(General Awareness For Bank's Exams) India and The World

January -2015

Economist at the World Bank.

U.S. looks forward to working with new Sri Lankan President

•  The U.S. looks forward to working with Sri Lankan president-elect Maithripala Sirisena, Secretary of State John Kerry said, as he commended outgoing President Mahinda Rajapaksa for accepting the election results.

•  “I look forward to working with President-elect Maithripala Sirisena as his new government works to implement its campaign platform of a Sri Lanka that is peaceful, inclusive, democratic, and prosperous,” Mr. Kerry said in a statement soon after Mr. Rajapaksa conceded defeat.

•  “I commend President Rajapaksa for accepting the results of the election in the proud tradition of peaceful and orderly transfers of power in Sri Lanka. His words about accepting the verdict of the people and moving forward are important,” Mr. Kerry said.

•  Mr. Rajapaksa had called the election two years ahead of schedule, hoping to win a record third six-year term before the defeat of the Tamil Tigers fades in the memory of the people of the island which saw a three decades war over the demand of a separate Tamil Eelam.

•  There was an unusual high voter turn-out for the elections held. “The Sri Lankan people deserve great credit on the successful conclusion of their elections. They turned out in great numbers to exercise their democratic rights and every vote was a victory for Sri Lanka,” Mr. Kerry said.

•  “The United States applauds the Sri Lankan Elections Commissioner, the security forces, Sri Lankan civil society, and the candidates themselves for making sure this election was not marred by unrest and for ensuring a significant drop in campaign-related violence. It will be important for that effort to continue in the coming days,” he added.

South Africa & India discuss UNSC reforms

•  Engaging in diplomacy on the sidelines of the Pravasi Bharatiya Divas (PBD) event, Prime Minister Narendra Modi had substantive meetings with Donald Ramotar, President of Guyana; Maite Nkoana-Mashabane, Minister of International Relations and Cooperation, South Africa; and Showkutally Soodhun, Vice Prime Minister Mauritius.

•  External Affairs Minister Sushma Swaraj is set to visit South Africa in the first quarter of this year to pursue opportunities for economic ties particularly in infrastructure and mining.

•  India and South Africa discussed the need for UN Security Council reforms especially when 2015 marks the 70th anniversary of the international body, Syed Akbaruddin, spokesperson of the Ministry of External Affairs told a press conference.

•  In his discussion with Mr. Ramotar, Mr. Modi assured a line of credit worth $ 60 million to Guyana for two road and ocean ferry projects in the Caribbean country.

•  The Centre also decided to include Guyana in the list of countries whose citizens will get a visa-on-arrival facility. The facility of Electronic Travel Authorization (e-Visa) has also been introduced to save time.

•  A deeper engagement with Mauritius is also on the cards with the country inviting Mr. Modi to pay a visit on March 12. Mr. Modi took a tour of ‘Dandi Kutir’ – a conical three-storey museum dedicated to Gandhiji – constructed in Gandhinagar. Gujarat Chief Minister Anandiben Patel said it was the biggest exhibition in Asia.

•  At the occasion, two stamps of Rs. 25 and Rs. 5 and two coins of Rs. 100 and Rs. 10 denominations were released in the memory of Gandhiji. This years PBD will honour 16 NRIs with ‘Samman Awards’. Microsoft CEO Satya Nadella, who is among those awarded this year, will not attending the awards function.

John Kerry heads for India to attend ‘Vibrant Gujarat Summit’

•  US Secretary of State John Kerry headed for India to attend the Vibrant Gujarat Summit during which he will address investors to boost economic ties and meet Prime Minister Narendra Modi to discuss a broad range of bilateral and global issues, including climate change.

•  “The Secretary would be emphasising the importance and future potential of our economic partnership with India, State Department Spokesperson Jen Psaki told.

•  “Obviously the discussion would be on everything from continuing to do more economically and technologically, given that United States and India, we believe, can reach greater level of prosperity together than we would achieve alone,” she said.

•  The three-day Vibrant Gujarat Summit will begin tomorrow in Ahmedabad. “He would also be reiterating throughout the trip, our shared commitment to address the challenge of climate change, promoting clean energy in the future. Prime Minister Modi has a strong track record in this regard,” she said, adding that the Obama administration sees this trip as a pivotal point in India-US relationship.

•  After a brief stopover in Munich to meet the Sultan of Oman, Kerry leading a high-level US delegation is scheduled to arrive in Ahmedabad. Soon after his arrival, he is expected to visit the Gandhi Ashram, meet members of the civil society and visit the Ford plant, which is expected to open shortly. He would address the Vibrant Gujarat Summit and hold a round table with top Indian CEOs.

•  Kerry is scheduled to meet Prime Minister Modi and hold another round-table with American CEOs participating in the summit.

•  Referring to the multi-fold increase in bilateral trade in the last 10 years, which stands now at about USD 100 billion, Psaki said the summit is an opportunity to further the goal that US President Barack Obama and Prime Minister Modi have talked about in terms of increasing trade five-fold to USD 500 billion.

Taiwan confirmed the H5N8 strain of bird flu

•  Taiwan’s agriculture authority confirmed that the strain of bird flu found in a goose breeding facility in the Chiayi County was the H5N8, which is not considered to be highly pathogenic.

•  This follows the discovery of the highly pathogenic H5N2 strain of the bird flu virus at a chicken farm in the southern Taiwanese county of Pingtung.
  Emerging economies must help combat climate change: U.N. Chief

•  U.N. Secretary-General Ban Ki-moon said that while respecting the principle of common but differentiated responsibilities, emerging economies such as India, China, South Africa and Brazil should take necessary action to combat climate change.

•  Interacting with presspersons after visiting a canal-top solar power project, he said the developed countries had caused much more impact on climate than the developing nations and they had different capacities to tackle impacts.

•  India was taking necessary action by projects such as the canal-top power project, a creative and impressive one which all developing countries should emulate.

•  To questions, he said climate finance was the most important aspect to make combating climate change a success. India could play a vital role as one of the fastest growing economies.

•  He was catalysing funds into the Green Climate Fund, which had topped $10 billion last year. He was optimistic about arriving at a new, robust climate treaty in Paris.

India-U.S. to jointly fight cancer & Ebola

•  India and the United States are expected to sign memoranda of understanding on cancer research and Ebola control when U.S. President Barack Obama arrives later this month.

•  Union Minister for Health and Family Welfare J.P. Nadda said the two countries had agreed to jointly fight Ebola. Under the agreement, Indian health care personnel will be trained in Ebola control and treatment procedures.

•  “The Indian Council of Medical Research is already working on producing a vaccine for Ebola. But this MoU will focus on capacity building in areas of Ebola control,” a senior official of the Ministry said.

•  Though India has had no reported cases of Ebola, the disease has so far claimed over 7,000 lives in the affected countries. A 26 year-old, who had travelled from Liberia to India and was found carrying the virus in his semen, remains in isolation.

•  Another MoU is to be signed between the National Cancer Institute, U.S., and the upcoming National Cancer Institute in Jhajjar, for sharing of treatment plans, expertise and research.

•  The NCI in the United States coordinates the National Cancer Programme, which conducts and supports research, training, health information dissemination, and other programmes with respect to the cause, diagnosis, prevention and treatment of cancer, rehabilitation and the continuing care of cancer patients and their families.

•  At the institute in Jhajjar being developed by the AIIMS, cancer research will be the area of focus apart from patient care and management. India reports 11 lakh new cases of cancer every year, with a mortality rate of 5.5 lakh per year.

•  Cancer treatment facilities in India are inadequate, compared to WHO standards, which requires one radiotherapy machine per million population. India at present has 0.41 machine per million population.

Leading U.K. papers reproduce “survivors’ issue” cover

•  Newsrooms in publications across the United Kingdom saw fierce debates over whether to reproduce the cover of the latest issue of Charlie Hebdo — the “survivors’ issue” as it has been called — which went into a record 5 million print run on January 14.

•  The latest issue of the satirical magazine carries a cartoon of Prophet Muhammad on its cover that is a tearful and forgiving depiction of the founder of Islam.

•  While some publications have opted to publish the page in their regular reportage on developments around the weekly magazine — that lost six of its editorial leadership and three others to terrorist bullets last week — others have declined to do so.

•  The Guardian; Times; Independent; Financial Times and the BBC have published the cartoon, as have major websites like Huffington Post, Buzzfeed and the news sites of Yahoo and Google.

•  The magazine — sold out in France, and selling at astronomical prices on ebay — will be available in Britain at select outlets. Bookshops and magazine distributers are cagey about the number of copies that they are likely to receive.

•  The Muslim Council of Britain has responded to the publication with restraint. A statement signed by 53 imams of mosques from across Britain, said that although most Muslims will be “hurt, offended and upset” by the re-publication of the cartoon, the “best and immediate” response is to emulate the “enduring patience, tolerance, gentleness and mercy as was the character of our beloved Prophet.”

Japan approves its largest defence budget

•  Japan approved its largest-ever defence budget for the next fiscal year, as Prime Minister Shinzo Abe looks to strengthen surveillance of territorial waters in the face of a continuing spat with China.

•  For the year to March 2016, Tokyo will spend 4.98 trillion yen ($41.97 billion), the government said, rising for the third straight year.

•  “This is the largest budget ever,” said a defence ministry official, adding the highest allocation previously was 4.96 trillion yen earmarked in 2002.

•  The trend reflects Mr. Abe’s wish to build a more active military, with an eye on a possible escalation of tensions with China.

Global economy to expand by 3% in 2015

•  Noting that the global economy is still struggling to gain momentum while many developing economies are less dynamic than they were in the past, the World Bank has projected that it would expand by three per cent this year.

•  The global economy grew by an estimated 2.6 per cent in 2014, and is projected to expand by 3.3 per cent in 2016 and 3.2 per cent in 2017, the bank said in a report.

•  Developing countries grew by 4.4 per cent in 2014 and are expected to edge up to 4.8 per cent in 2015, strengthening to 5.3 and 5.4 per cent in 2016 and 2017, respectively, it said.

•  Following another disappointing year in 2014, developing countries should see an uptick in growth this year, boosted in part by soft oil prices, a stronger US economy, continued low global interest rates, and receding domestic headwinds in several large emerging markets, it added.

•  “In this uncertain economic environment, developing countries need to judiciously deploy their resources to support social programmes with a laser–like focus on the poor, and undertake structural reforms that invest in people,” said World Bank President Jim Yong Kim.

•  “It’s also critical for countries to remove any unnecessary roadblocks for private sector investment. The private sector is by far the greatest source of jobs and it can lift hundreds of millions of people out of poverty,” he added.

•  Underneath the fragile global recovery lie increasingly divergent trends with significant implications for global growth, the World Bank report said.

•  Activity in the United States and the United Kingdom is gathering momentum as labour markets heal and monetary policy remains extremely accommodative. But recovery has been sputtering in the Euro area and Japan as legacies of the financial crisis linger.

•  The oil price collapse will result in winners and losers. “Worryingly, the stalled recovery in some high–income economies and even some middle–income countries may be a symptom of deeper structural malaise,” said Kaushik Basu, World Bank Chief Economist and Senior Vice President.

•  “As population growth has slowed in many countries, the pool of younger workers is smaller, putting strains on productivity. But there are some silver linings behind the clouds.

•  The lower oil price, which is expected to persist through 2015, is lowering inflation worldwide and is likely to delay interest rate hikes in rich countries,” he said.

•  “This creates a window of opportunity for oil–importing countries, such as China and India. What is critical is for nations to use this window to usher in fiscal and structural reforms, which can boost long–run growth and inclusive development,” Mr. Basu said.

PIA closure will snap vital link between India, Pakistan

•  Official Pakistani sources said they were worried that the Enforcement Directorate notice to the Pakistan International Airlines on its offices in Delhi, had political overtones.

•  The move, they feared, would “cut off a vital link between both countries.” PIA runs the only flights between India and Pakistan, with two flights a week on the Delhi-Lahore sector and once a week on the Mumbai-Karachi sector.

•  Pakistani officials insisted that the PIA service to India which started in 1976, would not be cancelled, despite all the problems. However, one official said there were apprehensions that the action came after Foreign Secretary talks were cancelled last July, and indicated other actions could follow “causing a further rift in ties.”

Germany eager to join ‘Make in India’ initiative

•  German Finance Minister Wolfgang Schäuble expressed interest in working with India in the manufacturing sector, especially in the auto and solar energy industries, at a meeting with business lobby Confederation of Indian Industry (CII) .The German minister is scheduled to hold talks with Union Finance Minister

Arun Jaitley .

•  Dr. Schäuble’s positive note on German manufacturing industry’s readiness to participate in the ‘Make in India’ policy comes close on the heels of U.S. Secretary of State John Kerry’s voicing of the Obama administration’s worries over the initiative.

•  Mr. Modi is scheduled to jointly inaugurate the Hannover trade fair along with German Chancellor Angela Merkel during his visit to Germany in April 2015.

India is world’s second most trusting nation: survey

•  Moving up the ranks, India has emerged as the second most trusted country in the world in terms of faith reposed on its institutions even as globally trust levels have fallen, says a survey.

•  As the world’s rich and powerful gather in the Swiss resort of Davos, a study by public relations firm Edelman has found that general level of trust in institutions among college-educated people around the globe are at levels not seen since 2009 in many of the markets it surveyed.

•  Trust in institutions in India has improved sharply in 2015 with the country moving up three notches to the second place among 27 nations.

•  While the number of “truster” countries are at an all-time low of six in 2015 including UAE, India, China and Netherlands, the number of “distruster” countries has grown significantly to 13 including Japan, Russia, Hong Kong, South Africa and Italy.

•  Brazil, Malaysia, France and the US are among the 8 “neutral” nations as per the trust index, the survey said.

•  India, which last year saw the BJP-led NDA government storming to power at the Centre, stands tall.

•  According to the report, an “alarming evaporation of trust” has happened across all institutions, reaching the lows of the Great Recession in 2009.

•  Trust in government, business, media and NGOs in the general population is below 50 per cent in two-thirds of countries, including the U.S., U.K. and Germany, it said.

•  From fifth most trusted in 2014, India has now become the second-most trusted in 2015 with a score of 79 per cent in the barometer. The study has put India Prime Minister Narendra Modi’s image on the first page.

Vision statement on Asia-Pacific, Indian Ocean

•  After meeting for close to five hours, including an extended lunch, tea on the Hyderabad House lawns, and delegation level talks, Prime Minister Narendra Modi and President Barack Obama issued three separate documents: a declaration of friendship with a commitment to regular summits, a joint statement called “Shared Effort, Progress for all”, and a joint strategic vision statement for the Asia-Pacific and the Indian ocean region.

•  The last document could raise eyebrows in China, when External Affairs minister Sushma Swaraj visits Beijing next week, as it elaborates on the clauses in their previous joint statement for the disputed maritime region, and says, “We affirm the importance of safeguarding maritime security and ensuring freedom of navigation and over flight throughout the region, especially in the South China Sea.”

•  Conspicuous by its absence was mention of “cross-border” terrorism or India’s issues with Pakistan, although the two sides repeated their September commitment to “disrupt” terror groups including Lashkar-e-Taiba, Jaish-e- Mohammad, D Company and the Haqqani Network.

New China-Myanmar oil pipeline bypasses Malacca trap

•  China has taken a firm step to beef up its energy security by inaugurating a pipeline that will bring crude oil from a deep water port in Myanmar, along a transit route that will bypass the strategic Malacca Straits.

•  The first tanker that will offload 300,000 tons of oil is expected to arrive on Friday at Maday Island – a deep water port developed by China in the Bay of Bengal. From there, oil, mostly brought from West Asia and Africa, will be pumped into a 2402 km long pipeline that will stretch for 771 km in Myanmar and another 1631 km in China.

•  A gas pipeline, next to the Maday Island terminal, already runs from Myanmar’s port of Kyaukpyu. China also finalised plans to establish a rail corridor from Kyaukpyu to its Yunnan province.

•  The strategic oil pipeline will service China’s two major growth centres — Kunming and Chongqing, an industrial hub along the Yangtze River delta. Both cities are pivotal in the development of China’s Silk Road Economic Belt, the 21st century Maritime Silk Road. Kunming is one of the starting points of the Maritime Silk Road, because it connects with three countries belonging to the Association of South East Asian Nations (ASEAN) — Myanmar, Vietnam and Laos. Landlocked Laos in turn becomes the gateway to ports in Thailand, and a wider transportation network covering Malaysia and Singapore as well.

•  Significantly, the new oil pipeline bypasses the Malacca Straits — a narrow channel that connects the Indian Ocean with the Pacific. The Chinese are concerned that their access to the Malacca Straits — the main channel of their trade and energy supplies — can become compromised on account of Beijing’s growing rivalry with the United States, and maritime disputes with neighbours in the South China Sea.

•  As oil begins to flow, the Chinese are also building a refinery in Kunming that can process 10 million tons of crude annually.

•  Part of the shipments received will also be delivered to Myanmar, says the country’s Vice-President U Nyan Tun. China and Myanmar have jointly funded the project, including the construction of the Maday oil unloading terminal.

•  Analysts say that apart from enhancing energy security, the construction of an oil and gas pipeline from Myanmar is driven by environmental considerations, as China works to limit carbon emissions resulting from its over-dependence on coal.
   

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