Current Affairs for IAS Exams – 31 May 2016

:: National ::

Athirappally hydel power project facing protest

• The new Kerala government’s want to go head with the 163-megawatt Athirappally hydel power project across the Chalakudy river

• Project may run into trouble with the vulnerable tribal group of Kadar, who believe it will wipe out their livelihood, they are preparing to oppose it.

• he tribe, estimated to have around 2,000-odd people, seldom farm and mostly subsist on collecting minor forest produce, including honey, which they trade with outsiders for essentials. Many work as labourers too.

• Chief Minister Pinarayi Vijayan and Power Minister Kadakampally Surendran had announced that the project would be pushed, while factoring in objections and opinions.

President takes account of attack on African nationals

• President Pranab Mukherjee said attacks on African nationals are painful to him personally given that as a student, political activist and Member of Parliament he had seen first-hand how India and Africa have always been close partners.

• “It would be most unfortunate if the people of India were to dilute our long tradition of friendship with the people of Africa and the welcome we have always extended to them in our country,” Mr. Mukherjee cautioned

• He said this while addressing the Seventh Annual Heads of Missions Conference at Rashtrapati Bhavan.

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: International ::

Iraqi forces pressing advantage against IS

• Iraqi forces thrust into the city of Fallujah from three directions marking a new and perilous urban phase in the week-old operation to retake the jihadist bastion.

• The drive to recapture the first city to be lost from government control in 2014 came as fighting also raged in neighbouring Syria, leaving huge numbers of civilians exposed.

• Iraqi forces entered Fallujah under air cover from the international coalition, the Iraqi air force and army aviation, and supported by artillery and tanks.

• The involvement of the elite CTS marks the start of a phase of urban combat in a city where in 2004 U.S. forces fought some of their toughest battles since the Vietnam War.

• The week-old operation had previously focused on retaking rural areas around Fallujah, which lies just 50 km west of Baghdad.

• It had been led by the Hashed al-Shaabi paramilitary force, which is dominated by Tehran-backed Shia militias.

• Only a few hundred families have managed to slip out of the Fallujah area ahead of the assault on the city, with an estimated 50,000 civilians still trapped inside, sparking fears the jihadists could try to use them as human shields.

• Fallujah is one of just two major urban centres in Iraq still held by IS jihadists.

• They also hold Mosul, the country’s second city and de-facto jihadist capital in Iraq, east of which Kurdish-led forces launched a fresh offensive. The jihadists holed up in Fallujah are believed to number around 1,000.

• Fallujah is expected to give Iraqi forces one of their toughest battles yet but IS has appeared weakened in recent months and has been losing territory consistently over the past year.

• According to the government, the organisation that has sewn havoc across Iraq and Syria over the past two years now controls around 14 per cent of the national territory, down from 40 per cent in 2014.

• However, as the “caliphate” it declared two years ago unravels, IS has been reverting to its old tactics of bombings against civilians and commando raids.

• A fresh wave of bomb attacks struck the Baghdad area on Monday, killing 11 people in three separate blasts.

• The IS onslaught has threatened tens of thousands of people, many of them already displaced from other areas, who have sought refuge in camps near the Turkish border.

Britain's PM calls against Brexit

• Prime Minister David Cameron put aside recent animosity with London Mayor Sadiq Khan to make a joint call for Britain to stay in the European Union (EU), as personal attacks from within his own party intensified.

• Mr. Cameron told a campaign event in London that he and the new Labour Mayor backed Britain’s EU membership because “we love our country and we want our country to be the best it possibly can”.

• Last month, Labour MPs had branded Mr. Cameron racist after he told Parliament he was “concerned” about Labour’s mayoral candidate who had “appeared again and again and again” on stage with “extremists”.

• While Mr. Cameron was building bridges with former adversaries, dissent within his own ranks escalated with some Tory MPs demanding he quit even if the country voted to remain in the bloc at the June 23 referendum.

• Mr. Cameron admitted he himself was “a eurosceptic”, but said his campaign’s criticisms of the European Union were a strength because “we are levelling with people, which is something the other side refuses to do”.

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:: Business and Economy ::

India’s global competitiveness rank rose three notches to 41 from a year ago

• India’s global competitiveness rank rose three notches to 41 from a year ago due to significant improvement in exchange rate stability, fiscal deficit management and efforts to tackle corruption and red tape.

• This was published in a survey by the Switzerland-based IMD World Competitiveness Centre (WCC).

• The Centre also found about 70 per cent of the executives surveyed on attractive economic indicators rated cost competitiveness, skilled workforce and a dynamic economy as India’s biggest plus points

• Half the executives also identified high education levels as a positive factor while 33 per cent said the government’s competency made the economy more attractive.

• India was ranked 44th in 2015, according to IMD. The current ranking is lower than the 35th position it secured in 2012.

• Higher consumer price inflation, lower public spending on education, tax revenue collection and merchandise exports proved to be the biggest drags on the country’s economic competitiveness, according to the Centre.

• The biggest challenges for the economy in 2016 would be sustaining its high growth rate, increasing the share of research and development in the economy and implementation of the Goods and Services Tax Regime.

• Infrastructure development and disbursing public benefits digitally would also be keenly watched, according to the IMD WCC.

• The U.S. is ranked third this year yielding the numero uno position to China Hong Kong followed by Switzerland.

• China Hong Kong fosters innovation through a low and simple taxation and imposes no restrictions on capital flows while offering a gateway for foreign direct investment into mainland China.

• Within Asia-Pacific, India is now the 11th most competitive economy with peers like Taiwan, Malaysia, Korea and Indonesia seeing a significant fall in their rankings this year.

• The rankings are based on analysis of over 340 criteria derived from four principal factors: economic performance, government efficiency, business efficiency and infrastructure.

• Data gathered since the first ranking was published in 1989 also lend weight to fears that the rich are getting richer and the poor poorer.

With the increased vigil of SEBI, P-Notes investment at 20 months low

• Investments into India’s capital markets through participatory notes (P-Notes) declined to a 20-month low of Rs.2.11 lakh crore at the end of April with SEBI keeping a strict vigil on funds coming through this route.

• SEBI, earlier this month, tightened norms to check any misuse of controversy-ridden P-Notes by making it mandatory for users of these overseas instruments to follow Indian anti-money laundering law and report any suspicious transactions immediately.

• P-Notes are typically instruments issued by registered foreign institutional investors to overseas investors who wish to invest in Indian markets without registering themselves directly in India to save on time.

• But they still need to go through a proper due diligence process.

• According to SEBI data, the total value of P-Notes investment in Indian markets (equity, debt and derivatives) declined to over Rs.2.2 lakh crore at the end of April, from over Rs.2.23 lakh crore in March-end.

• This also marked the lowest level since August 2014 when the cumulative value of such investments stood at Rs 2.11 lakh crore.

• Market experts opine that stricter set of norms will make it costlier to invest in India through P-Notes, as one of the major attractions of such instrument is cost-effectiveness and easier access.

• The share of P-Notes has been falling over the years on SEBI tightening disclosure norms and other related regulations.

• It used to be much higher at 25-40 per cent in 2008 while the reading was as high as 55 per cent at the peak of stock market bull run in 2007.

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Sources: Various News Papers & PIB

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