Comprehensive News Analysis - 29 April 2016

A. GS1 Related

1. Strong earthquake rattles Vanuatu; no threat of tsunami

Topic: Geography

Category: Earthquake

Location: The Hindu

Key points:

• A strong magnitude-7 earthquake rattled the Pacific Island nation of Vanuatu
• The Pacific Tsunami Warning Centre said there was no threat of a destructive, Pacific-wide tsumani
• Vanuatu sits on the Ring of Fire, the arc of seismic faults around the Pacific Ocean where earthquakes are common. The nation is also prone to volcanoes and cyclones

 

source:www.cnn.com

Tags: Pacific Tsunami Warning Centre, Ring of Fire,fault

B. GS2 Related

1. ‘India not competing with China in the Pacific’

Topic: International Relations

Category: India’s relations with Pacific Islands

Location: The Hindu

Key points:

• The President of India is in Papua New Guinea. It is the first ever state visit by an Indian head of state to the Pacific Island
• President Pranab Mukherjee brushed aside a suggestion that India was in competition with China in the Pacific regionand said he hoped that  his visit will be a precursor to intensified economic and security cooperation with the Pacific island nation
• India and Papua New Guinea are due to sign an MoU on cooperation in health and pharmaceuticals

Tags: Papua New Guinea, MoU on cooperation in health and pharmaceuticals

C. GS3 Related

1. India’s very own GPS is ready with seventh navigation satellite launch

Topic: S & T

Category: Space

Location: The Hindu

Key points:

• NAVIC( Navigation with Indian constellation )- the setup of India’s own navigational system was completed with the launch of the seventh and final satellite(the Indian Regional Navigation Satellite System- the IRNSS 1G)
• IRNSS 1G was launched into a sub geosynchronous transfer orbit.An area of 1,500 km from Indian boundaries will be covered under the navigational system
• With an accuracy of better than 20 m, the navigation system will be offered as an open or Standard Positioning Service (for civil purposes) and a superior, coded military Restricted Service.

• NAVIC would help planes to land with ease and accuracy and plan disaster relief better
• India is now one of five countries its own navigational system along with  Global Positioning System (GPS) operated by the United States with 24 satellites and the Glonass, Galileo and BeiDou systems of Russia, Europe and China respectively

Tags: NAVIC, IRNSS 1G,Global Positioning System (GPS),Glonass, Galileo, BeiDou

2. ‘GDP growth is not creating enough jobs’

Topic: Economy

Category: Employment Data

Location: The Hindu

Key points:

• India’s employment growth is beginning to show signs of a slowdown even as official data showed a pickup in GDP growth, according to a study by Care Ratings
• Jobs growth slowed to near-zero during 2014-15 in a sample of 1,072 companies. These companies created only 12,760 jobs in 2014-15. In the previous year, they had added 188,371 jobs
• Manufacturing accounted for more than 40 per cent of the jobs, the highest share in employment, followed by banking (23.0 per cent) and IT (18.4 per cent)
• “This means that the future of job creation would largely be dependent on the growth in the manufacturing sector and the low growth in the last 3 years is a cause for concern,” according to the study. In the current financial year, 2015-16 too, growth in the manufacturing sector has ranged around 3 per cent

Tags: Manufacturing, GDP

3. India to grow at 7.6% in FY17 on urban spending: UN report

Topic: Economy

Category: State of Indian Economy

Location: The Business Standard

Key points:

 

• India’s economy is expected to grow by 7.6 per cent in 2016-17, largely on the back of urban household spending amid steady employment growth and low inflation, according to the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP)
• Urban consumption is expected to get a boost with the government accepting the Seventh Pay Commission recommendations.

• Exports, however, continue to be a major cause of concern

 

Tags: UNESCAP, 7^th Pay Commission

D. GS4 Related

E. Important Editorials: A Quick Glance

The Hindu

1. Another missed opportunity

Topic: International Relations

Category: Indo- Pak Relations

Key points:

• The Foreign Secretary level meeting between India and Pakistan bore no results
• The two officials failed to find common ground to kickstart the Comprehensive Bilateral Dialogue process, or even agree on a timetable
• Neither mentioned the other’s concerns, with both statements clearly aimed at their respective domestic audiences rather than a bilateral outreach
• Pakistan has been reluctant for a full-fledged discussion on terrorism, but given that it hosts the SAARC summit this year, it may be willing to be more flexible in framing the talks agenda
• There have been numerous occasions over the past year to encourage hope that dialogue will acquire some sort of permanence – the meeting in Ufa(BRICS Summit in Russia) between the two Prime Ministersthat drew up an ambitious road map for talks, the subsequent meeting in Paris(Climate Conference), and Prime Minister NarendraModi’s unscheduled Christmas Day visit to Lahore surprised each time and pulled ties out of a deep freeze
• External Affairs Minister SushmaSwaraj’s December visit to Islamabad, when a new Comprehensive Bilateral Dialogue between the Foreign Secretaries was announced, as well as the sustained contact between the National Security Advisers, gave an impression of momentum towards a historic SAARC summit in November 2016.
• Importantly prime ministers of both sides have deliberately kept a direct line of conversation alive all these months and have expressed their vision of bilateral ties with clarity
• In a world where the U.S. and Cuba have restored ties, Russia and China have formed a close partnership, and Iran has emerged from isolation, it is not too much to hope that India and Pakistan can at least discuss key issues

Tags: Ufa summit, Paris Climate Conference, CBD, SAARC summit

Note: Do you think better India-Pakistan relations are nearer than ever? It is an end worth working for. Justify

Indian Express:

1. A higher well-being

Topic: Economy

Category: Poverty alleviation

Key Points:

• According to the Rangarajan Committee report on poverty, the monthly per capita consumption expenditure of Rs 972 in rural areas and Rs 1,407 in urban areas was treated as the poverty line at the all-India level in 2011-12
• the actual well-being of the household will be higher than what is indicated by the poverty line, if we take into account public expenditure along with private expenditure
• the Lakdawala Committee on Poverty (1993) says the “poverty line derived from personal consumption patterns and levels does not take into account items of social consumption such as basic education and health, drinking water supply, sanitation, environmental standards, etc
• the real levels of living of the poor, inclusive of social consumption are expected to be higher than what is reflected through the estimates of private consumption expenditure reported in NSS data
• In the seven-year period 2004-05 to 2011-12, public expenditures on education and health per capita at constant 2004-05 prices have nearly doubled with an implied compound annual growth rate of close to 10 per cent per annum
• However, in the absence of data on the distribution of the public expenditures on these social services by the size-class of private consumption expenditure, they cannot be factored into either the construction of the poverty line or in the assessment of their impact on measured poverty
• It is suggested that increased public expenditure on health, education and other social services will have to be taken into account while assessing the trends in poverty. This is because the actual well-being is higher than what is indicated by the poverty line — and it has policy implications

Tags:Rangarajan Committee report,Lakdawala Committee on Poverty, NSS Data

Others:

1. PIB update: Steps taken by Government to reduce malnutrition in the country

1. One of the targets under Globally Agreed Sustainable Development Goals (SDGs) is to end all forms of malnutrition by 2030.

 

2. SDGs also include achieving by 2025, the targets on stunting and wasting in children under 5 years of age and address the nutritional needs of adolescent girls, pregnant and lactating women and older persons.

3. To address the components of the Target, the WCD Ministry is implementing Integrated Child Development Services (ICDS) Scheme and Rajiv Gandhi Scheme for Adolescent Girls i.e. SABLA.

4. ICDS covers the nutritional needs of children of 6 months- 6 years age, pregnant and lactating mothers

5. SABLA Scheme covers the nutritional and non-nutritional components for adolescent girls.

6. Under the above schemes, age appropriate Supplementary Nutrition is provided to the beneficiaries at the AnagnwadiCentres spread across the country.

7. What is the status in India?

 As per the National Family Health Survey, the proportion of under-weight children below 3 years is 40% in 2005-06.

 As per the Rapid Survey on Children (RSoC), 2013-14, commissioned by Ministry of Women and Child Development, there is a reduction in underweight among under 5 years of age from 42.5% in NFHS-III to 29.4% and wasting from 19.8% in NFHS-III to 15.1% in RSoC.

( Note: Please read about SABLA and ICDS)

Tags: SABLA, ICDS, Malnutrition

 

2. Business Standard:Financing global reflation

Topic: Economy

Category: World Economy

Key Points

• The world is facing deflation. Production is slowing down. A flush of capital into economies is required
• Who will do it? How can it be done?
• The US is the economy that is best equipped to pull the world out of secular deflation
• But stagnant economic growth and high debt burdens have destroyed developed-world politicians’ will to raise taxes or borrow more to create space for fiscal expansion
• although near-zero interest rates have reduced debt-service costs, the real burden of debt has actually increased in recent years, owing to declining inflation
• The problem today is a lack of will, not a lack of opportunities, to do what it takes to boost demand. In fact, investment in global public goods – the infrastructure needed to meet the needs of the developing world and to mitigate climate change – could spur global reflation
• With the US, the issuer of the world’s preeminent reserve currency, unwilling or unable to provide the liquidity needed, a new supplementary reserve currency should be instituted
• one option could be the International Monetary Fund’s Special Drawing Right
• Consider a scenario in which member central banks increase their SDR allocation in the IMF by, say, $1 trillion. A five-times leverage would enable the IMF to increase either lending to member countries or investments in infrastructure via multilateral development banks by at least $5 trillion
• liquidity and credit can be created against the SDR allocation, with relatively little impact on inflation, provided there is excess capacity in production and insufficient effective aggregate demand)
• In this way, global public goods can be not only funded; they can also propel global recovery

Tags:SDR,IMF

3. The Economic Times : EPFO should invest in diverse instruments to minimise risk and maximise returns

Topic: Economy

Category: Personal Finance

Key points:

• Trade unions have reportedly opposed the finance ministry’s direction to lower the interest rate on the Employees’ Provident Fund Scheme to 8.7% in 2015-16
• The interest rate on PF balances should be market-determined, rather than being an outcome of pulls and pressures of various interest groups
• The way in which the EPFO financed its payouts in the past has been opaque, bearing little relation to its earnings
• The provident fund corpus, about Rs 10 lakh crore is large enough to be invested across risk classes to minimise risk and maximise returns
• The bulk of EPFO’s money is held only in government bonds and the rest is parked in securities issued by banks and public sector enterprises. A cut in the interest rate to let the economy grow will impact bond yields, and lower the returns for subscribers
• Equities, for example, are superior investments in the long term, even if they tend to be volatile. And pension funds from across the globe invest in Indian stocks. So, there is a case for the EPF to sharply raise investments in equities
• The government should implement its promise in last year’s Budget to give workers the option to migrate to the National Pension System. It should swiftly amend the EPF Act and enable workers to switch to the NPS and earn superior returns on their retirement savings. Such competition from a rival fund will incentivise the EPFO to choose better

Tags:EPFO,NPS

F. Concepts-in-News: Related Concepts to Revise/Learn:

• NPS
• SDR
• SABLA
• NAVIC
• Ring of Fire

G. Fun with Practice Questions 🙂

Question 1:Which of the following statement(s) is/are true?

Question 2: 2.	Which of the following navigation system(s) is/are correctly matched to its/their deploying country(ies)?

Question 3:Which of the following are services are covered under SABLA (a GoI scheme)

Question 4:Which of the following statement(s) is/are true?

Question 5:Which of the following statement(s) is/are true?

Explained

1. Here’s why the govt has cut LPG subsidy funds by 17%

Topic: Economy

Category: subsidy rationalization

Location: The Financial Express

• In order to offer clarity on subsidy sharing mechanism to both upstream (ONGC, Oil India and GAIL) and oil marketing companies (IOC, BPCL and HPCL), the government has put in place a fixed budgetary provisioning model for domestic LPG and kerosene. However, the actual subsidy turned out to be lower than the budgeted provision, letting the government create a pool account to keep the additional funds
• The consumer price is to be kept at 419 for 14.2 kg cylinder
• The benchmark Brent crude oil price fell nearly 44% to an average of $48.73/barrel in FY16 against $86.6/barrel in FY15
• So the average subsidy burden on domestic LPG got reduced by about 63% to Rs 11.08/kg in FY16 against Rs 29.63/kg in FY15
• The direct benefit transfer on LPG has helped to save about Rs 15,000 crore by stopping black marketing and diversions
• At the same time, more than one crore consumers have voluntarily given up their cooking gas subsidy
• Also, the government has also decided to rationalise the subsidy outgo by excluding such LPG consumers from the purview of subsidy whose or whose spouse have taxable income of Rs 10 lakh and above during the previous financial year computed as per the Income Tax Act, 1961

2. Quick Bits

Topic :Economy

In a first, CBDT has made public a host of hard data on the total number of taxpayers in the country, income disclosed in income tax returns by various category of taxpayers and number of PAN holders in the country for 2000-01 to 2014-15 financial years

The department said the objective of publishing these statistics was to encourage “wider use and analysis of Income Tax data by departmental personnel and academicians.”

Source

• Topic: Economy

The country’s current account deficit is likely to widen modestly to $ 25 billion in the current fiscal from $ 20 billion last year on rising demand for gold and sluggishness in exports-Investment Information and Credit Rating Agency

Source

Tags:EPFO,NPS,SDR,IMF,SABLA, ICDS, Malnutrition,Rangarajan Committee report,Lakdawala Committee on Poverty, NSS Data,UNESCAP, 7^th Pay Commission,Ufa summit, Paris Climate Conference, CBD, SAARC summit,Pacific Tsunami Warning Centre, Ring of Fire,fault,Papua New Guinea, MoU on cooperation in health and pharmaceuticals,GDP

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