Current Affairs for IAS Exams – 16 November 2016

:: National ::

SC refused to stay demonetising Rs. 500 and Rs. 1,000 notes

The Supreme Court refused to stay government notification demonetising Rs. 500 and Rs. 1,000 currency notes.
However SC asked the Centre to take immediate measures to alleviate the sufferings of the traumatised common man who is “forced” to stand in queues to withdraw a little bit of his own hard-earned money.
Court did not want to interfere with the government’s economic policy, Chief Justice Thakur said the objective of demonetisation might be a “surgical strike” on black money, but it should not cause hardship to the common man.
“Carpenters, masons, daily wage earners, maids, vegetable sellers are dependent on cash; we are only wondering if you are capable of doing anything to reduce the trauma of ordinary man,” Chief Justice Thakur asked
The Bench asked the Centre to file an affidavit by November 25, detailing the various measures it could take to lessen the hardship and inconvenience caused to people without hindering the larger objective of the government notification to get rid of black money and cross-border terror financing.
“After demonetisation, the black money hoarders do not even have the money they once used to have in their pyjamas,” Attorney-General Mukul Rohatgi Rohatgi submitted in the Supreme Court
He said 3.25 lakh crore in Rs. 500/1000 notes was deposited out of 15 or 16 lakh crore in circulation. At least, Rs. 10 to 11 lakh crore is expected to come in.

The government asked banks to start using indelible ink to identify persons

The government asked banks to start using indelible ink to mark and identify persons who exchange old Rs. 500 and Rs. 1,000 notes upto Rs 4,500 to ensure that the facility isn’t used multiple times.
A small mark of indelible ink, used during elections to prevent multiple voting, will be put on the right hand finger of persons exchanging the recalled currency notes.
Freshly minted notes of Rs. 100 denomination will start reaching banks soon to ease the lack of change for the new Rs 2,000 and Rs 500 notes that is impeding day-to-day transactions.
Finance Minister Arun Jaitley, meanwhile, asserted that the Centre was fully prepared for the impact of the exercise and was working for ‘effective currency management’ even as officials sought to manage the fallout.
“There are enough currency notes with banks and in the system. The situation will be continuously monitored… both the supply of cash and of essential commodities.”
The government has also asked religious institutions, which receive donations in smaller denomination notes, to deposit these notes in bank accounts to increase their supply in circulation, Mr. Das added.
Both the RBI and govt emphasised that the facility to exchange Rs. 4,500 worth of notes was a one-time opportunity and not a daily limit to clear any confusion that may have arisen in the matter owing to the language of the notification.

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:: International ::

One Belt One Road could get suprise entry of US

The head of China-led Asian Infrastructure Investment Bank (AIIB), Jin Liqun, has signalled that the United States under President-elect Donald Trump could reverse its decision not to join the lender.
A move that could pave the way for Washington’s broader acceptance of Beijing’s One Belt One Road (OBOR) connectivity initiative across the Eurasian region.
The AIIB is widely viewed as part of a new global financial architecture, and is expected to back infrastructure projects in Asia that are part of OBOR.
U.S. embrace of OBOR under the newly elected President could be on the cards, in case Beijing agreed not to the alter the status quo in the Asia-Pacific.
According to the People’s Daily , “Woolsey recognised China’s leadership role, but also said that the balance of power in Asia depends on America’s strength”.
The daily also carried an article by Nicholas Rosellini, the China head of the United Nations Development Programme (UNDP), extolling the OBOR’s potential to positively change the international landscape.

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:: India and World ::

India and Israel agreed to intensify counter-terror efforts

India and Israel agreed to intensify counter-terror efforts to deal with “constant” security threats posed by terrorism.
Welcoming visiting Israeli President, PM Modi said that both sides would work to counter terrorism, radicalism and extremism even as they agreed to work together in areas such as agriculture and water resource management.
“Our people are constantly threatened by forces of terrorism and extremism. We recognise that terrorism is a global challenge, knows no boundaries,” Mr. Modi said.
Mr Rivlin recollected the 26/11 attacks which claimed the lives of Israeli citizens.
“We recognise that terrorism is a global challenge, knows no boundaries and has extensive links with other forms of organised crime. We stand together defending our people.”
The declarations came even as both leaders referred to the twenty-fifth anniversary of formal diplomatic ties between two countries that have turned out to be “broad-based.”
Mr. Modi also thanked Israel for supporting India in multilateral diplomacy and said: “India is also grateful to Israel for its clear support to India’s permanent candidature in a reformed UN Security Council.”
Both sides agreed to take “practical and specific” measures such as cyber-security cooperation and agreed to expand defence ties.
The Israeli President is accompanied by a delegation of representatives of the country’s defence sector, leading academics and technology solution providers.

:: Business and Economy ::

Wholesale inflation slowed in October due to lower food prices

Retail and wholesale inflation slowed in October due to lower food prices with analysts predicting a further declining trend due to a demonetisation move, leading the central bank to cut rates in its next review meeting.
Growth in the Wholesale Price Index slowed to 3.4 per cent and in the Consumer Price Index dipped to a 14-month low of 4.2 per cent.
The Consumer Price Index registered a growth of 4.4 per cent in September, and the slowdown of retail inflation since then can be attributed almost entirely to easing food inflation.
The food and beverages category grew 3.7 per cent in October compared with 4.1 per cent in September.
The easing of inflation across both indices lends hope of a rate cut by the Reserve Bank of India, according to analysts.
Inflation in the pan, tobacco and intoxicants category of the CPI accelerated to 7.1 per cent in October from 6.8 per cent in September.
Similarly, inflation quickened marginally in the clothing and footwear category to 5.24 per cent in October from 5.2 per cent in September.
Inflation in the fuel and light segment slowed to 2.8 per cent in October down from 3.07 per cent in September.
On the other hand, the housing segment saw inflation slowing marginally to 5.15 per cent in October from 5.18 in September.
In the wholesale price index, the primary articles category saw inflation slowing to 3.3 per cent in October from 4.8 per cent in September.
Within this, inflation in the food articles category slowed to 4.3 per cent from 5.75 per cent over the same period. The non-food category saw inflation slowing even more drastically to 1.13 per cent in October from 4.5 per cent in September.
The fuel and power segment, however, saw inflation accelerating to 6.2 per cent in October compared with 5.6 per cent in September.
Notably, inflation in the manufactured products segment accelerated to 2.7 per cent compared with 2.5 per cent over the same period.

The country’s trade deficit widened to $10.16 billion in October

The country’s trade deficit widened to $10.16 billion in October, compared with $9.69 billion in the same month a year earlier, as gold imports more than doubled, government data showed.
Exports of goods grew 9.59 per cent to $23.51 billion compared with the same month a year earlier due to an increase in exports of gems & jewellery, engineering goods and readymade garments.
Imports expanded 8.11 per cent to $33.67 billion.
Owing to poor global demand, goods exports had fallen for 20 of the 23 months since December 2014 – the three months that the shipments registered positive growth this year were in June (1.27 per cent), September (4.62 per cent) and October.
India’s exports could touch $280 billion during the current fiscal, adding that the support given by the Centre will further be seen in exports figures in the coming months as well.
Working capital requirement hurdles in the refund process for exports in the proposed Goods & Services Tax regime along with infrastructural bottlenecks and further reduction in logistics cost should also be looked into by the Centre.
Oil imports grew by 3.98 per cent to $7.14 billion, while exports of petroleum products recorded a 7.24 per cent growth to $2.71 billion.
Non-petroleum exports in October grew 9.9 per cent to $20.79 billion, the ministry said.
Transport equipment was an item that witnessed a major jump in imports — registering a 15.77 per cent growth to $1.88 billion, while machinery imports grew by 0.55 per cent to $2.25 billion.