23.01.2007

• Look how the government is trying to tackle inflation:
• The government has slashed customs duty on a host of items, including cement, capital goods, steel, copper, aluminium and inorganic chemicals. This is an attempt at reducing cost of manufacturing in basic industries while providing a shot in the arm for infrastructure development.
• Duty on Portland cement made 0% from 12.5%
• Duty on project imports brought down to 7.5% from 12.5%
• Some movement on pension funds management
• The central government with the support of 19 other state governments has decided that 5% of the funds collected under the New Pension Scheme will be allowed to be invested in stock markets.
• Under the NPS, states collected an amount of Rs. 1500 crores till date.
• The NPS corpus earns an interest of 8% at present.
• The Supreme Court ordained police reforms in brief:
• Constitution of the state security commission, separation of investigation and law and order duties, setting up of a police complaints authority and formation of a national security commission.
• Future bureaucrats take note:
• The Administrative Reforms Commission headed by Veerappa Moily, has proposed in its forthcoming report on “Ethics in Governance”, simplification of procedures adopted for the initiation of disciplinary proceedings against errant officers.
• So far, articles 310 and 311 of the constitution of India have been the corner stones on which the security of tenure and security of job of the bureaucrats were based.
• Space Recover Experiment SRE-1
• The SRE-1 satellite sent out into the space through PSLV-C7, has successfully landed back on earth. It splashed into the Bay of Bengal, from where it had been recovered.
• The SRE demonstrates the technology of an orbiting platform for doing experiments in micro-gravity conditions.
• The SRE has an aero-thermal protection system. ISRO is testing basic technology for protective outer jackets for satellites and vehicles through this experiment.
• ET-NCAER Business Confidence survey
• India Inc’s confidence has touched a new high according to the survey. The index has peaked to 157.3, up 3% since the October quarter.
• TUFS likely for the steel sector
• You would have read about the TUFS scheme for the textile sector. The same scheme is also being proposed for the steel sector.
• TUFS for textile sector has been functioning from 1999. Under this scheme, lenders give an interest subsidy of up to 5% for modernization and technological upgradation of certain segments of the textile sector that is reimbursed by the government.
• Capetown Convention
• India is likely to join this convention, taking the convention’s strength to about 14.
• The convention is about establishing an international legal regime for high-value and mobile equipment, such as aircraft, railway rolling stock and space equipment.
• The principal objective of the convention is to ensure efficient financing of expensive equipment.
• Once India joins this, the risk attached to asset-based financing and leasing transactions of airline companies is expected to go down.
• This is significant in view of the fact that India is likely to procure about 480 aircraft in the next five years at an estimated investment of $30 bn, which will increase the total number of aircraft in the country to about 775.
• Millennium Development Goals
• UN member states have these goals (eight of them in all) with 2015 as the target date by which they should be achieved.
• The goals include eradication of hunger and poverty, education, gender equality, and aim at combating child mortality, AIDS and other diseases.
• At the time these goals were adopted, India’s population below poverty line was about 26.1%. The goal is to reduce this 18.75% by 2015.
• Look east policy and multilateralism
• In the face of lurking fear of collapse of the WTO talks, Pascal Lamy the Director General of WTO has noted that the WTO members would have entered into about 400 bilateral and regional trade agreements by 2010.
• Already 55% of Asia’s trade is happening within its boundaries. This is bound to go up substantially in due course.
• This is how we are witnessing a progressive evolution of a pan-Asian FTA in goods and services with ASEAN acting as a sort of glue.
• Japan, the major OECD country of the Asian region, has lobbied hard for a wider EAS (East Asian Summit) process which includes India.
• The West may have seen enough cause for worry in this evolving process and may possibly feel that is going to be left out of the robust Asian interaction.
• On financial inclusion
• I recommend reading today’s debate on this subject in ‘Perspectives’.
• A very good definition of financial inclusion coming from Nachiket Mor, the Dy. MD of ICICI Bank runs like this: We understand financial inclusion to mean the ability of every individual to access basic financial services which include savings, loans and insurance in a manner that is reasonably convenient and flexible in terms of access and design and reliable in the sense that the savings are safe and that insurance claims will be paid with certainty.
• Banking Corresondent Act permits partnerships between banks and non-banking entities.
• The first district in the country to achieve 100% financial inclusion is Palakkad in Kerala. This is followed by Gulbarga in Karnataka.
• About currency making
• While Indian currency notes are made of paper entirely, euros and Australian dollars are composed of polyester like synthetic mix, making them more durable
• There are about 25000 ATMs in the country. The country is stated to be adding about 5000 to 7000 ATMs per year.