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Current Affairs - 7 June 2017


General Affairs 

Mandsaur firing: 5 farmers killed, curfew imposed, CM hikes relief to Rs 10 lakh
  • A clash broke out today between agitating farmers and police in Madhya Pradesh's Mandsaur district after which five farmers were killed in police firing.
    Farmers have been protesting for a week demanding loan waiver and fair price for their produce in the district. The situation got violent when the farmers resorted to stone pelting at police due to which police had to open fire.
    Although the government initially denied that the bloodshed was a result of police firing but later on Madhya Pradesh Chief Minister Shivraj Singh Chouhan ordered a judicial enquiry into the incident. A curfew was also imposed in the affected areas.
    The government hiked the compensation of Rs 5 lakh to 10 lakh to the kin of deceased.
    ALL YOU NEED TO KNOW ABOUT THE MANDSAUR FIRING:
    1. "I appeal my farmer brothers to keep patience. Don't get carried away by provocation from others. The government is with you. We will find solution to all problems," Chouhan said.He also blamed the Congress for aggravating the situation saying that they have been trying to give political colours to the protests. "Congress has made the protests violent," Chouhan said.
    2. Madhya Pradesh's Home Minister Bhupendra Singh said police had not shot at the protesters. He had instead blamed "anti-social elements" in the crowd for firing bullets.
    3. The farmers however have a different story to tell. "Police started firing to disperse the crowd. Farmers were not carrying weapons," said Gajendra Tokas of the Rashtriya Kisan Mazdoor Sangh, or National Farm Workers' Union, which has called a state-wide strike on Wednesday.
    4. Congress vice-president Rahul Gandhi accused the Centre of waging a war against the country's farmers. "In Bharatiya Janata Party's (BJP) new India, our farmers get the bullets when they ask for their rights. This government is at war with the farmers of our country," the Congress leader tweeted.
    5. Tensions began in Mandsaur after the agitating farmers surrounded Piplya Mandi police station which soon snowballed into a clash. Heavy police reinforcement was sent to control the situation.
    6. Curfew was later clamped in Pipalya Mandi area and prohibitory orders imposed in other parts of the district, officials said.
    7. Farmers in western Madhya Pradesh are protesting since June 1 demanding minimum support price for their farm produce, among other things.
    8. Farmers last week started a strike in the state and in western Maharashtra, dumping vegetables and milk on the roads to demand billions of dollars in debt forgiveness and better prices for produce.
    9. On Monday, Chief Minister Shivraj Singh Chouhan assured that the government would purchase onions at Rs 8/kg and moong dal at an agreed price and to set up a Rs 1,000 crore stabilisation fund. Though the Bharatiya Kisan Sangh called off its strike, the other organisations have continued with the stir.
    10. The state has been facing shortage of milk and vegetables, leading to price hike. Farmers threw milk on the Agra-Malwa Highway last week and barred trucks from carrying vegetables. Several parts of the state faced a similar situation.

Maharashtra farmers strike enters 6th day, vegetable prices soar
  • The farmers' strike in Maharashtra entered the sixth day today, with prices of vegetables shooting up in various markets due to short supply.
    Farmers are on the warpath since June 1 for demands including loan waiver and higher minimum support prices.
    Despite the government announcing a loan waiver for marginal farmers on Saturday, the agitation has continued.
    In Pune's Agricultural Produce Market Committee (APMC), the inflow of vegetables and fruits was only about 50 per cent today, resulting in their prices going up by three to five times, sources said.
    The workers of Swabhimani Shetkari Sanghatna held protests outside the collector's office in Sangli and 20 of them were taken into custody by police.
    The rural economy has been affected in Nashik where apart from farmers, potters, tempo drivers and others working in allied fields are losing their jobs, sources said.
    The daily business of around Rs 20-25 crore in 17 major APMCs in Nashik and other smaller market committees has come to a standstill, they added.
    Farmers locked the offices of talathi (revenue officer) in some villages of Kolhapur and Nashik districts.
    In Ahmednagar district, the inflow of vegetables was mere 1 per cent and there was no milk collection, increasing the woes of the people, sources said.
    In the district's Puntamba village, the agitating farmers threw vegetables outside the divisional commissioner's office.
    In Amravati too the protesters dumped vegetables outside the district collector's office.
    Police took into custody six workers of Swabhimani Shetkari Sanghatna in Amaravati.
    Meanwhile, sources said the farmers' strike in Maharashtra has benefited traders from Surat, Belgaum, Indore and Delhi as the Vasai-Virar region is witnessing an influx of agricultural produce from Surat.
    The Vasai-Virar region has several vegetable markets which usually get the produce from Nashik, Junnar and Vashi.
    The farmers' strike has stopped the flow of vegetables from Maharashtra.
    "Truck drivers are scared of violent protests. Traders from Surat, Delhi, Indore and Belgaum have thus taken advantage of the strike, increased the prices and the inflow of vegetables in the Vashi APMC has increased by around 30 per cent," an official from the cooperatives department said.

    "From Vashi APMC, the produce gets distributed in the markets of Vasai-Virar. The prices of vegetables are fluctuating by around 15-20 per cent in most APMCs," the official added.

Centre slams Bengali scholar Partha Chatterjee for 'atrocious' comparison of Army Chief with General Dyer
  • The Centre on Tuesday slammed the comparison of human shield controversy with the Jallianwala Bagh massacre and General Dyer.
    Condemning the "atrociuos" comparison, Union Minister Venkaiah Naidu today said that people like Partha Chatterjee can only ridicule the Army and not do nothing else.
    Bengali scholar Partha Chatterjee in his article had written that Kashmir was witnessing its "General Dyer moment".
    Speaking at a press conference, Naidu said, "Chatterjee is only trying to find fault in the Indian Army which is doing a great job to protect the unity, integrity and security of the country. They only want to condemn the army but never want to come in support of it. Comparing Major Gogoi's incident and then General Rawat's observation to General Dyer is total atrocious and height of perversion".
    "These people have sympathy for the stone pelters but don't have sympathy for the ones who leave their family and serve the country," Naidu added.
    SCHOLAR STAND BY HIS ARTICLE
    Chatterjee has, however, has said that he stands firm with his comparison of Army Chief Rawat with General Dyer.
    "I have made my arguments as clearly and precisely as I could in my article. If I need to clarify or change anything then I will write again. I stand by what I wrote. I am not seeking any publicity," Chatterjee told ANI.
    HUMAN SHIELD CONTROVERSY
    The article came after General Bipin Rawat supported Major Leetul Gogoi, who had used a Kashmiri as a human shield on polling day in the Valley which created a huge furore.  
    The Army Chief while announcing a reward for Major Gogoi had said that such "innovative" ways are required to counter the "dirty war" underway in Kashmir.
    Major Gogoi was in the spotlight after a video shot during the April 9 Srinagar Lok Sabha by-polls, posted on the social media, showed a man tied on the bonnet of an Army jeep in Jammu and Kashmir's Budgam.

All options against Pakistan open, says Army chief General Bipin Rawat
  • As tension with Pakistan remains at an all-time high over frequent ceasefire violations and funding of terror in Jammu and Kashmir from across the border, Indian Army chief General Bipin Rawat today said all options are open against the belligerent neighbour. 
    In details of a high-level meeting in Srinagar to discuss border security, accessed by India Today, General Rawat is reported to have discussed "all options" against Pakistan's aggression along the Line of Control (LoC) and the international border. 
    General Rawat had visited Jammu and Kashmir last week to review the security and also met state Governor NN Vohra to discuss the security situation. His statement comes as tension continues to simmer along the India-Pakistan border, with several ceasefire violations being reported in recent months. 
    Last week, a civilian was killed and two others, including a BSF trooper, were injured in firing exchanges between Pakistani and Indian troops along the LoC.
    On the same day, Pakistan also summoned the Indian Deputy High Commissioner in Islamabad over fresh ceasefire violations on the Line of Control, claiming that one Pakistani civilian was killed. 
    The Army on May 23 had released a video of attack on Pakistani posts across the LoC. The video showed what appeared as bunkers in a forested area being bombed and smoke and fire billowing up after the explosion.
    The mutilation of Indian soldiers by Pakistani border forces, the Kulbhushan Jadhav trial, and the funding of Kashmiri separatists to fuel unrest in the Valley as exposed by India Today have been the other sticking points between the two countries.

Doctors on strike to protest against violence faced by fellow medical professionals
  • Doctors in Delhi are on a one-day strike to protest against a rise in cases of violence against their fellow healthcare professionals, the news agency ANI reported on Tuesday.
    The bandh was called by Delhi Medical Association (DMA), which supports the Indian Medical Association's Dilli Chalo Movement, a protest march that will begin at Rajghat and end at Indira Gandhi indoor stadium. More than one lakh doctors are expected to take part in that event, the news agency PTI reported on Monday.
    Hospitals like Max and Apollo have cancelled all out-patient department (OPD) appointments scheduled for today and have extended their support to the bandh. However, their emergency services will remain open.
    The IMA's website says its movement's objective is to "bring to the attention of the nation" the "atrocities faced by the medical profession."
    It also aims to address the medical fraternity's demands, which include a stringent central act against violence, single-window accountability with no criminal charges on doctors without intent to harm a patient, and single-window registration of doctors and medical establishments.
    'ENOUGH IS ENOUGH'
    "Feeling that enough is enough...the IMA has given this clarion call, Dilli Chalo," K K Aggarwal, national president of the IMA, said.
    The association will launch a signature campaign on social media, and has urged doctors to collect thousands of signatures, to be sent to the Narendra Modi government.
    It has also appealed to doctors across the country to not give out prescriptions between 10 am and 11 am today "in solidarity with Dilli Chalo movement and to save professional autonomy," in what it calls a 'pen-down satyagraha' 

Business Affairs 

    MPC meet: RBI may opt for status quo on rates tomorrow
    • Reserve Bank Governor Urjit Patel- led Monetary Policy Committee (MPC) today began its bi-monthly interest rate review amid the government pitching for a reduction in borrowing cost to help push private investments.
      Most analysts, however, expect no change in interest rates in view of more than USD 60 billion of excess liquidity in the system.
      Those seeking a cut in interest rates cite consumer price inflation slowing down to 2.99 per cent in April, economic growth during the last fiscal at its slowest pace in two years and weakest loan demand since at least 1992.
      Finance Minister Arun Jaitley yesterday made a case for cut in interest rates, saying inflation has been under control for long and is likely to remain so on the back of good monsoon while there is no likelihood of a spike in oil prices.
      "...growth and investment need to improve. These are indicators which are available. Any finance minister under these circumstances would like a rate cut, the private sector would like a rate cut. But then when you entrusted it with the MPC, I would rather wait for their decision," he had said.
      India Inc is also pitching for a rate cut to boost GDP growth that fell to 7.1 per cent in 2016-17 from 8 per cent in the previous fiscal.
      However, financial sector experts believe the Reserve Bank will likely maintain status quo at its second bi-monthly monetary policy review of the current fiscal to be unveiled tomorrow as the central bank would like to gauge the impact of GST rollout on inflation.
      "Given the inflation trajectory and as the liquidity is enough in the market, it is unlikely that there would be any rate cut this time. I think commentary of the policy will be benign," State Bank of India DMD and Chief Financial Officer Anshula Kant said.
      Finance Minister Arun Jaitley had said inflation has been under control for long and is likely to remain so on the back of good monsoon and unlikely spike in oil prices.
      "...growth and investment need to improve. These are indicators which are available. Any finance minister under these circumstances would like a rate cut, the private sector would like a rate cut. But then when you entrusted it with the MPC, I would rather wait for their decision," he had said.
      The RBI may wait for the July 1 rollout of the GST and assess the impact of the new indirect tax regime on inflation before tinkering with the policy rates.
      "I do not think the RBI will cut repo rate in the upcoming policy. They will wait for CPI data before taking a call. The tone of the policy is likely to be dovish," Union Bank of India executive director Vinod Kathuria said.
      The inflation data for July, to be released in August, will give an indication of the impact of Goods and Services Tax (GST) on prices.
      Retail inflation, based on Consumer Price Index (CPI), dropped to multi-year low at 2.99 per cent in April over last year, mainly due to lower cost of food items, including pulses and vegetables. CPI inflation was 5.47 per cent in April 2016.
      At the same time, inflation based on the wholesale price index slipped to a four-month low of 3.85 per cent in April as both food articles and manufactured items showed cooling in prices.
      On April 6, the Reserve Bank had left its benchmark lending rate unchanged at 6.25 per cent for the third monetary policy review in a row, citing upside risk to inflation.
      However, experts also feel that RBI will likely strike a less hawkish tone.
      The RBI is unlikely to cut rates in its upcoming policy review but the tone of the statement will be less hawkish than the previous one, rating agency ICRA said.

    Railways to launch overnight service for business travellers
    • The Railways will soon launch an overnight double-decker train service equipped with modern facilities to attract business travellers.
      The public transporter is looking to connect metropolitan centres through the new service, Uday Express, Railway Minister Suresh Prabhu said today at the 'Smart Railway Conclave' here.
      "We will be launching Uday Express for business travellers who would start in the night and reach in the morning so that they can save on hotel cost," Prabhu said, adding that it will have improved amenities.
      Currently railways has undertaken a large number of projects to provide better onboard amenities for passengers.
      "We are moving ahead with a holistic strategy and we are doing it in a most challenging situation. Whether it is catering, booking tickets, cleaning of coaches, all these are happening in a smart way in the railways," he said.
      He said railways has suffered from under investment and lack of capacity expansion in the past.
      "The expansion was not commensurate to the demand. Goods were moving away from the railways. There was a huge gap in demand and supply. So we decided to come out with a holistic strategy to deal with it. We tried to implement projects involving laying new lines, electrification on a faster pace," he said.
      He said the challenge now is to make better use of latest technology. "Technology was always been there but now the scale has multiplied now. Use of right technology is the game changer."
      The Dedicated Freight Corridor (DFC) which was languishing for years was made to progress rapidly and it is expected to be operational by 2019, he said.
      Highlighting the importance of investment in the rail sector, Prabhu said "Every rupee invested in railways has six time multiplying effect on economic and job creation sector."
      A huge capital expenditure of Rs 8.56 lakh crore was planned out for five years out of which more than Rs 3 lakh crore is being spent now, he said.

    Demonetisation slowed down economy: Manmohan Singh
    • Former Prime Minister Manmohan Singh and Congress President Sonia Gandhi today said the countrys growth has slowed down mainly due to demonetisation and the economy was running on just one engine of public spending.
      The status of the economy was discussed at the meeting of the Congress Working Committee (CWC), the highest decision- making body of the main opposition party here.
      Gandhi, who chaired the meeting, talked about the failure of demonetisation, saying it has affected the countrys growth.
      She highlighted that Manmohan Singh had predicted a fall in growth due to the note ban announced by Prime Minister Narendra Modi on November 8 last year.
      She said the GDP figures proved that the former prime ministers forecast that demonetization would slow down economic growth was correct.
      Singh, in his intervention at the meeting, talked about the decline in the economic growth as depicted in the last quarter GDP numbers.
      He said the slowdown was primarily due to demonetisation. and expressed serious concern over the situation, particularly the impact of the growth slowdown on job creation.
      The former Prime Minister, an acclaimed economist himself, said the Gross Value Addition (GVA) is the true sub-measure of economic activity and it has experienced a steep and sustained fall.
      "Private sector investment has collapsed and the economy is running on just one engine of public spending," he said at the meeting.
      Singh said the GVA growth of industry has fallen from 10.7 per cent in March 2016 to just 3.8 per cent in March 2017, a decline of nearly seven percentage points of growth.
      "The most worrisome aspect of all this is the impact on job creation. Jobs have been extremely hard to come by for the youth of the nation," he said.
      Gandhi in her speech said, "The governments experiments and policies are characterized by poor planning and shoddy implementation. They have been disastrous for our social and economic fabric."
      She said demonetisation was touted as a great success, but till today the government refuses to disclose how much of the demonetised currency in circulation was actually returned to banks.
      "It isnt that the Reserve Bank of India has forgotten how to count money; it is that the actual numbers show that the scheme was a disaster," she said.
      Gandhi also attacked the Make in India campaign saying it failed to create jobs or attract investment and unemployment was rampant in the country.
      The former Prime Minister noted that the construction industry, which is one of the largest employment generators in the country, has suffered contraction.
      This, he said, "implies loss of millions of jobs for the nations workforce".
      At the party briefing after the CWC meet, senior spokesperson Ghulam Nabi Azad said the Congress had raised the issue of demonetisation both outside and inside Parliament.
      Azad said Manmohan Singh and former Finance Minister P Chidambaram had said that note ban will have a bad effect on the economy and will affect GDP.
      "But the government rejected all our claims and it has to now admit within a year that the GDP has suffered a loss and how much loss the country has to suffer in last three years," said the Leader of Opposition in Rajya Sabha.

    Sensex, Nifty and Bank Nifty open at record highs
    • Indian benchmark indices opened at fresh highs. The BSE Sensex opened at 31,420.85 while the Nifty opened for the first time above 9,700.
      "As Nifty surpasses initial resistance we may see 9800 as a mark to be tested," says Mustafa Nadeem, CEO, Epic Research adding "This is the broader range for market. We recommend to have buy on dips strategy in coming sessions."
      At 9.35 am, the Sensex was trading 5 points down while the Nifty was trading 6 points lower.
      Market was trading flat on the back on global cues as investors took in the impact of 6 countries cutting diplomatic ties with Qatar.
      "The Tuesday's session is likely to trade with some volatility on the back of RBI monetary policy. Price-wise, we do not expect any positive surprise from this event and hence, any disappointment may lead to some profit booking in the market. 9,640 - 9,581 would act as a strong support zone on Nifty today," said an Angel Broking report.
      Sectoral indices led by IT, Teck, Auto, Realty, Metal, Healthcare, PSU and Banking were in the positive zone, rising up to 1.83 per cent.
      Brokers also said that markets got a booster dose after the GST Council last week finalised rates for some pending commodities, which has now taken the rollout of the new indirect tax regime from July 1 a step closer.
      Among the top gainers was Tata Consultancy Services trading over 3 per cent on the Sensex followed by Infosys and SBI.
      Yesterday, State Bank of India opened share sale through private placement at Rs 287.58 apiece to raise Rs 11,000 crore.
      This is part of plans to garner Rs 15,000 crore capital from markets in the current fiscal.
      Among the laggards was ITC, dipping over 2 per cent.
      Shares of Cipla, too, fell 1.92 per cent as Pharma woes continue to damper investor sentiment.
      Reserve Bank of India's MPC meet
      Reserve Bank of India's Monetary Policy Committee (MPC) is scheduled to commence later in the day to review monetary policy amid slowdown in growth and declining inflation.
      BofA-ML expects the committee to consider a 25 bps cut in interest rates on August 2 if monsoon remains normal.
      Goods and Services Tax
      Speculation over the Goods and Service Tax rate on gold and diamond Jewellery is finally over with the government finalizing the rate at 3 per cent, while the import duty of 10 per cent stays, which will be over and above the 3 per cent.
      The total levy on gold would be around 13 per cent (10 per cent customs duty + 3 per cent GST), effectively an increase of around 1 percent than the industry expectations of the 12 percent.
      "This would result in an increase in jewellery prices of gold, silver, and diamonds, however marginal it will be. This additional cost will be passed on to the consumers," says Chief Analyst, Prathamesh Mallya from Angel Broking. 

    Amendments in Income Tax Act: IPOs, bonus issue, share gifts exempted from capital gains tax
    • The government has exempted genuine equity investments through IPOs, bonus or rights issues by a listed company from long-term capital gains tax even if no securities transaction tax (STT) was paid on the transfers.
      It has also exempted holding-subsidiary transactions or transactions involving mergers/demergers, equity investments made by a non-resident under FDI regulations, employee stock options or gifts in the form of shares from long term capital gains tax.
      An amendment to Section 10(38) of the I-T Act was brought in after the tax department noticed that shell companies were being created by entering into sham transactions and unaccounted income was being routed into these companies to avail long-term capital gains benefits.
      The amendment provides that capital gains exemptions for income arising from the transfer of shares acquired on or after October 1, 2004, will be available only if the acquisition was chargeable to STT.
      The Income Tax department has now notified three types of transactions where the provision will apply, while sparing genuine ones. The first is where an acquisition of a listed equity share, which is not frequently traded in a recognised stock exchange, takes place through preferential issue.
      The second, those acquisitions where the listed scrip is not purchased over a recognised stock exchange. And third is the acquisition during the delisting period of the company.
      For each of the three categories, payment of STT will be mandatory to avail benefit of capital gain exemptions.
      The notification provides that capital gains exemption shall be available in case of share acquisition (without STT) made by non-residents/venture capital funds under the specified situations, for share acquisition made under ESOP or approved M&A schemes and the SEBI guidelines.
      It also extends the relief to share acquisition which has been approved by the Supreme Court, High Court, National Company Law Tribunal, Securities and Exchange Board of India or Reserve Bank of India.
      "The notification is a big relief for investors and shall re-instate their confidence that the Indian tax system is becoming taxpayer friendly and is prompt in bringing tax certainty to avoid unwarranted litigation. This notification is applicable from April 1, 2018 and shall accordingly apply to AY 2018-19," Nangia & Co Managing Partner Rakesh Nangia said.
      The tax department had in April come out with a draft notification specifying certain eligible transactions for capital gains tax exemption on which STT was not paid and sought public comments.
      Tax experts, however, said that the final notification does not address the acquisition of equity shares in private arrangements, which would mean that inter-se transfer of equity shares between promoter group companies will not enjoy the exemption.
      The transfer of equity shares under pledge arrangements (outside stock exchange) shall not be given the benefit of exemption to the buyer. Similarly, private family deals at fair values will also not enjoy the benefit of exemption under 10(38).
      Also the final notification does not afford protection to issuance of equity shares under sweat equity plan, which are quite prevalent these days. Similarly, the acquisition of equity shares under settlement of debt by any private company, will not enjoy the exemption.

    General Awareness

    India’s heaviest rocket with GSAT-19 satellite lifts-off into space

      1. On June 5, 2017, Indian Space Research Organisation (ISRO) successfully launched the Geosynchronous Satellite Launch Vehicle-Mark III (GSLV-Mk III) – D1, along with a communications satellite GSAT-19 from Satish Dhawan Space Centre at Sriharikota in Andhra Pradesh.
        Details related to the launch and its implications:
        43 metres tall GSLV-Mk III weighed 640 tonnes. It’s main and bigger cryogenic engine has been developed by ISRO scientists.
        • The communications satellite GSAT-19 weighed 3,136kg (heaviest to be lifted by an Indian rocket till date). It is a multi-beam satellite that carries Ka and Ku band forward and return link transponders and geostationary radiation spectrometer. GSAT-19 has a life span of 10 years.
        • Director of Vikram Sarabhai Space Centre Mr. K. Sivan has mentioned that payload will be gradually increased in future flights of the GSLV Mk-III.
        • The success of this mission has proven India’s ability to launch four-tonne satellites on its own rocket. This will help in saving huge amount of funds which is paid to foreign space agencies for similar launchings.
        About GSLV Mk-III:
        • The GSLV-Mk III-D1 is a three-stage vehicle with indigenous cryogenic upper stage engine designed to carry heavier communication satellites into the Geosynchronous Transfer Orbit (GTO).
        • In 2014, ISRO had flown a similar rocket without the cryogenic engine but with 3.7-tonne payload to test in-flight structural stability and the aerodynamics.
        • GSLV MkIII-D1 is capable of lifting payloads of up to 4,000 kg into the GTO and 10,000 kg into the Low Earth Orbit.
        • GSLV-Mk III (43.43 metres) is slightly shorter than Mk-II version that is around 49 metres tall, but has a greater punch power.
        Quick Facts about ISRO:
        ISRO is the space agency of Government of India, formed with a vision to harness space technology for national development
        • Formation Year: 1969
        • Founded by: Vikram Sarabhai
        • Headquarters: Bengaluru
        • Current Chairman: A S Kiran Kumar

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