Indian Current Affairs: 13.06.2008

Data released by the Central Statistical Organisation (CSO) on Thursday shows that the 7% growth of the Index of Industrial Production (IIP) in April is slower than the 11.3% attained in the same period last year, but sharply higher than a revised 3.9% in March.
Economic growth has averaged 8.9% in the last four years, making India the fastest-growing major economy in the world after China. Per-capita income doubled to Rs 24,321 in the year to March 2008 at constant prices, compared with 2001. At current market prices, per capita income topped Rs 33,000 in 2007-08. The government expects 8.5% growth in the current fiscal.
Take a look at the IIP in detail here.

RBI hiked the repo rate by 25 bps to 8%. Repo rate is the rate at which it lends funds to the banks. 25 bps is 25 basis points; which is another way of saying 0.25%.

These come into play while dealing with SSMs – Special Safeguard Measures. SSMs give developing countries the authority to increase import duties on specific farm products beyond the levels at which they have been bound at the WTO if there is a sudden increase in volume of imports or a fall in domestic prices. These are known as triggers.
India’s contention is that the triggers listed in the draft are set at such high levels that they would prove to be totally ineffective in preventing a surge in exports when the need arises and could result in a lot of losses.

MOBILE phone owners in the future will be allowed to transfer funds from their accounts to other mobile phone owners across networks and service providers.
As per the draft guidelines issued by RBI, even those with the most basic mobile phones may be able to pay for transactions through their mobile in the future. RBI has permitted the use of SMS-based mobile payments for small transactions up to Rs 1,500.
RBI has said that the long-term goal of the mobile-payment framework in India would be to enable funds transfer from and account in one bank to any other account in any bank on a real time basis, irrespective of the mobile network the customer has subscribed to.
The central bank has suggested that banks issue a separate mobile-PIN which will be completely different from the internet banking passwords. It has also suggested that the possibilities of dual-factor authentication and one-time passwords be looked into. However, there is some concern over the SMS channel being used for payments, since it is often unreliable and prone to tampering.
This step by RBI is surely a revolutionary one and is welcomed by the payment industry players.

The government needs to help aviation sector obtain a cost structure that is in keeping with global norms. Because of taxes, fuel accounts for about 40% of operating expenses of India’s airlines against 25-35% range for most airlines overseas.
Airport charges in India too are a lot higher than that in neighbouring countries. Since aviation has significant externalities, tourism for one, lower taxes would in net be positive.
The airport infrastructure revamp has to be speeded up and constraints such as route-dispersal that require airlines to deploy some capacity on even unviable routes need to be junked.

BTW ever wondered about the word ‘externalities’ used here. This is a word that is highly used by economists. Simply stated it means ‘spill over effects.’ An externality is a cost or benefit from an economic transaction that parties "external" to the transaction receive. They can be either positive or negative; meaning they can either be beneficial or harmful for those external parties.

India’s current account deficit has been on the rise mainly due to the rising trade deficit which in turn is on account of the rising global price of oil. India’s overall trade deficit for April-December ’07 aggregated to $66.5 billion. With a net invisible surplus of $50.5 billion, the current account deficit stood at $16.04 billion. This was comfortably set-off by ‘capital account’ which showed a surplus of $81.9 billion for the same period.
What consequences flow out of such deteriorating current account deficit situation?

This could lead to a depreciating currency, making imports more costly and reducing liquidity from the markets. This in turn could lead to higher interest rates and a consequent slowdown on economy. A slowdown could hurt both India Inc as also the government which could see lower tax growth and consequent higher deficit.

A DEER with a single horn in the center of its head — much like the fabled, mythical unicorn — has been spotted in a nature preserve in Italy. Look at the pic here.
The unicorn has always been a mythological animal. The 1-year-old Roe Deer — nicknamed “Unicorn” — was born in captivity in the research centre’s park in the Tuscan town of Prato, near Florence.
Single-horned deer are rare but not unheard of — but even more unusual is the central positioning of the horn, experts said.
Other mammals are believed to contribute to the myth of the unicorn, including the narwhal, a whale with a long, spiralling tusk.

This Kamal Hasan starrer is being released today. I rate Kamal Hasan as one of the best actors of Indian cinema. Cinema lovers amongst you can look at this article that appeared in today’s ET.

FOLLOWING appeals by four countries including India, the International Organisation for Standardisation (ISO) has put its earlier decision approving Microsoft’s Open Office OXML (OOXML) file format as an international standard, on hold.
OOXML is a format for word-processing documents, presentations and spreadsheets. The other countries that appealed against the ISO decision are Brazil, South Africa and Venezuela. In April, OOXML was approved as an ISO/International Electrotechnical Commission International Standard, having received the mandated over two-third votes of participating members.

Indian Current Affairs