Indian Current Affairs: 17.07.2007

Many of you would have heard about holding companies. Let’s take a look at why they have become the flavour of the season. Look here.
You shouldn’t miss today’s article by Hasan Suroor on the Muslim dilemma. Take a look at it here. Do you see any pattern in this? It takes a Muslim to write something critical about Muslims. Only a Muslim country gets the courage to storm into a Masjid and restore law and order. It takes only an SC to really challenge some policies which have outlived their utility!! I am referring to Mayawati and KG Balakrishnan. Only a woman gets the courage to refuse reservations for women. Here I am referring to one of our own readers who was against women reservation.
Supreme Court to know the connection between affirmative action and railway tenders!!!

Indian Railways appears to be taking affirmative action too far. It has provided reservation to SCs, STs and OBCs and minorities in awarding commercial contracts relating to catering tenders.
Article 16 provides for reservation in public employment.
Article 15(5) deals with reservation in education.
It would be interesting to watch whether awarding commercial contract falls within the scope of the above articles.
The Court has asked the Attorney General, who was appearing for the Centre to explain the reason for extending reservations in awarding commercial contracts. Let’s see what turns and twists it will start taking now.

Do you know that there is a body called the Investment Commission of India? Take a look at it here: http://www.investmentcommission.in/
It was set up in the Ministry of Finance in December 2004 by the Government of India, and has Mr. Ratan Tata as Chairman and Mr. Deepak Parekh and Dr. Ashok Ganguly as members. It was set up to enhance and facilitate investment in India. The Commission makes recommendations to the Government of India on policies and procedures to facilitate investment, recommends projects and investment proposals that should be fast tracked / mentored and promotes India as an investment destination.

The proposal of the Department of Posts to restrict the FDI in courier industry to 49% has not found favour with the investment commission.
At present FDI in courier services stands at 100%.

At present FDI up to 100% is permitted under the automatic route in select areas such as floriculture, horticulture, development of seeds, animal husbandry, aquaculture, services related to agriculture and allied sectors, and cultivation of vegetables and mushrooms under controlled conditions.

We have noted something about money laundering sometime back. Today we look at its definition once again:

It is the practice of moving illegally acquired cash through the financial system to make it legal.

There is a body called the FIU – Financial Intelligence Unit established in the Finance ministry which takes steps to prevent money laundering activities in India.
Its guidelines now require insurers to report suspicious transactions including those which could be ‘structuring deals.’

‘Structuring deals’ are those which are artificially carved into several transactions to avoid reporting requirements.
Paying insurance premiums in cash is one activity which lends itself to money laundering easily. Generally people opt for big ticket life insurance policies and pay one time premiums running into thousands, at times lakhs of rupees (in cash aka ‘black’ money) and discontinue the policies after a couple of years. The money returned from LIC is shown as ‘white’ money.

It has come out with a new variety of Arabica. This variety can resist the coffee leaf rust disease (CLRD), an ailment that facilitates infestation by the white stem borer.
It also yields 1200 Kg per acre compared to 700 to 750 Kg for normal Arabica.

It refers to the practice of traders using the unrealized profits from the positions they have built upon any securities using funds borrowed from a broker. While it provides the trader with an opportunity of earning far more profits than what his net worth would allow, it also accentuates the fall in a bear market.

State governments hold 15%, Commercial banks 35% and Central government owns 50% in RRBs.
RRBs were on par with co-operative banks earlier in taxation. Both were exempt from paying tax on their profits. But budget 2006-07 has brought RRBs into tax net.
The government is thinking of recapitalizing 29 RRBs with about Rs. 1,850 crores, as they have acquired a negative net worth.

A centrally sponsored scheme (CSS) is one in which specific purpose grants are extended by Centre. These funds are channeled directly to the district administration and local bodies. There are about 150 such schemes.

Indian Current Affairs