Current Affairs for BANK, IBPS Exams

20 June 2015

Investors can now buy gold in paper form

• The government has floated a proposal to issue sovereign gold bonds to attract part of the country's estimated 300 tonnes annual demand for gold bars and coins into 'paper gold' so that imports of the precious metal in physical form are reduced to save foreign exchange.

• The discussion paper on the scheme was issued late on Thursday night for which comments have been invited till July 2.

• Gold imports are the second-most costliest item next only to oil and tend to push up the current account deficit and weaken the rupee. Indians buy nearly 1,000 tonnes of gold every year, most of which is imported.

• The Reserve Bank of India (RBI) will issue the bonds for the government with a minimum interest rate of two per cent, according to a draft outline issued by the government.

• The bonds would be issued in denominations of two, five and 10 grammes of gold or other sizes for a minimum term of five to seven years in order to protect investors from volatility in gold prices.

• On maturity, the investor receives the equivalent of the face value of gold in rupee terms. The rate of interest on the bonds will be payable in terms of grammes of gold.

• The government plans to market the bond through post offices and various brokers and agents to give a wide access to consumers for buying them.

• The bonds can be used as collateral for loans and the loan-to-value ratio will be set equal to ordinary gold loans mandated by the RBI from time to time.

• Capital gains tax for the bonds will be the same as for physical gold. This will ensure an investor is indifferent in terms of investing in these bonds and physical gold as far as the tax treatment is concerned. This is still under examination, the draft states.

• The government aims to issue bonds worth Rs 13,500 crore, which is roughly equivalent to 50 tonnes of gold in the first year. "An indicative lower limit of two per cent may be given but the actual rate will have to be market determined," the proposal states.

• While the deposit scheme aims to mobilise idle household gold, estimated at more than 20,000 tonnes, the sovereign bond would allow consumers to invest in paper gold rather than physical gold.

WikiLeaks says it's leaking over 500,000 Saudi documents

• WikiLeaks is in the process of publishing more than 500,000 Saudi diplomatic documents to the Internet, the transparency website said Friday, a move that echoes its famous release of US State Department cables in 2010.

• WikiLeaks said in a statement that it has already posted roughly 60,000 files. Most of them appear to be in Arabic.

• If genuine, the documents would offer a rare glimpse into the inner workings of the notoriously opaque kingdom.

• They might also shed light on Riyadh's longstanding regional rivalry with Iran, its support for Syrian rebels and Egypt's military-backed government, and its opposition to an emerging international agreement on Tehran's nuclear program.

• One of the documents, dated to 2012, appears to highlight Saudi Arabia's well-known skepticism about the Iranian nuclear talks.

• A message from the Saudi Arabian Embassy in Tehran to the Foreign Ministry in Riyadh describes ''flirting American messages'' being carried to Iran via an unnamed Turkish mediator.

T'puram likely to host SAFF tournament

• The Kerala Football Association has not got wind of it yet but the South Asian Football (SAFF) Championship is likely to be held in Thiruvananthapuram in December.
• “It is the SAFF body (South Asian Football Federation) which decides on this with its commercial partner WSG (World Sports Group).
• With the FIFA World Cup qualifying rounds currently on and with the Indian Super League from October and with the South Asian Games likely to be held in Assam and Meghalaya by the end of this year, it’s going to be a crowded calendar for Indian football.
• The last SAFF Championship was held in Nepal in August 2013 and Afghanistan defeated India 2-0 in the final.

Co-op banks told to set up management boards

• The co-operative banking sector in India is facing three major issues and the sector is not able to utilise its full potential, said the Reserve Bank of India Deputy Governor R. Gandhi.

• Mr. Gandhi, who was addressing a gathering at the Silver Jubilee Celebrations of National Institute for Rural Banking, said lack of corporate governance and professionalism, reluctance to adapt to technology, decline in co-operative character were the major issues faced by the co-operative institutions in the country.

• “Even with a large number of co-operative banks in the country, the total asset size and their share in the Indian banking sector is not more than 5 per cent.

Falling Rouble Cuts Value of 'Electronic Noble' Prize for Recipients

• The highest Russian technology award was presented in St. Petersburg on Friday by President Vladimir Putin to two American recipients, calling their work as the greatest contribution to humanity in their fields.
• The Global Energy Prize, though not a government award, is looked upon in Russia as the 'electronics Nobel'.
• It was given to Nobel Laureate Shuji Nakamura for his contribution to white LED light technology, which is derived from his invention of blue LED for which he had received the Nobel Prize in Physics in 2014.
• The prize was shared by B. Jayant Baliga, professor at North Carolina University for his invention of the digital switch or the insulated gate bipolar transistor (IGBT) which has raised efficiency of all digital equipment and computer hardware and all powered machines, saving trillions of dollars for consumers around the world.
• The prize was presented by President Putin at the St. Petersburg International Economic Forum. The prize was established by several top Russian energy companies.
• The Rouble 33-million (roughly Rs. 3.8 crores) award, though, has lost much of its value because of the decline in the Russian currency. It was equivalent to over a $1.2 million dollars (roughly Rs. 7.6 crores) but at today's rate it would be only around $550,000 (roughly Rs. 35 lakh) to be shared equally by the two recipients. But the recipient felt that the global honour which came with the prize was more important.
• Nakamura said that his next big venture was development of white laser light, which will increase the efficiency of all equipment which uses light in any form. "The light would be 1,000 times brighter, and would occupy space of half a millimetre by half a millimetre only," the Nobel Laureate told IANS.
   

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