Current Affairs for BANK, IBPS Exams

18 May 2016

:: National ::

Centre is looking to make a bank of all its land holdings

• The Centre is examining the possibility of making a bank of all its surplus land holdings across the country from which parcels could be auctioned to private industry.

• The move will ensure that non-availability of land doesn’t dampen new investments and economic growth. Other than for private industry such land identified in Delhi, Mumbai and other metros could be used for urban renewal projects.

• A committee set up under Economic Affairs Secretary Shaktikanta Das is inventorying all the holdings, including that of government companies, in coordination with the Urban Development Ministry.

• The decision comes in the wake of the Centre’s legislation on land acquisition reforms failing to clear Parliament even a year after an ordinance for it was allowed to lapse. Even the Government’s allies are opposed to this Bill.

Geospatial Information regulation Bill turned into diplomatic war

• The Geospatial Information Regulation Bill, 2016, turned into a diplomatic war of words when India “firmly” rejected Pakistan’s objections to the draft Bill, saying Islamabad does not have any right to object to an internal matter of India.

• “The proposed bill is an entirely internal legislative matter of India, since the whole of the State of J&K is an integral part of India. Pakistan or any other party has no locus standi in the matter,” said Vikas Swarup.

• The draft Geospatial Information Bill plans to bring in a set of legally binding regulations regarding the geospatial information of India which may include provisions to penalise inaccurate depiction of India in maps. .

• The MEA’s response came after Pakistan wrote to the UN Secretary General raising “serious concerns” over the draft Bill, specifically criticising the depiction of Jammu and Kashmir in the bill as “incorrect and legally untenable”.

• The Pakistan Foreign Office issued a statement saying it has expressed “serious concern” to the UN over a draft bill in the Indian Parliament over the map of Kashmir and has asked the world body to uphold its resolutions and urge India to stop such acts which are in “violation of international law.”

• Reacting to Pakistan’s letter, Union Minister of State for Home KirenRijijusaid it was the duty of the government to ensure that India’s geography is projected properly.

PM Modi could make Afghanistan visit after Iran

• Prime Minister Narendra Modi will travel to Iran, the government announced, he might follow it up with a visit Afghanistan in June.

• Both visits — in what India considers its “extended neighbourhood” — will focus on infrastructure development.]

• The Chabahar port development project will top Mr. Modi’s agenda in Iran, while he is expected to visit Afghanistan to inaugurate the $300-million Salma dam and hydroelectric power plant, known as the Afghanistan-India friendship dam.

• Mr. Modi’s visits will complete the triangle as he is expected to sign the trilateral trade treaty with Iran and Afghanistan for Chabahar, which was finalised during External Affairs Minister Sushma Swaraj’s trip to Tehran last month.

• The transmission lines [for the hydroelectric plant] have been handed over, and we are conducting the final testing for power generation

•  The exact dates for the Prime Minister’s visit, that would come five months after his last visit to Kabul when he inaugurated the Parliament building, were “still being finalised.”

• The Ministry of External Affairs announced that Mr. Modi would visit Iran on May 22-23 to meet President Hassan Rouhani in an official visit that would “provide a timely thrust to the ongoing efforts of the two countries and their business entities.

• Visit will also expand bilateral cooperation and mutually benefit from new opportunities in the wake of lifting of secondary sanctions against Iran earlier this year.

• The Prime Minister will also meet the ‘Supreme Leader’ Ali Khamenei, marking his first visit to the country after the historic nuclear agreement with world powers was signed, and the U.S. lifted secondary sanctions in January 2016.

• Among issues on the agenda are agreeing on a channel for repayment of $6.5 billion in unpaid dues from India to appropriate corresponding banks in Iran, an Memorandum of Understanding on developing the Chabahar port project.

• Other issues will be trilateral transit trade agreement with Afghanistan, India’s stake in the Farzad-B oilfields, the announcement of investments from Indian companies in the Chabahar “Free Trade Zone,” and security and defence pacts.

• Mr. Modi’s visit to Iran is a rare stand-alone visit indicating that India hopes to fast-track ties and build on the alternative route for trade with Afghanistan and Central Asia.

Associate banks of SBI began merger with SBI

• The State Bank of India has kick-started the process of merging its five associate banks with itself at one go.
• The merger is expected to be completed by the end of the current financial year.
• The SBI board discussed the issue, and also explored the possibility to merge BharatiyaMahila Bank.

:: International ::

White House says blocking aid to Pak could complicate bilateral ties

• The Obama administration has opposed the Republican-controlled Congress’s move to block $450 million in aid to Pakistan for failing to “demonstrate its commitment” and taking action against the Haqqani network.

• A White House statement in this regard came as the bill made its way to the House of Representatives from House Armed Services Committee.

• The White House asserted that it shares the view of the lawmakers with regard to the Haqqani network, but such a move would “unnecessarily complicate progress” in bilateral ties.

• According to the National DefenseAuthorization Act 2017, of the total amount of reimbursement and support authorised for Pakistan during the period beginning on October 1 this year, and ending on December 31, 2017, $450 million would not be eligible for a national security waiver unless the Secretary of Defence certifies that Pakistan continues to conduct operations against Haqqanis.

• Under this new proposed provision, the Defense Secretary also needs to certify that Pakistan is demonstrating commitment to prevent the Haqqani Network from using North Waziristan as a safe haven.

• It also needs to show that it is actively coordinating with Afghanistan to restrict the movement of terrorists, including the Haqqani Network, along the Pakistan-Afghanistan border.

• There is similar certification requirement in the year ending on September 31, 2016, but the amount is $300 million.

• The Defence Secretary has not been able to give necessary certification for the release of the fund to Pakistan so far.

•  The House Armed Services Committee says that it will continue to review the reimbursements made to Pakistan and how it aligns with the future of U.S. policy, including key counter-terrorism objectives, in the region.

• The Obama Administration has opposed any move to either restrict or condition U.S. military aid to Pakistan, arguing that its ties with Islamabad are very important.

A conference on typeface process between Israel and Palestine postponed

• A conference on the peace process between Israelis and Palestinians, due to be held on May 30 in Paris, has been postponed, French President Francois Hollande said.

• U.S. Secretary of State cannot come on May 30 so it has been delayed. It will take place in the summer,” he told French radio.

• He also said it was vital for France to take “a strong initiative” in the dispute. “If not... what will happen? Settlement building, attacks.

• The original date for the conference falls on the U.S. Memorial Day holiday honouring members of the armed forces who died in combat.

• French Foreign Minister Jean-Marc Ayrault was in Jerusalem and Ramallah to present the French peace initiative to Israeli Prime Minister Benjamin Netanyahu and Palestinian President Mahmud Abbas.

• Ms. Ayrault received support from the Palestinians but objections from Israel. Mr. Netanyahu questioned French “impartiality” after Paris voted in favour of making Palestine a UNESCO member five years ago.

• Hamas spokesman Sami Abu Zuhri said on Twitter that Mr. Hollande’s announcement of the delay was “further evidence of the failure of the [peace settlement] option and the project of [Palestinian President] Mahmud Abbas”.

Sykes-Picot pact completes hundred years

• One hundred years ago on Monday, Britain and France signed a secret agreement carving out “spheres of influence” that ultimately created the modern Western Asia.

• Yet no one was celebrating the anniversary as Secretary of State John Kerry and his counterparts from Europe, the Arab States and Iran began gathering in Vienna for the latest international effort to end the civil war in Syria.

• The effort is also supposed to usher in what is delicately called a “political transition” that would ease out President Bashar Al-Assad.

• The Sykes-Picot Agreement, named for its British and French authors and the map it produced, is now widely considered a low point in colonial efforts to manipulate the region to fit the interests of outsiders.

• And yet the remnants of the agreement, which came to light after documents proving its existence emerged during the Russian Revolution in 1917, loom over everything Mr. Kerry and his fellow foreign ministers are doing here.

• Rarely in the past century have the shifting borders established by the agreement looked blurrier, and the effort to maintain them shakier.

• One of the few players who observed the anniversary at all was MasoudBarzani, the president of the Kurdistan Autonomous Region.

• He allowed for the possibility of a form of decentralisation in which different groups — the Kurds, Mr. Assad’s government and the opposition — receive some autonomy. But the goal, he said, was an intact Syria.

• While the official American position is that he has to go, the reality is that few in Washington are in a rush: The last thing they want is a power vacuum in Damascus that the Islamic State would try to fill.

• Still, it seems safe to say that if anyone has come out of the Syrian debacle nearly as hated in the region as Mr. Assad, it is probably the diplomats who rearranged the region: Sir Mark Sykes and François Georges-Picot.

• Sykes, an aristocratic racehorse breeder and Boer War veteran, died three years after the agreement was reached, killed by the Spanish flu while in Paris during the 1919 peace talks after World War I.

• Picot, the son of a historian and known for his skills as a lawyer and a diplomat, lived to be 80. He died in 1951, three years after the creation of Israel.
• Out of the ruins of the Ottoman Empire, the British ultimately obtained mandates over Palestine and Iraq; the French got what is now Syria.
• Areas experiencing some of the hardest-fought battles now, like Mosul, were attached to the Kingdom of Iraq.

:: Business and Economy ::

A system similar to Tatkal to expedite examination of patent

• The government has amended rules and introduced several measures including a system similar to ‘tatkal’, to expedite examination of patent applications by start-ups as well as entities choosing India for the first filing of patent.

• This comes in the backdrop of 2.37 lakh patent applications pending in the country.

• The government, incidentally, is aiming to bring down the time period for initial examination of patent applications from the present 5-7 years to 18 months by March 2018.

• It had also announced the National Intellectual Property Rights (IPR) Policy to push IPRs as a marketable financial asset and economic tool, promote innovation and entrepreneurship/start-ups, while protecting public interest.

• Under the ‘tatkal’ like system applicants can opt for the ‘expedited examination’- route on the grounds that they have chosen India as the competent International Searching Authority or International Preliminary Examining Authority.

• The ‘expedited examination’-route is also available to all entities that qualify as a start-up as per the definition for start-up provided in the Patent Rules. The applications for this route have to be filed only electronically.

• Under the ‘expedited examination’ route, the fees for individuals and start-ups have been fixed at Rs.8,000, while for small firms it is Rs.25,000 and for large companies, the fee is Rs.60,000.

Govt is finding it difficult to identify members for NPA of public sector bank

• The government is finding it difficult to identify willing members for its recently announced high-level panel to suggest recovery and sale of non-performing assets (NPA) of public sector banks.

• According to bankers privy to the discussion with the government, the finance ministry had sounded out former Securities and Exchange Board of India (SEBI), former Judge of Supreme Court, Justice B.N. Srikrishna and a former central vigilance commissioner to be a part of the committee.

• The formation of the panel was aimed at advising banks on bad loan recovery and one time settlement offers from defaulters.

• Banks often show reluctance in one time settlement offers from defaulters as they have to take haircut if such offers are accepted. They fear questions will raised by the investigative agencies if they settle for less.

• While banks owe over Rs.9,000 crore to the defunct airline, Mr Mallya had offered Rs 4,000 crore as one-time settlement.

• Banks had rejected the Mr Mallya’s settlement offer as they fear adverse public opinion if the entire money is not recovered.

• Moreover, public sector banks come under the purview of the investigative agencies, and bankers fear these agencies could hound them if they settle for what was offered by the liquor baron.

• Anil Sinha, director of the Central Bureau of Investigation recently came down heavily on banks for not reporting frauds to the investigators, indicating that lenders had given wilful defaulters and fraudsters a long rope to escape law.

• The finance ministry has been advising banks to beef up their recovery efforts in the wake of sharp rise in non-performing assets.

• The stressed assets for the banking system as a whole, which stood at 9.8 per cent at the end of March 2012, moved up sharply to 14.5 per cent at the end of December 2015.

Gross market borrowing of the state Govt to increase

• Only Karnataka, Madhya Pradesh and Odisha would be eligible for additional borrowings of 0.5 per cent of Gross State Domestic Product (GDSP) in FY17 while Gujarat, Telangana and Uttar Pradesh would be eligible for additional borrowings of 0.25 per cent, according to rating agency ICRA.

• With a limited number of states likely to be eligible for the additional borrowing in FY17, ICRA said that the ceiling for the gross market borrowing limit of the state governments would rise to Rs 3.5 lakh crore in FY17 against the actual borrowings of Rs.2.94 lakh crore in FY2016.

• However, if a majority of states revise pay scales in FY17 itself, the actual borrowings may be higher than this figure, given the flexibility to adjust borrowings raised in excess of the entitlement from the net borrowing limit for the subsequent year.

• The government has recently permitted eligible states to undertake a higher fiscal deficit and additional borrowings of up to 0.5 per cent of GSDP above the anchor of 3 per cent of GSDP.

• The eligibility criteria that decides the rate is the states’ compliance with a curb in interest payments at or below 10 per cent of their revenue receipts, their ability to curtail debt below 25 per cent of their GSDP and the maintenance of a balanced or surplus revenue account.

• The government has also permitted the states to avail of any unutilised fiscal deficit amount, between FY17 and FY19, in the following year within the Fourteenth Finance Commission’s (FFC’s) award period.

• Similarly, borrowings raised in excess of their entitlement would get adjusted from the net borrowing limit for the subsequent year.

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