Indian Current Affairs: 14.02.2011

Finance & Economy

The Global Hunger Index released by International Food Policy Research Institute (IFPRI) places India 67th in rankings with a score of 24.1, far below China and below Sri Lanka, Pakistan and Nepal.
The Global Hunger Index is calculated as an average of (1) proportion of the population that is undernourished (in %), (2) prevalence of underweight in children under five (in %) and (3) proportion of children dying before the age of five (in %). For India, the respective numbers are 22, 43.5 and 6.9.
According to FAO, about 25% of world’s undernourished live in India.

Take a look at the expert take on the issue. It runs contrary to the popularly held beliefs.
The notion that capital flows between countries are based largely on interest rate differentials no longer holds true. Money has been pouring into emerging markets over the past few years due to their superior growth prospects. The large capital outflows over the past month from developing countries, even as interest rates have risen, are evidence of the fact that a deterioration in future growth and inflation prospects is a much more powerful force behind capital flows.

The Union budget for 2011-12 could give an unconditional 2% subsidy on short-term farm loans to all districts that are more prone to drought and floods.
At present, only those farmers who repay loans on time are eligible for the 2% interest rate subvention, which brings down the interest rate on their short-term crop loan to 5% as banks have to give such loans at 7% rate of interest.
Fiscal 2009-10 recorded a 16% rise in farm loans, and Finance Minister Pranab Mukherjee hiked the loan target for 2010-11 to Rs. 3,75,000 crore, from Rs. 3,25,000 crore in the previous year, noting that banks had been meeting the targets set for agriculture credit flow in past few years.
A panel headed by Haryana Chief Minister B S Hooda has recommended that the effective short-term farm loan interest rate be brought down to 4%. The report has been sent to the National Development Council (NDC). Sending the report to the NDC will ensure that several of the key recommendations made by the panel become more binding on the state.

Sebi has initiated investigation into the insider trading charges against RIL. RIL has reportedly made a profit of about Rs. 500 crore from the sale of Reliance Petroleum shares.
Between November 1 and 6 of 2007, entities acting as agents to RIL sold 18.04 crore shares, or 4.01%, of Reliance Petroleum's equity for Rs 4,023 crore. The sellers had the same addresses as some RIL group companies. The insider trading allegation stems from the fact that there were two transactions: first in futures and then in cash. The analysis behind the insider trading allegation is that the company knew that it intended to sell shares in the cash segment when it transacted in the futures segment. This amounted to insider trading, it is alleged.
Sebi will now ask RIL to appear before it and respond to the show cause notice. Sebi had issued the notice in April 2009.
The regulator can impose a penalty of 25 crore or three times the amount of profit a company made from insider trading, whichever is higher. The potential penalty could thus be Rs. 1,500 crore.
Reliance Petroleum, which was set up to build a refinery in Jamnagar, no longer exists and has been merged with RIL.

International

Our favourite environment thinker, Bjorn Lomborg takes on the recent fallacy about 'green jobs.' His argument is that the promise of the so-called 'green jobs' does not measure up to economic reality. Take a look.

Iran has been selling crude to Indian refiners on credit for the past few months after the Reserve Bank of India stopped payments through the Asian Clearing Union, which US says Iran was using to avoid sanctions. This effectively ended settlement in dollars and euros.
India and Iran have been looking for banks that are not under the sanctions to make payments to the National Iranian Oil Co for the crude it ships to India.
But their efforts have not yet been successful.

Language Lessons

Useless printed instructions and manuals.
Originated in England during World War II when English soldiers were overwhelmed with unnecessary printed materials and used them as they would toilet tissue or "bum fodder".

Indian Current Affairs