Current Affairs - 28 February 2016

General Affairs 

Prime Minister Modi To Address Farmers Rally In Uttar Pradesh Tomorrow

• BAREILLY:  Prime Minister Narendra Modi will address a farmers rally in Bareilly tomorrow.
  
  Union Home Minister Rajnath Singh and BJP president Amit Shah among others will also attend the 'Kisan Kalyan' rally in the district.
  
  "The Prime Minister will address the Kisan rally in the rubber factory ground at Fatehganj and elaborate arrangements have been made to make it a grand success," state unit president of BJP, Laxmikant Bajpai said.
  
  PM Modi will leave for New Delhi in the evening after addressing the rally, Mr Bajpai said.
  
  Elaborate security arrangements have been made for the rally, a police spokesman said.

BJP Shouldn't Give Certificates Of Patriotism: Raj Thackeray On JNU Row

• PUNE:  Maharashtra Navnirman Sena (MNS) chief Raj Thackeray today said that the BJP should not issue "certificates of patriotism" by politicising the issue of alleged sedition in Jawaharlal Nehru University.
  
  "While anti-national sloganeering in JNU has to be condemned, it is not for BJP to issue certificates of patriotism or treason," Mr Thackeray said at a function in Pune.
  
  "The BJP has a lot to answer on its alliance with PDP in Jammu and Kashmir, where the state Assembly took a stance supporting the Parliament House attack convict Afzal Guru.
  
  "The party has struck an alliance with a party like PDP in J&K, and is parading its patriotic credentials outside," he said.
  
  The leader added that the BJP should not "politicise the issue to bring in its students' wing ABVP on the university campuses."

JNU Sedition Case Transferred To Special Cell, Says Commissioner BS Bassi

• NEW DELHI:  Delhi Police Commissioner BS Bassi today said the sedition case in connection with the controversial JNU event has been transferred to the force's counter-terrorism unit Special Cell.
  
  "I have directed my officers to transfer the case to Special Cell as the matter needs focused investigation. In a case registered under Section 124 A (Sedition), the Special Cell shall do justice," Mr Bassi told reporters.
  
  The process of transfer will take around two days, he said, adding that the local police district would not be able to put the focus which the case demands as they have to deal with numerous routine law and order affairs.
  
  A few days after registering the case in connection with the February 9 event in JNU campus, DCP (South) Prem Nath had written to the Commissioner, requesting him to transfer the case to Special Cell.
  
  Mr Bassi had refused to do so then saying that the concerned police district has enough capacity to deal with the matter.
  
  JNU Student's Union president Kanhaiya Kumar was arrested in connection with the case on February 12.
  
  Two more students Umar Khalid and Anirban Bhattacharya, who made the police chase them across cities for around 10 days, later surrendered themselves a day after they resurfaced in the varsity's campus on Sunday.

Mumbai Suburban Stations To Get New Escalators, Foot Over Bridges

• MUMBAI:  A budget of Rs. 45 crore has been earmarked towards escalators, Foot Over Bridges (FOBs), ATVMs for Mumbai suburban section among other allocations in the annual Union Railway budget, a senior railway official said.
  
  Railway ministry has paid attention towards Thane suburban station, which has seen unprecedented passenger growth in the last few years, a senior official said.
  
  "To upgrade Thane station, sufficient funds have been provided for 15 escalators, besides a foot over bridge. Rs. 4 crore has been allocated for increasing automated ticket vending machines (ATVMs) on the suburban system to reduce queues at booking offices," he said.
  
  Besides, a budget of Rs. 160 crore has been allocated for the construction of sixth track between Kalyan and Kasara as well as funds has also been allocated for the Thane-Kalyan and Thakurli road over bridges, he said.
  
  

  The officer also apprised that Rs. 10.9 crore has been earmarked for an Integrated Security System (ISS) at 11 stations on the suburban section and Rs. 1.29 crore to install lifts at various stations.
  
  According to a statement issued by Central Railway (CR), Rs. 2 crore has been allocated for roof over platforms to cater 15-car trains at some of the CR suburban stations.
  
  A senior official of Western Railway (WR) said Rs. 5.68 crore has been sanctioned for installation of a water recycling plant at the Bandra Terminus with a capacity of one million litre water per day for cleaning of trains and other various internal uses.
  
  "We have got adequate funds. Escalators will be installed at 12 locations in six stations while foot bridges will be provided at Bhayander, Elphinstone Road, Kandivli, Khar and Virar stations," he said.
  
  "There is also sufficient budgetary allocation to raise the height of platforms from 840 mm to 920 mm of 97 stations on the Churchgate and Dahanu Road route," the official said.

Shutdown In Kashmir Against Arrest Of JNU Students, SAR Geelani

• SRINAGAR:  A complete shut down is being observed Kashmir today to protest the arrest of former Delhi University professor SAR Geelani and police action against JNU students.
  
  The strike was called by various Kashmiri separatist groups who have termed the sedition charges against Mr Geelani and JNU students as preposterous.
  
  Shops and business establishments are closed in all the 10 districts of Kashmir valley and traffic is very thin on the roads. Many separatists have either been arrested or put under house arrest.
  
  

  The strike has also affected the attendance in government offices in Srinagar and other districts. Police say the situation is largely peaceful in the valley.
  
  A heavy security cover has been deployed at sensitive places to prevent protests in support of JNU students.
  
  Three JNU students have been arrested over a controversial event commemorating 2001 Parliament attack convict Afzal Guru where anti-India slogans were allegedly raised.
  
  SAR Geelani was also arrested earlier morning on sedition and other charges for allegedly organising an event in support of Guru who was executed in 2013.
  
  Mr Geelani, also an accused in the case, was acquitted in 2003.

Business Affairs 

Govt mulls publishing names of those owing Rs 1 cr tax arrear

• The government is considering a proposal to publish names of people with "irrecoverable" tax arrears of more than Rs 1 crore, Parliament was informed on Friday.

  Currently, the limit for making public such names is Rs 5 crore.

  "A proposal to publish names of persons with irrecoverable arrears of more than Rs 1 crore is under consideration as against the present limit of Rs 5 crores," Minister of State for Finance Jayant Sinha said in a written reply in Lok Sabha.

  Besides, the government has also published names of 18 income tax defaulters against whom outstanding tax dues is of the order of Rs 1,152.52 crore.

  Of these, the highest amount of tax dues of Rs 779.04 crore is listed against (late) Uday M Acharya; Rs 68.21 crore is against Nexxoft Infotel Ltd; Rs 32.16 crore against Liverpool Retail India Ltd and Rs 32.13 crore dues against Jashubhai Jewellers Pvt Ltd.

  Others include, Praful M Akhani (Rs 29.11 crore); Sakshi Exports (Rs 26.76 crore); Hemang C Shah (Rs 22.51 crore); Mohd Haji Alias Yusuf Motorwala (Rs 22.34 crore); Dharnendra Overseas Ltd (Rs 19.87 crore) and Jag Heet Exports Pvt Ltd (Rs 18.45 crore).

  Sinha said all steps have been initiated to recover the pending dues from these entities.

  In a separate reply, Sinha said India's tax collections rose during the April-January period of 2015-16 on various measures taken by government, economic activity and better compliance by tax payers.

  During the period, direct tax collections increased by 10.87 per cent from a year ago to Rs 5.22 lakh crore.

  The indirect tax collections increased by 33.7 per cent from a year earlier to Rs 5.69 lakh crore.

  "The net direct and indirect tax collection during the current financial year 2015-16 is showing an overall positive growth as on January 31, 2016," he said.

  In 2014-15, the direct tax collection was up 8.97 per cent to Rs 6.96 lakh crore, while the indirect tax collection during the previous fiscal stood at Rs 5.44 lakh crore, up 9.5 per cent from a year ago.

India a leading investment destination for Sembcrop Industries

• Tang Kin Fei, Group President and CEO Sembcrop Industries pointed out that India is and will remain Sembcrop's key market and integral part of the company's emerging market strategy.

  The leading energy, water and marine group operating across five continents, with assets over Singapore $ 20 billion, Sembcrop is one of the biggest foregin investor in India's power sector with over 3,500 megawatts of power capacity in operation and under development across Rajasthan, Gujarat, Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh, Telangana.
  
  Out of its 10,600 megawatts of gross power capacity worldwide, India accounts for more than 30 per cent of Sembcrop's portfolio.
  Fei said that Sembcrop is a committed long term investor in India. "We are looking at both greenfield and brownfield projects in India, especially in the energy and urban development sectors."

  Fei pointed out that India and China are leading investment destinations for Sembcrop. "We are cautious as well as optimistic about India, however we are looking at a 20 year time frame for India."

  Talking about the challenges of doing business in India, Fei said that the cost of doing business in India was much higher than that in China or other frontier markets. Also on the ease of doing business in India, Fei said that the regulatory environment as well as the time frame of setting up business is also long. "Though India has come a long way, vagueness in policy leaves room for interpretation. Interest cost and capital cost of investment is very high in India."

  He said that the restructuring and policies regarding financing of discoms will help businesses in the long run.

  Talking about how the power pricing was still not attractive for foreign investors, he said that Sembcrop will be staying away from getting into the solar space for now. Sembcrop had 900 MW of renewable energy capacity in India. "In Solar we are not seeing sustainable tariffs. In the long term, returns and tariffs have to be sustainable."

  He said that Sembcrop was keen to partner with government and industries to improve India's energy security and support its urbanization and development goals.

G20 draft communique says monetary policy alone cannot bring balanced growth

• A draft of the G20 communique seen by Reuters on Saturday says that monetary policy alone cannot bring balanced growth, as global finance leaders meet in Shanghai to try to agree on confidence-building measures for the world economy.

  The communique repeats previous pledges from G20 finance ministers not to engage in competitive currency devaluations, but adds a mention of the risk a "potential UK exit from the European Union" would pose to the world economy.

  At the same time the draft suggests that markets' recent ructions have been overreactions to economic anxieties that do not reflect economic fundamentals.

  "While recognising these challenges, we nevertheless judge that the magnitude of recent market volatility has not reflected the underlying fundamentals of the global economy," the draft said.

Union Budget 2016: Will Sensex fall on D-Day? Here's what history suggests

• The nervous and heavily battered domestic equity market is eagerly waiting for the biggest business and economic event of the year - the Union Budget 2016-17.
  
  Even as most analysts gave thumbs up to the Rail Budget announcements, it hardly brought cheer on investors' faces. Analysts now expect the Union Budget 2016-17 may also turn out to be a dull affair amid shaky economic conditions, as government would walk on a tightrope to strike a balance between the industry expectations and fiscal prudence.
  
  And if history is any indication, they might well be right.

  An analysis on Sensex movement on Budget days in the past 10 years suggested that the market has fallen more often than rise on Budget days.

  

  
  

  
  This holds true in seven out of 10 times.
  

  In 2015, Sensex did end with gains of 141 points, but only after plunging over 700 points intraday. The market was closed on February, 28, 2015, the day of Budget announcement.
  
  The index resumed trade on March 2, only to find huge volatility. It though managed to end 0.81 per cent higher for the day at 29,459.14.

  Soon, riding on the Reserve Bank of India's surprise rate cut the index hit its all-time high of 30,021 on March 4, 2015.

  Prior to 2015, Sensex tumbled for three consecutive years from 2012 to 2014 and shed 1.18 per cent, 1.51 per cent and 0.28 per cent, respectively.
  
  The year 2009 budget day was the worst for stocks as the index fell around 950 points during trade and settled the day with losses of 870 points or 5.83 per cent.

  In 2007, the Sensex crashed 678 points even before Finance Minister P Chidambaram rose to present the budget, and ended at the then four-month low of 12,938.09 points, a net loss of 540.74 points, or 4.01 per cent.

  As we head towards the big budget day, Dinesh Rohira, Founder & CEO of 5nance.com sees Sensex to test around 22,600 levels, in case finance minister Arun Jaitley fails to present a bold budget.

  However, experts believe markets will not entirely be guided by Budget announcements this year. Global cues will also play a significant part, they said.

  Below is what market analysts anticipate on the index level post Budget 2016:

  Ambareesh Baliga, independent market analyst

  As the expectations are muted, Baliga does not see any major crack in the markets post budget unless there are specific anti-market measures. He expects Nifty is likely to remain in range between 7,000 and 7,600 over the next two months.

  R Sreesankar, Head - Insitutional Equities, Prabhudas Lilladher

  With no near term political triggers except the passage of GST bill, the Nifty is likely to rule within trading range of 6,800-7,500 levels.  

  Dinesh Rohira, Founder & CEO of 5nance.com
  
  Rohira believes Sensex and Nifty will hit 22,600 and 6,900 levels if government fails to come up with a bold Budget and follows the same footsteps as last two years.
  
  "Domestic markets will correct unless there are some bold reforms, like those in 1997 or 1991 budget, which may change the face of the economy or at least a budget that will promise a policy framework for bolder reforms in the coming future," said Rohira.
  
  Amisha Vora of Prabhudas Liladhar
  
  The expert believes markets will be more dictated by the global risk uncertainties rather than Budget and will not move beyond 5 per cent in any direction from the current levels.
  
  "I see little reason why the risk-off in the global markets and also the reverse-flow from emerging markets will change in a hurry. We believe markets will move in the plus/minus range of 5 per cent post Budget," said Vora.

NITI Aayog to interact with public on General Budget

• Government think tank NITI Aayog, which provides policy support to the Centre and the states, will interact directly with citizens on the Union Budget.

  "In a first of its kind, one-on-one interaction with the public on the Union Budget, NITI Aayog Vice Chairman, and noted economist, Arvind Panagariya, and NITI Aayog CEO Amitabh Kant will host Google Hangouts, for two consecutive days, in collaboration with MyGov," a NITI Aayog press release said.

  According to statement, Panagariya will unfold the many intricacies of the Union Budget and explicate its real impact on various crucial sectors of the economy on March 2, 2016.

  Following this, on March 3, 2016, Kant will talk about what the Budget spells for key policies of the government and the direct bearing they will have on employment generation, investments and economic growth in India.

  Besides providing an exclusive, expert perspective on the Union Budget, both the Vice-Chairman and the CEO will also take questions directly from the viewers.

  The talks can be accessed on the NITI Aayog website, www.niti.gov.in and on the MyGov portal, www.mygov.in/home/talk/.

  Viewers may pose their questions in advance, and also through the duration of the talks on both days, via NITI Aayog's Twitter and Facebook page, and directly on the MyGov portal, it added.

General Awareness

Macro Economic Survey 2015-16

• • On 26th February 2016, Finance minister Arun Jaitleytabled the Macro-Economic Survey 2015-16 in Parliament. The economic survey was prepared by theChief Economic Advisor Arvind Subramanian.

    • In accordance with survey, Indian economy is growing at a pace of 7-7.5% and it is expected to accelerate at 8% in the next couple of years.
    • India’s macro-economy is sturdy and it is likely to be the fastest growing major economy in the world in 2016 as it shows an expansion from 7.2% in 2014-15 to 7.6% in current fiscal.

    Before heading towards the other highlights lets us take a brief view on economic survey:
    To showcase the ministry’s view on the annual economic development of the country, every year before the Union Budget, the economic survey is presented by Finance Ministry of India.

    • Economic Survey summarizes the performance on major development programs and highlights the policy initiatives of the government and the prospects of the economy in the short to medium term.
    • This document is presented to both houses of Parliament during the Budget Session.

    Following are the highlights of the report:

    Fiscal Deficit

    • 2015 -16 fiscal deficits seen at 3.9% of GDP seems achievable
    • 2016 – 17 expected to be challenging from fiscal point of view.
    • Credibility and optimality argue for adhering to 3.5% of GDP fiscal deficit target.

    Inflation

    • CPI inflation seen around 4.5 to 5% in 2016 – 17.
    • Confidence in price stability has improved and it is expected that RBI to meet 5% inflation target by March 2017.
    • Prospect of lower oil prices over medium term likely to dampen inflationary expectations.

    Current account deficit

    • 2016 – 17 current account deficit seen around 1-1.5% of GDP.

    Currency

    • Rupee’s fair value can be achieved through monetary relaxation.
    • India needs to prepare itself for a major currency readjustment in Asia.
    • Gradual depreciation in rupee can be allowed if capital inflows are weak.

    Taxes

    • Proposes widening tax net from 5.5% of earning individuals to more than 20%.
    • Tax revenue expected to be higher than budgeted levels in FY15 – 16.
    • Favours review and phasing out of tax exemptions.

    Banking & Corporate Sector

    • Estimated capital requirement for banks likely around Rs 1.8 trillion by 2018 – 19.
    • Corporate, bank balance sheets remain stretched, affecting prospects for reviving private investments.
    • Underlying stressed assets in corporate sector must be sold or rehabilitated.
    • Govt could sell off certain non-financial companies to infuse capital in state-run banks.
    • Govt proposes to make available 700 bn rupees via budgetary allocationsduring current, succeeding years in banks.

    India Ranks First in Milk Production
    In accordance with the economic survey 2015-16, India ranks first in milk production, accounting for 18.5% of world production. It achieved an annual output of 146.3 million tons during 2014-15 as compared to 137.69 million tonnes during 2013-14 recording a growth of 6.26%.