Current Affairs for SSC CGL Exams - 14 August 2017

::National::

Home Minister asked the Gorkha Janamukti Morcha to end long shutdown

• Home Minister Rajnath Singh asked the Gorkha Janamukti Morcha (GJM) to end the 62-day long shutdown in Darjeeling and the 23-day hunger strike of 12 GJM members.
• The Minister also said the move would help create an atmosphere for finding a solution to the current crisis.
• Members of the GJM met the Home Minister and reiterated that their demand for a separate State of Gorkhaland. Mr. Singh told the delegation that the Centre would intervene only after the GJM exhausts all other options.
• Following the meeting, Mr. Singh appealed to West Bengal Chief Minister Mamata Banerjee to initiate dialogue with the GJM and other stakeholders.
• “The GJM has called for an indefinite strike in the Darjeeling hills from June 12 demanding a separate State of Gorkhaland. I am concerned about the developments in Darjeeling and the loss of valuable lives,” said Mr. Singh.

Indian Navy would join PLA Navy in a maiden maritime search and rescue exercise

• Despite growing tensions with China, Indian Navy would join the People’s Liberation Army (PLA) Navy in a maiden maritime search and rescue exercise to be chaired by Bangladesh at the Indian Ocean Naval Symposium (IONS) in November this year.
• Bangladesh, the current Chair, is scheduling a maiden International Maritime Search and Rescue Exercise (IMMSAREX) in November in the Bay of Bengal to be attended by ships and aircraft of the members and observers of the IONS.
• The IONS is a regional forum of Indian Ocean littoral states, represented by their Navy chiefs, launched by India in February 2008. It presently has 23 members and nine observers.
• The exercise comes at a time of intensifying competition among regional navies for dominance in the Indian Ocean — navies of China and Japan, presently observers, in addition to member states like India, France, Iran and the U.K.
• In addition, Bangladesh is also scheduling an “extraordinary conclave of Chiefs,” a meeting of chiefs of Navy before it hands over the Chair to Iran next year.
• India has considerably expanded its engagement with countries to further its own interests as well as to check the rapid expansion of Chinese naval forays in the Indian Ocean.
• Other countries in the region are also engaged in rapid expansion of their military capabilities.

T-90 tanks broke down due to a technical snag in Russian competition

• In a setback to the Indian Army’s tank fleet, the team which was competing in the global tank competition in Russia has crashed out of race after the T-90 tanks broke down due to a technical snag.
• The Indian team was among the top in an earlier round of the competition and was expected to take the lead in the later rounds. Two T-90 tanks developed mechanical problems and were disqualified from the competition.
• India is competing with 18 other countries, including China, in the ‘Tank Biathlon’ which began on July 29. These tank games have been held annually since 2013 as part of the International Army Games in the Alabino Ranges in Russia.
• The International Army Games involve 28 events held across Russia, Belarus, Azerbaijan, Kazakhstan and China.
• India joined the games three years ago but this has been the first time it had taken its own tanks for the competition. In the past, Russia had provided its tanks for the Indian team.
• India was among the 12 teams that made it to the semi-final in the three-stage games. Belarus, China, Kazakhstan and Russia will now compete in the final stage.

::Business and Economy::

Market regulator acts against Shell companies

• A recent order from markets regulator SEBI brought to a halt trading in more than 170 actively traded stocks on the stock exchanges.
• These firms formed part of a larger group of 331 ‘shell’ companies whose names the Minsitry of Corporate Affairs (MCA) shared with the regulator for initiating action.
• The order issued by the Securities and Exchange Board of India (SEBI) last week put at risk investor wealth amounting to almost Rs. 13,000 crore.
• A look at the financials of the companies show that most of them reported at least some income in the last financial year with a few even reporting a positive bottom line.
• There are seven companies that reported a net profit of more than Rs. 20 crore in the financial year ended March 31, 2017. One of them — J Kumar Infraprojects – registered a profit of Rs. 105.51 crore in FY17.
• Incidentally, stock exchanges have already asked their member brokers to verify if any of the unlisted entities, that were part of the MCA list, were registered as their clients.
• The brokers will have to verify the credentials of such entities and submit a report to the exchanges by August 31.
• A lot of companies, directors and promoters are going to go to SAT as this order will create an ineligibility for many other things such as directorships in other companies and fund raising.
• The order assumes significance as the government, in April, had said that during the last three financial years, ie, from 2013-14 to 2015-16.
• Investigations by the Income Tax department led to the detection of more than 1,155 shell companies used as conduits by more than 22,000 beneficiaries.
• The amount involved in non-genuine transactions by such beneficiaries was more than Rs. 13,300 crore, it had said.
• A day after the diktat — the BSE MidCap and BSE SmallCap indices lost more than 1% each even as the benchmark Sensex declined only 0.8%.

Centre has brought out an online database of half a million hectares of land

• In a little over six months beginning February, the Centre has brought out an online database of more than half a million hectares of land assisting industry.
• The Geographic Information System-enabled database also has details of close to 3,000 industrial parks/clusters, as well as area-wise availability of agricultural/horticultural crops, and mineral production.
• The portal will soon incorporate information on warehouses, power-grid and financial institutions as well as the demand for industrial infrastructure captured on the basis of applications from entrepreneurs for projects.
• The exercise is to eliminate the information asymmetry that is currently adversely affecting the country’s industrial policy-making and investments in the manufacturing sector.
• The development comes in the backdrop of the Centre firming up a new industrial and manufacturing policy to push up the contribution of the manufacturing sector in India’s GDP to 25% by 2020 from the current level of about 16%.
• The aim is to make India a global manufacturing hub and in the process generate employment locally. The details on the database about government-approved technical institutions will indicate the availability of skilled and semi-skilled talent.
• At present, the database has mapped 539,501 hectares of land and 2,978 industrial clusters/estates/parks/regions/areas/corridor/zones including Special Economic Zones and National Investment and Manufacturing Zones.
• The information available online is a beta version and will be updated and upgraded soon.
• It currently has specific area-wise details in each state on industrial parks/clusters, the focus sectors, common facilities available for industry, industrial land in use and available industrial land, approved and pending projects etc.
• The database also has information on the distance from airport/port to each industrial area/cluster and a satellite map view of the area.

Interest rates may be at the bottom of the interest cycle

• If you’re a retiree subsisting on income from bank deposits, you’re probably dismayed by the ‘bungee-jump’ in interest rates.
• The interest rate on the one-year term deposit in India’s largest bank has nosedived from 9% in July 2014 to 6.5% now. Interest rates on the three-year term deposit have dropped from 8.75% to 6.25%.
• In pegging down their deposit rates, banks have taken their cues from the RBI. The central bank has pared its repo rate, the rate at which it lends overnight money to banks, from 8% three years ago to 6% now.
• So, with bank deposit rates dropping by a steep 250 basis points in three years (50 basis points more than the repo rate), how much further can they fall? And will they rebound at all?
• History suggests that we may be quite close to the bottom of this falling rate cycle.
• The repo rate, which hovered at 9% in April 2001 drifted down to 6% by March 2004, but reversed direction to recapture the 9%peak in July 2008. But, with the global credit crisis hitting India and recessionary trends in the economy, RBI was forced to effect a swift and brutal reduction in rates again from 2008.
• This time around, the repo rate dropped from 9% in July 2008 to 4.75% by April 2009.
• As growth limped back and inflation began rearing its head, the RBI embarked once again on a hiking spree, taking its rates from 4.75% in 2009 to 8% in 2012. The years 2012 to 2014 saw a sideways crawl in rates.
• But with inflation moderating and the economy going into slow motion, RBI pruned its repo rate again, from 8% in 2014 to 6% by August 2017.
• In its recent policy reviews, RBI has shown reluctance to hack away any further, issuing warnings about inflation risks.
• This brief history of interest rates tells us two things. One, benchmark interest rates have broadly gyrated in a band of 6%-9% in the last fifteen years.
• When the rate sinks to the lower end of the band, circumstances conspire to flag off the next rate hike cycle.
• Two, India’s central bank prefers to prioritise inflation targeting over growth. It is usually prompt with pre-emptive rate hikes to quell inflation, but doesn’t hurry to cut rates in a downturn.

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