• Pass-through status removed for VCs
    • In this is year’s budget, income tax exemptions for VCs (Venture Capital funds) registered in India has been restricted to nine sectors. If domestic venture capital funds invest in any other sector and make money, they will have to pay taxes now. Till now, these funds had a pass-through status.
    • What is a pass-through status?
      • Pass-through status means that the income earned by funds are not taxed at all.
  • Trivia about Nusli Wadia – let’s learn some language on the way
    • Remember seeing the movie “Guru”. And remember the young and aristocratic ‘contractor’ depicted in the movie? He has resemblance to Nusli Wadia, the irrepressible Bombay Dyeing Chairman and one of India’s top industrialists. He is known for his stubbornness in fighting corporate battles. The recent reports in the press suggesting that he may have lost his stomach for scraps, has been termed ‘balderdash’ by an article in today’s ET.
    • What is balderdash? It means ‘trivial nonsense’.
    • It goes on to say “Reports from the lair indicate…”. What is lair? The dictionary meaning of a lair is that it is a place that animals use to hide themselves, while at sleep, hibernation or when they take part in reproduction. In this context, it means that the corporate headquarters of Nusli Wadia.
    • BTW, do you know that he is the grandson of Mohammad Ali Jinnah, the founder of Pakistan? It’s no balderdash; hahaha.
  • The size of the US economy
    • It is a $13.3 trillion economy. Let me count the numbers and convert it into crores. Do tell me, if I am wrong. The Princeton University’s definition of a trillion is – one million million. I will go by that. It should be 1.33 crore crore dollars!!! I am not too confident about my bean counting abilities :( Am I right? Any suggestions from maths people from among you?
    • UPDATE: See Kalyan's comment below. He corrects me and says that it is 0.133 crore crores dollars. So; I stand corrected.
  • Mars Express
    • Is a European spacecraft. It found that Mars has huge deposits of pure frozen water under its southern pole.
  • Indian Institute of Tropical Metrology
    • It is located in Pune.
  • National Agricultural Insurance Scheme
    • The Finance Minster announced that a restructuring exercise of the NAIS is taken up.
    • NAIS offers financial security for agriculture and allied activities through insurance schemes to agricultural growers. It was originally implemented by the General Insurance Corporation of India. Subsequently, the administration of the scheme was taken over by the Agriculture Insurance Company of India Limited (AIC) from April 2004.
    • AIC is also likely to be asked to start a weather based crop insurance scheme in two or three states as an alternative.
  • BR Act amended
    • The Banking Regulation Act, 1949 has been amended removing the 25% floor that was there for SLR (Statutory Liquidity Ratio). Removal of this floor means that the RBI can fix SLR at any ratio it wants.
  • What are refuge plants in GM (Genetically Modified) cropping?
    • These are non-GM crops that are grown along with GM crops to evaluate the impact of the GM crops. These refuge plants are expected to prevent/curtail adverse impact of GM seeds on conventional seeds in the same crop.
  • A bit of banking history
    • India’s largest nationalized bank (Punjab National Bank) was not even headquartered in the present day India when it was formed. It was incorporated in Lahore in 1895.
    • The oldest of the nationalized banks is Allahabad Bank that was incorporated in 1865 by three Europeans in Allahabad.
    • Most of the other present day nationalized banks came into existence in the 20th century.
  • An excellent critique of the ‘salva judum’ programme
    • The appropriate response for countering naxalism, is not the Salwa Judum experiment, which has armed one section of the local tribal population against another. Such a practice, of raising poorly armed militias from among the local population to purportedly assist the police, has riven local society, undermined the moral authority of the security apparatus, and de-legitimized the rule of law.
  • Why is amalgamation of the RRBs bad? And what could be the solution for achieving financial inclusion? Excerpts from an excellent piece by Sanjay Sinha.
    • With about 14,500 branches the RRBs are undoubtedly key to providing low-income remotely located families with the financial services required to enable their inclusion in the economic growth process. But the proposed process of state-wide amalgamation of these banks is bad for the following reasons:
      • RRBs don’t operate in a competitive environment. They were formed basically for promoting economic development amongst small/marginal farmers, agricultural labour and other ‘weaker sections’. There is little competition for them in this segment even today.
      • The basis behind such amalgamation which leads to larger entities, is economies of scale. Economies of scale will help in lowering the average cost of operations and boosting margins. The premise behind gaining economies of scale is attracting larger and more paying customers. But the customer profile of RRBs is not going to be having any larger or more paying customer at any time!
      • If it is transaction cost reduction that is being aimed at by this amalgamation, through an alteration of the public sector ethos that they RRBs are mired in now, it is not achievable for the simple reason that the increased size of the labour forces will only increase the potential for disruptive action thus actually increasing transaction costs.
      • Finally, even if greater efficiencies are gained by this amalgamation, the original objective of forming RRBs would not be served. It is well known that small loans are uneconomical for the banks. So amalgamation would make them also chase the same customer profile that the commercial banks do. This would only lead to further ‘financial exclusion’ of the weaker sections.
    • So for achieving the intended financial inclusion two things are recommended:
      • Decontrol of interest rates on small value loans so that banks, rural or commercial, can lend to weaker sections at rates that cover costs. Since commercial banks can never compete with RRBs on lower costs of operations, naturally RRBs would emerge the winner in servicing this segment.
      • Privatising RRBs would throw the ‘non-returnable’ and ‘sarkari paisa’ image that loans by these RRBs have come to acquire from the days of the ‘loan mela’ raj.
  • WTO lingo
    • Doha-lite: It refers to a shallow low-ambition agreement.
    • Single-Undertaking principle: It means that nothing is agreed unless everything is agreed.
  • Cricket World Cup
    • Herschelle Gibbs hit six sixes in one over, in the match between South Africa and Netherlands.
    • He is the third person in the history of first class cricket to achieve this feat. The other two were Sir Garfield Sobers (West Indies) and Ravi Shastri (India).


Nikhil Pavan Kalyan said...

13.3 trillion dollars = 13.3 million million = 13.3 * 10(6)10(6)
=13.3 10(5)10(7) = 13.3 *10(5) Crore = 0.133 Crore crore dollars!!

Please correct it!
10(6) - is 10 to the power of 6 - just for clarification

venkat said...

1 million million = 10 power -2 crore crore dollors.

so it is 0.133 crore crore dollors