Current Affairs Current Affairs - 2 January 2017 - Vikalp Education

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Current Affairs - 2 January 2017

General Affairs 

Can't Reveal If Finance Minister Was Consulted Before Notes Ban: RBI
  • Were the views of the Chief Economic Advisor and the Finance Minister taken before the sudden announcement of demonetisation of high-value currency notes by Prime Minister Narendra Modi on November 8? The Reserve Bank of India feels this query cannot be answered under the Right to Information Act as it does not come under the definition of information under the transparency law. The applicant wanted to know whether the "views of Chief Economic Advisor Arvind Subramaniam and Finance Minister Arun Jaitley were taken before announcement was made".

    "Query is in the nature of seeking opinion from CPIO which is not defined as information as per Section 2(f) of the RTI Act," the RBI said in response to an RTI query.

    Asked whether the information sought will fall under "seeking opinion" from the CPIO, former Chief Information Commissioner A N Tiwari said, "No. It does not. It is a fact sought by an RTI applicant. The CPIO cannot say an opinion has been sought from him."

    "How it can be called seeking opinion? Whether someone was consulted or not is a matter of record. Had the question been that should views be taken then it would mean taking opinion," former Information Commissioner Shailesh Gandhi said, expressing surprise at the response of RBI Central Public Information Officer.

    The definition of information covers "any material in any form, including records, documents, memos, e-mails, opinions, advices, press releases, circulars, orders, logbooks, contracts, reports, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force".

    The query was also sent to the Prime Minister's Office and the Finance Ministry but it remained unanswered even after 30 days of filing of the RTI application.

    The applicant had also sought to know the designation and the names of officials who were consulted before scraping of old Rs. 500 and Rs. 1000 currency notes.

    "The information sought relates to sensitive matters pertaining to discontinuation/withdrawal of bank notes. The information is exempt from disclosure under Section 8(1)(a) and (g) of RTI Act," the RBI said.

    The monetary policy regulator also did not disclose if the decision to demonetise currency notes worth Rs. 20 lakh crore was opposed by any official or minister, saying the information sought is "hypothetical" in nature.

    It also cited Section 8(1)(a) of the RTI Act to deny minutes of deliberations related to demonetisation. 

    Section 8(1)(a) of the RTI Act exempts from disclosure the information which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State, relation with foreign State or lead to incitement of an offence.

    Information sought under Section 8(1)(g) would endanger the life or physical safety of any person or identify the source of information or assistance given in confidence for law enforcement or security purposes.

    The RBI has been denying information related to crucial aspects related to demonetisation citing exemption clauses.

    It recently refused to give reasons behind the demonetisation move.

    Earlier, it had denied to Mumbai-based RTI Activist Anil Galgali information about distribution of currency to banks between November 9 and November 19 citing Section 8(1)(g) of the RTI Act.

    The central bank did not give any reason as to how this section would apply in the case of information sought by Galgali.

    RTI Activist Venkatesh Nayak, who was also denied deliberations on demonetisation by the RBI, said: "While confidentiality prior to announcing the demonetisation decision is understandable, continued secrecy after its implementation is difficult to understand when people are facing problems due to shortage of cash."

    He said the refusal to disclose the minutes of the board meeting where the decision was taken is "perplexing".

    Army Won't Shy Away From Flexing Muscles, Says New Chief General Bipin Rawat
    • New Army Chief General Bipin Rawat today said the role of the force is to maintain peace and tranquillity at the border but it will not "shy away from flexing its muscle, if the need be". Eastern Army commander Lt General Praveen Bakshi and Southern commander Lt General P M Hariz will continue to serve the Army and maintain the unity, he said. "The force is to maintain peace and tranquillity at the border but it will not shy away from flexing its muscle, if the need be," General Rawat said.

      All units and services of the Army are together and he would always look at each one of them as one unit, he said.

      General Rawat, who took over as the 27th Army chief on Saturday, was speaking to reporters here after inspecting the Guard of Honour at the South Block in New Delhi.

      General Rawat had superseded two senior most Lt Generals - Praveen Bakshi and P M Hariz.

      Lt General Bakshi Saturday announced "full support" to the new chief and told theatre officers through video conferencing he will continue to lead with full professional sincerity as hither-to-fore.

      Government sources had earlier said Rawat was found best suited among the Lt Generals to deal with emerging challenges, including a reorganised and restructured military force in the north, continuing terrorism and proxy war from the west, and the situation in the North-East.

    Jharkand Coal Mine Cave-In: Another Death Takes Number Of Fatalities To 17
    • The number of deaths in the Jharkand mine collapse today rose to 17 even as rescue operations were underway at the site. Officials are using all means to rescue miners from the cave-in at Lalmatia open cast coal mine of Eastern Coalfields Ltd (ECL). RR Mishra, officiating CMD of ECL, a Coal India subsidiary today said, "One more body has been recovered. Despite dense fog in the area, rescue operation is underway." Sniffer dogs have also been pressed into service, he said.
      RR Mishra had on Saturday said, "We are carrying on the rescue operation in a systematic manner so that the situation does not aggravate as the debris is too much and it should not fall."

      Danger zones have been declared around the place of incidents to restrict the entry of people there. Moreover, police and CISF officials have been stationed to restrict entry of people in the danger zone, he had said.

      Central Mine Planning and Design Institute (CMPDIL), the consultancy arm of Coal India Ltd, has deployed magneto meters along with imaging system for locating magnetic and conductive material up to a depth of 80 meters, the statement said.

      The incident occurred at around 7.30 pm on December 29 when a massive mound of earth came crashing down on excavators at Lalmatia open cast coal mine of Eastern Coalfields Ltd (ECL), the worst such disaster in over a decade.

      The rescue operations was launched immediately after the incident.
      Senior officials of Director General of Mines Safety (DGMS) had arrived at the site and launched an inquiry into the incident. Around
      13 excavators and dump trucks swamped under the debris have been recovered.

    Jan Dhan Deposits Double To Rs. 87,000 Crore, Tax Officials Dissect Data
    • Deposits in Jan Dhan account have more than doubled to Rs. 87,000 crore in 45 days post demonetisation, prompting the tax department to "dissect" information relating to such deposits, a top government official said. Besides, the tax department also has data on small cash deposits between Rs. 30,000-50,000 made in 4.86 lakh accounts totalling to Rs. 2,000 crore. Between November 10-December 23, the total deposits in Jan Dhan accounts reported is Rs. 41,523 crore in 48 lakh accounts.

      This, together with the total deposits of Rs. 45,637 crore as on November 9, takes the aggregate amount in Jan Dhan accounts to over Rs. 87,100 crore.

      "All these information received on Jan Dhan Accounts are being dissected. If it is found that money deposited in these accounts belong to some other persons, necessary action will be taken at the appropriate time," the official said.

      Cash deposit between Rs. 30,000 and Rs. 50,000 have been reported in 4.86 lakh accounts till November 30, taking the total deposits in such quantum to Rs. 2,022 crore.

      The official further said that inflows of funds into Jan Dhan accounts was the highest in the first week after demonetisation at Rs. 20,224 crore, but after that the deposits went down substantially.

      "The inflow of funds in Jan Dhan accounts after the first two weeks was below Rs. 5,000 crore per week and thereafter it got reduced to about Rs. 1,000 crore per week," the official said, adding that the deposits have come down significantly after the tax department warned people not to allow their accounts to be misused for converting black money into white.

      Prime Minister Narendra Modi had on November 8 announced junking of old Rs. 500 and Rs. 1,000 notes, and replaced the currency with new Rs. 2,000 and Rs. 500 notes.

      After setting a cash deposit limit of Rs. 50,000 in Jan Dhan accounts, the government had on November 18 cautioned account holders that they will be prosecuted under the I-T Act for allowing misuse of their bank accounts through the deposit of black money in Rs. 500/1,000 notes during the 50-day window till December 30.

      The directive came against the backdrop of reports that some are misusing other persons' bank accounts to convert their black money into new denomination notes. As per latest data available, Rs. 12.10 lakh crore in form of old 500 and 1,000 rupee notes have returned into the banking system till December 12, 2016. It was estimated that now defunct notes constituted 86 per cent or Rs. 15.45 lakh crore in circulation.

    Turkey Police Launch Search For Istanbul New Year's Nightclub Attacker
    • Turkish police are hunting for an assailant who - reportedly dressed as Santa Claus - opened fire at a crowded Istanbul nightclub during New Year's celebrations Sunday, killing at least 39 people and wounding close to 70 others in what authorities said was a terror attack.

      President Recep Tayyip Erdogan vehemently condemned "the terror attack in Istanbul's Ortakoy neighborhood in the first hours of 2017" and offered condolences for those who lost their lives, including "foreign guests."

      The attacker, armed with a long-barreled weapon, killed a policeman and a civilian outside Istanbul's popular Reina club at around 1:15 am before entering and firing on people partying inside, Governor Vasip Sahin said.

      "Unfortunately (he) rained bullets in a very cruel and merciless way on innocent people who were there to celebrate New Year's and have fun," Sahin told reporters.

      There was no immediate claim of responsibility for the attack and authorities did not name any suspects. The bloodiest attacks that Turkey endured in 2016 were the work of the ISIS group or Kurdish militants.

      Turkey is a member of NATO and a partner in the US-led coalition against the ISIS. The country is also facing renewed conflict with Kurdish rebels in the southeast, and across the border in Syria and Iraq.

      Interior Minister Suleyman Soylu said the attacker has not been identified and is still at large. "Our security forces have started the necessary operations. God willing he will be caught in a short period of time," he said.

      Private NTV news channel said the assailant entered the upscale nightclub, on the shores of the Bosporus, on the European side of the city, dressed in a Santa Claus outfit. The minister said the lone attacker was believed to have left the club wearing different clothing.

      At least 15 of the dead were foreign nationals, Soylu said, without providing information on their nationalities. Five of the victims were identified as Turkish nationals while authorities were still trying to identify the rest. At least 69 people were being treated in hospitals, four in serious condition, Soylu said.

      Three or four of the Turkish victims may have been employees at the nightclub, he said.

      "This was a massacre, a truly inhuman savagery," Soylu said.
      Some customers jumped into the waters of the Bosporus to escape the attack, the NTV report said.

      Mehmet Dag, 22, was passing by the club and saw the suspect shoot at a police officer and a bystander. He said the suspect then targeted security, gunning them down and entering the club. "Once he went in, we don't know what happened. There were gun sounds, and after two minutes the sound of an explosion."

      IPhone footage filmed by Dag and obtained by The Associated Press showed a police officer lying on the ground outside the club, and then a woman. Dag told the woman, who was lying on the floor face down in a pool of blood, "my sister, you will get better." He called for an ambulance. Footage showed ambulances and the lights of an Istanbul bridge when the sound of gunfire rang out inside the club.

      Sinem Uyanik was inside the club with her husband, who was wounded in the attack.

      "Before I could understand what was happening, my husband fell on top me," she said outside Istanbul's Sisli Etfal Hospital. "I had to lift several bodies from on top of me before I could get out. It was frightening." Her husband was not in serious condition despite sustaining three wounds.

      The nightclub area remained sealed off on Sunday morning.

      Heavily armed police blocked the snowy street in front of the nightclub where the entrance was covered with blue plastic sheeting below a Turkish flag. Police patrolled the Asian side of the Bosporus on the other side of the club.

      Crime scene investigators were seen inside the club searching through piles of mingled chairs, tables and pieces of clothing left behind during the panic among the guests.

      And there were emotional scenes in front of a city morgue where those shot dead were brought for identification. Some relatives cried out and fell to the ground as they apparently learned the fate of their loved ones.

      Major attacks carried out by ISIS or Kurdish militants killed more than 180 people in Istanbul and Ankara alone in 2016.

      On December 10, a double bomb attack outside a soccer stadium near the Reina nightclub killed 44 people and wounded 149 others. The attack was claimed by Turkey-based Kurdish militant group, the Kurdish Freedom Falcons.

      Nine days later, an off-duty Turkish riot policeman assassinated Russian Ambassador Andrei Karlov at a photo exhibition in the capital, Ankara. The government has suggested that a movement led by US-based Muslim cleric Fethullah Gulen was behind the killing - an accusation the cleric has denied.

      "Turkey continues its combat against terror and is absolutely determined to do whatever is necessary in the region to ensure its citizens safety and peace," said President Erdogan in a written statement Sunday.

      The nightclub attack drew quick condemnation from the West and Russia.

      Russian President Vladimir Putin sent his Turkish counterpart a a telegram of condolences, saying "it is hard to imagine a more cynical crime than killing innocent people during New Year celebrations."

      "However, terrorists don't share moral values. Our common duty is to combat terrorists' aggression," Putin said.

      The White House condemned what it called a "horrific terrorist attack" and offered U.S. help to Turkey.

      The US Consulate General in Istanbul reminded US citizens "that extremist groups are continuing aggressive efforts to conduct attacks in areas where US citizens and expatriates reside or frequent."

      European Union foreign policy chief Federica Mogherini tweeted: "Our thoughts are with victims and their loved ones. We continue to work to prevent these tragedies."

      An estimated 600 people were celebrating inside the club that is often frequented by famous locals, including singers, actors and sports stars. Several shocked revelers were seen fleeing the scene after the attack and the music fell silent.

      The prime minister's office issued a media blackout on the events and asked media to refrain from broadcasting and publishing anything that may cause "fear in the public, panic and disorder and which may serve the aims of terrorist organizations."

      Security measures had been heightened in major Turkish cities, with police barring traffic leading up to key squares in Istanbul and the capital Ankara. In Istanbul, 17,000 police officers were put on duty, some disguised as Santa Claus and others as street vendors, Turkey's Anadolu news agency reported.

    Business Affairs 

    Notes Ban Impact: EMIs To Fall As SBI, Other Banks Cut Lending Rates
    • Top PSU lenders State Bank of India, PNB and Union Bank on Sunday slashed their benchmark lending rates by up to 90 basis points, a day after Prime Minister Narendra Modi asked banks to priorities their lending towards the poor and middle class.

      The country's largest lender, SBI, has reduced marginal cost of funds based lending rate (MCLR) by 0.9 per cent from 8.90 per cent to 8 per cent for one-year tenure, the bank said in a statement.

      Flushed with funds after demonetisation, the base interest rate for other tenures, including one month, three months and six months, has been slashed by 0.9 per cent. 

      MCLR has been reduced by 0.9 percentage points to 8.10 per cent for two-year term and 8.15 per cent for three-year tenure.

      Other public sector lenders Punjab National Bank (PNB) and Union Bank of India (UBI) too have brought down the benchmark interest rate by up to 0.9 per cent.

      PNB has cut its one-year MCLR rate by 0.7 per cent to 8.45 per cent from 9.15 per cent, effective today.

      Lending rate was moderated by similar percentage points for 3 years and 5 years period to 8.60 per cent and 8.75 per cent, respectively.

      Similarly, Union Bank of India has reduced its MCLR by 0.65-0.9 per cent to 8.65 per cent, effective today. The revised one-year MCLR stands at 8.65 per cent.

      Welcoming rate reduction by banks, Economic Affairs Secretary Shaktikanta Das said in a tweet, "Trend of interest rate reduction follows demonetisation. Banks have substantial quantum of low cost funds now."

      "Welcome reduction of interest rates by SBI. Loan disbursements expected to pick up. Positive for the economy," he added.

      Yesterday, the Prime Minister had asked banks to pay special attention towards the need of poor and middle class.

      "While respecting the autonomy of the banks, I appeal to them to move beyond their traditional priorities, and keep the poor, the lower middle class, and the middle class at the focus of their activities," he had said.

      Last week, SBI's subsidiary State Bank of Travancore had announced reduction in the lending rate, followed by another public lender IDBI which cut base interest rate by up to 0.6 per cent.

      Banks have moved to MCLR as their new benchmark lending rate from June, replacing the base rate system for new borrowers. It is calculated on the marginal cost of borrowing and return on net worth for banks. It was introduced by RBI to ensure fair interest rates to borrowers as well as banks.

    Petrol, Diesel Prices Go Up As New Year Begins
    • Petrol price was on Sunday hiked by Rs 1.29 per litre while diesel rate was increased by Rs 0.97 per litre. Revised prices will take effect from midnight.

      The revision in rates announced is excluding state levies (VAT).

      After the revision, petrol will cost Rs 70.60 per litre in the national capital, while diesel will be sold at Rs 57.82 per litre.

      The rates were last revised on December 16, when petrol was increased by Rs 2.21 a litre while diesel was hiked by Rs 1.79 per litre.

      Petrol and diesel prices are deregulated in India - which means they are linked to market rates.

      State-owned fuel retailers Indian Oil Corp (IOC), Bharat Petroleum Corp and Hindustan Petroleum Corp revise rates of the fuel on a fortnightly basis based on the average oil price and foreign exchange rate in the preceding fortnight.

      Earlier in the day, aviation turbine fuel (ATF) or jet fuel price was hiked by a steep 8.6 per cent and subsidised LPG rate raised by Rs 2 per cylinder which is the eighth increase in cooking gas price in seven months.

      ATF price was hiked by Rs 4,161 per kilolitre (kl), or 8.6 per cent, to Rs 52,540.63 per kl in Delhi. The hike comes on back of a 3.7 per cent cut in rates last month.

      The subsidised LPG rate was hiked by Rs 2 per 14.2-kg cylinder and it will now cost Rs 434.71 a cylinder as against Rs 432.71 previously.

    Infosys Ends Employment Of General Counsel 'Mutually'
    • Country's second largest software services provider Infosys on Sunday said its General Counsel and Chief Compliance Officer, David Kennedy, and the company have "mutually agreed" to cease the former's employment on December 31, 2016.

      The Bengaluru-based company, however, did not disclose any reasons for the decision.

      Infosys' Deputy General Counsel, Gopi Krishnan, will assume Mr Kennedy's duties as acting General Counsel as the company conducts a search for a new General Counsel. 

      "David Kennedy, its General Counsel and Chief Compliance Officer, and the company have mutually agreed that Mr Kennedy's employment with the company will cease on December 31, 2016. The company has entered into a separation agreement with Mr Kennedy on December 23, 2016," Infosys said in a BSE filing.

      It further said that Mr Kennedy was entitled to revoke his acceptance of the separation agreement within seven days of his signature of the agreement.

      "Accordingly, December 31, 2016 is the effective date of the Separation Agreement," it said.

      Under the Separation Agreement and in line with the employment agreement that it supersedes, Mr Kennedy will receive aggregate severance payments of USD 868,250 along with reimbursements for COBRA (insurance) continuation coverage over a period of 12 months, it added.

      "The severance payments shall be paid, less applicable withholdings, in accordance with the company's normal payroll practices, subject to the fulfillment of all the applicable conditions set forth in the Separation Agreement," it said.

      Mr Kennedy had joined Infosys as Executive Vice President and General Counsel on November 1, 2014.

      Tata Motors, ICICI Bank, Can Fin Homes - Motilal Oswal's Picks For 2017
      • Indian markets have seen a rollercoaster ride in 2016 with Sensex and Nifty reacting to many global and domestic events. While Sensex and Nifty ended Year 2016 with minor gains, experts are hopeful about 2017 with an expected rate cut by the Reserve Bank of India as early as in February and tax soaps by the government in the upcoming Budget. 

        Meanwhile, domestic brokerage Motilal Oswal has come out with its top picks for 2017: 

        Tata Motors (Target Rs 610): Jaguar Land Rover volumes and revenues are seen growing at around 12.5 per cent and 15 per cent CAGR over FY17-19, driven by continued new product launches. This coupled with mix improvement and full benefit of forex would drive realisations and revenues, the brokerage said. 

        ICICI Bank (Target Rs 337): Strong capitalisation, significant improvement in loan book granularity (around 52 per cent from retail and SME), sharp improvement in liability profile (CASA ratio of 40 per cent) is helping ICICI Bank to build a low-risk business without much impact on core earnings.

        Can Fin Homes (Target Rs 2,260): The home financier is focused on Tier 1 and Tier 2 cities promoted by Canara Bank in 1987. It is India's sixth largest housing finance company. Low cost funding from NCD/CP/Public Deposits is expected to increase to 60 per cent by FY18 from 35 per cent in FY16. This is expected to translate into expansion of spreads from 2.23 per cent in FY16 to 2.9 per cent in FY18.

        Sterling Tools (Target Rs 1,207): Sterling Tools is one of the largest manufacturers of fasteners in India, with a market share of around 28 per cent. The company is a supplier of high tensile (HT) fasteners to Honda Motorcycle Scooter India Private Limited and Maruti Suzuki India Limited. Conducive macro factors like good monsoons, 7th pay commission rollout, passage of GST, increasing localisation by OEMs will propel Sterling Tools on a growth path going forward. An earnings growth of 20 per cent is expected over FY16-18.

        APL Apollo Tubes (Target Rs 1,248): APL is the largest manufacturer of ERW pipes in India with a capacity of 1.3 mt and enjoys a market share of around 15 per cent in domestic market ahead of Tata steel (6 per cent), DP Jindal group (7 per cent) and Surya Roshni (6 per cent). It has a diversified product portfolio. The domestic ERW pipe market is expected to grow at a CAGR of 9 per cent over FY16-19 to 10 million tonnes by FY19.

      Government Permits 12 PSU Banks To Raise Rs 3,000 Crore From Market
      • In a bid to strengthen capital base of public sector banks (PSBs), the government has allowed 12 lenders to raise nearly Rs 3,000 crore via preferential shares over and above the Rs 22,915 crore capital support committed to them in July last year.

        The Finance Ministry granted approval to 12 proposals of PSBs to raise a sum of Rs 2,914.038 crore through preferential allotment and permission given to raise Rs 200 crore by United Bank of India through QIP mode.

        The government had already infused a sum of Rs 25,000 crore in 19 PSBs during FY 2015-16. 

        "A budgetary provision of Rs 25,000 crore has been made for 2016-17 and the government has already allocated Rs 22,915 crore to 13 PSBs on July 19, 2016 of which 75 per cent has been allocated in first tranche while remaining amount will be released on assessment of performance of PSBs, the Department of Finance in its year-end review for 2016 said today.

        As regards consolidation in the banking space, it said, the Union Cabinet in June 2016 had approved the proposal of acquisition of assets and liabilities of subsidiary banks i.e. State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala, State Bank of Travancore and Bhartiya Mahila Bank (BMB).

        With regard to financial inclusion, as many as 26.03 crore accounts have been opened under Pradhan Mantri Jan Dhan Yojana (PMJDY), out of which 15.86 crore accounts are in rural areas and 10.17 crore in urban areas.

        Deposits of Rs 71,557.90 crore have been mobilised and 19.93 crore RuPay Debit cards have been issued under PMJDY.

        Zero balance accounts has been reduced to 23.86 per cent.

        Aadhaar seeding has been done in 14.43 crore account under PMJDY, while 99.9 per cent households out of the 21.22 crore households surveyed have been covered under PMJDY.

        As on December 23, 2016, out of total requirement of 1,27,198 fixed location 'bank mitras' in sub service areas (SSAs), 1,26,985 'bank mitras' have been deployed by banks.
        Out of 1,712 claims lodged, 1,626 claims have been disposed of under accidental insurance cover of Rs 1 lakh under RuPay debit card.

        Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) cumulative Gross enrolment reported by banks, subject to verification of eligibility, etc. is over 3.08 crore, while Rs 9.88 crore under Pradhan Mantri Suraksha BimaYojana (PMSBY) as of December 28.

        A total of 38.23 lakh subscribers have been enrolled under the Atal Pension Yojana (APY) with a total pension wealth of Rs 1,344.70 crore. Out of the total subscribers, 19.74 lakh subscribers have been enrolled during 2016 (up to December 15, 2016).

        To make APY more attractive, the Ministry modified some rules and gave an option to the spouse of a subscriber in case of pre-mature death to continue contributing to the account of the subscriber, for the remaining vesting period, till the original subscriber would have attained the age of 60.

        The earlier provision was to over lump sum amount to spouse on the premature death (death before 60 years of age) of the subscriber.

        During the year, the government also started Stand-Up India Scheme with objective to provide bank loans between Rs 10 lakh to Rs 1 crore for greenfield enterprises set up by SC, ST and women entrepreneurs and extending effective handholding support to them.

        As on December 23, total number of loans sanctioned under Stand Up India Scheme is 15,341 (Women: 12,055, SC: 2,568 and ST: 718).

        Under Pradhan Mantri Mudra Yojana (PMMY) loan disbursement of Rs 77,916.54 crore was done to 2.12 crore beneficiaries till December 9. Out of this, there were 1.68 crore women entrepreneurs who benefited.

        The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) and the Recovery of Debts Due to Banks and Financial Institutions Act (RDDB & FI Act) have been amended for speedier resolution of defaulted loans through 'Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016'.

        The government proposes to bring in a comprehensive central legislation to deal with the menace of illicit deposit taking schemes.

        The government had earlier constituted an Inter-Ministerial Group (IMG) for identifying gaps in the existing regulatory framework for deposit-taking activities and to suggest administrative/ legislative measures, including formulation of a new law, to cover all relevant aspects of 'deposit-taking'.

        The IMG had finalised its report and recommended a number of legislative and non-legislative/administrative measures.

        The IMG's legislative recommendations included the enactment of a new central legislation called the Banning of Unregulated Deposit Schemes and Protection of Depositors' Interests Bill (Banning Bill) in order to tackle the menace of illicit deposit taking schemes.

        The revised draft legislation, titled the "Banning of Unregulated Deposit Schemes and Protection of Depositors' Interests Bill, 2016" (Version 2.0), has been uploaded on the website of the Department of Financial Services on November 17, 2016 seeking comments from the public on the Draft Bill to reach on or before December 17, 2016.

        The Banning Bill seeks to bring out a clear demarcation between regulated and unregulated deposit schemes, comprehensively define deposit takers, and provide strong penal provisions for different offences.

        General Awareness

        PM Narendra Modi’s Key Announcements on New Year’s Evening

          1. Prime Minister Narendra Modi, while addressing the Nation on December 31, 2016, on the New Year’s Eve, thanked people for patiently bearing the pain caused by the Government’s decision to demonetise Rs 500 and Rs 1,000 currency notes.
            • In his address to the nation, PM Modi also made a series of announcements aimed at the welfare of the entire Citizen of the Country with main focus on the senior citizens, farmers, rural housing, women and small entrepreneurs to lighten the burden of demonetization.
            Key Points of the Announcements
            Urban Housing
            • PM Modi announced two new housing schemes for the urban poor. As per the decision, home loan taken by urban poor in 2017 up to Rs. 9 Lakh would get 4 percent subvention on interest while 3 percent subvention on interest on home loans of up to Rs. 12 Lakh.
            Rural Housing
            • In villages, taking home loans of up to Rs. 2 Lakh for new housing or extension of housing in 2017 would attract 3 percent subvention on interest.
            • The number of houses being built for the poor, under the Pradhan Mantri Awaas Yojana in rural areas has also been increased by 33 per cent.
            PM also announced to convert 3 crore Kisan credit card into RuPay card in the next 3 months. The problem with Kisan Credit Card is that farmers need to go to bank to withdraw money, but RuPay Card will enable them to buy/sell directly through the card.
            • He also announced to waive 60-day interest on farm loans taken in the Rabi season from District Cooperative Banks and Primary Societies. This means that the banks will not charge any interest for 60 days on loans and that amount would be beared by the Government.
            • NABARD created a fund of Rs 21000 crore to Dstrict central Cooperative Banks in November 2016 to provide loan to farmers for Rabi season. Government has decided to add Rs 20,000 crore more to this along with giving the loan at subsidized rate. The loss that NABARD would suffer by giving loans to cooperative banks, societies at low interest rate shall be borne by Government.
            Senior Citizens
            • The Prime Minister said that senior citizens would get a monthly fixed interest of 8% on their deposits of up to 7.5 lakhs for 10 years.
            • A sum of Rs 6000 would be deposited in the account of pregnant and lactating women in above 650 rural districts to meet medical expenses. The scheme would initially be implemented in form of a pilot project in 53 districts, with the amount of Rs 4,000
            MSME(Micro, Small and Medium Enterprises)
            To give a boost to the small entrepreneurs, the government has taken certain decisions in the interest of small and medium businesses, which will also boost employment.
            • PM Modi said that the cash credit limit for small businesses would be raised to 25 per cent from 20 per cent. The Credit guarantee for Micro Small and Medium Enterprises would be raised to Rs 2 crore from current Rs 1 crore. 
            • Earlier, the scheme only covered bank loans, but now it will cover loans given by NBFCs (non-banking financial companies) as well.
            • Banks have also been asked to increase working capital loans from 20 per cent of turnover to 30 per cent, for enterprises that transact digitally.
            • Government also announced that earlier the tax on Income of businesses with turnover of up to Rs 2 crore was calculated at 8 per cent of the turnover. Now, for such businesses income from digital transactions will be calculated at 6 per cent. This will effectively reduce their tax liability by 25 per cent.
            • For MUDRA Yojana, Modi said that last year nearly 3.5 crore people benefitting from it. The government now aims to double this, giving priority to dalits, tribals, backward classes and women.

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        Current Affairs - 16 December 2018

        General Affairs   Cyclone Phethai Gathers Over Bay Of Bengal, May Hit Andhra On Monday ...

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