May 2013 Economic Affairs.pdf

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Mohanlal Sukhadia

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are set to form a joint ven ture (JV) for taking up various initiatives in

the oil and gas sector including supply of LNG to Sri Lanka by Petronet

LNG Limited (PLL) to feed power plants in that country The decision to

form the joint venture was taken following a meeting between the Petroleum

Secretary Vivek Rae and the Ministry of Finance and Planning and Secretary

Ministry o f Economic Developme nt Sri Lanka P B Jayasundara rece ntly Seeking

to put the co-operation in the oil and gas sector on the fast track the government

has asked IOC to formalize a proposal within this month and submit the same to

CPC to facilitate further discussions While acknowledging that there were p ending

issues of Lanka IOC the Sri Lankan side suggested that the b est way forward was to

carry the initiative for enhancing co-operation between the two countries It was

decided during the meeting that IOC would submit a comprehensive proposal on

the structure o f the proposed JV that would address all concerns of IOC

In a surprise rejig at the top on 1 June NR Narayana Murthy is back in

Infosys as Executiv e Chairman at a time when the IT major has lost ground to

rivals and the stock has been among the worst performers in its league The

company which Narayana Murthy co-founded with six others for $250 is now$7 -

billion software majo r but has b een going throug h a ro ugh patc h the last two y ears

With Murthy rsquos appointment as Executiv e Chairman of the board and Additional

Director for the next five years the countryrsquos third largest software exporter hopes

to make up the lost ground The board proposes to extend the retirement age for

the Executiv e Chairman to 7 5 y ears ldquoThis is my second innings and an exc iting yet

somewhat new level of challenges awaits merdquo said Murthy who got to know of his

role this morning However the shareholders have to give their nod to the

appointment of Murthy who retired from Infosys in August 2011 and has not held

an executive role the last seven years KV Kamath who was appointed Chairmanafter Murthyrsquos ex it will step down this month

APTITUDE TESTS

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అం టల అర ల

వక ల

YEARLY TM

CURRENT AFFAIRS

WEEKLY TM

CURRENT AFFAIRS



Ac co rding t o data r eleased by the Central Statis tic al Organizatio n (CSO) on 3 1 May

2013 economic growth slowed to 48 in the January-March quarter

and fell to a decades low of 5 for the entire 2012-13 fiscal due to poor

performance of farm manufacturing and mining sectors The economic growth or

GDP had expanded by 51 in January-March quarter of 2012-13The Indian

econo my had grown by 54 per cent 5 2 and 47 amp in the first second and third

quarters respectively of 2012-13

The country had clocked 62 growth in 2011-12 fiscal In January-March quarter

of 2012 -13 manufacturing sector grew marginally by 26 against 01 growth in

the same period of the earlier fiscal During 2012-13 the sector grew by a meagre

one per c ent compared to 27 in the prev ious fiscal Mining and quarrying sector

contracted by 31 during the fourth quarter of last fiscal Farm sector output

expanded by just 14 in January-March this year as against 2 in the same

quarter of 2011-12 The agriculture sector also grew at a slower rate of just 19 in

2012-13 compared to 36 in 2011-12

The Reserve Bank of India on 27 May 201 3 imposed restrictions on banks and

NBFCs for providing loans against gold coins as well as units of gold ETFs and

mutual funds to curb demands for gold Also banks were asked to ensure that the

amount of loan to any customer against gold ornaments gold jewellery and gold

coins (weighing up to 50 grams) should be within the board approved limit Banks

are currently permitted to grant advances against gold ornaments and other

jewe ller y and against spe cia lly minted gold co ins sold by banks Howev er no

advances can be granted by banks for purchase of gold in any form including

primary gold gold bullion gold jewellery gold coins units of gold exc hange traded

funds and units of gold mutual funds Gov ernment has taken sever al steps rec ently

including raising import duty to curb the inbound shipments of gold RBI too had

put restrictions on banks on gold imports which has led to forex outflow and

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T he In ternational Monetary Fund (IMF) lowered its forecast for Chinarsquos

economic growth at 775 for the year 2013 citing a weak world economy

and exports in Washington on May 29th Earlier it had forecasted 8 growth

Annual ec ono mic gro wth of China fell to 7 8 in 20 12 the slo west sinc e 1999

becau se of its dec reasing ex po rt demand and increasing co sts the eur o-zo ne deb t

crisis and uncertainty over the US economic recovery China is worldrsquos second

largest economy The IMF advised that China should put priority on reining in

social financing growth or else the country s fast credit supply may fuel inflation in

future

The Planning Commission approved Project Ananta an Rs 8000 crore

programme that looks for pulling Anantapur district out of the control of the

perennial drought The Planning Commission has approved an Rs 53000 crore

Plan for the State up by 82 per cent compared to 48935 crore Rupees in year

2012 The project will take a complete approach to achieve the target The

Commission is supposed to send its team to study the feasibility o f the scheme Both

the State and the Centre would fund the Project After getting the Planning

Commission nod the State would consider starting similar programmes for other

bac kward distric ts suc h as Medak Adilab ad and Srikakulam A high-lev el team of

scientists suggested that the district required a five year plan to take stock of the

situation and prepare a plan to address issues such as natural resource

management crops and livestock

Pursuant to the announcement made in the Union Budget for 2013-14

the Government of India in consultation with Reserve Bank of India

(RBI) has decided to launch Inflation Index Bonds (IIBs) as instruments

that will protect savings of the poor and middle classes from inflation and

incentivise the household sector to save in financial instruments rather than buy

gold An official press release on 16 May said that for appropriate price discovery



and market development however it is necessary to issue comparable instruments

through auctions to the institutional investors such as Pension Funds Insurance

and Mutual FundsThis will create demand for IIBs and help in making them

tradable in the secondary market It is therefore proposed to issue initial series for

institutional investors (including 20 to retail investors) and later another series

exclusively for retail investors First series of IIBs would be issued in H1 of the

current FY With a view to target greater retail participation for this series also it

has been decided to enhance the non-competitive segment for retail investors to

20 from the present lev el of 5 the release said
















Opening up the prospects of export of shale gas to energy-starved India

the US on 17 May has granted conditional authorisation to export

domestically-produced liquefied natural gas (LNG) to count ries that do



major implications for India the Department of Energy (DoE) on 17 May

announced that it had conditionally authorised Freeport LNG Expansion LP and

FLNG Liquefaction LLC (Freeport) to export domestically-produced LNG to non-

FTA countries from the Freeport Terminal on Quintana Island in Texas Given that

the companies from countries such as China Japan and Britain have already an

ov erwhelming stake in this Tex as company India is unlikely to benefit immediately

from this grant of licence But the decision paves the way for India which does not

have a free trade agree ment with the US to get its co mpanies seek similar licences

for import of the much-needed gas from the US in large quantities from other

terminals The existing federal law generally requires approval of natural gas

exports to countries that have an FTA with the US For countries that do not have

an FTA with the US the Natural Gas Act directs the Department of Energy to grant

export authorisations unless the Department finds that the proposed exports ldquowill

not be co nsistent with the public interestrdquo

T he RBI on 12 May 2013 imposed restrictions on gold import by banks

in order to moderate the demand of gold for domestic use The RBI

decided to restrict the import of gold on consignment basis by banks only to meet

the genuine needs of expor ters o f gold jewellery The RBI stated that the dec ision is

base d on the reco mmendat ions of the Working Grou p on Gold that had sugg ested

aligning gold import regulations with the rest of the imports for creating a level

playing field between gold imports and other imports The restrictions have come

into effect immediately

The Union Government in Month of May 2013 has proposed stronger

powers to Securities and Exchange Board of India (SEBI) enabling it to

carry out search and seizure operations and for attachment of assets

With this a Spec ial power has also been pro po sed to SEBI with whic h it can seek

information on telephone call data records from any persons or entities in respect



to any securities transaction being examined by it It is worth mentioning here that

Proposals to make required amendments in the SEBI Act and other relevant

regulations have been finalized after detailed consultations with the market

regulator and are being presented before the Union Cabinet for its approval The

Government is planning to introduce the Securities Laws (Amendment) Bill 2013 in

Parliament to carry out the proposed changes for grant of stronger powers to SEBI

The Government has come up with the decision of accepting most of the proposals

made by SEBI in this regard and the amendments would be carried out after the

Cabinet approv es them and the req uired amendment Bill is passed by Parliament

The Union Government on 13 May 2013 hiked the monetary assistance

by 25 000 ru pees un der the Indira Awas Y ojana (I AY ) the housing scheme

for the poor giving priority to the scheduled castes tribes and minorities The cost

for 250 square foot housing unit has gone up to 7 000 0 rupees in plain areas and

7 500 0 rupee s in hilly and difficult areas from 4500 0 rupee s The Union

Government under the new guidelines of the Indira Awas Yojna has decided to

transfer the share of its funds to the State Governments rather than making a

district based allocation The Union Governmentrsquos assistance got procurement of a

homestead site to the states has been doubled for landless poor from 10000

rupees to 200 00 rupee s The changes has been brought in following the agreement

reached between the Government and the Jan Satyagraha on 11 October 2012 at

Ag ra also known as the Ag ra Agreeme nt on Land Refor ms in whic h 10-point

agreement was signed by the Rural Dev elopment Minister Jairam Ramesh at A gra

In connection with Cobrapost Red Spider 2 Expose which was released on 6 May

Rajiv Takru Secretary Department of Financial Services (DFS) and Ministry of

Finance have ordered the Chairman cum Managing Directors (CMDs) of various

Public Sector Banks and Life Insurance Corporation of India an immediate action in

the matter The Secretary of DFS had also sought compliance and action taken

report to be submitted on utmost priority As a result certain PSBs have already



officersemployees of various Public Sector Banks have been suspended including

one from insurance sector Beside it ten officers of PSBs have be en diveste d of their

wor k and six hav e been asked to proc eed on leave More actio n taken repo rts are

expected in near future

An In ter-m inisterial Group on 9 May has appro ved 10 per ce nt equ ity

sale in Coal In dia which is expected to fetch over Rs 17000 crore to the

government At present the government holds 90 per cent stake in Coal India

Ltd The Group headed by Disinvestment Secretary Ravi Mathur is guiding the

process of disinvestment of governments equity in CIL Besides the panel has

members drawn from Ministry of Coal Departments of Legal Affairs Economic

Affair s Corporate Affairs and Chairm an-cum-Managing Dire ctor of CIL Coal India

whic h has a cash balance of abo ut Rs 60 000 crore will be the bigg est

disinvestment for the government in the 2013-14 fiscal The government would like

to earn Rs 4000 0 cr ore thro ugh PSU stake sale in this fiscal

The Cabinet Committee on Economic Affairs (CCEA) on 9 May 2013

approved the proposal of the Ministry of Shipping for setting up of two

major ports in the count ry The two por ts will come up in Andhra Pradesh and

West Bengal eac h through Public Priv ate Partnership mod e As per the proposal

approved one port is expected to come up at Dugarajapatnam Nellore

district in An dhra Pradesh and looked forward to find out the techno-eco nomic

feasibility report for commissioning of the port Another port will be developed at

Sagar Island in West Bengal after obtaining environmental clearances and

following exact procedures for development of the project The cabinet also agreed

for appointment of the transaction adviser s and legal consultants and finalization of

the project structure in c onsultation with the State Gov ernment o f West Bengal and

the Planning Commission



National Stock Exchange launched the countryrsquos first dedicated debt

trading platform on 11 May 2013 The new Platform launched is awaiting the

market regulator Securities and Exchanges Board of Indisrsquos (SEBI) guidelines for

allowing participation of mutual funds insurance companies and pension funds

NSE had recently received approval from SEBI to launch the debt segment The

debt trading platform is supposed to provide retail investors an opportunity to

invest in corporate bonds on a liquid and transparent exchange platform Banks

and primary dealers are the first to enter and they will provide enough liquidity in

the debt segment The mutual funds insurance companies and pension funds are

also expected to participate after guidelines for the same are issued The Debt

Trading exchange platform is an innovation which has been launched after

intensive feedback from market participants It is similar to RBIrsquos NDS-OM where

Government sec urities are traded on a transparent platform

The Cabinet Committee on Economic Affairs on 2 May gave its approval to the

proposal of Ingka Holding BV Netherlands as recommended by the Foreign

Investment Promotion Board (FIPB) The approval would result in FDI inflows

amounting to Rs10 5 00 c rore approximately into the country

The Cabinet Committee on Economic Affairs on 2 May approved the

setting up of a Central Public Sector Enterprises (CPSE) Exchange

T raded Fund (ET F) which would com prise CPSE stocks (from amongst

the listed CPSE stocks) Each stock would have a fixed weightage in the basket

The composition of the basket the launch of the New Fund Offer (NFO) the

discount to be provided and other issues relating to contribution and pricing of the

ETF would be dec ided by the Empowere d Group of Ministers (EGoM) This will help

in minimizing market disruptions seen in public offerings of listed CPSEs increase

ability o f the Government to monetize part ial stakes in listed CPSEs some o f which

have lo w liquidity and free float broad base re tails participation of shares o f CPSEs

-



-

the Government from a pricing perspective as part of the discounts could be back-

ended in the per spectiv e of success o f ETFs globally a CPSE ETF will boost the ETF

product in the country and will help fulfill the domestic investorsrsquo appetite for an

equity ETF products as the domestic Indian investor is vastly under-served vis-a-

vis the fore ign inv estor co mmunity CPSE ETF is made up of a b asket of shar es of

different CPSEs that tracks an index fund but trades like a stock o n the ex change

Asian Dev elo pm ent Bank (ADB) on 5 May 2013 announced that it is going to

provide about 6 billion dollars loan to In dia ov er th e next th ree years

whic h was dec ided a t the co ncluding day of the 46t h annual mee ting of the funding

agency Although the ADB is facing the challenge of raising resources the basic

idea behind providing loan is to maintain its lending level to India The bank is

wor king on par tnership strategy and is planning to maintain the lev el of lend ing to

India It is important here to note that India is the biggest borrower of ADB and

ADB had ex tended a 24 billion dol lars loan to India in 20 12 across sec tors like

transport energy commerce industry trade and finance The bank will also

continue to lend10 billion dollars a year across the member-nations despite

generating lower return from investments

The Supreme Court of India on 1 May 2013 upheld the constitutional

validity of Govern m en trsquos dec ision allowing 51 percent foreign direct

Inv estment in the mu lti-brand retail sector A bench of Justices R M Lodha

Madan B Lokur and Kurian Joseph gave the ruling The bench observed that there

was no harm in giv ing the po licy a c hanc e It saw mer it in t he polic y that it would

eliminate intermediaries and help provide farmers a better price for their produce

It dismissed the petition filed against the 51 percent FDI in multi-brand retail As

per the court the policy will affect the lives of only 133 of the countrys

population living in 53 cities



Ac co rdin g to T RAI data Utt ar Pradesh acc ou nt ed for th e largest

number of mobile subscribers in India followed by Tamil Nadu

Maharashtra An dhra Pradesh an d Bihar Uttar Pradesh has a total of 12160

million mobile phone connect ions while Tamil Nadu has 7 181 million

subscribers Maharashtra is at the third position with a subscriber base of 67 7 3

million followed by Andhra Pradesh and Bihar at 6412 million and 607 3 million

respectively These five states together account 366 million mobile subscribers

whic h is 45 per ce nt of the total ce ll pho ne co nnec tio ns in t he co untr y Karnataka

stands sixth with 5245 million mobile subscribers followed by the central Indian

state of Madhya Pradesh with 5143 million subscribers Gujarat fast rising as the

most industry-friendly state came eighth with 5123 million cell phone

connectio ns while Rajasthan the largest state in terms of area has 47 83 million

mobile subscribers India which is the worlds second largest mobile

phone market in terms of subscribers had 86166 million mobile

connections as on February 2013 data from telecom regulator Telecom

Regulatory Authority of India (TRAI) showed Mobile subscriber base in the

country declined by 011 percent to 86166 million at the end of February 2013

from 8626 million in January 2013 Indias total telecom subscriber base which

includes mobile and landline connections declined marginally to 892 million in

February 2013 from 8931 million at the end of January this year Indias telecom

subscriber base had touc hed an all-time high of 9655 million in June 201 2

Infrastructu re financier IDFC on 2 May has announ ced that its current

Managing Director amp Chief Executive Officer Rajiv Lal would replace

outgoing chairman Deepak Parekh Mr Parekh will leave the government-

promoted IDFC to chair the IDFC advisory council - consultative body that will be

formed within the next few months Mr Parekh has been the chairman of the

gove rnment promote d infrastructure financier for the last fifteen y earsIDFC said in

a statement Parekh has relinquished his post as Chairman The board has



Managing Directo r and CEO

Sticking to its c autious stance the Reserve Bank of India (RBI) on 3 May cut

the key interest rate by just 025 per c ent to 7 25 per cent and kept the

liquidity enhancing cash reserve requirement unchanged disappointing

the industry and stock market The RBI in its annual monetary policy statement

said there would be modest improvement in the countryrsquos economic growth to 57

per cent in the current fiscal as against the decadersquos low of 5 per cent in 2012-13

Justifying the limited easing RBI Governor D Subbarao said the ldquomonetary policy

action by itself cannot revive growth It needs to be supplemented by efforts

towards easing the supply bottlenecks improving governance and stepping public

investmentrdquo The upside risks to inflation which cooled to a three-year low in

March ldquostill remain significantrdquo in the near term on suppressed inflation on the

energy front Mr Subbarao added ldquoOverall the balance o f risks stemming from the

Reserve Bankrsquos assessment of the growth-inflation dynamic yields little space for

further policy easingrdquo he said The decision to leave the CRR unchanged seems to

have been driven by an improvement in the liquidity deficit as the banks are now

drawing around Rs 84000 crore from the overnight window compared to Rs 18

lakh crore late last fiscal RBI expects inflation to hover broadly around the 55 per

cent mark in the curr ent fiscal and said it will deploy ldquoall instruments at co mmandrdquo

to bring it down to 5 per c ent by March next y ear

wwwsakshieducationcom

Published on 572013 72900 PM

Other Current Affairs

A t E i Aff i



August 2013 Economic Affairs

July 2013 Economic Affairs

June 2013 Economic Affairs

April 2013 Economic Affairs

March 2013 Economic Affairs

February 2013 Economic Affairs

January 2013 Economic Affairs

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MBA (Full Time Part Time)

BCom BBA MSc Exam

Results

Mohanlal Sukhadia

University MA BPE BSc

BTM Exam Results Vi ew Al l

are set to form a joint ven ture (JV) for taking up various initiatives in

the oil and gas sector including supply of LNG to Sri Lanka by Petronet

LNG Limited (PLL) to feed power plants in that country The decision to

form the joint venture was taken following a meeting between the Petroleum

Secretary Vivek Rae and the Ministry of Finance and Planning and Secretary

Ministry o f Economic Developme nt Sri Lanka P B Jayasundara rece ntly Seeking

to put the co-operation in the oil and gas sector on the fast track the government

has asked IOC to formalize a proposal within this month and submit the same to

CPC to facilitate further discussions While acknowledging that there were p ending

issues of Lanka IOC the Sri Lankan side suggested that the b est way forward was to

carry the initiative for enhancing co-operation between the two countries It was

decided during the meeting that IOC would submit a comprehensive proposal on

the structure o f the proposed JV that would address all concerns of IOC

In a surprise rejig at the top on 1 June NR Narayana Murthy is back in

Infosys as Executiv e Chairman at a time when the IT major has lost ground to

rivals and the stock has been among the worst performers in its league The

company which Narayana Murthy co-founded with six others for $250 is now$7 -

billion software majo r but has b een going throug h a ro ugh patc h the last two y ears

With Murthy rsquos appointment as Executiv e Chairman of the board and Additional

Director for the next five years the countryrsquos third largest software exporter hopes

to make up the lost ground The board proposes to extend the retirement age for

the Executiv e Chairman to 7 5 y ears ldquoThis is my second innings and an exc iting yet

somewhat new level of challenges awaits merdquo said Murthy who got to know of his

role this morning However the shareholders have to give their nod to the

appointment of Murthy who retired from Infosys in August 2011 and has not held

an executive role the last seven years KV Kamath who was appointed Chairmanafter Murthyrsquos ex it will step down this month

APTITUDE TESTS

Practice Tests in Number

system percentages ages

etc

GENERAL KNOWLEDGE

GK for competitive exams

in various topics

JEE MAIN

FAQs Quick Review Model

tests Study material etc

JEE ADVANCED

Study material chapter-

wise and online tests etc

CAT SPECIAL

Shortlisting and selection

criteria for IIMs

USEFUL LINKS

UPSC Exams Schedule

అం టల అర ల

వక ల

YEARLY TM

CURRENT AFFAIRS

WEEKLY TM

CURRENT AFFAIRS

















2012-13 compared to 36 in 2011-12













SSC Exams Sche dule


Citizen Service s

Useful Websites

Important Days

Age Calc ulator













future




































































































































































-



-


















































































A t E i Aff i






























2012-13 compared to 36 in 2011-12













SSC Exams Sche dule


Citizen Service s

Useful Websites

Important Days

Age Calc ulator













future




































































































































































-



-


















































































A t E i Aff i
























future




































































































































































-



-


















































































A t E i Aff i































































































































































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A t E i Aff i


































































































































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A t E i Aff i





































































































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A t E i Aff i







































































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A t E i Aff i











































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A t E i Aff i
















-


















































































A t E i Aff i





































































A t E i Aff i







































A t E i Aff i



























Documents

May 2013 Economic Affairs.pdf