Comprehensive News Analysis – 07 March 2017

Table of Contents:

A. GS1 Related:
B. GS2 Related:

1. N. Korea fires 4 missiles, 3 reach Japanese waters

2. U.S. assures India of speedy justice

C. GS3 Related:

1. NIIF in talks with two sovereign funds

2. Centre mulls modifying definition of start-up

D. GS4 Related:
E. Important Editorials : A Quick Glance

The Hindu

1. The Tawang test

2. Last mile concerns-GST Bill

Economic Times

1. India needs a thriving municipal bond market, and fast

F. Concepts-in-News: Related Concepts to Revise/Learn
G. BILLS/ACTS/SCHEMES/ORGS IN NEWS
H. Fun with Practice Questions 🙂
I. Archives

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Useful News Articles for UPSC Current Affairs

 

A. GS1 Related

Nothing here for today!!!


B. GS2 Related
1. N. Korea fires 4 missiles, 3 reach Japanese waters

Category: International Relations
Topic:Effect of policies and politics of developed and developing countries on India’s interests

Key Points:

  • Nuclear-armed North Korea launched four ballistic missiles recently.
  • Three missiles landed provocatively close to America’s ally Japan.
  • It is important to note that under leader Kim Jong-un, North Korea has ambitions to develop an intercontinental ballistic missile (ICBM) capable of reaching the U.S. mainland.

Reaction to these tests

  • Regional and world powers lined up to condemn the launches.
  • Japanese Prime Minister Shinzo Abe said that three of the North Korean missiles came down in Tokyo’s Exclusive Economic Zone (EEZ) – these waters extend 200 nautical miles (370 km) from its coast.
  • In Washington, the State Department condemned the launches, saying the U.S. was ready to “use the full range of capabilities at our disposal against this growing threat”.

2. U.S. assures India of speedy justice

Category: International Relations
Topic: Indian diaspora

Key Points:

  • In a recent development, the U.S. State Department has assured Indian Ambassador to the U.S. Navtej Sarna that it was working with all agencies concerned to ensure speedy justice following the violence that has targeted Indian Americans over the last fortnight.
  • Since February 22, three incidents targeting Indian-Americans have claimed the lives of two and injured two.

C. GS3 Related
1. NIIF in talks with two sovereign funds

Category: Indian Economy
Topic: Infrastructure

Key Points:

  • In a recent development, the National Investment and Infrastructure Fund (NIIF) have begun talks with two sovereign wealth funds to become the first investors to come on board.
  • The NIIF plans to leverage the Centre’s financing – equivalent to $3 billion – to invest a far higher amount in infrastructure firms and projects, in partnership with global, long-term investors eyeing infrastructure assets, and fund managers that could create dedicated infra sector funds.

2. Centre mulls modifying definition of start-up

Category: Indian Economy
Topic: Government Policy

Key Points:

  • The Centre is considering proposals to amend the definition of ‘start-up’ in the policy and looking to review applications seeking benefits of start-up policy which were rejected, according to a top official.
  • Ramesh Abhishek, Secretary, Department of Industrial Policy & Promotion (DIPP) made important statements regarding the same.

Key Points:

  • It states that for the purpose of claiming the benefits of the government schemes, ‘start-up’ means an entity, incorporated or registered in India: (a) not prior to five years, (b) with annual turnover not exceeding Rs. 25 crore in any preceding financial year and (c) working towards innovation, development, deployment or commercialisation of new products, processes or services driven by technology or intellectual property.
 
D. GS4 Related
Nothing here for today!!!
 
E. Important Editorials: A Quick Glance

The Hindu

1. The Tawang test

Category: International Relations
Topic: Bilateral Relations

Key Points:

  • Recently, China’s stated that it is “gravely concerned” over the government’s decision to allow the Dalai Lama to visit Arunachal Pradesh’s Tawang monastery in early April.
  • China further mentioned that the Dalai Lama’s visit would “seriously damage” bilateral ties.
  • This statement is unwarranted.

History of the issue

  • The controversy over the Tawang area goes back to the Shimla meet of 1914, when the Chinese representatives just initialled, and didn’t sign, a trilateral agreement with British India and Tibet.
  • Later, in 1959, when the current Dalai Lama fled Tibet, he came into India through Tawang.
  • He has not visited Arunachal Pradesh since 2009, when he retraced his 1959 journey.

Concluding Remarks

  • The Chinese government would do well to not allow tensions with India over the issue of Arunachal Pradesh to spill into other spheres of engagement.
  • Beijing’s objections over access for the Dalai Lama as a spiritual leader to a religious shrine obviously cannot be allowed to intimidate India into restricting his free movement.
  • Pinpricks cannot substitute for policy and India should keep its focus on the major issues between the two countries.
  • The bid for Nuclear Suppliers Group membership and having Masood Azhar placed on the UN terrorists’ list have occupied much of the bilateral canvas, while the larger issue of the boundary resolution hasn’t been addressed adequately.

2. Last mile concerns – The GST Bill

Category: Indian Economy
Topic: Taxation

Key Points:

  • The Centre and States have managed to find considerable common ground on the long-debated indirect tax system of Goods and Services Tax (GST).
  • Recently, the GST Council approved final drafts of the Central and Integrated GST Bills, which should be placed in the public domain as soon as possible.
  • With the law to compensate States already cleared, the only pending legislative negotiation left for the Council, which is expected to meet again on March 16, involves the State and Union Territories’ GST bills.
  • As these bills secure assent from State Assemblies and Parliament, and swiftly, the operational rules for the GST must be readied.
  • Industry would need at least three months after that to prepare for the transition from the present system of myriad State, Central and local levies on goods and services.
  • Moreover, switching to a new indirect tax system in the middle of a financial year will bring its own subset of accounting complications.

Concluding Remarks

  • Clearer communication of intent is equally essential.
  • In industry circles, the introduction of a peak 40% tax rate in the GST Bills has set the cat among the pigeons.
  • The GST’s anti-profiteering penal provisions are far too vague and draconian, and could discourage companies from making efficiency improvements in supply chains if they are required to pass on the entire benefit to consumers.

Way forward

  • Colombo must do much more to address the concerns of the Tamil minority.
  • The government should start addressing the core issues, keeping reconciliation and the future of Sri Lanka in mind.

 

Economic Times

1. India needs a thriving municipal bond market, and fast

Category: Indian Economy
Topic: Government Policy

Key Points:

  • India needs a thriving municipal bond market, and fast.

The Potential

  • The fact of the matter is that Brihanmumbai Municipal Corporation, the richest municipal body in India, earned as much as 33% of its revenue last fiscal from octroi, which will need to be discontinued once the goods and services tax (GST) is implemented nationwide later this year.
  • There is huge potential for raising much-needed resources via municipal bonds here, as urbanisation picks up speed nationally.
  • Yet, the funds garnered cumulatively by way of municipal bonds pan-India add up to a mere Rs1,750 crore or so; in sharp contrast to, for instance, South Africa, where about $1.8 billion is raised by floating municipal bonds, and in just one quarter. In a mature market like the US, municipals raise about $300 billion per annum.

The Way Forward

  • We do need to boost the demand and supply for ‘munis’, and meet at least partly the massive funding requirement for our 100 smart cities, to begin with.
  • The munis can well finance urban transport, public housing, solid waste disposal and umpteen other municipal projects, and also provide steady, longterm returns for investors.
  • Earmarking of GST revenue would make sense.
  • On the demand side, investor attractiveness for the municipals needs to be policy-induced. Tax breaks could be considered.
  • The 8% ceiling interest rate on such bonds needs to be revised.
  • We also need an active secondary market for munis, and sound safeguard mechanism including escrow provision for the bondholders.
 
F. Concepts-in-News: Related Concepts to Revise/Learn
  • Goods and Services Tax (GST)
  • Exclusive Economic Zone (EEZ)

G. BILLS/ACTS/SCHEMES/ORGS IN NEWS
 
H. Fun with Practice Questions 🙂
Question 1: Consider the following statements:

1] An Exclusive Economic Zone (EEZ) is a concept whereby a coastal State assumes jurisdiction over the exploration and exploitation of marine resources in its adjacent section of the continental shelf, taken to be a band extending 200 miles from the shore.

2] Among other things, in the exclusive economic zone, the coastal State has the exclusive right to construct and to authorize and regulate the construction, operation and use of artificial islands.

Which of the above statements is/are correct?

  1. 1 Only
  2. 2 Only
  3. Both 1 and 2  
  4. Neither 1 nor 2  
Question 2:‘INS Viraat’ was recently in the news. What is it?
  1. An aircraft carrier
  2. A submarine
  3. An offshore patrol vessel
  4. A Frigate
Question 3: Consider the following statements:

1] Arunachal Pradesh borders the states of Assam and Nagaland to the south.
2] Arunachal Pradesh also shares international borders with Bhutan in the west, Myanmar in the east and China in the north.

Which of the above statements is/are correct?

  1. 1 Only
  2. 2 Only
  3. Both 1 and 2  
  4. Neither 1 nor 2
Question 4: The ‘Senkaku Islands’ dispute, often featured in the news is a 
dispute between which two countries?
  1. Japan and China
  2. China and Philippines
  3. Japan and Taiwan
  4. Japan and Russia
Question 5: Which of the following organizations bring out the report 
known as ‘The State of the World’s Children reports’? 
  1. UNICEF (United Nations Children’s Emergency Fund)
  2. The United Nations Development Programme
  3. The World Economic Forum
  4. The World Bank
Check Your Answers

 

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