Current Affairs For Bank, IBPS Exams - 18 July, 2015

Current Affairs for BANK, IBPS Exams

18 July 2015

:: National ::

Decision on net neutrality yet to take

Amid criticism of a DoT panel report suggesting 'regulatory framework' for Internet calls, Telecom Minister Ravi Shankar Prasad today said it is not the final view of the government and a "structured" decision will be taken only after looking into views of all stakeholders.
The suggestions of the panel, if implemented, may lead to free calls offered by apps like Skype and WhatsApp coming to an end.
The panel has proposed regulation of domestic calls on Internet-based apps like Skype, Whatsapp and Viber by putting them on par with services offered by telecom operators.
The panel was chaired by DoT Advisor for Technology A K Bhargava and members included officers A K Mittal, V Umashankar, Shashi Ranjan Kumar, G Narendra Nath and R M Agarwal. The minister had asked the panel to study net neutrality operation in various parts of the world and the debate on the issue.
Prasad said that the report is now in public domain for comments and it will be sent to TRAI also.
Net neutrality implies that equal treatment be accorded to all Internet traffic and no priority be given to an entity or company based on payment to content or service providers such as telecom companies, which is seen as discriminatory.
The DoT panel has said that international Internet-based calls and messaging services should not be regulated.
Telecom Watchdog, an NGO and co-petitioner in 2G spectrum case, has alleged that the report was a "protectionist policy for the incumbent telecom service providers" and anti-consumer.
Telecom operators, which have hailed the report, contend that they are under financial distress and there should be a level-playing field between them and Over-the-Top (OTT) players like WhatsApp and Viber, as these apps are eating into their revenues while using their infrastructure.
The pricing difference is around 12.5 times in the case of a voice call and 16 times for messages between services offered by telecom operators and OTT players, data put together by TRAI showed.
For a one-minute phone call, a customer is charged around 50 paise, but a call made using Internet costs 4 paisa to customer, according to TRAI calculations.
Indian telecom operators have said their cumulative investments in the sector stand at approximately Rs 7.5 lakh crore and further investments of around Rs 5 lakh crore will be required in the next five years to meet the demand.

:: Business ::

If Posco cancels $12 bn Odisha project & Modi's 'Make in India'

South Korean steel giant Posco has decided to suspend work at its proposed $12 billion steel project in Odisha after 10 years of delay.
According to a report in Bloomberg, company CEO Kwon Oh Joon has said the suspension will continue "until Indian Prime Minister Narendra Modi offers better deals".
The suspension of work assumes significance as it may result in a complete pullout from the project.
With the latest development the only thing certain about the controversial project is that that all parties involved - the governments and the company - are still committed to it.AFP

What is the project all about?

The Odisha government signed a memorandum of understanding with South Korea's Posco in 2005 to set up a 12 million tonnes per annum (mtpa) steel facility. As per the agreement, the project includes iron ore mine development over 30 years (total 600 million tonnes) at captive mines located in the Keonjhar and Sundergarh districts of Odisha and also development of related infrastructure like ports. The Posco project required 4,004 acres of land. The Odisha government has reportedly acquired 2,700 acres and handed over 1,700 acres to the steel giant. In all eight villages were to be directly impacted. It is the largest FDI commitment the country has received yet.

Why is the project controversial?

There are many reasons. First one is the protests from the betel vine farmers in the affected villages. Soon after the signing of the MoU villagers who were to be affected by the project started protesting against it. Posco Pratirodh Sangram Samiti was established by Sishir Mohapatra and fights for the rights of the tribals. The government has taken violent means to crush the protests against the project, resulting in deaths of villagers. The epicentre of the protests is Dhinkia village. In October 2013, a UN human rights panel asked the company to halt the work. "Construction of a mega-steel plant in Odisha in Eastern India should be halted immediately... The project reportedly threatens to displace over 22,000 people in the Jagatsinghpur district, and disrupt the livelihoods of many thousands more in the surrounding area," the panel of experts said.
Second issue is the environmental clearance. The project first got environmental clearance in 2007. On 30 March 2012, the National Green Tribunal suspended the clearance and directed the ministry of environment and forest to review the approval accorded earlier. An expert appraisal committee recommended that the clearance for the project could be revalidated until 2017. The critics of the project allege that the company does not have a valid MoU with the state government as the first pact got lapsed in 2010.
Thrid issue is iron ore linkage. The state government in January 2009 had recommended 2,500 hectares of Khandadhar iron ore reserve in Sundergarh district for Posco. The arrangement did not take off and it had a lot of twists and turns. In 2010, the Odisha High Court cancelled it and then the Supreme Court upheld it but wanted the Union mines ministry to take a final call. In January 2014, the central government sought more information from the state government on its recommendation in favour of Posco. Now, with the new mining ordinance promulgated by the Centre in the after of the coal scam, it is imperative that all companies have to participate in an auction to get mining licence. If the company is to participate in a competitive bidding, the costs are sure to go up, which is why the company has suspended its work now.
Fourth controversy was regarding the captive port. There is a view that the company should use the Paradip port, instead of setting up a captive port. According to this Business Standard article, state BJP leaders had voiced concerns about the iron ore arrangement recommended by the state government, the SEZ status accorded to the project and the captive port.

Why is the suspension of the project critical?

Because the chances of scrapping the project completely is now the highest. Also one cannot escape the irony that it is happening under the prime ministership of Modi, who projects himself to be a business-friendly politician. Moreover, what has hastened the decision to suspend the works is the mining ordinance promulgated by the government, which has been touted as one of the key reforms taken up by the government. If the project is indeed cancelled, it is likely to dent the government's investor friendly image. It will also be a setback to Modi's Make in India campaign. Meanwhile, for the fighting tribals, it will be a big victory.

SBI chairman,s new proposal

Concerned about competition from new private sector banks and other financial services providers, public sector banks, led by State Bank of India (SBI), have approached the government to increase performance-based incentives for their employees.
SBI, the country’s largest lender, has already set the ball rolling, writing to the finance ministry and seeking approval to share three per cent of profits with senior- and middle-management employees. Other large lenders such as Bank of Baroda, Bank of India and IDBI Bank are likely to follow.
SBI Chairman Arundhati Bhattacharya said incentivisation was a good way of retaining talent in the wake of competition. “...if you consider the fact that incentivisation is a good way of ensuring people meet up to whatever are the challenges...they respond to them. So, to that extent, the government allows us to share one per cent. We are saying it is necessary for us to hike that amount to three per cent,” Bhattacharya told news agency PTI.

Panagariya,GDP expectation

NITI Aayog vice chairman Arvind Panagariya on Friday exuded confidence that India could be an $8-trillion economy within next 15 years or even less if it continues with growth-enabling policies.
Raj Kumar Talwar was one of the most successful chairmen of SBI. He led the bank from 1969 to 1976.
The World Bank and the International Monetary Fund (IMF) as well as many analysts have predicted that the country would become the third largest economy after China and the US with a GDP of $10 trillion by 2030.
Noting that the economy clipped at its best at 8.3 per cent during 2003-04 to 2012-13, when the country saw the largest reduction in the number of BPL people, he said with the present government's policies its can achieve the same or even higher growth rates going forward.