5-6 march 2015

Assam Assembly passed a resolution on continuation of Special Category status of the state

The Legislative Assembly of Assam on 4 March 2015 unanimously passed a resolution requesting the Union Government to continue with the special category status of the state. The Speaker of Assam Assembly is Pranab Kumar Gogoi.

The resolution passed by the State Assembly also requested the Union Government to ensure that the pattern of funding shall be either 100 percent Central share or on the principle of 90 central shares and 10 percent state share.

The resolution on Special Category status of Assam was moved in the house by Parliamentary Affairs Minister Rokibul Hussein. Reason behind the Resolution
Less contribution from Centre to implement the schemes:
In recent past, it was noticed that Assam has to bear 20 to 50 percent of share in implementing several schemes, which was against the existing funding principle of 90:10 for special category state. This scheme was not followed mainly in five centrally funded scheme and they were
• Command Areas Development (50:50)
• Nirmal Bharat Abhiyan (70: 30)
• Rajiv Gandhi Panchayat Sashastrikaran Yojana (75: 25)
• National Mission on Agriculture Extension and Technology (75: 25)
• Assistance to State for Infrastructure Development for Exports (80: 20)
Less grants for Assam in 14th Finance Commission:

The 14th Finance Commission headed by YV Reddy has allocated lesser grants to the state which is likely to affect the economic growth of the state.

According to recommendations of the 14th Finance Commission, Assam will be given grants-in-aid of 3379 crore rupees to cover the revenue deficit during the period 2015-20. This grant-in-aid is the lowest among the North-Eastern states except Meghalaya which will get 1770 crore rupees as grants-in-aids.

The grants-in-aids for Manipur, Mizoram, Nagaland and Tripura stand at 10227 crore rupees, 12183 crore rupees, 18475 crore rupees and 5103 crore rupees respectively.

Among all the Hilly States, the highest grants-in-aid has been recommended to Jammu & Kashmir at 59666 crore rupees, followed by 40625 crore rupees for Himachal Pradesh.

Maharashtra Government scrapped 5% reservations to Muslims in government jobs

State Government of Maharashtra on 4 March 2015 scrapped the resolution that provided five percent reservations to Muslims in Maharashtra government jobs. The resolution was announced by the erstwhile Congress-NCP government just before Assembly polls in 2014.

In this regard, Devendra Fadnavis headed BJP government released a resolution stating that the ordinance to provide a five per cent job quota to Muslims stands scrapped.

The ordinance was passed by the previous government on 24 July 2014 and lapsed on 23 December 2014. Background
Congress-NCP led government of Maharashtra in June 2014 had approved a 16 percent reservation for Marathas and five percent for Muslims ahead of the Assembly polls that were held on 15 October 2014.

These quotas were given through two separate categories namely the Educationally and Socially Backward Category (ESBC) for Marathas as well as a Special Backward Class (Muslims) segment for the Muslims.

The Bombay High Court on 14 November 2014 had put a stay on the 16 percent reservation to Marathas in jobs and education from implementation in the state. The court had also stayed the decision on five percent reservation to Muslims in government jobs but allowed quotas for Muslims in educational institutions.

This was challenged by the then Maharashtra government in the Supreme Court which refused to interfere with the interim decision of the High Court. But the Supreme Court asked the state government of Maharashtra to go back to the Bombay High Court on the issue.

Lok Sabha passed Coal Mines (Special Provisions) Bill, 2015

Lok Sabha on 4 March 2015 passed the Coal Mines (Special Provisions) Bill, 2015 by voice vote. This bill will replace the Coal Mines (Special Provisions) second ordinance, 2014. Provisions of the Bill
• It has provisions for allocation of coal mines through a transparent bidding process like e-auction that will ensure the continuity in coal mining operations.
• It facilitates e-auction of coal blocks for private companies for captive use and allots mines directly to state and central Public Sector Undertakings (PSUs).
• It provides for vesting of the right, title and interest in and over the land and mine infrastructure together with mining leases to successful bidders.
• It proposes strong measures for rehabilitation and compensation for farmers who are displaced.

Foreign Secretary S Jaishankar completed his SAARC Yatra

Foreign Secretary S Jaishankar completed his SAARC Yatra of four nations on 4 March 2015. His SAARC Yatra started on 1 March 2015 and ended on 4 March 2015. He undertook the SAARC Yatra with an aim to firm up India’s ties with members of the grouping while reviewing regional and bilateral cooperation.

During the Yatra, he visited four countries namely Afghanistan on 4 March 2015, Pakistan on 3 March 2015, Bangladesh on 2 March 2014 and Bhutan on 1 March 2015. Jaishankar visit to Afghanistan: During the visit, he called on Afghan President Ashraf Ghani and CEO Abdullah Abdullah and held extensive talks focusing on India's development projects and the security situation in the war-torn country. Afghan leaders welcomed India being partner of choice for Afghanistan and briefed the Foreign Secretary Jaishankar about their views on India's involvement in furthering the cause of stability and security in the country.

Jaishankar visit to Pakistan: During the visit, he held Foreign Secretary level talks with his Pakistani counterpart Aizaz Chaudhary, which was cancelled in July 2015. He also met with Prime Minister Nawaz Sharif and his Advisor on Foreign Affairs and National Security Sartaj Aziz. He handed over a letter from Prime Minister Narendra Modi to Pakistan Prime Minister Sharif.

Jaishankar visit to Bangladesh: During the visit, Jaishankar met with Prime Minister of Bangladesh Sheikh Hasina in Dhaka. He also met with Bangladesh Foreign Minister Abul Hassan Mahmud Ali and Bangladesh Foreign Secretary Shahidul Haque. He held foreign secretary level talks in Dhaka.

Jaishankar visit to Bhutan: During the visit, he met with Bhutanese Prime Minister Tshering Tobgay and held discussions on SAARC co-operation and bilateral ties. He also met with the 4th King of Bhutan Jigme Singye Wangchuck.

Australia created the record for highest ever score of 417 in Cricket World Cup

Australian cricket team on 4 March 2015 created the World Cup record for highest-ever score of 417 for 6 in a match against Afghanistan in Perth. It defeated Afghanistan by 275 runs which was the biggest winning margin in the tournament’s history.

Afghanistan was bowled out for 142 in 37.3 over.

The record was created with the help of David Warner’s 178 runs, Steve Smith’s 95 runs and Glenn Maxwell’s 88 runs. The previous record of highest runs in a World Cup match was held by India and it was 413 run at a loss of 5 wickets. The record was created on 19 March 2007 against Bermuda played at Queen's Park Oval and India won the match by 257 runs.

The winning margin of India which was broken by Australia was earlier equaled by South Africa on 27 February 2015 in their victory over West Indies in Sydney.

Highest World Cup Scores
• 417 run at a loss of 6 wickets in a match Australia vs Afghanistan at Perth on 4 March 2015
• 413 run at a loss of 5 wickets in a match India vs Bermuda at Port of Spain on 19 March 2007
• 411 run at a loss of 4 wickets in a match South Africa vs Ireland at Canberra on 3 March 2015
• 408 run at a loss of 5 wickets in a match South Africa vs West Indies at Sydney on 27 February 2015
• 398 run at a loss of 5 wickets in a match Sri Lanka vs Kenya at Kandy on 6 March 1996

Lok Sabha passed Insurance Laws (Amendment) Bill, 2015

Lok Sabha on 4 March 2015 passed the Insurance Laws (Amendment) Bill, 2015 by voice vote. The Bill will replace the Insurance Laws (Amendment) Ordinance, 2014. The Ordinance amends the Insurance Act, 1938 (the Act), the General Insurance Business (Nationalisation) Act, 1972 and the Insurance Regulatory and Development Authority (IRDA) Act, 1999.

The Bill was introduced in Lok Sabha on 3 March 2015.

Provisions of the Bill
• It seeks to remove archaic provisions and incorporate modern day practices emerging in a changing dynamic environment, which includes private participation.
• It hikes Foreign Direct Investment (FDI) cap in the insurance sector to 49 percent from present 26 percent.
• It calls for establishment of Life Insurance Council and the General Insurance Council. They will act as self-regulating bodies for the insurance sector.
• It allows PSU general insurers to raise funds from the capital market.
• It also provides for increased penalty for those who deter multilevel marketing of insurance products like imprisonment of up to 10 years for selling policies without registration with the insurance regulator.
• It prohibits an insurer from challenging the life insurance policy on any ground after a period of three years of selling it.

Reliance Infrastructure Ltd announced acquisition of Pipavav Defence Company Ltd

Anil Ambani-led Reliance Infrastructure Ltd on 4 March 2015 announced the acquisition of management control of Pipavav Defence and Offshore Engineering Company Ltd (PDOE) for 2082.3 crore rupees. With this acquisition, Reliance Infrastructure Ltd will foray into the emerging business of defence production.

As part of the acquisition, Reliance Infrastructure with its wholly-owned subsidiary Reliance Defence Systems Private Ltd will pay 819 crore rupees to buy 18 percent stake from Nikhil Gandhi-led Pipavav Defence. It will make an offer for an additional 26 percent stake at 66 rupees per share totaling to 1263.3 crore rupees. After the change in management and control, the company will be renamed Reliance Defence Ltd. and Anil Ambani will be its Chairman.

Post acquisition, the existing promoters of Pipavav Defence will continue to retain a minority stake in the company, together with two non-executive board seats. The acquisition is subjected to all regulatory and statutory approvals.

About Pipavav Defence and Offshore Engineering Company Ltd (PDOE)

Led by Nikhil Gandhi, Pipavav Defence is India's first world class integrated defence production, ship building and offshore infrastructure company.
It is the country's first private sector company to get the licence and contracts to build frontline warships for the Indian Navy.

It has one of the world's largest infrastructure facilities spread over 841 acres of land on the Gujarat coast and has one of the world's largest dry docks measuring 662 meters in length and 65 meters in width.

CCEA gave nod to extend PDS Kerosene, Domestic LPG Subsidy Scheme

The Cabinet Committee on Economic Affairs (CCEA) on 4 March 2015 gave its nod to extend the PDS Kerosene and Domestic LPG Subsidy Scheme 2002 for a period of one year that is up to 31 March 2015. It also approved extension of the Freight Subsidy Scheme 2002 for far-flung areas till 31 March 2015. The Freight Subsidy Scheme 2002 provides for freight subsidy to PDS Kerosene and Domestic LPG consumers in far-flung areas.

These approvals will help in reducing the under-recovery of the Oil Marketing Companies (OMCs). Till date government was providing a subsidy of 22 rupees 58 paise per 14.2 kg on LPG cylinder and 82 paise per litre on PDS Kerosene and Domestic LPG Subsidy Scheme.

It also approved extension of the Freight Subsidy Scheme 2002 for far-flung areas till 31 March 2015. The Freight Subsidy Scheme 2002 provides for freight subsidy to PDS Kerosene and Domestic LPG consumers in far-flung areas.

BBC released a documentary film India's Daughter

British Broadcasting Corporation (BBC) on 4 March 2015 released a documentary film India's Daughter. The documentary film has been directed by Leslee Udwin.

The film is based on the Delhi gang rape and murder of the 23-year-old female named Nirbhaya that took place on 16 December 2012. The film was simultaneously released in Denmark, Sweden, Switzerland, Norway and Canada.

The documentary includes an interview conducted by British filmmaker Leslee Udwin and BBC of Mukesh Singh, the driver of the bus. Mukesh has made derogatory statements against women.

A Delhi court has restrained the media from publishing, broadcasting, telecasting or uploading the interview on the internet. Also, Indian Parliament witnessed outrage over the interview and demanded to ban the screening of the documentary to which Union Government heeded.

The makers of the documentary had earlier decided to release the film on the occasion of International Women’s Day on 8 March 2015. However, they decided it to launch it earlier following the decision by the Indian authorities to ban the film.

RBI adopted Inflation Targeting as a policy tool for monetary regulation

Inflation Targeting: the new foundation of Monetary Policy Framework

Inflation targeting was in news recently as Union Government and Reserve Bank of India (RBI) on 20 February 2015 signed an agreement on Monetary Policy Framework. As per the agreement, RBI accepted to focus on flexible inflation targeting.

Inflation targeting is defined as an economic policy in which a central bank estimates or decides for a medium-term target inflation rate.

Inflation Targeting: the new foundation of Monetary Policy Framework

Inflation targeting is defined as an economic policy in which a central bank estimates or decides for a medium-term target inflation rate.

In Indian context, as per the agreement, inflation targeting means that the RBI will have to maintain Consumer Price Index (CPI)-based inflation targets below six per cent by January 2016 and four per cent from 2016-17, with a band of plus/minus two per cent.

The new framework makes RBI more accountable as now it will have to explain to the government if it fails to meet the inflation targets.

The transition from monetary targeting suggested by Chakravarty Committee (1988) to Inflation targeting suggested by Urijit Patel Committee is similar to the practice adopted by central banks in developed countries.

Benefits of Inflation Targeting

The benefits of inflation targeting are many. Two of the prominent benefits of inflation targeting are enhancement of transparency and reduction of price variability.

The most important benefit of inflation targeting is that it helps the central banks to maintain low inflation and low inflation eventually promotes long term growth.

Other most important benefits of using inflation targeting include enhanced public understanding of monetary policy, increased central bank accountability, and an improved state for economic growth.