for U.S.-manufactured drugs, so our drug companies have greater financial resources to accelerate development of new cures.”

 

Conclusion

Author concludes by stating that in the light of ever increasing efforts of the developed world to limit the access to medicines, India needs a far greater government commitment to the use of the public health safeguards in the indigenous patent law to survive this era and ensure the health of the country’s citizens


ECONOMY


[1]. Centre to raise EPFO’s equity investments to 15%

The Hindu

 

Context

The Employees’ Provident Fund Organisation (EPFO) will increase its equity investments to 15% of its incremental corpus next fiscal year from 10% at present

 

What has happened?

The Employees’ Provident Fund Organisation (EPFO) will increase its equity investments to 15% of its incremental corpus next fiscal year from 10% at present. It had earlier increased the investments in exchange traded funds (ETF) from 5% to 10% of its corpus

  • Although the EPFO is permitted to invest up to 15% of its incremental corpus in equity and related instruments, it began by investing 5% in ETFs in August 2015 and increased it further to 10% last year.

 

[2]. SEBI to form panel to facilitate crowdfunding

 

The Hindu

 

Context

Constitution of an advisory committee by SEBI on financial technology or fintech-related issues

 

What has happened?

The Securities Exchange Board of India (SEBI) is forming an advisory committee on financial technology or fintech-related issues, which would look at safeguards that can be put in place to facilitate crowdfunding of ‘genuine’ ventures and mobilise more household savings into the financial markets

 

Membership of the committee

The committee shall have representatives and experts from different sections of fintech industry

 

SEBI Chairman’s views

  • Enabling access in small towns: To harness technology to enable persons in small towns with small amounts to invest in a retirement fund, we are going to form an advisory committee on fintech that will be led by some very strong business leaders from the industry
  • “If you want to raise money in the bond market, one has to file a draft red herring prospectus, make lots of disclosures, get a credit rating and appoint a debenture trustee,” he said, adding that even England and New Zealand that have allowed crowdfunding of ventures have imposed ‘restrictions.’

 

Holding discussions

SEBI is holding fresh discussions with representatives of start-ups and venture capital funds to assess why a single start-up hasn’t been listed yet on the special platform created by the regulator for mature ventures looking to go public

 

[3]. Centre to send experts to expedite talks at WTO

 

The Hindu

 

Context

Article mentions the latest development vis-à-vis India’s efforts to expedite talks at WTO

 

What has happened?

The Centre will send an expert team to the World Trade Organisation headquarters in Geneva next month to ensure that negotiations on food security issues and the proposed global services pact are expedited

 

Backdrop

The latest development follows WTO DG Robert Azevedo’s two-day visit to India

 

Note: India’s concerns with respect to introduction of new issues into the formal agenda of WTO-level negotiations has already been discussed in previous briefs.


Indian Express


[1]. Unprepared for Paris

 

Indian Express

 

Context

Failure of thermal power plants to meet emission standards does not speak well of India’s climate commitments

 

Backdrop

In the run-up to the Paris climate change meet in 2015, the government stressed on reducing the share of this fossil fuel in the country’s energy mix and using it in a climate friendly manner

  • The latter meant reducing the emissions from thermal power stations. Over 140 such stations were assigned targets for improving energy — and thus, emissions — efficiency. That the government now finds these standards too stringent could raise questions about India’s commitment to its Paris targets

 

Point to be noted: Coal, a major culprit for climate change, powers more than 80 per cent of the electricity consumed in the country

 

Why reducing emissions from thermal plants is critical for India?

  • Although India’s energy targets reflected in INDCs (Intended Nationally Determined Commitments) submitted under Paris accord stress on renewable sector, the country will still require thermal power plants to generate 60 per cent of its energy requirements in 2030. That makes reducing emissions from these coal-fired plants crucial to the country’s Paris commitments. That makes reducing emissions from these coal-fired plants crucial to the country’s Paris commitments
  • India shown in poor light on a global scale: There are still 3 years before India has to comply with its Paris climate targets. The failure of thermal power plants to comply with the emission norms does not show the country’s preparedness in good light. Most thermal power plants in the country work at efficiencies below 33 per cent.

 

Roadblocks

Author states that the following factors are presenting a roadblock in the effort to reduce climate footprint of thermal power plants in India,

  • Lack of coordination amongst government agencies: n June 2015, when new emission norms for thermal plants were being discussed, the National Thermal Power Corporation reasoned that these norms were too strict. The government set aside the objections of the biggest player in the sector when it submitted its INDC document to the United Nations Framework Convention of Climate Change. The environment ministry is also not without blame. It gave clearances to new plants without specifying the new standards, well after it had the norms in place

Live Mint


[1]. Charting the near-term policy road map

 

Live Mint

 

Context

Since the macro fundamentals are a lot more stable than they were a few years ago, the government can now concentrate on structural reforms

 

Yet another article which relates to the recent decision of Monetary Policy Committee to not change the policy rates

 

It gives an idea about impending challenges

 

Give it a go-through once


 

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
Mains Marathon

Mains Marathon – UPSC Mains Current Affairs Questions – February 8



Read the following questions and answer them by clicking on the links in not more than 200 words

Time: 30 Minutes

Kindly review each others answers.


1.What do you understand by Trade facilitation of WTO? What is the view of developing countries on trade facilitation? (GS 2)

विश्व व्यापार संगठन के व्यापार सुविधा से आप क्या समझते हैं? विकासशील देशों की इसपर क्या राय है?

The Hindu | WTO


2.Do you think that parliament needs more funds for research, infrastructure and digital outreach? Also, discuss the benefits of Increased budgetary support for Parliament. (GS 3)

आपको क्या लगता है कि संसद को क्या अनुसंधान, बुनियादी ढांचा और डिजिटल आउटरीच की जरूरत है? इसके अलावा, संसद के बजटीय सहायता बढ़ाने के लाभों पर चर्चा करें।

Indian Express


3.“The reward for work well done is the opportunity to do more.” Discuss. (GS 4)

अच्छी तरह से काम करने का इनाम अधिक काम करने के लिए एक अवसर है। चर्चा करें।