Tag Archives: India

Ram Nath Kovind elected as 14th President of India with 65.65% votes

Sh. Ram Nath Kovind will be India’s 14th President. He is second Dalit President of India after KR Naraynan.Prime Minister Narendra Modi congratulated him on his overwhelming victory.

Ram Nath Kovind secured 2930 votes with value of 7,02,044; Meira Kumar got 1,844 votes with the value of 3,67,314; 77 invalid.Ram Nath Kovind got 65.65 percent votes (7,02,644 votes) while UPA’s Meira Kumar gets 3,67,314 votes

“Gladdened by the extensive support for Shri Ram Nath Kovind Ji among MPs & across various states. I thank members of the electoral college.” – Prime Minister Narendara Modi

Ram Nath Kovind said that he is the representative of working class and poor sections of the society.He further said that he is overwhelmed by the support.

“This huge responsibility is a message to everyone who works hard for the nation”: President-designate Ram Nath Kovind.

Sh. Ram Nath Kovind also thanked opposition candidate Meira Kumar.

Meira Kumar said that she is not upset on her defeat.

“I am not upset, why should I be upset? I am a fighter, I fought for the belief and faith of majority of my countrymen and women:: Meira Kumar

The swearing in ceremony for India’s next President will be on July 25.

How Demonetization will benefit Indian Economy in the Long Run

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Demonetization was introduced with the objective of curbing black money, terror financing and counterfeit currency.

Demonetization was introduced with the objective of curbing black money, terror financing and counterfeit currency. No one knows the exact measure of our black economy but as per certain estimates the black economy is large as 3 times our GDP imposing an immense drain on our resources. All over the world the countries that have experimented with demonetization of high denomination currency have met with varying degrees of success. But in none of the countries a measure of this magnitude had been introduced as was the case with India where almost 85% of currency was rendered illegal with a single stroke. This move came at a time when the government had initiated several measures in the preceding months to curb black money including the Black Money Bill, Real Estate (Regulation and Development) Act, 2016, Income disclosure scheme etc.

Although the move might impact the economy negatively in the very short run owing to liquidity crunch and excessive dependence on cash transactions in real estate, jewellery, retail, logistics, consumer durables, cement and some segments in MSMEs which may get deferred, but in the long run the benefits are going to far exceed the costs.

Firstly, there are significant costs to cash economy and cashless economy would help to eliminate those costs. Hard currency transactions involve the cost of time and shoe-leather cost involved in approaching the bank or ATM to withdraw cash. Also there are significant costs of printing currency, logistics involved in maintaining currency chests that can be avoided with greater use of digital transactions. Moreover cash transactions are anonymous while digital transactions ensure greater accountability and transparency.

Secondly, this move will severely dent terror financing which thrives on counterfeit currency and high denomination notes. Greater transparency in transactions will deter smuggling of arms.

Thirdly, it will boost tax revenues of the government as the black and unaccounted income gets converted to white. It is a shocking fact that in a country with 1.2 billion population, only 24 lakh persons declared their annual income to be above Rs. 10 lakhs. There is serious under-reporting of income to evade taxes causing significant loss to the exchequer.

Fourthly, going cashless will improve financial inclusion in remote areas where bank branches are far and unviable. The move has shifted behaviour of the people to move towards cashless transactions.

Demonetization is also expected to reducing liability of the RBI. It is expected approximately Rs. 5 Lakh Crore may come to the government in the form of extinguished RBI Liability, Taxes and Penalties, an amount that is enough to meet entire Fiscal Deficit for a year. Recent figures released suggest that only Rs. 1 to 2 lakh crore may actually come to the government from the money not drawn back into the system. However the final estimates would only be known after penalties on unaccounted income are realized by the Income tax department.

More importantly, in the long run, policy rates are expected to come down as bank deposits increase and NPAs decline which would further boost overall investment in the economy. Also higher tax revenues arising from better compliance would offer scope to reduce rates over the long term which will boost consumption demand.

Although there are immense opportunities for economy to grow in the long-run from demonetization, few threats remain in the short-run. The liquidity crunch caused by demonetization will negatively impact sectors with high level cash transactions. Also there will be added costs of replacement of currency. Moreover it will be a big challenge to turn the society cashless where more than 50% population is not well versed with card transactions and mobile wallets and do not possess smart phones or internet.

The Government is however making all efforts to ease the liquidity crunch and encouraging cashless transactions. The central government started the “Lucky Grahak Yojana” and “Digi Dhan Vyapar Yojana” to incentivize digital transactions so that the e-payments are adopted by the poor as well. The government also launched the digital payments BHIM app (Bharat Interface for Money)- after Babasaheb Dr Bhimrao Ambedkar, to support Aadhar-based transactions using fingerprint. To make the demonetization move a success, efforts on the digital India campaign also need to be intensified.

Overall demonetization is a progressive step shaped by the right idea, intention and initiative and like any other shock will have negative impact in the short run but will be instrumental in a positive transformation of the economy in the long run.

India and Afghanistan signed extradition treaty

India and Afghanistan came together to show solidarity against terrorism. India and Afghanistan decided to end terrorism of all forms.
Without naming any country directly India and Afghanistan will work together to end sponsorship,support and sanctuaries of terrorism. India and Afghanistan both have accused Pakistan for providing support to terrorists.
Afghanistan President Mohammad Ashraf Ghani is on a two-day visit and arrived in New Delhi on Wednesday.
India offered fresh $1 billion in aid to Afghanistan. This amount will be spent for capacity building in areas such as education,health,agriculture,energy and infrastructure.
Apart from this both countries also signed an extradition treaty.

India is investing heavily in Afghanistan due to it’s strategic location and to mount pressure on Pakistan.US also wants India to play a major role in Afghanistan.Recently US asked India to set up military aid to Afghan forces. India is providing military training to Afghan forces.
India provided four attack helicopters to the Afghan military in Dec. 2015.
India is playing a crucial role in the infrastructure development in Afghanistan.India built a landmark dam on on river Chist-e-Sharif in Herat province.The dam  will irrigate 75,0000 hectares and on river Chist-e-Sharif in western Herat.

 

New Civil aviation policy: Airline required 0 years and 20 aicrafts for international operations

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Decade old 5/20 rule was abolished and 0/20 rule was implemented.

Government has unveiled a new civil aviation policy to boost domestic airline sector. Government has abolished 5/20 rule in the new civil aviation policy. Abolition of 5/20 rule is a shot in the arm for new carriers like Vistara and Air Asia who wants to start their international operations but were not able due to 5/20 rule.

5/20 rule says Airlines Carrier should have five years of domestic operations and should have 20 aircrafts in it’s fleet to start it’s international operations.

In new Civil Aviation policy 5/20 rule has been replaced with 0/20 rule. It means if an Airline company have 20 aircrafts in it’s fleet they can start international operations.

So Airline companies having 0 years of domestic experience but having at least 20 aircrafts or 20% of their total fleet of aircraft, whichever is higher, allocated for domestic sector can start their international operations without any hindrance.

Older airlines like IndiGo, Spice Jet, Go Air and Jet Airways are not happy over the decision to abolish the 5/20 rule.

“This is to ensure that any new airlines starting business in India should essentially serve the remote parts of the country,” a ministry official said.

Arms Race Again? China Modernizing its Nuclear Force to Counter US, Russia and India

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Nuclear Arms race

The Pentagon revealed that China was deploying new military and nuclear capabilities in the face of growing advances in US and Russia. India’s nuclear force is also a major reason behind China’s steps towards modernizing its nuclear force.

In a report to the US Congress, the Pentagon Report revealed that China was deploying new command and control systems and communication capabilities to its nuclear defence forces to control multiple-units In the field. The new technologies are being set up with an aim to counter the US and other countries’ ballistic missile defence system including manoeuvrable re-entry vehicles (MaRVs), MIRVs, decoys, chaff, jamming, and thermal shielding.

China has also increased its troop along Indian border and is setting up military bases in various parts of the world, particularly with its longstanding friend Pakistan. Pakistan remains China’s major market for conventional weapons. China is involved in both arms sales and defense industrial cooperation with Pakistan, including LY-80 surface-to-air missile systems, main battle tank production, air-to-air missiles, and anti-ship cruise missiles.

The Pentagon report said that despite India-China’s strengthening political-economic relationship, “tensions remain along disputed portions of the Sino-Indian border, where both sides patrol with armed forces.” After a five-day military standoff in September 2015, at Burtse in Northern Ladakh, China and India held had agreed to maintain peace, and retreated to mutually acceptable positions to both sides.

With the emerging military might of China and its growing economic dominance in the world, it will be interesting to see how the major powers of the world will respond. If a tit-for-tat strategy is adopted then the world is slowly moving towards another era of arm’s race.

Could the BRICS New Development Bank usher a New Bipolar Financial World Order?

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With the emergence of the New Development Bank, formerly known as the BRICS Development Bank, and the AIIB (Asian Infrastructure Investment Bank), the world is increasingly becoming Bipolar, with China and India together growing as the ‘Eastern power Bloc’ challenging dominance of the Western powers led by the United States. The Bank was created with an idea to counter the dominance of European countries and the U.S. in global financial institutions such as the World Bank and IMF.

Infrastructure is needed in much of still emerging Asia, and by providing the funding to construct it, China and India make stride towards achieving economic and political status at par with the United States. BRICS countries have also created a $100 billion Contingency Reserve Arrangement (CRA), meant to provide additional liquidity protection to member countries during balance of payments problems. The CRA, unlike the pool of contributed capital to the BRICS bank, which is equally shared, is being funded 41% by China, 18% from Brazil, India, and Russia, and 5% from South Africa.

China and India are among the fastest growing Economies in the world. The economies of the five BRICS nations account for almost 30% of global GDP and 40% of the world’s population. BRICS countries produce a third of the world’s industrial products and half of all agricultural goods. Trade between BRICS countries has increased by 70% since the group was established in 2009. Noone can deny the ubiquitous presence of both India and China in the world stage.

Besides, China has recently proposed the IMF to add its currency Renminbi as a reserve currency as part of the Special Drawing Rights (SDRs).This move has the potential to shift the global economy toward a bipolar order with two dominant reserve currencies-the U.S. Dollar and the Chinese Renminbi.

In the past IMF has been accused of practicing ‘one-size-fits-all’ approach and imposing liberalization indiscriminately even on those countries where financial institutions were not well-developed. IMF conditionalities allegedly ruined several developing economies. The World Bank along with the WTO has advocated protectionism against industries of the developing countries while protecting interests of the developed countries, such as the recent Agreement on Agriculture, which stipulates reduction of export subsidies on agricultural produce on which livelihoods of the poor in the developing countries depend.

Emergence of this new ‘Eastern power Bloc’ will motivate the IMF and the World Bank to function more normatively, democratically, and efficiently, in order to promote the reforms of international financial system as well as it will lead to democratization of international relations.

China is also undertaking ambitious project to build Maritime Silk Route connecting all major ports across South, South-East and Central Asia through land and sea to boost its trade and gain strategic importance. The initiative will push each economy to advance toward the goal of setting up deep integration of markets, multi-level communication, efficient network of land, sea and air passages, and closer cultural exchanges.

Recently India has also been accorded full membership of the Shanghai Cooperation Organisation (SCO) along with Pakistan at its Ufa summit held in Russia. SCO membership to India will have significant benefits from Economic point of view. It will open up trade, energy sector and strategic transit routes between India and Russia, Central Asia, China. As Iran has observer status in the SCO, it will serve as a platform for India to boost trade through the Iranian ports of Bandar Abbas and Chabahar. These ports are considered as India’s gateway to Central Asia through International North-South Transport Corridor (INSTC).

Thus, in this politically polarized world, SCO will play an important role in counter-balancing India’s perceived tilt on security issues towards U.S. and its allies. It can help to maintain full balance of India’s relations with the western powers.

Regional stability is the basis of the economic collaboration and economic development boosts regional stability. Therefore, both the BRICS and the SCO will jointly and effectively promote stability and prosperity in Asia and counter the hegemony of global institutions such as World Bank and IMF.

Modi Deepens Ties with Sri Lanka, Seeks Edge over China on a Landmark Visit

PM Modi during bilateral talks with the Sri Lankan counterparts
PM Modi during bilateral talks with the Sri Lankan counterparts

As part of PM Narendra Modi’s first tour to Sri Lanka, India and Sri Lanka today signed four bilateral pacts which includes agreement on visa and customs to simplify trade and reduce non-tarriff barriers, agreement on youth development and building Rabindranath Tagore. Modi’s visit to Sri Lanka is the first stand alone bilateral tour by an Indian Prime Minister since 1987.  Modi met Sri Lankan President Maithripala Sirisena and discussed issues of regional importance. Modi called for greater security cooperation with Sri Lanka whose drift towards China has raised concerns in India.

Modi said that it will take time to reach an amicable solution to the fishermen’s issue between India and Sri Lanka as it has both livelihood and humanitarian dimensions to it. The Prime Minister said his meeting with Sirisena has been very productive. It “gives me confidence and optimism about the future of our relations,” Modi said.

The progress indicates the countries’ shared commitment to stronger economic cooperation.

Modi said India stands ready to help Trincomalee become a petroleum hub and announced that India will provide a fresh Line of Credit of up to USD 318 million for the railways sector in Lanka to procure rolling stock, and to restore and upgrade existing railway track.

In addition, the Reserve Bank of India and the Central Bank of Sri Lanka have agreed to enter into a Currency Swap Agreement of USD 1.5 billion to help keep the Sri Lankan rupee stable.

“We stand with you in your efforts to build a future that accommodates the aspirations of all sections of society, including the Sri Lankan Tamil community, for a life of equality, justice, peace and dignity in a united Sri Lanka”, said Modi.

Sarabjit Singh condition is still critical

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Sarabjit Singh condition is still critical.

Family members of Sarabjit Singh, led by Sarabjit’s sister Dalbir Kaur, his wife Sukhpreet Kaur and daughters Swapandeep and Poonam Singh met him in a hospital in Lahore on Sunday.

Sarabjit Singh is in deep coma and fighting with life and death after a murderous attack on him by fellow prisoners in Lahore’s Kot Lakhpat jail.

“Sarabjit Singh’s face is swollen, he was beaten by iron rods… He is unconscious, in a very critical condition… I was in hospital for 10 minutes and spoke to the doctors,” his sister Dalbir Kaur told a news channel.

The Pakistan High Commission in New Delhi issued the visas to the family Saturday evening as a special case after doctors in Lahore’s Jinnah Hospital hospital described Sarabjit’s condition as “critical” and “in deep coma”.

 

Before crossing Attari-Wagah joint check post for Pakistan family members of Sarabjit offered prayers at Harmandir Sahib on Sunday morning.

“We are going there with lots of hopes. We want to bring him back hale and hearty. His condition is such that there is some fear in our hearts. We have offered prayers to the almighty to help him recover fast,” Dalbir Kaur said before leaving for Pakistan.