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Current Affairs - 25 January 2018

General Affairs 

With Moon Race Called Off, Antrix And TeamIndus Also End Launch Agreement
  • India's space agency ISRO's commercial arm Antrix today said its launch services agreement with space company TeamIndus has been "mutually terminated". Bengaluru-based TeamIndus had said it would launch a spacecraft aboard the Polar Satellite Launch Vehicle (PSLV) from Satish Dhawan Space Centre in Sriharikota in 2018.

    In a statement, Antrix's Chairman and Managing Director Rakesh Sasibhushan said his company remained committed to encouraging and promoting private enterprise in space.

    "Antrix and TeamIndus are mutually terminating the launch services agreement signed in 2016. TeamIndus also thanks Antrix for its assistance and looks forward to collaborating with Antrix in the future... Antrix takes this opportunity to wish TeamIndus all success in its future endeavours," he said.

    TeamIndus was participating for the Google Lunar XPrize. The global race with a prize money of $30 million was seen as a competition to challenge and inspire engineers, entrepreneurs and innovators from around the world to develop low-cost methods of robotic space exploration.

    However, none of the participants, including TeamIndus, could stick to the deadline, which prompted the organisers to call of the contest.

    "Today, we announce that after consulting our teams over the last few months, that there will not be a launch by March 31st, 2018, and our grand prize will go unclaimed. We are exploring a number of ways to proceed, to continue to support our teams," Google Lunar XPrize tweeted.

    The earlier plan of the TeamIndus was to inject the spacecraft into orbit, and the spacecraft would then set a course to the Moon using a series of complex orbital manoeuvres.

    "TeamIndus has been in talks with the Google Lunar XPrize over the past few weeks and had expressed its inability to meet the 31 March 2018 deadline to complete 500 metre traversal on the Moon," TeamIndus said in a statement.


    It added, "We have formally, amicably and mutually closed our launch services agreement with Antrix. We continue to look towards Antrix and ISRO as our preferred partners of choice for all our future endeavours."

Sushma Swaraj Inaugurates Bharat-ASEAN Maitri Park In Delhi
  • External Affairs Minister Sushma Swaraj today inaugurated the Bharat-ASEAN Maitri Park in the national capital, a day ahead of the ASEAN-India Commemorative Summit.

    ASEAN Secretary General Le Luong Minh also attended the event, held at the Tughlaq Crescent, in the heart of Lutyens' Delhi.

    "Blossoming friendship! EAM @SushmaSwaraj inaugurated Bharat ASEAN Maitri Park. Secretary General @ASEAN, Le Luong Minh and MoS @Gen_VKSingh were also present. #aseanindia," Raveesh Kumar, spokesperson, Ministry of External Affairs, tweeted.

    The two-day summit is expected to give boost to India-ASEAN cooperation in key areas of counter-terrorism, security and connectivity.

    In an unprecedented event, the leaders of all 10 member countries of the Association of Southeast Asian Nations (ASEAN) will also be the chief guests at the Republic Day parade.

    ASEAN comprises Thailand, Vietnam, Indonesia, Malaysia, the Philippines, Singapore, Myanmar (Burma), Cambodia, Laos and Brunei.

    In the run-up to the summit, various programmes in different areas ranging from culture to trade have been organised by India.

Upgraded Version Of Saras Completes Successful Maiden Flight
  • The new upgraded version of SARAS, the indigenous transport aircraft developed by National Aeronautics Laboratory, "successfully" made its maiden flight in Bengaluru on Wednesday.

    SARAS PT1N, a 14-seater passenger aircraft, is an upgraded version of the plane, after the second prototype of SARAS had crashed during a test flight killing all the three crew members on board, on the outskirts of the city near Bidadi in March 2009.

    The aircraft took off at about 11 am from HAL airport and flew for about 40 minutes at the maximum height of 8500 feet at the speed of 145 knots.

    "All the system parameters are found normal," an official release said, describing it as a "text book flight."

    Designed and developed by CSIR-NAL, a frontline aerospace research laboratory, the flight 'SARAS PT1N' was commanded by Wg Cdr U P Singh, Group Captain R V Panicker and Group Capt K P Bhat from IAF-Aircraft and Systems Testing Establishment (ASTE), the release said.

    The 'chase aircraft' (KIRAN) was piloted by Gp Captain Badrish and telemetry commanded by Gp Captain Naraynen,  Wg Cdr Pandey and Wg Cdr R Sridhar (Retd), it said.

    The aircraft is seen as culmination of the efforts of team CSIR-NAL, IAF-ASTE, Center for Military Airworthiness and Certification (CEMILAC), HAL and Directorate General of Aeronautical Quality Assurance (DGAQA).

    The primary objective is to evaluate the system performance in about 20 flights and the data collected from this would be used to freeze the design of production version aircraft, the release said.

    Council of Scientific and Industrial Research said the production version aircraft will be of 19-seat capacity and will undergo civil/military certification.

    The first prototype of the plane had made its first flight in May 2004.

Many See "Missiles As Message", India Believes In "No First Use": MJ Akbar
  • Union minister MJ Akbar today asserted that India is a responsible nuclear state and believes in "no first use" of such weapons, even as he questioned why no action is being taken at the global level against proliferation.

    Speaking at a session on nuclear threats to international security here at the World Economic Forum (WEF), he said many countries see nuclear weapons as the ultimate deterrence and see "missiles as a message".

    The minister of state for external affairs said just a few days ago India joined the Australia Group and is party to other such pacts.

    "The world recognises that India is a very responsible nuclear state. Also, we are like that not because someone asked us to do so, but because we want to be like that," Mr Akbar said.

    He said India's approach is clear -- it wants a nuclear regime that is non-discriminatory.

    "We have got support from so many countries on our approach and we hope that the world will work together on reducing if not eliminating the nuclear threats," he said while adding that he is hopeful as everyone takes the threat of destruction seriously.

    Asked about both India and Pakistan having nuclear weapons, he said, "We can only speak from our position. I can't speak on behalf of another country and we have these weapons as a form of deterrence and we believe in no first use."

    "We would want to get an agreement at global level on 'no first use'. If ideals can't be achieved at least we can work towards good. It's easy to hear the noise but a little less easy to hear the silence," he said.

    Mr Akbar said India is very proud that its objective is peace. We want peace but peace not necessarily comes from pacifism, he added.

    Mr Akbar said people have gotten away with proliferation and strong actions are needed against that.

    Speaking in the same session, Beatrice Fihn of the International Campaign to Abolish Nuclear Weapons said the only solution is to abolish and eliminate nuclear weapons and it makes no sense for responsible countries to have such weapons that always present a major risk.

    She said these weapons create, rather than resolve, crises.

    Mr Akbar, however, said demands of security cannot be simply wished away and wondered why it is that no country is taking unilateral decision against nuclear weapons.

    "We are in Europe which has nuclear states and why don't they lead the way? Can they seek public opinion on disarmament? At our level, we work very strongly through multilateral framework which is the only way forward.

    "We urge other nations to take steps and we hope this diligence with which we work towards a safer world will yield result," he said.

    Mr Akbar asserted that we needed to question why no steps were being taken against proliferation.

    The panel discussed the increasing number of nuclear states and threat of "first use" of nuclear weapons as dual global risks on the rise.

    The panel members discussed what political, diplomatic and military options can mitigate or manage such existential threats.

    They also sought to understand why nuclear threats are back on the table.

    Other areas of discussion included re-evaluating the risk/reward balance in nuclear deterrence and how to keep the human factor in focus.

Shiv Sena Blames BJP For Decision To Go Solo In 2019 Polls
  • A day after announcing to go solo in the 2019 Lok Sabha and Maharashtra Assembly polls, the Shiv Sena today blamed the BJP for its decision, alleging that the allies were being given a cold shoulder in the NDA.

    Affirming that it has decided on its way forward, the Shiv Sena cited an example of Chhatrapati Shivaji Maharaj, saying the Maratha warrior king went ahead to fulfill his pledge for 'Swarajya' at a time when people used to question as to from where he would get resources to take on Mughal rulers.

    The Sena said why eyebrows should be raised now over its decision when the allies were being sidelined by the BJP in setting its target of winning 380 plus seats in the next general elections.

    The Sena's aim was social uplift and thus, it does not need to worry about political wins and losses, the party said in an editorial in its mouthpiece 'Saamana'.

    The Sena, which is a part of the governments at the Centre and in Maharashtra, on Tuesday said it will have no truck with ally BJP in the 2019 state Assembly and the Lok Sabha polls.

    "BJP chief Amit Shah has given a target of 380 plus seats in the 2019 Lok Sabha polls. When the allies of NDA are being sidelined in setting this target, why the astonishment over Sena's stand to go solo in the Lok Sabha and the Assembly elections?" the editorial asked.

    It said that BJP stalwart late Pramod Mahajan had in the past given a call to secure a 100 per cent mandate in polls and at that time, nobody had asked him why the Sena was being sidelined, despite being an ally of the BJP at the Centre and in Maharashtra.

    The Sena was formed as a means to create social uplift and thus, it does not need to worry about political wins and losses, said the editorial.

    "We have decided on our way forward," it said.

    Recalling the oath of 'Swarajya' taken by Shivaji Maharaj during the rule of Mughals, the Sena said the Maratha warrior did not worry about the vast empire of Muslim rulers and their unlimited sources of wealth when he himself did not have enough money to pay his army men.

    "Questions were then raised how he would fulfil his pledge of Swarajya and who would back him. Yet, Shivaji Maharaj went ahead because he knew people would back him," it said.

    A similar opposition was faced by Sena supremo (late Bal Thackeray) but he went ahead, knowing his "aim was to do good for people," the Sena said.

    The Sena, in its National Executive meet held yesterday, passed the resolution to go solo in the Lok Sabha and state Assembly polls in 2019.

    The party set a target of winning at least 25 seats (out of a total 48 Lok Sabha seats in Maharashtra) and 150 Assembly seats (out of a total 288) in the state.

    The Sena, which has been routinely attacking the BJP-led governments at the Centre and in the state over a variety of issues--from the notes ban and GST to the plight of farmers and cross-border assaults by Pakistan-- also said it would now contest elections outside Maharashtra.

Business Affairs

WEF 2018: PM Modi's anti-protectionism stance gets praise from Beijing
  • While China and India have little that they agree upon, the two biggest growing economies seem to have found common ground in their disagreement with protectionist policies. Beijing has praised Prime Minister Narendra Modi's speech at the World Economic Forum 2018 for his stance against protectionism.

    In his keynote address during the opening plenary of WEF 2018, Modi comapred the impact of protectionism with that of terrorism.

    "I noticed that Prime Minister Modi made some remarks on protectionism and his remarks showed that globalisation is the trend of the times and serves the interests of all the countries including developing countries and the fight against protectionism and promoting globalisation," Chinese Foreign Ministry spokesperson Hua Chunying said during a press meet.

    China has hailed this point of view and expressed interest to strengthen ties with India to boost globalisation for the benefit of other countries.

    "China and India share a lot of common interests. China would like to enhance coordination and cooperation with all countries including India to steer the economic globalisation towards benefiting world economic growth and well-being of all countries," Hua said.

    The unexpected appreciation from China came after official media in the country played Modi's Davos speech big. Chinese dailies like Global Times carried the report on their front pages.

    Modi became the first Indian prime minister in two decades to speak at the WEF. Apart from protectionism, he raised crucial global issues like terrorism and climate change in his speech.

    "Many countries are becoming inward focused and globalisation is shrinking and such tendencies can't be considered lesser risk than terrorism or climate change," he had said.

    Chinese premier Xi Jinping had spoken firmly against the protectionist policies of the Unites Stated at the WEF last year. Beijing has been opposing the 'America First' policy of the Donald Trump administration.

    When asked that Modi's speech followed the theme of Xi's speech, advocating globalisation, last year at the same forum, Hua said Xi called for moving globalisation to a more open, inclusive, universal, balanced and win-win direction.

    The recent changes in visa policies in the US under the 'Buy American, Hire American' executive order have taken a toll on the Indian economy too, the IT sector in particular. Restrictions on H1-B via under this policy are expected to impact the American service sector too.

    Meanwhile, China's reputation as the world's manufacturing hub stands to take a hit on account of the rising protectionist tendencies. China has managed to build up a strong manufacturing sector, catering to the global entities, in the past thirty years with the help of globalisation. This has resulted in double-digit GDP growth rates for years on account of massive exports to everywhere in the world.

    On the question of whether the shared interests of India and China to check protectionism could help improve strained bilateral ties, Hua said "Our position is clear. India is a big neighbour of China. As the two largest developing countries and as two close neighbours, of course we hope that we can maintain steady development of bilateral relations. It serves the interests of our two sides".

    "We look forward to working with India to enhance our communication and our mutual trust, properly handle our differences and ensure sound and steady development of our bilateral ties. I believe this is the aspiration of the people of our countries," she said.

Govt unveils bank recap, reform plan; to infuse Rs 88,139 crore in PSBs in FY18
  • Finance Minister Arun Jaitley on Wednesday said the government has moved proposal to infuse additional grant of Rs 88,139 crore - Rs 80,000 crore through Recap Bonds and Rs 8,139 crore as budgetary support - for 2018 under the public sector banks recapitalisation plan. Jaitley said the government last year announced the capital infusion plan to pump in Rs 2.1 lakh crore in PSBs - burdened under huge Non-Performing Assets (NPA) - in the course of two years (FY18 and FY19). 

    "The government has a prime responsibility of keeping the PSBs in good health. We inherited a major problem, and are committed to find solutions. Now the government's job is to create an institutional mechanism to ensure what happened in past is not repeated," he said, indicating a huge burden of Non-performing Assets (NPAs) under which the PSBs are reeling. The Finance Minister said various steps will be taken to ensure the banks follow the highest standard of governance in future, and that the bank recapitalisation is first such exercise in the extensive reform plan.

    The recapitalisation initiative will be accompanied by a strong reforms package across six themes incorporating 30 action points. Major agendas under the action plan are Enhanced Access and Service Excellence (EASE) focusing on six themes of customer responsiveness, responsible banking, credit off-take, PSBs as Udyami Mitra, deepening financial inclusion and digitalisation and developing personnel for brand PSB.  

    FOLLOW-UP IN LOANS ABOVE Rs 250 CRORE

    A strict watch will be kept on the PSBs' lending and recovery systems to ensure clean consortium loans with only 10 per cent exposure. The PSBs will have to keep in mind they follow a rigorous process for corporate lending and make post-sanction follow-ups in loans above Rs 250 crore. In addition to flagging loan defaults in time, the PSBs will initiate stringent loan recovery methods.

    REPORT CARD ON COMPLIANCE 

    Department of Finance Secretary Rajeev Kumar said the government will make sure once capital infusion happens, the necessary compliance standards are followed to make the banks strong, professional and accountable institutions. Under these standards, the government will not interfere in commercial decisions of banks. There will continuous efforts to strengthen bank boards in addition to theme-wise reform implementation assigned to whole-time directors of these PSBs. Reputed independent agencies will evaluate and rank PSBs every year to make them more accountable on different parameters, which could spur competition and transparency among the banks, said Kumar, adding that the survey results will be made public every year.

    UDYANMITRAS FOR MSMES

    Rajeev Kumar said unlike rumours on social media about risk to depositors' money, the government is making sure no PSB fails. They are not getting any corporate loan waiver and large default cases have been referred to the NCLT, said Kumar. Kumar said the government has put a special focus on the Micro Small and Medium Sector by providing credit support and easy application loan facility. On UdyanMitra, decision on a loan application will be taken in 15 days, and GST-registered MSMEs will be able to avail enhanced working capital.

    BANK-WISE CAPITAL INFUSION

    With the capital infusion of Rs 10,610 crore, IDBI Bank is the biggest beneficiary of the recapitalisation plan followed by Bank of India (Rs 9,232 crore) and the State Bank of India (Rs 8,800 crore). UCO bank will receive Rs 6,507 crore; Punjab National Bank - Rs 5,473 crore; Bank of Baroda - Rs 5,375 crore; and Central Bank of India - Rs 5,158 crore.

    Here's the full list of the beneficiary banks.

    1.    IDBI Bank: Rs 10,610 crore

    2.    Bank of India: Rs 9,232 crore

    3.    SBI: Rs 8,800 crore

    4.    UCO Bank: Rs 6,507 crore

    5.    PNB: Rs 5,473 crore

    6.    BoB: Rs 5,375 crore

    7.    Central Bank: Rs 5,185 crore

    8.    Canara Bank: Rs 4,865 crore

    9.    IOB: Rs 4,694 crore

    10.    Union Bank: Rs 4,524 crore

    11.    OBC: Rs 3,571 crore

    12.    Dena Bank: Rs 3,045 crore

    13.    Bank of Maharashtra: Rs 3,173 crore

    14.    United Bank: Rs 2,634 crore

    15.    Corporation Bank: Rs 2,187 crore

    16.    Syndicate Bank: Rs 2,893 crore

    17.    Allahabad Bank: Rs 1,500 crore

    18.    Vijaya Bank: Rs 1,277 crore

    19.    Punjab and Sind Bank: Rs 785 crore

    20.    Andhra Bank: Rs 1,890 crore

Tata Trusts has become an enabler from merely a funder, says Ratan Tata
  • Tata Trusts, which holds a majority stake in the Tata group holding company Tata Sons, has changed its DNA -- from merely funding funding projects, it has become an enabler of social initiatives, joining hands with foundations, research institutions and the government.

    "No longer are we merely the funders of initiatives; we have widened our view on the nature of our philanthropic interventions to become enablers. The redefining of our approach and our purpose -- an exercise that began in 2014 -- has resulted in Tata Trusts shifting from only grant-giving to also include direct implementation," says Ratan Tata, Chairman of Tata Trusts. "It has led to partnerships with like-minded foundations, research institutions and the government. It has given us the capability to influence the discourse on India's social development agenda. It has broadened the canvas of our operations," Tata says in the annual report of Trusts.  

    Tata Trusts has completed 125 years of community service. The total disbursal made by Sir Ratan Tata trusts & Allied Trusts during the last financial year was Rs 636.79 crore, largely as grants and endowments. Sir Dorabji Tata Trust & Allied Trusts have made a disbursal of Rs 318.03 crore. Tata Trusts partners with the government in Swachh Bharat Mission, in addition to its engagements in skill development, nutrition, digital governance and child protection. The Trusts had partnered with GE Healthcare in 2016 to train 10,000 youth in various technical areas of healthcare over a three-year period. The partnership focuses on bridging the skills gap in healthcare technical or operating staff.

    Strategy and long-term goals, technology and innovation, collaboration and cooperation, sustainability and scalability are now more crucial than ever before for Tata Trusts, says Tata.

    In healthcare, Tata says, the efforts of Trusts is concentrated on delivery systems and quality care, particularly in the context of cancer and infectious diseases. "Patient-centric is the watchword here, and our programmes in this space are augmented through collaborations, the building of medical institutions and information networks, the provision of state-of-the-art equipment and the support of research programmes," he says.  

    In the last financial year, the income of Tata Trusts has risen by 333 per cent to Rs 6,948 crore from Rs 1,606 crore despite the fall in dividend income from Tata Sons. One key reason for former chairman of Tata group Cyrus Mistry's ouster in 2016 was the displeasure of Tata Trusts in not receiving enough dividends on its shares. The financial highlights in the two annual reports of Sir Ratan Tata trusts & Allied Trusts and Sir Dorabji Tata Trust & Allied Trusts show that the expenditure of the Trusts is  same as that of the income.

    The dividend income of Sir Ratan Tata Trust has fallen to Rs 57.6 lakh in 2016-17, compared to Rs 228.82 crore. For Navajbai Ratan Tata Trust, the dividend income fell to Rs 18.33 crore from Rs 249.56 crore. Sir Dorabji Tata Trust's dividend income went down to Rs 2.53 crore from Rs 272.43 crore, while its Allied Trusts reported a slip to Rs 30.66 crore from Rs 541.72 crore. The major expenditure of the trusts comes under 'expenditure on objects of the Trust (including grant related expenses)' category. Tata Education & Development Trust, Bai Hirabai JN Tata Navsari Charitable Institution and Sarvajanik Seva Trust are the allied Trusts of Sir Ratan Tata Trust.

    Tata Education & Development Trust has the highest liabilities at Rs 5,201.18 crore as on March 31, 2017. It's largely reflected in the assets category as investment. The investments of the trust stood at Rs 4,813.11 crore.

Both Amazon, Flipkart claim to be winner in recent mega sales
  • This year's first big online sales by two ecommerce majors were especially different in terms of their sale claims. Amazon said it was able to secure almost double the number of sale orders in the 'Great India Sale' than its nearest competitor. Flipkart, meanwhile, said it captured 60-65 per cent of the market share during its three-day 'Republic Day' sale. Amazon's 'Great Indian Sale' started on January 21 and will end on Wednesday night, while Flipkart held its 'Republic Day Sale' from January 21-23.

    Citing Kantar IMRB data, Amazon India Vice President (Category Management) Manish Tiwary said: "Amazon.in had the highest share of orders with 2X more orders than nearest competition" in the first three days of sale. Also, Amazon.in had nearly double the number of transacting customers over its nearest competitor, he said.

    Smrithi Ravichandran, Senior Director at Flipkart, countered Amazon.in's statement saying Flipkart continues to maintain the lead as the largest e-commerce player in the country on the back of a stellar sale. "During the 3-days period, our share of the e-tail market would be between 60-65 per cent," she said.

    Amazon is locked in an intense battle with SoftBank-backed Flipkart to grab the top spot in the ecommerce space. Both companies have pumped in billions of dollars in expanding infrastructure and delivery capabilities. Tiwary said Amazon acquired the highest number of new customers ever in one single event, outside of Diwali sales, with 85 per cent of the new customers coming in from tier II-III towns. He added that there had been a strong uptake across categories including smartphones, large appliances and apparel during its sale.

    "Smartphones were the most popular category with a sharp increase of 6X over a normal day...Large appliances also grew over 4.5X," Tiwary said.

    Homegrown e-commerce giant Flipkart on Monday lost an appeal against the Income-Tax Department over the categorisation of marketing expenditure and discounts as capex. The ruling was about capital spent by e-tailers on marketing through deep discounts. Ecommerce players in the country have been classifying this as marketing expenses and deducting it from revenue, leading to them posting losses and therefore not being liable to tax, it said.

Nagpur drug firm develops soluble strips that can be used instead of pills, injections
  • Nagpur-based ZIM Laboratories that develops and manufactures innovative and differentiated pharmaceutical products, has now developed affordable orally disintegrating strips (ODS) formulations upto 100 milligram that critically ill and bed-ridden patients can consume instead of swallowing tablets and taking painful injections. These films, based on a patented oral thin film technology, adhere to the tongue mucosa and disintegrate almost instantaneously, when placed on the tongue.

    "Though there are some ten companies across the globe that have this technology, they were not able to grab a big share of the market due to its prohibitive costs. By our technology, we can offer thin films almost equal to that of what costs a tablet", Anwar S Daud, Managing Director of ZIM Labs told Business Today.

    Market opportunity for the drug is huge in the country, as about Rs 35,000 crore worth of drugs are delivered every year in oral solid dosage forms.

    Moreover, the company, in association with a leading pharmaceutical company, will soon launch multi-layer orally soluble thin films that can carry dosages above 100 grams. ZIM Labs is in advanced stages of further researching the product to launch thin films with fixed-dose combinations and liquid drugs, 3D printed tablets for personalised medicines and nano-fibre based thin films.

    Started in 1989, ZIM Labs employs about 118 drug researchers and has already partnered with about ten pharmaceutical companies to license the technology besides selling own brands with thin films. In the last one year, the company netted about Rs 60 crore alone from this product. ZIM Labs, which sells about 31 products in proprietary technologies (modified release and taste masking), to develop and manufacture differentiated pharmaceutical products, has a turnover of over Rs 250 crore, of which over Rs 200 crore is from exports to non-EU and the US markets.

    Anwar S. Daud said the company will get listed on the Bombay Stock Exchange soon through the non-IPO route to facilitate the exit of its private equity partners. Daud and his family hold 52 percent stake in ZIM Labs and the private equity partner has about 23 percent.  The private equity fund managed by Ashmore Alchemy India Advisors had invested USD 8.2 million (Rs 45 crore) in ZIM Labs in 2013.

General Awareness

population and associated issues, poverty and developmental issues.
‘Reward Work, Not Wealth’ report

  • A report titled ‘Reward Work, Not Wealth’ has been released by the international rights group Oxfam. The report reveals how the global economy enables wealthy elite to accumulate vast wealth even as hundreds of millions of people struggle to survive on poverty pay.

    Highlights of the report:

    The richest 1% in India cornered 73% of the wealth generated in the country last year. Besides, 67 crore Indians comprising the population’s poorest half saw their wealth rise by just 1%. The wealth of India’s richest 1 per cent increased by over Rs. 20.9 lakh crore during 2017, an amount equivalent to total budget of the central government in 2017–18, Oxfam India said. This presents a worrying picture of rising income inequality.
    Globally, 82% of the wealth generated last year worldwide went to the 1%, while 3.7 billion people that account for the poorest half of population saw no increase in their wealth. 2017 saw an unprecedented increase in the number of billionaires, at a rate of one every two days. Billionaire wealth has risen by an average of 13% a year since 2010—six times faster than the wages of ordinary workers, which have risen by a yearly average of just 2%.
    The survey also showed that women workers often find themselves at the bottom of the heap and nine out of 10 billionaires are men. In India, there are only four women billionaires and three of them inherited family wealth.

    Concern:

    The billionaire boom is not a sign of a thriving economy but a symptom of a failing economic system. Those working hard, growing food for the country, building infrastructure, working in factories are struggling to fund their child’s education, buy medicines for family members and manage two meals a day. The growing divide undermines democracy and promotes corruption and cronyism.

    What needs to be done?

    Oxfam makes several recommendations to start fixing the problem of income inequality. On the government’s part, it has asked for things like promoting inclusive growth by encouraging labour-intensive sectors that will create more jobs, imposing higher tax on the super-rich, implementing policies to tackle all forms of gender discrimination and sealing the “leaking wealth bucket” by taking stringent measures against tax evasion. The report reveals that the top 1% is evading an estimated $200bn in tax. More significantly, developing countries are losing at least $170 billion each year in foregone tax revenues from corporations and the super-rich.

    The recommendations for corporations are far more eyebrow-raising, be it “Limit returns to shareholders and promote a pay ratio for companies’ top executives that is no more than 20 times their median employees’ pay” or refraining from rewarding shareholders through dividends or buybacks or even paying bonuses to executives until “all their employees have received a living wage”.

    Way ahead:

    The survey found that, in India, it will take 941 years for a minimum wage worker in rural India to earn what the top paid executive at a leading Indian garment firm earns in a year, the study found. In the US, it takes slightly over one working day for a CEO to earn what an ordinary worker makes in a year. Therefore, the survey stressed that the gap between the rich and the poor needs to be urgently addressed.

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