Indian Current Affairs 25.09.2010Indian Current Affairs 25.09.2010
Politics & the Nation
Finance & Economy
- The story of slow but sure death of the quarry workers
- Take a look at this story
which tells us how the poverty stricken quarry workers in Rajasthan are
dying a slow but sure death. What are your suggestions with regard to
tackling this problem?
- Celebrations cut short, extra 1% EPF interest to be taxed
government’s surprise gift for workers isn’t much of a gift after all.
The labour ministry has hiked the employees’ provident fund, or EPF,
rate to 9.5%, but a finance ministry notification says that anything in
excess of 8.5% will be taxed. This is because, even before the EPF
board met to declare the higher rate, the CBDT (Central Board of Direct
Taxes) had notified a tax-free PF rate of 8.5% for 2010-11 -- effectie
from September, 1. This means that the 9.5% provident fund return would
be tax-free from April to August, but taxable thereafter.
is an unprecedented situation that is witnessed. Historically, the
tax-free PF rate notified by the income tax department has never been
lower than the EPF rate declared for the year.
tax deduction by the EPFO and the company-run trusts is sure to pose
lot of problems. For instances they will find it hard to calculate the
tax liability on 1% PF income for seven months, as they don't have the
appropriate systems in place to do so.
labour ministry is, however, confident that the tax department will
renotify the higher rate, as otherwise a lot of contentious issues will
- Cabinet agrees for giving statutory powers to UIDAI
government on Friday cleared the decks for the formation of a statutory
body to be christened — National Identification Authority of India
(NIAI), in order to give collection of data for allocating unique id
numbers, a legal sanction. The approval by the cabinet paves way for
introduction of the NIAI Bill 2010, in winter session of the Parliament.
legal sanction is for collection of private data of citizens and makes
it difficult to challenge in a court of law. The sanction is needed as
the government plans to allocate the first set of numbers to citizens in
a few weeks in Maharashtra. In 2009, the Unique Identification
Authority of India (UIDAI) had already made it clear that an Act of
Parliament will set it up as a statutory body. But, already many NGOs
are planning to challenge the proposed Bill.
passed, the NIAI Act 2010 will contain a prescription against
collecting any other information than the information permitted, with
specific prohibitions against collection of information regarding
religion, race, ethnicity and caste. It will also contain penal
provisions against persons employed by, or associated directly or
indirectly with, the data repository, registrars, enrolling agencies and
other service providers for failing to comply with the directions
issued under the Act.
very good comment made in the context of Sonia and Rahul realizing the
importance of protecting the rights of the displaced and poorer sections
might be, by now, aware of the way Rahul has been conducting himself.
He championed the cause of the Dalits in the Dalit hinterland -- UP.
Then he took up the cause of the displaced tribals in Orissa and
congratulated them saying that they won the battle against Vedanta.
- It is in this backdrop that the following comment made by CP Bhambhri in today's op-ed deserves to be appreciated:
is no disconnect between social welfare market economics of Europe and
their economic growth trajectory because every social class and group,
on the basis of historical experience of industrialisation, has come to
realise that a politics that seek to primarily uphold working class
interests has to be guided by a pragmatic definition of enlightened
self-interest. Hence, European welfare capital is not at all guided by
any ideology of socialism because experience has shown that
non-ideological pragmatism is a good guide to diffuse social conflicts
which arise if the labouring classes are neglected and they are not
provided with social security.”
- Sonia and Rahul seem to have realized that what is possible in Europe, cannot be impossible in India.
- SEBI boss slams steep IPO pricing
regulator CB Bhave (SEBI Chairman) charged investment bankers with
fleecing investors by pricing initial public offers (IPOs) at
astronomical valuations, leading to investor anguish when the market
pricing could enrich bankers and companies, but persistence of the
practice could demoralise investors, damaging capital markets, he said
in what may be the first regulator comment on share-sale pricing since
the abolition of the Controller of Capital Issues in 1992.
underperformance of the BSE IPO index—it gained 14.5% in the last 12
months, when the benchmark Sensex rose 19.45%—reflects the Sebi
chairman’s charges. Furthermore, a price performance study by CARE
Research, a unit of rating company CARE, showed that 62% of the 116 IPOs
between August 2007 and August 2010 are trading lower than their sale
price while 35% are ruling higher.
- Government turns cautious in gauranteeing loans of PSUs
government came out with a policy shift in respect of its gaurantees to
the loans advanced by bankers to the PSUs. This is reportedly done
with a view to ensure two things -- one to discourage laxity in loan
appraisals by the bankers and two to ensure that the lenders do bear
some risk in advancing loans to PSUs.
is a marked shift from the earlier policy where the entire loan was
guaranteed. The new policy on government guarantees says the state will
back only 70-90% of the loan amount in some cases, leaving the lender to
bear the balance risk.
the case of default on such a partially-guaranteed loan, the borrower
will also have to first negotiate with the lender for the unguaranteed
part. It could then approach the government to settle the balance
immediate fallout of the new rules will be that despite the credit
enhancement provided through government guarantees, such loans will be
priced higher because of the partial risk that will stay with the
government had committed to keeping such guarantees in check by putting
a limit of 0.5% of GDP in any financial year in the fiscal discipline
act, or the Fiscal Responsibility and Budget Management Rules, 2004.
the end of fiscal 2007-08 the total outstanding central government
guarantee was Rs. 1,04,872 crore, 2.2% of GDP. The bulk of these relate
to those given to international financial institutions for funding local
- The tighter rules will help free up guarantees where they may be needed more.
went on to suggest that instead of a 0.5% annual ceiling, the
government should put a cap of 5% of GDP on the guarantee outstanding at
the end of every year.
reduced level of government guarantee will have the desired effect of
forcing public sectors to use the public-private partnership mode more
for financing projects.
- Govt names WDRA chief; FMC may lose turf war
to rest a simmering dispute between the commodity futures market
regulator and the food department, the government has appointed Dinesh
Rai, a retired IAS officer, as chairman of Warehousing Development &
Regulatory Authority (WDRA). The regulator is being set up to develop a
negotiable warehouse receipt (NWR) system for agri commodities.
after Parliament passed the WDRA Act in 2007, Forward Markets
Commission held that since its jurisdiction extended from the execution
of a trade on exchanges to the settlement of a futures contract, it
should be notified as the WDRA authority.
the food department was in favour of having a separate regulator for
monitoring warehousing and had been scouting for a whole-time chairman
and two members to sit on the board of WDRA. In the absence of an
independent regulator for warehousing, FMC has been regulating over 1.5
million tonne of warehousing capacity.
very good editorial comment on the reported move of the government to
raise the ceiling for investment in government and corporate bonds by
- Take a look at this comment here. Well worth a reading.
Arts & Literature
- Petrobras offers the largest share sale ever
Brasileiro, the state-controlled oil company, raised as much as 120.4
billion reais ($70 billion) from the Brazilian government and other
investors in the world’s largest share sale as it seeks cash to develop
offshore fields. Petrobras, based in Rio de Janeiro, sold 2.4 billion
common shares for 29.65 reais each and priced 1.87 billion preferred
stock at 26.30 reais apiece.
- Jnanpith for Kurup, Akhlaq Shahryar
Malayalam litterateur ONV Kurup and noted Urdu poet Akhlaq Khan
Shahryar have been chosen for the Jnanpith Award for the year 2007 and
2008, respectively, for their contribution to literature.
recipients for the country’s highest literary honour were announced on
Friday after a meeting of Jnanpith Selection Board chaired by noted
Oriya writer and Jnanpith award winner Sitakant Mahapatra.
in 1931 in Kerala’s Kollam district, Kurup is a leading voice among the
contemporary Malayalam poets who has reinvented the narrative
transition of Malayalam poetry. Born in 1936 in a Muslim Rajput family
in Bareilly district, Shahryar shaped himself as an “intellectual poet”,
whose poetry strongly expresses an “ideological noncommitment”.
- epiphany: Noun
- A moment of sudden understanding or revelation; A divine manifestation
During the Cold War, one bumper sticker used by peace activists read:
“Nuclear weapons: May they rust in peace.” We need a similar epiphany for the malcontents of the information age.
- snifter: Noun
- A globular glass with a small top; used for serving brandy