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Current Affairs: Jan-Feb 2009

Current Affairs: Jan-Feb 2009


India, Kazakhstan ink N-accord: As part of its efforts to boost the country’s energy sources, India, on January 24, 2009, signed a civilian nuclear energy cooperation agreement with the uranium-rich Kazakhstan. The agreement was signed during the visit of President Nursultan Nazarbayev. India and Kazakhstan also signed four other key accords, including an extradition treaty. President Nazarbayev was also the chief guest at the Republic Day parade.
Afghan President’s visit: Expressing solidarity with India in the wake of the Mumbai terror attacks, Afghan President Hamid Karzai, during his visit on January 12, 2009, joined Prime Minister Manmohan Singh in castigating Pakistan for reneging on its commitment not to allow the misuse of its territory for terrorist activities. This was President Karzai’s second visit to New Delhi within six months. He held extensive talks with Prime Minister Manmohan Singh on a wide range
of issues, but the focus was on the Mumbai terror attacks.

India inks safeguards pact with IAEA: On February 2, 2009, India signed a safeguards agreement with the International Atomic Energy Agency (IAEA) which paves the way for the supply of atomic fuel and
technology by the international community to India after 34 years of nuclear isolation. The agreement would effectively bring 14 of India’s nuclear reactors under non-proliferation inspections of the international atomic watchdog. The IAEA currently applies safeguards to six nuclear reactors in India.  The India-specific safeguards agreement was unanimously approved by the IAEA Board of Governors on August 1, 2008.

RBI leaves rates untouched, sees lower 7% growth: The Reserve Bank, on January 27, 2009, lowered the economic growth forecast to 7%, saying the global economic crisis has hit India shores, but kept key policy rates and ratio unchanged. The bank also
lowered inflation estimates to 3% by March-end. In its quarterly review of the annual monetary policy, the apex bank extended special refinance facilities to banks up to September 30 for providing liquidity support to meet the funding requirements of mutual funds, non-banking finance companies by relaxing the maintenance of SLR up to 1.5%. The bank has injected over Rs 3,00,000 crore liquidity into the financial system through several changes in policy rates since October 2008. In the last three months, the repo rate, at which the apex bank lends short-term funds to banks, has been reduced from 9% to 5.5% and the reverse repo, at which the RBI accepts funds from banks, has been lowered from 6% to 4%. RBI said that the Central government’s fiscal deficit—the money spent more than the revenue raised and borrowed funds—would shoot up from the earlier estimate of 2.5% to 5.9% of the value of the country’s total economic output.

Cabinet okays Rs 25,000 cr for NBFCs: The government has set in motion the process of providing liquidity support of up to Rs 25,000 crore to cash-strapped Non-Banking Finance Companies (NBFCs) to enable them to pay existing liabilities as was announced in the second stimulus package to spur sagging economic growth. A Stressed Asset Stabilisation Fund, set up for acquiring the stressed assets of IDBI, would function as a Special Purpose Vehicle (SPV) to provide money to non-deposit taking systemically important NBFCs. The SPV would issue government guaranteed securities, subject to a total amount of securities not exceeding Rs 20,000 crore with an additional Rs 5,000 crore, if needed. The funds will be used by NBFCs only to repay existing liabilities he said, adding the RBI would issue guidelines for pricing and lending in consultation with the Department of Financial Services.
SEBI unveils norms for pledging of shares: The Securities and Exchange Board of India (SEBI) has spelt out the reporting norms for companies whose promoters have pledged shares to a third party. The market regulator has asked companies to disclose details of the promoters’ pledged shares within seven days of the date of receiving information from the promoters. In a circular dated January 28, 2009, SEBI said the promoters, who have pledged shares, have to disclose the details to the company within seven days of such a transaction. Further, the market regulator said that companies should disclose all the details pertaining to the promoters’ share pledge, if at the end of any quarter, the total number of such pledged shares exceeds 25,000 or one percentage of the total shareholding, whichever is lower.
India lags in health spending: At 4.8 per cent of the GDP, India’s total annual health expenditure (THE) is among the poorest in the world, with only Nigeria, Indonesia and Bangladesh reporting lesser expenditure. The WHO recommends a total annual health expenditure of 6.5 per cent of a country’s GDP. The public health expenditure (PHE) in the country is as low as Rs 215 per capita per year. It works out to a shockingly low 1.2 per cent of the GDP and 25 per cent of the total health expenditure. That the basic health services are yet to reach the low-income groups is clear from the fact that a whopping 75 per cent funding of the health sector still comes from private sources. The national Samples Survey Organisation’s 60th round has reported 126 per cent increase in urban hospita-lization costs and 78 per cent increase in rural hospitalization costs in the private sector as compared to the 52nd NSSO conducted in 1995.
India losing 1m neonates, 78,000 mothers annually: India is losing one million neonates annually, 82 per cent of them to birth-related infections (pneumonia,
tetanus and diarrhea), asphyxia and pre-term birth, finds the latest UNICEF State of the World Children (SOWC) report. Maternal health scenario is even worse, with 78,000 women dying each year from complications related to pregnancy and childbirth. Three-quarters of all maternal deaths in India are occurring from hemorrhage (38 per cent), followed by infections (11 per cent), unsafe abortions (8 per cent) and hypertensive disorders (5 per cent). On an average, every seven minutes, one woman dies of pregnancy problems; institutional delivery rate remains a poor 40 per cent.

State of education—Puducherry best, Bihar worst: India now has lesser number of single-teacher schools than it had a year ago. The latest government study on the state of elementary education in India shows that percentage of single-teacher schools in the country has declined from 11.76 in 2006-07 to 10.13 in 2007-2008, an improvement of 1.63 per cent. Among the States, Puducherry is ranked first in both primary and
elementary education, while Bihar, Arunachal, West Bengal and Jhar-khand are at the bottom. Kerala is the first in upper primary education, while Delhi and Chandigarh are fourth and fifth, respectively. The government also lists Muslim students as a separate category saying the percentage of Muslim enrolment in primary classes increased to 10.49 in 2008 as against 9.39 the previous year.

Jharkhand Chief Minister resigns following loss in by-poll: On January 12, 2009, Jharkhand Chief Minister Shibu Soren submitted his resignation to Governor Syed Sibte Razi, ending speculation on his continuance in the post after his defeat in the Tamar Assembly by-election.  On January 19, the Centre imposed President’s rule in Jhar-khand as no political alliance was in a position to form an alternative government. Soren lost to the Jhar-khand party’s Gopal Krishna Patar, also known as Raja Peter—a local Robin Hood—by nearly 9,000 votes. Raja Peter joins the ranks of MLAs with criminal backgrounds in

Satyam—A Rs 7,000 Crore Lie: Ramalinga Raju, the politically-connected promoter-chairman of Hyderabad headquartered Satyam Computers was lying for years to shareholders, employees and the world at large, building up to India’s largest corporate fraud of over Rs 7,000 crore. India’s fourth largest IT company—after TCS, Infosys and Wipro—was for years cooking its books by inflating revenues and profits, thus boosting its cash and bank balances; showing interest income where none existed; understating liability; and overstating debtors position (money due to it). This wasn’t some fly-by-night operator that had been caught out. Satyam is listed on the NYSE, boasts 185 Fortune 500 companies and the US government among clients and employs 53,000 people. The Union government has entrusting the probe to the Serious Fraud Investigations office, or SFIO.
Heroes, villains can smoke again: Amitabh Bachchan and Shah Rukh Khan can again blow rings of smoke on celluloid. The Delhi High Court has struck down the Ministry of Health’s 2005 notification banning smoking scenes. The court said the ban violated a filmmaker’s right to freedom of speech and expression as guaranteed under Article 19. “Directors should not have multi-farious authorities breathing down their necks. A film must reflect the realities of life. It may be undesirable but it exists and is not banned by law”, Justice Sanjay Kishan Kaul said. The order came on a petition filed by director Mahesh Bhatt questioning the validity of a notification under the Cigarettes and Other Tobacco Products (Prohibition of advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act.

Obama takes over as 44th President of USA: On January 20, 2009, Barack Obama became first black American to occupy White House, fulfilling Martin Luther King’s dream sooner than anyone had imagined. He was sworn in as the 44th President of the United States. The event marked the end of an eight-year chapter of George W. Bush’s Presidency, a record blighted by unfinished wars, record deficits and an economy in recession.
United States pulls back as Iraqis vote: On February 1, 2009, Iraqis across the country voted in provincial elections that will help shape their future, but regardless of the outcome it is clear that the Americans are already drifting offstage and that most Iraqis are ready to see them go. The signs of mutual disengagement were everywhere. In the days leading up to the elections, it was possible to drive safely from near the Turkish border in the north to Baghdad and on south to Basra, just a few miles from the Persian Gulf without seeing an American convoy. In the Green Zone, the Americans retreated to their vast, garrisoned new embassy compound. Iraqi soldiers now handle all checkpoints. In the US, many view the war as already over, even though more than 140,000 American soldiers remain in Iraq. Allies of Iraq’s Prime Minister appeared to have made gains in the provincial elections, rewarding groups credited with reining in insurgents and militias, according to unofficial projections.
$138-b lifeline for Bank of America: In yet another rescue act, the US government decided to inject $20 billion of fresh capital into financial services major Bank of America, apart from standing guarantee to its toxic assets worth $118 billion. While the treasury will invest $20 billion in the firm in return for preferred stocks, FDIC, along with the Treasury, will guarantee bad assets. Bank of America would also comply with enhanced exe-cutive compensation restrictions. The bank, which recently acquired Merrill Lynch, has already received $25 billion from the Troubled Asset Relief Program.
UK launches second rescue plan: Britain unveiled a second bank rescue plan and Royal Bank of Scotland recorded the biggest loss in UK corporate history in the month of January 2009, while a cut in Spain’s credit rating caused fresh market wobbles. Announcing Britain’s bank bailout, Finance Minister Alistair Darling said fourth-quarter GDP figures would confirm the UK was in recession for the first time since 1992. The European Commission, meanwhile, forecast the euro zone economy would contract for the first time in 2009, by 1.9%, and grow by only 0.4% in 2010. RBS said it made a loss of up to £28 billion ($41.3 billion) in 2008, including a huge goodwill hit on its purchase of parts of ABN Amro in 2007. Britain pumped £37 billion into the banks in October 2008 but credit remains scarce. The UK government will now allow banks to insure themselves against losses on their riskiest assets. It will offer guarantees on their debt and set up a £50-billion fund to buy up high-quality securities to get cash flowing freely again.
Sri Lanka—LTTE last post falls, Army says war over: On January 25, 2009, Sri Lankan troops rampaged through stiff resistance to capture the garrison town of Mullaitivu, the last military stronghold of the Liberation Tigers of Tamil Eelam, making a decisive victory in the war for territorial control of the island’s north and east. Earlier, on January 9, Elephant Pass, the last LTTE stronghold on the A-9 main highway also fell and enabled the military to re-open the Jaffna-Kandy supply route for people and troops instead of relying on supplies through ships.
Middle East—Tensions remain despite ceasefire: On January 18, 2009, Israel decided to halt its Gaza offensive without any agreement with Hamas. However, Hamas vowed to fight on. Gaza’s border crossings with Israel were initially allowed to open only for humanitarian supplies, with a more permanent solution linked to progress over negotiations. Later, Hamas also announced an immediate ceasefire by its fighters and allied groups in the Gaza Strip, adding that the Islamists gave Israel a week to pull out its troops. During the 22-day-long offensive, Israeli attacks killed more than 1,300 Palestinians, including some 700 civilians. Hundreds of gunmen were among the dead. Ten Israeli soldiers were killed as well as three Israeli civilians hit by rockets. The mounting civilian death toll in the Gaza Strip and mounting destruction and hardship in the territory brought strong international pressure on Israel to stop the
Obama, Hu discuss trade imbalances: On January 31, 2009, US President Barack Obama told
Chinese leader Hu Jintao in a phone call that the two countries must work together to correct global trade imbalances and unclog credit markets to fight the world economic crisis. Hu told Obama that China firmly opposed trade or investments protectionism as part of settling the crisis and said Beijing would join Washington in promoting stable development at an economic summit in London in April 2009. Hu also acknowledged US efforts to address the world economic crisis and said the two countries should strengthen cooperation. In 2008 China overtook Japan as the largest foreign holder of US government debt and held $681.9 billion in US Treasuries as of November 2008. With the US expected to issue new debt to help pay for a huge economic stimulus package, China’s holdings could grow.
US cuts $ 55 m of terror aid to Pakistan: The Obama administration’s threat to make Pakistan more accountable in the war on terror is materializing quickly, with Washington now withholding $55 million from the latest tranche of reimbursement of expenses that Pakistan claims to have incurred while fighting against terrorism. The decision was taken after auditors raised objections about the bills
given by Pakistan for expenses incurred in the war on the Pakistan-Afghan border. Financial advisor in Pakistan PM’s office, Shaukat Tarin, confirming the development, put down the US decision to a change in accounting procedures. He added that Pakistan has demanded a reassessment from Washington to enable release of the remaining amount. But the decision assumes significance in view of the Obama administration’s known stance that Islamabad must deliver on its commitment as a member of the coalition against terror, in order to receive assistance.
US sanctions on Pak N-scientist, 12 others: The US State Department has slapped sanctions on 13 individuals and three private companies because of their involvement in the Pakistan-led Abdul Qadeer Khan nuclear-proliferation network. The sanctions followed a multiyear US government review of information regarding the A.Q. Khan network. The entities provided an extensive international network for the proliferation of nuclear equipment and know-how that offered one-stop shopping for countries seeking to develop nuclear weapons, the State Department said. In 2008 a UN nuclear watchdog said the A.Q. Khan network smuggled nuclear weaponisation blueprints to Iran, Libya and North Korea and was active in 12 countries.
Lashkar-e-Toiba’s latest name: Jamaat-ud-dawa, the banned charity front of Lashkar-e-Toiba, has resurfaced as the Tehreek-e-Tahafuz Qibla Awal following the United Nations Security Council ban. A video in public domain shows JuD leaders and activists holding a rally under the banner Tehreek-e-Tahafuz Qibla Awal. The Indian establishment had been voicing concerns about JuD renaming itself in a bid to escape UNSC sanctions that included freezing of accounts, travel and arms ban. Sources have pointed out that JuD remained active in spite of the ban and kept updating its website regularly. Headquarters of JuD in Muridke was never shut down and reports said that all educational institutes, hospitals and seminaries of JuD were operating routinely. The change of name will basically allow JuD to escape restrictions placed on organisations and individuals put on UNSC consolidated list of terror groups and terrorists and operate funds in banks’ accounts frozen by the UNSC ban.

India has slipped to the 41st position from 23rd in 2007-08 in the Global Innovation Index (GII) 2008-09, says a study by industry body CII and B-school INSEAD. The US has topped the ranking once again, followed by Germany, Sweden and the UK. As per the survey, India is at the 49th position in terms of the overall input pillars index and is ranked 34 when it comes to the overall output pillars index. In both cases, China is ranked above India. However, India tops the BRIC nations for variables such as institutions and policies that can provide support for innovation. Similarly, in terms of human capacity, which captures the human resource and education aspects of a nation, India is among the top 30 countries in the world and leads among the BRIC countries as well.
Army Day is celebrated on January 15.
Kazakh President Nursultan Nazarbayev was the Guest of Honour at the Republic Day parade, 2009.
The new armoured limousine which transported US President Barack Obama down Pennsylvania Avenue during the inauguration parade on January 20 looked like something out of a James Bond film. Nicknamed The Beast, the 18-foot-long Cadillac is actually a bunker on wheels. It features heavy armour that is at least 5 inches thick and is filled with special foam that can prevent it from blowing up in the event of a direct hit. The tradition of US Presidents using Cadillac limousines dates back to the Woodrow Wilson era (1913-21). In 1965, Lyndon Johnson was the first President to ride in a bulletproof limo to an inaugural parade, less than two years after John F. Kennedy was shot and killed while riding in an open car.
The US Food and Drug Administration has opened an office in New Delhi and would shortly start another in Mumbai. The move is part of a US programme called Beyond the Borders initiative, that aims at ensuring safety and quality of medicines and food imports by expanding FDA’s outreach.
Vikas Swarup is the author of the book “Q & A” on which the film Slumdog Millionaire is based.
The Union government has scrapped its export tax on basmati rice and cut the floor price for overseas shipments to $1,100 (Rs 53,900) per tonne.
The Heads of eight institutions—Archeological Survey of India, Anthropological Survey of India, National Museum, National Library, National Archives, National Gallery of Modern Arts, Central Reference Library, National Research Laboratory for Conservation of Cultural Property)—who were earlier appointed through the UPSC, will now be appointed through a search-cum-Selection Committee monitored by the Ministry of Culture.
Archeological Survey of India, New Delhi established in 1861, maintains 3,667 monuments of national importance (including 21 monuments, which are world heritage sites).
Anthropological Survey of India, Kolkata, researches in the area of bio-cultural and biological aspects of Indian populations.
National Museum, New Delhi was set up in 1960, and houses more than two lakh art objects.
National Library, Kolkata is a repository of all reading and information material produced in India as well as abroad, concerning India.
National Archives, New Delhi was set up as an imperial records department in 1891 in Calcutta. It is the custodian of non-current records of enduring value of Central Government Ministries/Departments/ offices and their predecessor bodies.
The silver lotus awards are the national film awards presented in two main categories: feature films and non-feature films. These were established in 1954. Two separate 10-member jury panels select the winners for each, and these juries are appointed by the Directorate of Film Festivals in India.
The distance between planets was calculated by Copernicus using Kepler’s Third Law of Planetary Motion. According to Kepler’s Law of Motion, the square of the time period of the revolution of a planet around the sun is directly proportional to the cube of the semi-major axis of its orbit.
S. Krishnaswamy, a documentary film maker on historical subjects, was commissioned by late Prime Minister Indira Gandhi to do the controversial Time capsule project during the Emergency in 1975. He has been conferred the Padma Shri award in 2009. He is also known for making the hugely popular documentary Indus Valley to Indira Gandhi which covered every State from Kashmir to Kerala and dealt with contentious issues like untouchability, women being worshipped as deity and being subjected to slavery.
International Customs Day is observed on January 26.
On recommendations of the Commission for Agricultural Costs and Prices (CACP), the Cabinet Committee on Economic Affairs has approved the Minimum Support Prices (MSP) for wheat at Rs 1,080 per quintal, an increase of Rs 80 per quintal over the past year’s MSP. CACP is the nodal agency that recommends remunerative prices of crops.
Rising by almost 60 per cent since 2003-04, India’s per capita income, which indicates what an average person earns, has increased to Rs 33,283 in 2007-08, as per the quick estimates of national income released by the Central Statistical Organisation (CSO). The per capita income, increased by 12.7 per cent (at current prices) during 2007-08, while country’s population inched up by 1.4 per cent to 1.38 billion by the end of the fiscal.
Commanding officer of Chandigarh-based 48 Squadron, Gp Capt S.C. Chafekar has been decorated with the Shaurya Chakra for exceptional courage and professionalism. He had created history by landing an AN-32 twin-engine aircraft at the world’s highest airfield, Daulat Beg Oldie, located at an altitude of 17,000 feet, on May 31, 2008.
Reliance Industries Limited (RIL) Chief Mukesh Ambani has emerged as the third-richest Chief Executive in the world, as per a list of the 10 wealthiest CEOs compiled by Forbes magazine. Steel tycoon Lakshmi Mittal, Anil Ambani and Sunil Mittal are the other Indians in the list. Billionaire investor Warren Buffet was the wealthiest Chief Executive for the second year in a row, with a stake worth $ 35.9 billion in investment management firm Berkshire Hathaway. Business software major Oracle CEO Larry Ellison was ranked second ($ 19.7 billion).
First-time users of internet can now literally find the web at their doorstep as Google India has launched a customized internet-enabled bus which will touch 15 towns in Tamil Nadu to rope in more people on the information superhighway. The bus has four booths based on four themes—information, communication, entertainment and education—with informative content in English and Tamil.


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13.0 Learning Outcome

13.1 Introduction

13.2 Initiatives towards Constitutional Status to Local Governance

13.2.1 Features of 73rd Constitutional Amendment

13.2.2 Features of 74th Constitutional Amendment

13.2.3 Decentralised Planning in Context of 73rd and 74th Constitutional Amendment Act

13.3 Initiatives after Economic Reforms

13.4 Functioning of PRIs in Various States after 73rd Amendment

13.5 Functioning of Local Governance after 73rd and 74th Constitutional Amendment: Observations

13.6 Conclusion

13.7 Key Concepts

13.8 References and Further Reading

13.9 Activities


After studying this Unit you should be able to:

• Identify the background of revitalisation of local governance;

• Understand the features of 73rd and 74th constitutional amendment;

• Discuss the initiatives after economic reforms; and

• Outlines the functioning of local governance in various states after the amendment.


The revitalization of Pancha…

Q. What is the meaning of the terms like ‘Pardon’, ‘Reprieve’, ‘Respite’, ‘Remission’ and ‘Commutation’ with respect to the power of the President to grant pardon to convicted persons?

Ans. In terms of their scope and effect, these terms have specific connotations. The effect of Pardon is to abolish punishment and to absolve the convict of all charges. If Pardon is granted, it is assured as if the convict has not committed any crime. The convict will not face any disabilities due to the allegations and charges made against him. ‘Remission’ means reducing the punishment without changing the nature of punishment. For example, the imprisonment for 20 years may be reduced to the imprisonment for 10 years. ‘Commutation’ means reducing the punishment by changing the nature of punishment. For example, punishment to death may be changed to life imprisonment. ‘Respite’ means reducing or changing the nature of punishment in view of the specific facts and circumstances of the convict. For example, the punishment to death awarded to a pregnant woman, may be changed to simple life imprisonment. Respite means delay in execution of punishment especially that of death, in order to …

General Studies :: Indian Polity #1

Constitutional evolution under British ruleRegulating Act 1773beginning of British parliamentary control over the East India Companysubordination of the presidencies of Bombay and Madras to BengalGovernor of Bengal made Governal-Generalcouncil of Governor-General establishedSupreme Court established in CalcuttaPitt’s India Act 1784commercial and political activities of the Company separatedestablished a board of control over the CompanyCharter Act 1813trade monopoly of the Company abolishedmissionaries allowed to preach in IndiaCharter Act 1833Governor-General of Bengal becomes Governor-General of Indiafirst Governor-General Lord William Bentickends commercial activities of the CompanyCharter Act 1853legislative and executive functions of the Governor-General’s council separatedopen competition for Indian Civil Services establishedIndian Council Act 1861establishes legislative councils at the centre, presidencies and provincesGovernor-General’s executive council to have Indians as non…