Current Affairs - 27 July 2017

General Affairs 

Doklam standoff: Indian Air Force chief says ready for any eventuality

• As India explores diplomatic options to resolve the stand-off between Indian and Chinese troops in the Doklam plateau in Bhutan, the Indian Air Force is ready for any eventuality.

  Chief of Indian Air Force Air Chief Marshal B S Dhanoa in an exclusive interview to Indian Today said, "We are ready for any eventuality. The stand-off on the ground continues, diplomatic options are being explored".

  Indian and Chinese troops are engaged in a face-off since June 6 when Chinese People's Liberation Army (PLA) moved into Doklam Plateau - claimed by both Bhutan and China - demolished bunkers and took away Bhutanese soldiers at gunpoint. India is treaty bound to help Bhutan. The Indian Army moved into Doklam to stop the Chinese from building a road through the disputed area.

  Although short on fighters the Indian Air Force is prepared for a "full spectrum" - or a two-front war. "For a full-spectrum war we need a certain number of squadrons which we don't have immediately.  The government," he said is "aware of the shortage."

  India has recently bought fighter aircrafts from France and the shortfall is likely to be made up soon, he said. "There has never been a two-front war," Air Chief Marshal BS Dhanoa said and added the point to ponder is whether the world will allow Pakistan to fight along with China and "world will permit it.

  Air Chief Marshal Dhanoa was speaking to India Today to mark the 18th anniversary of Kargil war. The Kargil war - between India and Pakistan - came to end today in 1999. Then commanding a fighter squadron, Air Chief Marshal Dhanoa flew several missions along the Line of Control - the de-facto border between India and Pakistan - destroying Pakistani ammunition dumps and strongholds.

  Remembering the Kargil operations, the Air Chief said: "My worst moment was when Squadron Leader Ahuja was killed. Squadron leader Ahuja - who was bomb damage reconnaissance mission - was captured alive and shot dead by Pakistani forces when he ejected after being hit by a missile".

  The IAF could have "knocked off" the Pakistani supply lines and neutralised the Pakistani artillery that was firing into India if the IAF was allowed to cross the LoC during the Kargil war, Air Chief Marhsal B S Dhanoa said.

  He was, however, quick to add that "every war is fought to achieve a political motive. The political objective then was to throw out the Pakistani soldiers who had crossed into India. That political objective was achieved".

Centre makes a U-turn, says certain aspects of privacy protected under fundamental rights

• After maintaining that privacy is not a fundamental right, the Centre today made a U-turn in the Supreme Court by saying that certain aspects of privacy can be protected under fundamental rights.

  Attorney General K K Venugopal, arguing on behalf of the Centre in the right to privacy case, said that certain aspects of privacy are protected under fundamental rights while others are merely a part of the common law.

  The Centre has so far consistently debated the existence of privacy as a fundamental right and said that validity of Aadhaar cannot be challenged over violation of right to privacy under Article 21.

  
  

  CENTRE's BACK AND FORTH ON RIGHT TO PRIVACY DEBATE IN SUPREME COURT TODAY:

  1. Earlier in the day, while opening arguments on behalf of the Centre in front of the nine-judge Constitution bench headed by Chief Justice J S Khehar, Attorney General Venugopal said, "privacy is part of Right to Life under Article 21, but does not enjoy the status of a fundamental right".
  2. There are several aspects to Right to Life such as right to food, shelter and employment but everything does not enjoy the status of a fundamental right, K K Venugopal said.
  3. Bringing the argument of rich vs poor, Attorney General Venugopal said that right to privacy of the privileged cannot be at the expense of the right to food and life of the poor.
  4. "Right to privacy has no claim in a country like India where people are deprived of basic things like food and shelter," Venugopal said.
  5. He said that judgments on privacy in countries like the United States cannot be applied to India which is a developing country, adding that every aspect of privacy cannot be protected.
  6. The court asked the Attorney General if he means that certain aspects of privacy are covered under fundamental rights.
  7. To this, Attorney General K K Venugopal said there are aspects of privacy which are protected under fundamental rights.
  8. Kapil Sibal, who appeared for Karnataka, West Bengal and Puducherry, told the Supreme Court that the three states support the petitioners on the argument that privacy is a fundamental right under Article 21 of the Constitution.
  9. Arguing for privacy as a fundamental right, Kapil Sibal said that while privacy is not mentioned in the Constitution of America and Australia but it is a fundamental right.

Enforcement Directorate gets 7-day custody of Kashmiri separatist leader Shabir Shah

• How separatist leaders are fueling unrest in the Kashmir Valley by taking funds from Pakistan, the Jammu and Kashmir Police arrested Shabir Shah, founder and president of the Jammu and Kashmir Democratic Freedom Party (JKDFP).

  Shah was shifted from his uptown Sant Nagar residence in Srinagar to Humhama police station in Badgam district on Tuesday evening.

  Here is what we know so far:

  • Talking to reporters outside the court, Shabir Shah said he was under house arrest and that is why he couldn't appear in the case before ED. "This is politically motivated. The people of the country should understand this. The allegations are baseless," Shah said.
  • The Enforcement Directorate got a 7-day custody of the separatist leader who was produced in the Patiala court in Delhi during the day.
  • Shabir Shah was flown to Delhi today following his arrest by Enforcement Directorate (ED) officials.
  • ED officials "executed a non-bailable warrant issued against Shah by a Delhi court".
  • The central probe agency has issued several summons to Shah over the last few years in pursuance of the August 2005 case wherein the Delhi Police's Special Cell had arrested Mohammed Aslam Wani (35), an alleged hawala dealer.
  • The arrest followed disclosures by Aslam Wani, who has admitted having passed on hawala money worth Rs 2.25 crore to Shah.
  • In the wake of the arrest of Shabir Shah, former Jammu and Kashmir CM Farooq Abdullah, speaking exclusively to India Today, Abdullah said that the Jammu and Kashmir government is in cahoots with the Hurriyat leadership in Kashmir. 
  • Seven separatist leaders, arrested on Monday by the National Investigation Agency (NIA), were produced before the designate NIA court in Delhi on Tuesday.
  • The court remanded the accused to NIA custody for 10 days for custodial interrogation in connection with a terror funding case being investigated by the agency.
  • Srinagar police tried to stop NIA from flying arrested Kashmiri separatists to Delhi.
  • The seven arrested Hurriyat leaders were taken to BSF camp in Chhawala today.
  • Hurriyat leaders Mirwaiz Umar Farooq and Syed Ali Shah Geelani are already under house arrest while Jammu and Kashmir Liberation Front chairman Yasin Malik is also under arrest.

Tale of two floods: Assam continues to wave for help while Gujarat gets Rs 500 crore

• While Prime Minister's home state just got handed a relief package of Rs 500 crore for the flood-affected districts, ex-gratia for the injured and kin of the deceased, the less fortunate north-eastern state of Assam is still lurking for attention.

  PM Narendra Modi on Tuesday rushed to take an aerial view of the flood-ravaged areas in north Gujarat after President Ram Nath Kovind's swearing-in and a slew of ex-gratias followed soon

  Injured are entitled to compensation of Rs 50,000, while the kin of deceased will get Rs 2 lakh as relief- but only in Gujarat.

  Assam has been reeling under the worst ever flood situation in decades, nearly 17 lakh people's lives have been rummaged, over 77 killed, swathes of croplands inundated and an inter-ministerial team started for the state only on Tuesday, July 25.

  BJP, WHY THE BIAS?

  This comes after Chief Minister Sarbanand Sonowal met Prime Minister Narendra Modi on July 18 and urged the Centre to help. The Union government is yet to extend financial assistance.

  The Assam government has sought an interim assistance of Rs 2,939 crore from the central government to deal with destruction caused by floods as an inter-ministerial team arrived in the state on Tuesday.

  Criticising Centre's inaction, former Assam Chief Minister Tarun Gogoi said that the Prime Minister rushed to Gujarat and announced interim relief and ex-gratia for the victims while no such treatment was rendered for the people of Assam.

  Assam Pradesh Congress Committee President Ripun Bora today said, "Our state witnesses a serious flood scenario almost every year but the Modi government that promised achhe din (good times) showed no sincerity towards the problem."

  60 PER CENT FALL IN FUNDS

  Modi visited Jammu and Kashmir, Bihar and Tamil Nadu during the floods but is yet to steer his attention to Assam- which has been grappling with flash floods during monsoons for the past three years now.

  A Comptroller and Auditor General (CAG) report has observed that there has been a 60 per cent shortfall in release of central funds to Assam for implementing flood management programme.

  In the report tabled in Parliament today, the CAG noted that the Centre was to share Rs 2043.19 crore with Assam for implementing 141 projects in the state between 2007-08 and 2015-16. Out of this, it released Rs 812.22 crore, a shortfall of Rs 1230.97 crore or 60 per cent.

  The team led by Joint Secretary of Ministry of Home Affairs V Shashank Shekhar will conduct an on-the-spot assessment of the flood situation and will be visiting flood affected areas of Biswanath, Lakhimpur, Majuli, Barpeta, Cachar, Hailakandi and Karimganj districts of Assam till Friday, July 28.

NSA Ajit Doval to meet China's Xi Jinping as tension over Doklam peaks

• National Security Adviser Ajit Doval and the other BRICS national security advisers will meet Chinese President Xi Jinping on Friday afternoon, officials said, following the BRICS NSA's summit in Beijing.

  The five NSAs of Brazil, Russia, India, China and South Africa will call on the Chinese President at the Great Hall of the People, officials said, following the BRICS meeting on Friday morning at the Diaoyutai State Guesthouse in Beijing.

  The call-on is unlikely to provide a platform to discuss substantive issues, and is more a courtesy call. Xi had similarly met with the BRICS Foreign Ministers following their summit in Beijing last month.

  Officials said arrangements were also being made for a bilateral engagement between NSA Doval and his Chinese counterpart, Yang Jiechi. This may take place before the BRICS NSA's summit.

  Yang and Doval are also Special Representatives on the India-China boundary negotiations.

  "On bilateral meetings, I do not have the relevant information right now. As far as we know, in previous meetings, usually it is arranged for the heads of delegations to hold meetings to exchange views on bilateral relations and other international issues," Chinese Foreign Ministry spokesperson Lu Kang said on Monday.

  Lu also stressed that in China's view, "meaningful dialogue" on the stand-off at Doklam was not possible until India withdrew. "China and India have a smooth diplomatic channel," he said. "The crux now is Indian border troops illegally stayed on China's territory. Once again we urge India to pull back to the Indian side of the boundary. I want to stress that this is precondition for any meaningful talks between the two sides."

Business Affairs 

IRCTC to take over catering services in all trains by year end

• Catering services in all trains with pantry cars will be handed over to IRCTC by the year-end in order to improve onboard food quality, according to Railways.

  Besides, passengers in seven Rajdhani and six Shatabdi trains will have an option for e-catering facility.

  IRCTC will be given responsibility of managing catering services in all trains with pantry cars be December end, Railway Board Member (Traffic) Mohd Jamshed said here today.

  Till now, the zonal railways were managing catering services in majority trains as per the catering policy 2010.

  There are about 350 trains including Rajdhani, Shatabdi and Duronto which are equipped with pantry cars.

  With a view to improve catering services at rail premises, Railways will also conduct third party audit at pantry cars, base kitchens and food stalls to ensure best practice.

  "We have hired two reputed companies to do the third party audits at food stalls and pantry cars," Jamshed said.

  Railways has also undertaken a three-week drive to inspect food quality and hygienic condition at base kitchens.

  The Railways formulated catering policy in 2005 and according to the policy, IRCTC, the tourism and catering wing of the Railways, was given catering responsibility for all trains.

  In 2010, the then Railway Minister Mamata Banerjee announced the policy in which catering responsibility was taken away from the IRCTC and zonal railways were asked to look food services.

  However, since complaints against food quality were increasing constantly, Railway Minister Suresh Prabhu decided to go for a new catering policy aiming to improve food services at rail premises.

  The new catering policy was announced in February under which IRCTC was given catering responsibility with stringent guidelines.

  The new policy envisages separation of cooking and distribution of food.

  Jamshed said now options have been given to passengers in a few Shatabdi, Rajdhani and Duronto trains to opt out of the catering services while booking tickets.

  Catering services are mandatory in premier services like Rajdhani and Shatabdi trains and the catering cost is included in the ticket.

  Seeking to explore the possibility of making mandatory catering services optional on trains, Railways had earlier announced in June last year to undertake the scheme on Nizamuddin-Mumbai August Kranti Rajdhani Express and Pune- Secunderabad Shatabdi Express.

  Passengers have to specifically opt out from the mandatory food option and catering charges will be excluded from the ticket fare.

  Catering charges ranging from Rs 175 to Rs 340 will be deducted from the total fare if the passenger opts out from the mandatory food options.

NCLT allows banks to initiate insolvency proceedings against Bhushan Steel, Bhushan Power

• The National Company Law Tribunal on Wednesday allowed banks to initiate insolvency proceedings against Bhushan Steel and another firm, Bhushan Steel and Power.

  The petition for launching the insolvency process was filed by SBI, the lead bank of the consortium of lenders, in the case of Bhushan Steel while a similar plea was filed by Punjab National Bank (PNB) against Bhushan Steel and Power.

  Since the plea has been admitted by the NCLT, there is a 180-day timeline to decide on a resolution plan in accordance with the Insolvency and Bankruptcy Code (IBC), 2016.

  SBI has claimed recovery of Rs 4,295 crore from Bhushan Steel and USD 490 million for foreign currency loan.

  The NCLT, on July 13, issued notices to Bhushan Steel as well as Bhushan Steel and Power over insolvency proceedings initiated by their lenders State Bank of India and PNB. The companies were directed to file their reply.

  Both the petitions were filed under the Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, where the financial creditor initiates insolvency proceedings with a claim.

  After hearing both the parties, the tribunal had kept its order reserved for July 19.

  Bankruptcy proceedings have also been initiated against other companies, including Electrosteel Steel and Lanco Infratech, Alok Industries and Jyoti Structures, which are among the 12 NPA or bad loan cases identified by the Reserve Bank of India.

  The 12 accounts alone constitute a quarter of the over Rs 8 lakh crore of NPAs. Of the total, Rs 6 lakh crore are with public sector banks alone.

  The internal advisory committee (IAC) of the RBI, after its meeting on June 13, had recommended 12 accounts representing about 25 per cent of gross NPAs of the banking system for immediate reference under the IBC.

  These accounts have an exposure of more than Rs 5,000 crore each, with 60 per cent or more classified as bad loans by banks as of March 2016.

Nifty closes above 10,000 for first time, Sensex at all-time high

• The Sensex and Nifty extended gains in the last hour of trade and ended at their record closing highs on Wednesday.

  While the Sensex closed at 32382 level up 154 points or 0.48 percent, Nifty closed above 10,000 for the first time ever at 10,020 level, up 56 points or 0.56 percent. 

  Expectations of a better earnings season with improving economic indicators have increased investor confidence, extending a record-setting rally this year, although high valuations are seen capping gains in the near term.

  The Nifty has hit a string of record highs this year and is Asia's third best-performing index this year with a 22 per cent gain.

  The Sensex, too, has recorded almost 22 per cent gains this year.

  Stocks rose amid the BSE metal index hitting a 34-month high intraday after a strong rally in global commodity prices, mainly in metals.

  The BSE metals index closed 213 points or 1.74 percent higher at 12,504.07 level.

  The Nifty metal index too closed 1.73 percent or 55 points to close at 3283 level.

  Vedanta rose 2.33 percent to 280.80 level  after the mining conglomerate consolidated profit after tax doubled to Rs 1,525 crore for the quarter through June, driven by strong show in zinc and oil and gas businesses.The firm posted consolidated profit after tax at Rs 754 crore in the same quarter last year.

  "The market is on a secular uptrend. Among other factors, corporate results so far have been fairly decent with upbeat performances," said Nitasha Shankar, senior vice-president and head of research at Yes Securities (I) Ltd.

  "Overall, things are improving and we expect the market to continue on this journey upward, though there will be some days of profit booking which would only be prudent."

  Top gainers on the BSE were GE T&D India (19.99 percent), Sun Pharma Advanced Research Company (9.18 percent) and Jindal Steel and Power (8.37 percent).

  GE T&D India hit the upper circuit on June quarter earnings which came above street expectations. The firm posted a net profit of Rs 61.6 crore for the first quarter ended June 30, 2017 against a net loss of Rs 197.4 crore in the year-ago period.

  On the Nifty, 30 stocks closed higher against 21 declines.

  YES Bank was the top gainer rising 6.44 percent, IndusInd Bank (2.43 percent) and Tata Steel closing 2.34 percent higher.

  On the Sensex, 22 stocks closed higher led by Tata Steel (2.22 percent), Sun Pharma (2.08 percent) and ICICI Bank (2.07 percent).

  Axis Bank (2.90 percent), Asian Paints (1.60 percent) and TCS (0.62 percent) were among the top losers.

  Private sector lender Axis Bank reported a 16.06 per cent decline in net profit to Rs 1,306 crore for the first quarter ended June 30, as the bad loans almost doubled during the period. The bank had registered a net profit of Rs 1,556 crore in the June quarter of 2016-17.  

  Asian Paints reported a 20.23 per cent decline in consolidated net profit at Rs 440.74 crore for the first quarter ended June 30, mainly on account of higher expenses. The company had posted a net profit of Rs 552.56 crore in the same period of the previous fiscal, Asian Paints said in a BSE filing today.

  Market breadth was slightly positive with 1362 stocks advancing against 1324 declines on the BSE. 

  GLOBAL MARKETS 

  World stock markets were mostly higher Wednesday, lifted by another record day on Wall Street and buoyant oil prices. Investors were keeping a cautious eye on the Fed's upcoming interest rate decision.

  European shares rose in early trading. France's CAC 40 added 0.7 percent to 5,196.27 and Germany's DAX climbed 0.4 percent to 12,309.31. Britain's FTSE 100 rose 0.6 percent to 7,477.89. US shares were poised to open higher. Dow futures were up 0.1 percent to 21,581.00 and broader S&P 500 futures edged up 0.1 percent to 2,476.10.

  Japan's benchmark Nikkei 225 index climbed 0.5 percent to close at 20,050.16 but South Korea's Kospi index slipped 0.2 percent to 2,434.51. Hong Kong's Hang Seng index added 0.3 percent to 26,941.02 and the Shanghai Composite index edged up 0.1 percent to 3,247.67. Australia's S&P/ASX 200 rallied 0.9 percent to 5,776.60. India's Sensex gained 0.3 percent to 32,338.57 and benchmarks in Southeast Asia were mostly higher.

Over 18,000 NGOs fail to file annual income returns for 5 years, government tells Rajya Sabha

• More than 18,000 NGOs did not file their annual income and expenditure statements for the five-year period between 2010-11 and 2014-15, the Rajya Sabha was informed today.

  "More than 18,000 NGOs, who did not file due annual returns from financial year 2010-11 to 2014-15, were given one month time to upload the missing annual returns pertaining to the above period," Minister of State for Home Kiren Rijiju said in a written reply.

  Rijiju said more than 8,000 NGOs complied with the directions of the government. Around 6,000 defaulting ones have been served showcause notices, he said.

  The minister also said a number of NGOs, registered under the Foreign Contribution Regulation Act (FCRA), 2010, with invalid bank accounts were asked to validate the same.

  "Close to 25,000 NGOs are registered under FCRA, 2010, and as per record, over 20,000 NGOs have valid bank account numbers," he said.

YES Bank Q1 net profit rises 32%; board approves stock split of 1:5

• Private sector lender YES Bank's net profit rose 32 per cent to Rs 965.52 crore for the first quarter ended June 30 compared to the year-ago period.

  The bank had reported a net profit of Rs 731.80 crore in the same quarter of last fiscal. The board of directors of the bank at the meeting held on Wednesday approved sub-division of one equity share into five i.e., in the ratio of 1:5, the private bank said in a regulatory filing.

  "The Board of Directors considered and approved the sub-division of existing 1 equity share of face value of Rs 10 each fully paid up into 5 equity shares of Rs 2 each fully paid up," the filing said.

  According to the filing, total income of the bank jumped to Rs 5,785.96 crore in the April-June quarter, from Rs 4,762.83 crore in the same quarter of 2016-17.

  Interest income rose to Rs 4,653.80 crore during April-June of 2017-18 from Rs 3,801.83 crore same period year ago, however, income on investments fell to Rs 902.72 crore from Rs 958.97 crore year earlier.

  Gross non-performing assets (NPAs) of the bank rose to 0.97 per cent of gross advances as on June 30, 2017, against 0.79 per cent as on June 30, 2016. Net NPAs or bad loans were up marginally at 0.39 per cent of net advances on June 30, 2017, from 0.29 per cent at the end of the first quarter of FY2016-17.

  Provisions for bad loans and contingencies rose to Rs 285.78 crore in the June quarter from 206.63 crore in the year ago period. YES Bank Managing Director and CEO Rana Kapoor said: "We will be shortly commencing our 14th year of commercial operations one more quarter from now and we remain well on course to achieve our stated objectives for 2020 with yet another quarter of overall satisfactory performance."

  YES Bank reported a 44 per cent growth in net interest income to Rs 1,808.90 crore in the first quarter, driven by growth in advances and current account & savings accounts (CASA) deposits and steady expansion in net interest margin (NIM).

  NIM, a key parameter to gauge profitability of a bank, expanded to 3.7 per cent during the reported quarter from 3.6 per cent in preceding quarter March 2017. YES Bank stock zoomed 4.83 per cent to Rs 1,692.05 post announcement of financial results.

General Awareness

India will need $4.5 trillion by 2040 for infrastructure – Global Infrastructure Outlook

• As per `Global Infrastructure Outlook’ released by Global Infrastructure Hub (GIH), India will need investments to the tune of around USD 4.5 trillion till 2040 to develop infrastructure to improve economic growth and community wellbeing. The report is based on an intensive study of 50 countries and seven industry sectors. 
  

  India specific Highlights of ‘Global Infrastructure Outlook’ Report:

  As per the report, rising income levels and economic prosperity is likely to drive significant demand for infrastructure investment in India over the next 25 years.

  • Taking sustainable development goals (SDGs) into account, it is predicted that India will need additional USD 888 billion by 2030 to provide universal household access to electricity and water. 
  • In absolute terms, the total investment needed to meet the SDGs is greatest in India – a total of USD 1.3 trillion of investment is needed by 2030, more than China, which is USD 257 billion.
  • The report highlighted that on account of rural to urban migration in India urban population is growing by 46%, triggering massive demand for infrastructure support.

  Infrastructure Spending in Global Context:

  To support global economic growth and to bridge infrastructure gaps, it is forecasted that cost of US$94 trillion has to be incurred by 2040, with a further USD 3.5 trillion needed to meet the UN SDGs (sustainable development goals) for universal household, access to drinking water and electricity by 2030, bringing the total to USD 97 trillion.

  • The reports has expressed concerns that nearly a fifth of the $94 trillion in global infrastructure investment needed by 2040 risks being unfunded if current spending trends continue.
  • To close the spending gap, annual infrastructure spending needs to rise to 3.5% from 3% of global gross domestic product.

  About Global Infrastructure Hub (GIH):

  Global infrastructure Hub is a G20 initiative started with the goal of increasing the flow and quality of private and public infrastructure, by facilitating knowledge sharing, highlighting reforms and connecting public and private sectors globally.

  • GIH was set up in 2014. It is funded by governments including Britain, Australia, China, Korea and Singapore.
  • Chris Heathcoteis the current Chief Executive of GIH.
  • Global Infrastructure Outlook report details how much each country needs to spend on infrastructure up to 2040, which sectors need it the most and how far they are from meeting these needs based on current spending trends.