Today's GK (16-813)

Consumers should brace for a more than 15% rise in cost of making calls over mobile phones as some operators consider increasing rates, albeit gradually, to boost profitability and increase their cash flows.

"All we want is 10 paise (per minute) more from customers," said a top executive at one of India's largest mobile phone operators. "And that too, over a period of time, not at one go. I am sure they (customers) won't mind."

The extra 10 paise is all that most top mobile phone operators would need to boost profitability, and generate enough cash to fund capital expenditure plans which would be the bedrock of their future growth, this person

The finance ministry plans to increase the weightage given to debt recovery in the appraisals of top public sector bank managers in an effort to stem the rising tide of bad loans at these lenders.

The ratio of non-performing assets to total credit of state-run banks rose to 3.78% in March 2013 from 3.17% a year ago. At present, a bank chairman can claim up to 8 lakh as incentive if he scores a perfect 100 on the appraisal matrix. The performance incentive for executive director is 6.5 lakh.

"Besides credit growth and other banking parameters, there is a need to focus on recoveries. If the top brass at the banks make an extra effort towards it, the action will percolate to the lower ranks," a finance ministry official said requesting anonymity.

India's worst naval accident in at least three decades that gutted and sank INS Sindhurakshak early morning on Wednesday remains unexplained, but will inevitably call to attention the country's submarine programme, marked by islands of achievements in an ocean of delays, political indecision and administrative bungling.

A massive fire lit up the sky near the Mumbai Naval Docks in Colaba around midnight after a series of explosions tore through INS Sindhurakshak, a Russia-made Kilo class submarine first commissioned in 1997 and comprehensively upgraded last year.

Many of these banks were among early outsourcers and used to work with several service providers but are now looking to bring down the number from as much as six vendors to as few as three, sometimes moving work from smaller, local firms to global vendors, a senior Wipro executive said. By offering more work to fewer service providers, these banks are also looking for discounts.

He can walk into any Indian team on a given day but former captain Kapil Dev decided to keep himself "out" of the best-ever Indian ODI line-up which he feels should be led by another limited overs legend Mahendra Singh Dhoni.

The World Cup winning captain's team of 12 has young Saurashtra all-rounder Ravindra Jadeja while Harbhajan Singh and Anil Kumble are the other two spinners.

Apart from Dhoni, the team has legendary Sachin Tendulkar, Virender Sehwag, Sourav Ganguly, Virat Kohli and Mohammed Azharuddin while Zaheer Khan and Javagal Srinath are the two fast bowlers.

Interestingly, Kapil didn't select a single member of the victorious 1983 squad.

Backed by her bronze medal-winning performance at the World Championships last week, PV Sindhu entered the top-10 of the women's singles rankings for the first time in her career.

In the latest Badminton World Federation (BWF) rankings, released Thursday, the 18-year-old jumped two places to No.10 while citymate Saina Nehwal retained her No.4 position.

The efforts by government and social sector to create awareness about organ donation is finally paying off as more and more people are coming forward for the 'final act of kindness'. In the last 24 hours, the All India Institute of Medical Sciences (AIIMS) has received three cadaveric donations.

British MP Barry Gardiner has written to Gujarat chief minister Narendra Modi, inviting him to visit the House of Commons and speak on 'The Future of Modern India', a move that ends UK's decade-long boycott of Modi following the 2002 Gujarat riots.

Gardiner, who is also the chairman of Labour Friends of India, told TOI that he invited Modi because he is the chief minister of a state with which Britain has more FDI than the rest of the country put together.

Bangalore-headquartered Indian Institute of Science (IISc) has once again made the country proud. It is the only Indian institute that has made it to the top 500 in the 2013 Academic Ranking of World Universities.IISc, which was ranked 45 in the world ranking for Chemistry last year, is on 43rd spot this time

President Pranab Mukherjee has rejected the mercy petition of two death row convicts found guilty of raping and murdering an 18-year-old girl. With this, Mukherjee has rejected 11 mercy petitions awarding death penalty to 17 convicts -- the highest in the last 16 years. Shankar Dayal Sharma (1992-1997) had rejected 14 petitions during his five-year tenure while Mukherjee has completed 13 months in office.

The tussle between Google and Microsoft over the "official" YouTube app for Windows Phone turned nasty on Thursday. A few hours after Google banned its YouTube app, Microsoft hit out saying that "Google just doesn't want Windows Phone users to have the same experience as Android and Apple ( iOS) users."

The government of India and the World Bank on 14 August 2013 signed a 100 million US dollars credit agreement aimed at helping low-income households to secure loans to purchase, build or upgrade their dwellings.

The Low Income Housing Finance Project would be implemented by the National Housing Bank (NHB).

The credit agreement for the Low Income Housing Finance Project was signed between the Government of India, National Housing Bank (NHB) and World Bank in New Delhi on 14 August 2013.The project aims at reaching a higher proportion of lower income households while maintaining portfolio quality standards.

About the Project

1.The objective of the project is to provide access to sustainable housing finance for low-income households to purchase, build or upgrade their dwellings.
2.The project will support the government’s agenda for financial inclusion by making it easier for low-income households in urban areas to access housing finance.
3.The project will also support financial institutions which target low-income households and build their capacity to scale up sustainable housing finance.
4.This project will allow low-income households to switch from informal finance to longer-term, formal sources for their housing needs.
5.The project funding is a financial intermediary loan for an implementation period of 5 years.
6.The project will be financed by a credit from the International Development Association (IDA), the World Bank’s concessionary lending arm which provides interest-free loans with 25 years to maturity and a grace period of five years.

Comment

India’s urban population is expanding at a rapid pace and is expected to rise to 600 million by 2031, more than double that in 2001.

Housing shortages in India are also acute with more than 90 percent of the shortage being faced by low-income households. In 2012 the urban housing shortage was estimated at 19 million.

In India housing shortages are a result of several challenges facing the housing sector. Current land use policies and building norms restrict the availability of housing and developers tend to refrain from entering the low-income market due to perceived risks associated with buyers who lack access to formal finance.

The bulk of the low-income population works in the informal sector, with no documentation of income is also worsening the problem.

Most banks in India do not have the tools or the capacity to assess and manage credit risk for this market. And most non-bank financial institutions lack access to the long-term funding necessary to make housing finance affordable to low income household.

Israel and the Palestinian Governments resumed their first direct peace talks in Jerusalem on 14 August 2013 after a three-year of gap for resolving the land and border disputes.

 

The Palestinian Authority, led by President Mahmoud Abbas, made the release of 104 prisoners a condition for resuming the talks. In response Israel government on 13 August 2013 released 26 long-term Palestinian prisoners as part of the deal to reopen negotiations.

The Palestinian team leaders Saeb Erekat and Muhammed Shtayyeh and Israeli team leaders Tzipi Livni and Isaac Molcho are participating in the present peace talks.

US Middle East Peace Envoy Martin Indyk and his deputy, Frank Lowenstein are participating as US mediators in the talks.
The Key issues in the talks are Status of Jerusalem, borders, security arrangements, settlements and possible land swaps, Palestinian refugees, recognition of Israel.

Israel and the Palestinians returned to the negotiating table on 30 July 2013 in Washington after US mediation. They agreed to work towards an agreement within nine months for a two-state solution to end their decades-long conflict.
The last round of direct peace negotiations collapsed in September 2010 because Israel refused to stop constructing settler homes on occupied Palestinian land.

The Palestinians want their state to include land captured by Israel in 1967, but some 500000 Israelis now live in settlements built on the occupied territories. The settlements are considered illegal under international law, though Israel disputes this.

The Central Government on 13 August 2013 raised customs duty on gold, silver and platinum to 10 percent in a bid to curb the surging imports and burgeoning Current Account Deficit.

According to the notification of the Central Board of Excise and Customs, the duty on gold and platinum was raised from 8 percent to 10 percent and the levy on silver was raised from 6 percent to 10 percent. This step would also collect an additional 4830 crore rupees to the exchequer.

This is the third time that the Government has raised the duty on gold in 2013 with a view to containing its imports, mainly responsible for spurt in CAD which touched at a record high of 4.8 percent in 2012-13.

 

Import of gold went up by a huge 87 per cent from 205 tonnes in April-July 2012 to 383 tonnes during the corresponding period of 2013. In value terms, the increase was 68 per cent from 56488 crore rupees to 95092 crore rupees.

In the case of silver, import during April-July 2013 was valued at 12789 crore rupees in comparison with 4281 crore rupees during the corresponding period of 2012, registering a 200 per cent increase.

The Government is also planning to announce more measures to curb other non-essential imports, including luxury items, in order to contain the Current Account Deficit to 3.7 percent of Gross Domestic Product (GDP) in 2013-14 compared with 4.8 percent of GDP in the last fiscal year (2012-13).

The basic purpose of enhancing the import duty was to curb the import of the precious metals to check the Current Account Deficit (CAD). CAD is the difference between inflow and outflow of foreign currency.

A high Current Account Deficit impacts the value of currency which in turn makes imports expensive and adds to the fiscal deficit.

The Union Petroleum and Natural Gas Ministry on 13 August 2013 decided to extend Direct Benefit Transfer for LPG (DBTL) scheme to 35 more districts from 1 September 2013.

With this extension the total districts covered under this scheme would go up to 55 districts.

The new districts which will be covered under the scheme include 12 in Kerala, seven in Andhra Pradesh, seven in Himachal Pradesh, five in Punjab, two in Madhya Pradesh and one each in Maharashtra and Goa.

The decision to include 35 more districts would add about 1.4 crore consumers to the 2.12 crore existing consumers.
Under this scheme consumers will get an advance of 435 rupees in their bank accounts. They can then use this to buy gas cylinders at the market price which is double the subsidised rate.

Since its launch on 1 June 2013, about four million direct cash transfers have taken place to consumers’ bank accounts. So far, 150.6 crore rupees has been transferred to consumers in 20 districts of phase one.

About the Scheme

• The Union Government on 1 June 2013 launched the Direct Benefit Transfer for LPG (DBTL) scheme with the aim of curbing leakages, preventing black-marketing and sending gas subsidy to the consumers’ bank accounts.

• All Aadhaar-linked domestic LPG consumers get an advance of 435 rupees an LPG cylinder in their bank account as soon as they book the first subsidised unit before delivery.

• When the first subsidised cylinder is delivered to such consumers, the next subsidy will be credited to their bank account, which can then be used for the purchase of the next subsidised cylinder at the market rate

The Union Cabinet on 13 August 2013 approved the proposal for setting up of the Tax Administration Reform Commission (TARC) to remove ambiguity and establish a stable and non-adversarial tax administration.

About the commission

• The Commission will consist of a Chairman, two full time members and four part-time members, of which at least two part-time members will be from the private sector.

• The Chairman will be an eminent person having wide experience of tax administration and policy making. The two full-time members will be with a background in revenue service pertaining to Income Tax and Central Excise and Customs respectively. The term of the Commission will be 18 months.

• The Commission will review the application of tax policies and tax laws in India in the context of global best practices and recommend measures to strengthen the capacity of the tax system in India that would reflect best global practices.

• The Commission will help in removing ambiguity in application of tax policy and tax laws, thereby establishing a stable tax regime and a non-adversarial tax administration.

• The Commission will facilitate an efficient tax administrative system that would enhance the tax base as well as tax payer base.

Egypt on 14 August 2013 declared a state of emergency after many people were killed in a bloodbath when security forces, stormed two camps occupied by supporters of ousted President Mohammed Morsi in Cairo. The protesters were camping outside the eastern Rabaa al-Adawiya mosque and at Nahda Square.

The emergency will be in place for one month. The state of emergency enables the army to take all necessary measures to impose and retrieve security.

Protesters had camped in Cairo demanding the reinstatement of Morsi, who was country's first democratically elected President and his Freedom and Justice Party was the largest political group in the now dissolved parliament.