News highlights : 29 September 2016

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Janet Yallen

CURRENT AFFAIRS SEP 29, 2016

01. Parliamentary panel will examine ramifications of merger of railway and general budget, says Moily:

Chairman of Parliamentary Standing Committee on Finance M. Veerappa Moily said that the committee will give its report on the ramifications of the Union Cabinet’s decision of merging the Railway Budget with the General Budget before the commencement of next Parliament session. Speaking to presspersons on the sidelines of a function at the University College, Mr. Moily said the committee would examine its implications on the Railways, the Railway Board, statistics, planning and finance departments. The committee would have at least three sittings on the same. “It is a major budgetary reform. The committee would examine in depth the implications and submit its report before the commencement of the winter session in November,” he said. Mr. Moily said the matter would be discussed with the Statistics and Planning Departments on September 29. Later it would be taken up with the Finance department and the Railway Board. The former Union minister said that the Railway Budget has been separate since the British era. When the Railways had its own budget there was flexibility to announce its new programmes and impose levy. It may not be so after the merger.

02.Federal Reserve may change stress tests, capital buffers for US banks: Janet Yellen

The Federal Reserve is considering changing the annual stress tests it gives to US banks to see if they can withstand a massive financial crisis, and also using test results to set the capital buffers that banks must maintain to blunt the effects of a downturn, according to its chair, Janet Yellen. In prepared testimony for a House of Representatives Financial Services Committee hearing on Wednesday, Yellen said the Fed is “now considering making several changes to our stress testing methodology and process.” “The existing capital conservation buffer would be replaced with a risk-sensitive, firm-specific buffer that is sized based on stress test results,” she also said. For the eight US banks that are large and considered important to the global financial system the new buffer calculation “would result in a significant aggregate increase in capital requirements,” Yellen said. Yellen did not comment on the outlook for the economy or monetary policy in her prepared remarks.

03. Income Declaration Scheme: Black money declaration without PAN to be accepted

The I-T department has been directed to accept declarations without PAN under the black money compliance window, but ensure that the unique number is later obtained by the entity concerned. The Central Board of Direct Taxes (CBDT) has asked tax sleuths to ask such declarants to attach a separate application in the Income Declaration Scheme (IDS) form for allotment of a fresh Permanent Account Number (PAN) to them quickly. The decision was notified by CBDT as some field offices brought to its notice that they were encountering “few cases” where an entity wanted to make a declaration of black money under IDS, but had no PAN. PAN is mandatory for a valid declaration under the IDS. It is a ten-digit alphanumeric number issued in the form of a laminated card by the I-T department to any person, firm or entity. “The issue (non possession of PAN) has been examined. It has been decided that in such cases, a declaration under the scheme can be filed manually before the jurisdictional Principal Commissioner/Commissioner by quoting the date and acknowledgment number of PAN application form. The Principal Commissioners/Commissioners are directed to accept such declarations,” the CBDT, policy-making body of the Income Tax department, said

04. IMF chief sees lower US growth, calls trade barriers ‘malpractice’ :

International Monetary Fund Managing Director Christine Lagarde said that the institution would lower its 2016 US growth forecast again and called policies that restrict trade “economic malpractice” that would choke off growth. Lagarde, in prepared remarks at Northwestern University ahead of next week’s IMF and World Bank annual meetings, said the US growth forecast would be reduced again because of economic setbacks in the first half. The IMF in July had cut its 2016 US growth forecast to 2.2 percent from 2.4 percent based on weak first quarter growth. The Fund will issue new forecasts next week in an update to its World Economic Outlook. Japan and Europe were seeing sub-par growth, but the picture did not appear to be deteriorating, Lagarde said. Meanwhile, she said China and India would continue to do relatively better, growing at around 6 percent and more than 7 percent, respectively, while recession-wracked Brazil and Russia were starting to show some signs of improvement. Adding it all up, the good and the bad, we continue to face the problem of global growth being too low for too long, benefiting too few,” Lagarde said.

05. OPEC reaches deal to cut oil output for the first time since 2008 :

OPEC agreed to cut its oil output for the first time since 2008, with the group's leader Saudi Arabia softening its stance on arch-rival Iran amid mounting pressure from low oil prices. Two sources in the Organization of the Petroleum Exporting Countries said the group would reduce output to 32.5 million barrels per day from current production of 33.24 million bpd. How much each country will produce is to be decided at the next formal meeting of OPEC in November, when an invitation to join cuts could also be extended to non-OPEC countries such as Russia, sources said. Oil prices jumped more than 5 per cent to trade above $48 per barrel as of 1924 GMT. Many traders said they were impressed OPEC had managed to reach a deal but others said they wanted to see the details.

06. IGI Airport achieves “carbon neutral” status:

The Indira Gandhi International Airport has become Asia-Pacific’s only and one of the world’s few airports to achieve a “carbon neutral” status. Less than 25 airports in the world, with most of them located in Europe, have earned carbon neutral status. The Delhi airport, managed by private operator Delhi International Airport Ltd (DIAL), boasts green buildings, solar power plants, rainwater harvesting system, etc., which have helped it reduce and offset its carbon emissions. The announcement was made by the Airports Council International during the Airport Carbon Accreditation certificate presentation ceremony in Canada on 27th Sept 2016.

07. One graph that shows India’s big leap in global competitiveness under PM Narendra Modi :

The Global Competitiveness Report 2016-17 released by the World Economic Forum shows India has made the biggest leap among all countries of the world this year. India is placed at the 39th position, which is 16 notches above the last year’s rank. Incidentally, in 2015-16 also India had jumped 16 positions in the Global Competitiveness Index. While Switzerland has topped the list for the record eighth time, it is closely followed by Singapore and the US. With a score of 4.52, India is also the second-most competitive among BRICS nations behind China, which is ranked 28th. Switzerland’s score is 5.81. Much of the change in India’s competitive outlook has been possible because of Prime Minister Narendra Modi reform measures to make India a leading global destination for investment. In the report, a graph comparing 10 years of competitiveness in India shows the country’s competitiveness index remained in the negative for most of the years between 2008-2014, during the Congress-led UPA government. While the index touched above zero points during 2010-11 and 2012-13, it slumped again in the negative in the following years till 2014. In the last two years of PM Modi’s rule, India’s has jumped a whopping 32 places in the competitiveness index.

08. Mumbai wealthiest city in India with total wealth of $820 bn :

India’s financial capital Mumbai, home to 45,000 millionaires and 28 billionaires, is the wealthiest city in the country with total wealth of USD 820 billion, says a report. According to New World Wealth, Mumbai is followed by Delhi and Bengaluru at the second and third place respectively. While Delhi, home to 22,000 millionaires and 18 billionaires has total wealth of USD 450 billion, Bengaluru boasts of a total wealth of USD 320 billion. The city is home to 7,500 millionaires and 8 billionaires. Total wealth refers to the private wealth held by all individuals. The report defines ‘wealth’ as the net assets of a person. It includes all their assets (property, cash, equity, business interests) less any liabilities. The report excludes government funds from its figures. As per the report, the total wealth held in the country amounts to USD 5.6 trillion (as of June 2016). The country is home to 264,000 millionaires and 95 billionaires in total. Other emerging cities in the country include, Surat, Ahmadabad, Visakhapatnam, Goa, Chandigarh, Jaipur and Vadodara, the report said.

09. Possession, sale of imported fireworks illegal: Commerce Ministry

In view of forthcoming festive season and complaints from associations, the government said possession and sale of fireworks of foreign origin in India are illegal and punishable under the law. The commerce and industry ministry said information about possession and/or sale of illegal fireworks may be reported to the nearest police station for suitable action. The Department of Industrial Policy and Promotion (DIPP) has received a number of complaints and representations regarding clandestine import of fireworks of foreign origin under false declarations, the ministry said in a statement. Various fireworks associations have time and again raised this issue, saying these smuggled items include ‘potassium chlorate’, which is a dangerous and hazardous chemical and can ignite or explode spontaneously. “Possession and sale of fireworks of foreign origin in India are illegal and punishable under the Law, information about possession and/or sale of such fireworks may be reported to the nearest police station for suitable action,” it said. Fireworks in India have been declared as restricted item in respect of import by director general of foreign trade, it added.

10. Over 10 lakh train travellers fail to get seats everyday: Study

A recent study by RailYatri.in reveals that over 10 lakh people fail to travel daily due to unavailability of train tickets. The demand-supply mismatch on long distance trains has been a well-known assumption for long. There are more people wanting to travel in a particular train than the available number of seats. But the scale of this mismatch has never been quantified. Since January 2016, RailYatri.in has been tracking train ticket booking patterns across the country to analyse the mismatch. Based on the data gathered from train travellers across the nation, the study revealed that there are nearly 10-12 lakh potential travellers who are unable to travel due to non-confirmed tickets on a daily basis. These are people whose waitlist tickets did not get confirmed. Percentage wise, this would translate to nearly 13 per cent of long distance train travellers daily. In the peak travel season, this number increases to about 19 per cent. Data scientists at RailYatri.in used mathematical models to analyse the travel plans reported by over 30 lakh travellers from over 3,100 railway stations looking for seats in nearly 2,800 trains. Using prediction models, RailYatri.in estimated its overall impact across the nation on a daily basis.