Indian Current Affairs: 07.01.2011

Politics & the Nation

Look at this editorial that pleads for the formation of Telangana on economic footing.

In the context of the country witnessing scams all around in every sphere, the institution of Lok Pal has again got some attention. Here is an excellent critique of the proposed bill by Justice Rajindar Sachar former Chief Justice of the Delhi High Court.

The Srikrishna panel has suggested six routes to settle the dispute over Telangana but found a “united Andhra Pradesh”, with an economically and politically empowered Telangana region, as the “most workable option”.
“This can be done through the establishment of a statutory Telangana Regional Council with adequate transfer of funds, functions and functionaries. The regional council would provide a legislative consultative mechanism for the subjects to be dealt with by the council,” said the report placed by Union Home Minister P Chidambaram before a meeting of political parties from Andhra Pradesh here on Thursday.
The suggests that Telangana Regional Council be allowed to exclusively deal with subjects such as planning and economic development, water and irrigation, education and skill development, local administration and public health.
Recommending the bifurcation of Andhra’s boundaries into Telangana and Seemandhra, with a new capital for the latter, as the “second best option”, the panel insisted that the option may be exercised only if “unavoidable and if this decision can be reached amicably amongst all the three regions”.

Finance & Economy

The government will link wages under the employment guarantee act to inflation risking higher food inflation, but resisted the demand to bring them on par with minimum wages.
Minimum wages under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) will rise between 17% and 30% from the current Rs. 100 a day with effect from January 1. The new rate will come into effect from January 1 this year and will require an additional Rs. 3,500 crore spend in the current year itself.
The decision to link NREGA wages to inflation is a half-way solution to the demands of social activists that the scheme guarantee at least the minimum wages.
Sonia Gandhi had backed the demand to align NREGA payments with minimum wages. But the government had admitted its inability to meet the demand as states could then revise the minimum wages sharply knowing that the Centre will be legally bound to pay.
It had, instead, set up an expert committee under Planning Commission member Pranob Sen to suggest an appropriate indexing of NREGA wages. The government said it will consider its recommendations once submitted.

The International Monetary Fund (IMF) expects Indian economy to grow by 8.8% during the current financial year, up from 7.4% a year ago, mainly driven by robust growth in farm sector and pick up in consumption.
It had, however, expressed concern over rising prices and underlined the need for controlling inflationary expectations by more monetary actions by the Reserve Bank.

Food inflation rose to 18.3% for the week ended December 25, its highest level in 23 weeks, even as key policymakers in charge of fighting price rise threw their hands up in despair.
The untimely spurt in prices is being attributed to a supply shock, whose effect on retail prices is seen as disproportionate. Food inflation stood at 14.4% in the previous week.
The government’s efforts to tackle food inflation, which has been in double digits since June 2009 except for a three-week period in November, have not yielded much result so far.

American oilfield service provider Schlumberger has executed state-owned Oil and Natural Gas Corporation’s (ONGC) contract to drill India’s first shale gas well in the Damodar Valley. The Houston-based company’s Asian arm drilled the well and is expected to submit its report to ONGC this month. Schlumberger will drill three more wells subsequently to establish possibilities of producing shale gas in India.
Shale gas accounts for 21% of US’ total gas production. Now India is also exploring possibilities to produce shale gas and ONGC is investing 120 crore for the pilot project underway in West Bengal and Jharkhand. With growing demand for energy, companies are looking at shale gas, which is natural gas present within shale formations.
India is yet to conduct comprehensive studies to evaluate shale gas prospects. However, experts believe that the country has more shale gas reserves compared with conventional gas.

International

The Irish National Asset Management Agency (Nama) was set up in 2009 to clean up Irish banks’ balance sheets. It does this by giving the banks newly conjured government IOUs — not euros — in return for dodgy debt. The banks then dump the IOUs on the European Central Bank, which then provides the actual cash. Since Nama swaps IOUs for bank debt at only about half its face value, the three-way transaction can result in a €1 capital loss for every €1 the banks get from the ECB.
Of course, the IOUs now lodged with the ECB may themselves have to be written down, threatening to undermine the ECB’s own balance sheet.

Language Lessons

A dead body that has been brought back to life by a supernatural force; (voodooism) a spirit or supernatural force that reanimates a dead body; Someone who acts or responds in a mechanical or apathetic way

A political leader who seeks support by appealing to popular passions and prejudices

Indian Current Affairs