05.05.2008

• Indian Companies earning $1 bn Profit After Tax for 2007-08
• This year about 10 companies have managed this feat, while last year a mere four companies have done so.
• These companies are: Reliance Industries, SBI, DLF, Bharti Airtel, Reliance Comm, TCS, Infosys, Sterlite Industries, Hindustan Zinc and ICICI Bank.
• What is notable is that a company like TCS has taken 40 years to achieve this mark, while Bharti Airtel has taken about 13 years to do so. But Reliance Comm has done this in just 4 years.
• George Bush’s remarks on India’s contribution to global food crisis
• He is reported to have said that higher prosperity levels in India were pushing demand for food globally.
• There was near unanimous condemnation of such a statement by all the political parties in India.
• Manipur to have Salwa Judum type defence
• Manipur government has decided to replicate the Salwa Judum experiment in the state. This is done by the cabinet with a view to restrict the militant movement within the state.
• Microsoft abandons Yahoo bid
• It withdrew its $42.3 bn bid to buy Yahoo, scrapping an attempt to snap up the Internet icon in hopes of toppling online search and advertising leader Google.
• Yahoo demanded $53 bn for getting acquired, which Microsoft found way too high for the company. It was willing to pay up to $47.5 bn.
• Entire D-6 block of RIL declared discovery block
• What exactly is a ‘discovery’ block and what does this entail?
• A discovery block means that part of the contract area about which the contractor is of the opinion that petroleum exists (based on discovery and results obtained from wells drilled) and is likely to be produced in commercial quantities.
• What this means is that RIL need not surrender 25% of the block area after completion of phase I of exploration and 50% of the area after completion of the II phase of exploration.
• PSUs to be allowed to decide incentives for staff?
• The second pay revision committee for the Central PSUs, which is presently in the process of finalizing its pay revision proposals, is stated to be recommending giving freedom to PSUs to decide on the incentives, while leaving decision about pay scales to the government.
• This is expected to benefit about 4 lakh employees directly and about 17 lakh indirectly.
• If you are asked to state the subtle differences between monetary policy and fiscal policy, what could your answer be? Does it resemble anything like the one that follows?
• Unlike fiscal policy that hits us directly and hence is much more mainstream monetary policy has always been a bit of a black box. Part of the reason is that while fiscal policy (government expenditure, taxes etc) impacts aggregate spending directly, monetary policy acts indirectly by influencing cost and availability of credit and money. Its impact depends on behavioural patterns and institutional developments.
• The net result is monetary policy is a far more inexact tool, bedevilled by leads and lags that make firm prognosis of its outcome difficult to predict.
• When was the cess on crude oil output introduced and why?
• Cess on the crude oil ouput: When it was mooted as per the Oil Industry (Development) Act, 1974, there was arguably a funds crunch in exploration and production (E&P). Then, there was just no provision for FDI or private sector participation in the high-risk and capital-intensive E&P sector.
• But the scenario now is entirely changed, with open bidding for acreage and significant investor interest to invest across the board, both upstream in E&P and downstream in refining in oil & gas.
• Hence there is no case for it to exist.