April 10,2019

April 9,2019
April 9, 2019
Quiz April 5. 2019
April 11, 2019

Current Affairs for Engineering Service Exam

 Topics list:

  1. National and International Issues on
    1. Economic Development
    2. Social Development
    3. Industrial Development
  2. Energy and Environment
    1. Energy
    2. Environment
  3. Information and Communication Technology
    1. Technology
    2. Application
  1. General Knowledge
  2. Government Initiatives

Topic 1:Economic development

World Economic Outlook 2019

The International Monetary Fund (IMF) has released biannual World Economic Outlook 2019.

Global projections:

  • The global growth will be 3.3% in 2019, down from 3.6% in 2018 and 4% in 2017.
  • The IMF expects growth to pick up in the second half of the year and return to 3.6%, but this is subject to a rebound in Argentina and Turkey.
  • Brexit uncertainties and China’s growth not being as high as expected (down from 6.6% in 2018 to 6.3% and 6.1% in 2019 and 2020 respectively) are risks that will impact these projections.
  • Beyond 2020, the IMF predicts that global growth will stabilise at around 3.5%, buoyed mainly by growth in China and India.
  • Reasons for slow growth:
  1. U.S.-China trade tensions
  2. Macroeconomic stress in Turkey and Argentina
  3. Tighter credit policies in China
  4. Mounting debt levels
  5. Increasing inequality etc.

India’s projections:

  • India’s growth is projected to pick up to 7.3% in 2019 (2019-20) and 7.5% in 2020.
  • Reasons for improvements:
  1. The continued recovery of investment and robust consumption.
  2. A more expansionary stance of monetary policy and some expected impetus from fiscal policy.
  3. These forecasts are nevertheless less by 10 and 20 basis points from earlier forecasts.

Recommendations

Global level:

  • Greater multilateral cooperation to resolve trade conflicts
  • To address climate change and
  • To address risks from cybersecurity, and
  • To improve the effectiveness of international taxation.

India specific recommendations:

  • Continued implementation of structural and financial sector reforms in order to lower public debt and aid growth.
  • Enhancing governance of public sector banks and reforms to hiring and dismissal regulations that would incentivize job creation and absorb the country’s large demographic dividend.
  • A continued fiscal consolidation is needed to bring down public debt, strengthening goods and services tax compliance and lowering subsidies.
  • Speed up the resolution of Non Performing Assets (NPAs) and a simplified bankruptcy framework — measures that can be reinforced by stronger governance of public sector banks.
  • Laws around land reform to change, to expedite infrastructure development as well as changes to hiring and firing laws in order create jobs and absorb the India’s large demographic dividend.

Read more at: The Hindu

World Bank’s Migration and Development Brief

According to the latest edition of the World Bank’s Migration and Development Brief, India has retained its position as the world’s top recipient of remittances with its diaspora sending a whopping $79 billion back home in 2018.

Key Facts:

  • Remittances to low- and middle-income countries reached a record high in 2018.
  • Global remittances, which also include flows to high-income countries, reached $689 billion in 2018, up from $633 billion in 2017.
  • The officially recorded annual remittance flows to low- and middle-income countries reached $529 billion in 2018, an increase of 9.6 % over the previous record high of $483 billion in 2017.
  • Growth in remittance inflows ranged from almost 7% in East Asia and the Pacific to 12 %in South Asia.
  • Remittances to South Asia grew 12% to $131 billion in 2018, outpacing the 6% growth in 2017.
  • The overall increase was driven by a stronger economy and employment situation in the United States and a rebound in outward flows from some Gulf Cooperation Council (GCC) countries and the Russian Federation.
  • In 2019, remittance flows to low- and middle-income countries are expected to reach $550 billion, to become their largest source of external financing.
  • Among countries, the top remittance recipients were India with $79 billion, followed by China ($67 billion), Mexico ($36 billion), the Philippines ($34 billion), and Egypt ($29 billion).
  • Remittances grew by more than 14% in India, where a flooding disaster in Kerala likely boosted the financial help that migrants sent to families. India received $62.7 billion in 2016 and $65.3 billion in 2017 from remittances.

About World Bank’s Migration and Development Brief:

  • It is prepared by the Migration and Remittances Unit, Development Economics (DEC)- the premier research and data arm of the World Bank.
  • It aims to provide an update on key developments in the area of migration and remittance flows and related policies over the past six months.
  • It also provides medium-term projections of remittance flows to developing countries. The brief is produced twice a year.

About Remittances:

  • Remittances are usually understood as financial or in-kind transfers made by migrants to friends and relatives back in communities of origin.
  • These are basically sum of two main components;
  1. Personal Transfers in cash or in kind between resident and non-resident households and
  2. Compensation of Employees, which refers to the income of workers who work in another country for a limited period of time.
  • Remittances help in stimulating economic development in recipient countries, but this can also make such countries over-reliant on them.

Read more at: The Hindu

Small Finance Banks

Data from the Reserve Bank of India (RBI) show that the small finance banks, in total, saw their deposits grow 31.6% in the third quarter (ended December) of this financial year, compared with the second quarter.

What are Small Finance Banks(SFBs)?

The small finance bank will primarily undertake basic banking activities of acceptance of deposits and lending to unserved and undeserved sections including small business units, small and marginal farmers, micro and small industries and unorganised sector entities.

What are the functions of SFBs?

  • Accept small deposits and disburse loans.
  • Distribute mutual funds, insurance products and other simple third-party financial products.
  • Lend 75% of their total adjusted net bank credit to priority sector.
  • Maximum loan size would be 10% of capital funds to single borrower, 15% to a group.
  • Minimum 50% of loans should be up to 25 lakhs.

How are they different from other commercial banks?

  • They Cannot open branches with prior RBI approval for first five years.
  • Cannot lend to big corporates and groups.
  • Other financial activities of the promoter must not mingle with the bank.
  • They cannot set up subsidiaries to undertake non-banking financial services activities.
  • Cannot be a business correspondent of any bank.

Read more at: The Hindu

Topic 5: Government initiatives

Pradhan Mantri Fasal Bima Yojana

The new Crop Insurance Scheme is in line with One Nation – One Scheme theme.  It incorporates the best features of all previous schemes and at the same time, all previous shortcomings / weaknesses have been removed. The PMFBY will replace the existing two schemes National Agricultural Insurance Scheme as well as the Modified NAIS.

Objectives:

  • To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases
  • To stabilise the income of farmers to ensure their continuance in farming.
  • To encourage farmers to adopt innovative and modern agricultural practices.
  • To ensure flow of credit to the agriculture sector.

Highlights of the scheme:

  • There will be a uniform premium of only 2% to be paid by farmers for all Kharif crops and 1.5% for all Rabi crops. In case of annual commercial and horticultural crops, the premium to be paid by farmers will be only 5%. The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss on account of natural calamities.
  • There is no upper limit on Government subsidy. Even if balance premium is 90%, it will be borne by the Government.
  • Earlier, there was a provision of capping the premium rate which resulted in low claims being paid to farmers. This capping was done to limit Government outgo on the premium subsidy. This capping has now been removed and farmers will get claim against full sum insured without any reduction.
  • The use of technology will be encouraged to a great extent. Smartphones will be used to capture and upload data of crop cutting to reduce the delays in claim payment to farmers. Remote sensing will be used to reduce the number of crop cutting experiments.
  • PMFBY is a replacement scheme of  NAIS / MNAIS, there will be exemption from Service Tax liability of all the services involved in the implementation of the scheme. It is estimated that the new scheme will ensure about 75-80 per cent of subsidy for the farmers in insurance premium.

Farmers to be covered

All farmers growing notified crops in a notified area during the season who have insurable interest in the crop are eligible.

  1. Compulsory coverage : The enrolment under the scheme, subject to possession of insurable interest on the cultivation of the notified crop in the notified area, shall be compulsory for following categories of farmers:
  • Farmers in the notified area who possess a Crop Loan account/KCC account (called as Loanee Farmers) to whom credit limit is sanctioned/renewed for the notified crop during the crop season. and
  • Such other farmers whom the Government may decide to include from time to time.
  1. Voluntary coverage : Voluntary coverage may be obtained by all farmers not covered above, including Crop KCC/Crop Loan Account holders whose credit limit is not renewed.

Unit of Insurance

The Scheme shall be implemented on an ‘Area Approach basis’ i.e., Defined Areas for each notified crop for widespread calamities with the assumption that all the insured farmers, in a Unit of Insurance, to be defined as “Notified Area‟ for a crop, face similar risk exposures, incur to a large extent, identical cost of production per hectare, earn comparable farm income per hectare, and experience similar extent of crop loss due to the operation of an insured peril, in the notified area.

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