(Current Affairs) Economy & Energy | November + December: 2015

Economy

Current Account Deficit to Remain Comfortable in FY16: India Ratings

  • India’s current account deficit is expected to remain “comfortable” in the current fiscal year even as it rose sequentially to $6.2 billion in the first quarter, says a report.
  • Current account deficit for the first quarter of FY16 stood at $6.2 billion (1.2 per cent of GDP), sequentially higher than $1.5 billion in the previous quarter, the report by India Ratings & Research said on Monday.
  • The current account deficit, however, was lower than $7.9 billion the first quarter of FY15.
  • Current account deficit reflects a high outgo of forex and subsequently weakens the domestic currency.
  • Invisible receipts were mainly instrumental in improvement of current account deficit in the first quarter of current fiscal year, it said.
  • India Ratings said merchandise exports contracted for the third consecutive quarter and a worrying trend is that the magnitude of the contraction has been increasing with each quarter.
  • On oil, it said crude oil prices are likely to remain soft for remaining part of 2015-16 due to the sluggish global recovery and demand-supply situation in the crude oil market.

Drugmaker Abbott Healthcare tangles with Indian regulators over cough syrup complaint

  • Drugmaker Abbott Healthcare is challenging a state’s accusation that a sample of the company’s cough syrupcontained excessive levels of codeine, the second multinational to question India’s regulatory testing regime in recent months.
  • Whether the sample of Abbott’s popular “Phensedyl” was a genuine product or a fake has not been established, but the suspect batch of 80,000 bottles has not been recalled.
  • The state laboratory in West Bengal first raised the alarm last November.
  • The previously unreported case underlines the weakness of India’s unwieldy and poorly resourced drug and food regulatory system, the uncertainty it creates for foreign and domestic companies operating there and the potential risk to consumers.
  • Abbott Healthcare is a unit of U.S.-based Abbott Laboratories. Abbott Laboratories also has a listed subsidiary in India, Abbott India Ltd.
  • Three months ago, Nestle was forced to withdraw its Maggi instant noodles from Indian shelves because the food safety authority banned the snack after its tests showed excess lead.

Government developing framework for repowering wind farms: Piyush Goyal

  • With a view to ensure better capacity utilisation of wind energy projects, the Union Power Ministry is developing a framework for repowering wind farms from 200-300 watt units to 2-5 MW that are available in the market, Minister for Power, Coal, and New and Renewable Energy, Piyush Goyal said at an Assocham event held in New Delhi on Friday night.

Discom resolution

  • Talking about the discom resolution, Mr. Goyal said, “We are not only ceased of it but we are working relentlessly on a daily basis to fine tune and refine our proposals on that without giving any subsidy again or any grant/additional money (to the States).”
  • The Minister also said that government plans to bring down the cost of each LED bulb to Rs.44 from a level of Rs.74 through competitive bidding.

Hydel power sector

  • Talking about the slow progress of hydel power sector, Mr. Goyal said at the event that he had been able to get the Rs.9,000 crore worth Teesta power project back on line and with work expected to start soon it is likely to come on stream in a year’s time.
  • He also asked the industry associations to work in the national interest and not to become postman for scamsters or those following bad business practices.

Renewable energy sector

  • Talking about the poor progress of renewable energy sector in India, Mr. Goyal said, “Effectively, what I inherited was a situation where the industry had almost given up hope, you had anti-dumping looming large on solar industry, wind industry was crumbling in the back of withdrawal of certain fiscal benefits, bagasse based plants were almost dead or sick, small hydel was already over.”

Over 50 Indian companies take part in India Expo exhibition in Sri Lanka

  • Over 50 Indian companies are participating in India Expo tradeexhibition in Colombo.
  • The India Expo 2015, a multi product and services exhibition was inaugurated by Sri Lanka’s Commerce Minister Rishad Bathiudeen on Friday.
  • The India Expo has been organised by the Federation of Indian Export Organisations (FIEO) in association with Indian Ministry of Commerce and Industry and the High Commission of India in Colombo.
  • The companies that are participating represent various sectors, including construction products, apparel and garments, cosmetics, agro products, pharmaceuticals, power and electrical technology.

Audit Bureau of Circulation elects office-bearers

  • Shashidhar Sinha CEO, IPG Mediabrands, was unanimously elected as Chairman of the Audit Bureau of Circulation (ABC) for 2015-16, according to an ABC press release.
  • He was elected at the bureau’s 67th Annual General Meeting.
  • I Venkat of Eenadu was unanimously elected as Deputy Chairman.
  • The members on the ABC Council for 2015-2016 are: Advertising Agencies Representatives — Madhukar Kamath of Mudra Communications (as Honorary Treasurer), Srinivasan K Swamy of RK Swamy BBDO, and CVL Srinivas of Group M Media India Pvt Ltd; Publishers Representatives — Amit Mathew of Malayala Manorama, Shailesh Gupta of Jagran Prakashan, Hormusji N Cama of Bombay Samachar, Devendra V Darda of Lokmat Media, Sanjeev Vohra of Bennett, Coleman & Co Ltd, Benoy Roychowdhury of HT Media, and Chandan Majumdar of ABP Pvt Ltd; Advertisers Representatives — Hemant Malik of ITC (Honorary Secretary)
  • Debabrata Mukherjee of Coca-Cola India, and Sandip Tarkas of Future Retail.
  • Hormuzd Masani has taken over as Secretary General.
  • The ABC, which plays a key role in print measurement, will soon start measuring digital audiences, according to the press release. In his new capacity as Chairman of the organisation, Sinha will implement the digital measurement project. The new services will available to all digital properties which want to utilise them.

SEBI asks Raju family to pay more than Rs 1,800 crore

  • The Securities and Exchange Board of India (SEBI) on Thursday asked ten entities connected to the Satyam scam case including the ex-chairman of the erstwhile Satyam Computer Services Ltd., B. Ramalinga Raju and other family members to disgorge over Rs.1,800 crore, which are ‘ill-gotten gains’ made by them.

  • The SEBI order said that pursuant to the SEBI order on July 15, 2014, B. Ramalinga Raju and B. Rama Raju have to jointly and severally disgorge Rs.56,16,85,195 (Rs.26,62,50,000 and Rs.29,54,35,195) “which they had earned by sale/transfer of shares held by them in Satyam Computers.” Further SEBI asked SRSR Holdings Pvt. Ltd. (controlled by Raju brothers) to disgorge the wrongful gain of Rs.1,258.88 crore jointly and severally with B. Ramalinga Raju and B. Rama Raju.

  • The other family members include, Chintalapati Srinivasa Raju, Anjiraju Chintalapati (since deceased). Ms. B. Appalanarasamma, Ms. B. Jhansi Rani, B. Rama Raju Jr., B. Suryanarayana Raju, B. Teja Raju and IL&FS Engineering and Construction Company Ltd. (formerly known as Maytas Infra Ltd.) were also asked to disgorge the amounts.

  • SEBI ordered that these amounts would be paid, along with simple interest at 12 per cent per annum from January 7, 2009, till the date of payment, within 45 days from the date of this order, that is, September 10, 2015.

  • Earlier, SEBI passed an order on July 15, 2014, wherein it had barred B. Ramalinga Raju, B. Rama Raju (then Managing Director of Satyam), Vadlamani Srinivas (ex-CFO), G. Ramakrishna (ex-VP) and V.S. Prabhakara Gupta (Ex-Head of Internal Audit) from the markets for 14 years and also asked them to return Rs.1,849 crore worth of unlawful gains with interest.

Gold Monetization scheme,Get Cabinet approval

  • The government on Wednesday announced the launch of sovereign gold bonds and a separate gold monetization scheme in a bid to lure away Indians from buying physical gold.
  • Both the gold schemes announced today were part of the annual Budget proposal.

Here are 10 things to know about the two gold schemes:

1) The sovereign gold bond will enable investors to buy gold certificates from the government, which can later be encashed for money or physical gold.
2) Gold Bonds will be issued with a rate of interest to be decided by the government. Interest will be calculated on the value of gold deposited at the time of investment.
3) Gold bonds will be issued in denominations of 5, 10, 50, 100 grams of gold. The cap per person per year has been set at 500 grams, the government said.
4) Duration of such gold bonds will be for minimum of 5 to 7 years to protect investors from medium term volatility in gold prices, the government said.
5) Gold bonds are expected to reduce the demand for physical gold bars by shifting a part of estimated 300 tons per annum for investment into gold bonds.
6) The gold monetization scheme involves mobilization of tonnes of the yellow metal stored in households and temples. Ornaments will not be accepted under gold monetization scheme, Finance Minister Arun Jaitley said.
7) The gold monetization scheme that will enable depositors to earn interest on their on their gold accounts.
8) The gold monetization scheme will cut down on imports, thus reducing foreign exchange outflows. According to estimates, India paid $34.32 billion to import around 930 tonnes of gold in the year ending March 2015.
9) Gold monetization scheme, in long term, will reduce country’s reliance on the import of gold & put it to productive use, the government said.
10) Though stocks of gold in India are estimated to be over 20,000 tonnes, most of this gold is neither traded, nor monetized. Gold collected through the scheme will be made available to jewelers for manufacturing of new jewellery and other items.

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