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Thursday, March 15, 2012

current affairs March 2012 01

Advisory Group on Asset Reconstruction Firms favoured $20 billion Limit for Investments by FIIs

 

A government-appointed advisory group on asset reconstruction firms that submitted its report to Finance Minister Pranab Mukherjee favoured $20 billion limit for investments by foreign institutional investors(FIIs) in security receipts (SRs) issued by securitisation firms. The report of the advisory group also recommended a subcap of 10% participation by foreign institutional investors in SRs be removed.

Security receipts are the ones issued by a securitisation company for a period of seven years to qualified institutional buyer or banks as they do not pay cash upfront.

The advisory group constituted to look into the condition of ARCs, in its report recommended that reconstruction firms should be allowed to buy performing loans from banks, arrange them in groups, and issue bonds on such groups or securitise in banking parlance.

RBI rejected the proposal to allow ARCs deal with healthy assets. As per the RBI ARCs should only play the role of resolving only NPAs in the system and should not be allowed to deal in healthy assets.

The committee however suggested that ARCs can hold these assets through Special Purpose Vehicles (SPVs), which will be regulated according to RBI guidelines.

About ARC

ARCs came into business after the government passed the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

The primary purpose of an ARC is to help the banking system get rid of NPAs to avoid crisis in the financial system. The ARCs function by buying non-performing assets (NPAs) from banks and financial institutions at a discount (mutually agreed upon) through a trust following which it recovers the outstanding amount, and earns a fee for managing the trust.

The ARCs however did not manage to taken off in India. The pace of new bad loans with banks far exceeded the amount transferred to ARCs. between March 2009 and March 2010, even as bad loans with banks increased by Rs 15774 crore, transfers to ARCs stood only at rs 10675 crore.

Credit rating agency Crisil’s report in September 2011 projected gross non-performing assets (NPAs)- essentially, bad loans outstanding to touch 3% of assets in March 2012, against 2.3% in March 2011.


 Tata Steel topped the List of Most Admired Indian Brand

Syrian President Bashar al-Assad set 7 May 2012 as the date for Elections


In Syria, President Bashar al-Assad set 7 May 2012 as the date for parliamentary elections. This would be the third election for parliament since President Bashar Al Assad became the President of Syria in 2000. The elections would be held as per the new constitution adopted by a referendum in February 2012.

 As per the new constitution, Baath party will not have monopoly on power. The new charter states that the president can serve only two seven-year terms and a Supreme Constitutional Court will oversee free and fair elections. The parliamentary elections are being considered as a response from President Assad to UN Special envoy to Syria Kofi Annan’s initiative.

 14 March 2012
The Centre proposes to formulate a National Livestock Policy to increase cattle population in the country. Under the policy, the States will be provided guidelines to implement specific programmes. This information was given by the Minister of State for Agriculture, Dr. Charandas Mahant in a written reply in the Lok Sabha today. He said the proposed livestock policy aims at providing food and livelihood security to cattle farmers to improve their socio-economic status. It also aims at ensuring a clean environment for them. The Minister informed the House that the draft National Livestock Policy has been circulated to all States and Union Territories for their views. Some feedback has also been received.

India has the potential to produce about one million tonnes of dry seaweed. This is the outcome of a study conducted by the Central Marine Fisheries Research Institute. The government has agreed to provide financial aid for seaweed cultivation through the National Fisheries Development Board.  This information was given by the Minister of State for Agriculture, Dr. Charan Das Mahant in reply to a question in the Lok Sabha today.

In Manipur, Laishram Nandakumar Singh is being sworn-in as Protem Speaker of the state assembly at Imphal this afternoon. He will later give oath to the newly elected Members of Legislative Assembly. With this, the process for the formation of a new government will be set in motion.
Present Manipur Chief Minister, Okram Ibobi Singh has been re-elected as the leader of the Congress Legislature party of Manipur. 







Government has initiated actions on various fronts to combat black money issue. These include enactment of Benami transactions Prohibition Act and certain amendments have been introduced in prevention of Money laundering Act as well. Simultaneously special committee has been set up to examine measures to strengthen laws to curb the generation of black money in the country.

Under the Rashtriya Swasthys Bima Yojna, approximately 2 crore 64 lakh families are being provided with Health Insurance programme. This programme will be further expanded and I hope that around 7 crore families will be benefited under this scheme by the end of the 12 th plan.

On urban development, the President said that the government will be launching the next phase of the Jawaharlal Nehru National Urban Renewable Mission. The focus of the Mission will now shift from metropolitan cities and large towns to Class I and medium towns.
Mrs. Patil announced a new scheme called the National Programme for the Urban Homeless that would help create a network of composite shelters in the urban local bodies, with adequate provisions for housing and food for the destitute.
The President said that government has undertaken a time-bound programme to convert the entire analog cable television system to digital by December 2014. This will create a more equitable and transparent system and provide better viewing experience at affordable cost. In order to extend FM radio services to millions living in small towns and remote areas, the government has taken a significant decision to e-auction 839 FM radio channels in 245 cities across the country including in border areas of Jammu and Kashmir and the North East.

Speaking on manufacturing policy, Mrs. Patil said government has announced a National Manufacturing Policy which aims at augmenting the share of manufacturing in GDP to 25 percent within this decade and creating 10 crore new jobs. She said the government will be establishing National Investment and Manufacturing Zones to promote growth in the sector.
The President mentioned that government has recently approved the Public Procurement Policy for goods produced and services rendered by Micro and Small Enterprises with a special provision for enterprises owned by Scheduled Castes and Scheduled Tribes.
On increasing port capacity, she said, rail and road connectivity to ports is being improved. In Railway sector, she said more dedicated freight corridors in addition to the eastern and western corridors already in progress, will be built to segregate freight and passenger train operations. She said, to give priority to road development, Projects for construction of atleast 7000 kms of roads will be awarded this year. The President announced that to ensure safe and affordable air services and protect the interests of air travellers, a Bill will be introduced this year for setting up the Civil Aviation Authority.
On Defence, Mrs. Patil said that the government's focus is on enhancing domestic defence production capabilities as well as achieving technological self-reliance in weapons and delivery systems.
In the areas of internal security, Mrs. Patil said government has taken several steps towards development of areas affected by Left Wing Extremism. The Integrated Action Plan with an outlay of 3,300 crore rupees in the last two years has brought development to the villages in the most backward and violence-affected districts of the country.
The Plan, which was being implemented so far in 60 districts has been extended to 78 districts. She said that the security situation in the North-Eastern States and Jammu and Kashmir has shown considerable improvement during the last year.

The Assam government today presented a tax free 293 crore 44 lakh deficits budget for the year 2012-2013.Chief Minister Tarun Gogoi, who is also holding the post of finance minister laid down the budget. He announced a slew of initiatives for the benefit of the people.
Emphasise has been given on Health, Education, Agriculture and Rural Development sectors. The chief minister declared to provide footwear to the primary school students. At least 1 thousand 600 new faculty positions will be created in colleges and universities to introduce courses like nano-technology, bio-technology and performing arts. In health sector, provision has been made to give one time grant of 1 lakh rupess to the widows of persons who died of HIV-AIDS. In a bid to achieve the target to cover 5 lakh hectares under Mission Double Cropping, Assam government announced to distribute 1000 tractors and 2000 power tillers to small and marginal farmers at 50 percent subsidy. Under Mahatma Gandhi National Rural Employment Guarantee Act, it is proposed to create around 600 lakh mandate for the next financial year.Manas Pratim Sarma,AIR News,Guwahati.

Showing signs of recovery, the industrial production grew by 6.8 per cent in January, mainly due to improvement in the manufacturing sector. As per the official data released today, growth in factory output, as measured by the Index of Industrial Production (IIP), was however higher at 7.5 per cent in January 2011. IIP growth has been revised upwards to 2.5 per cent in December, from the provisional estimates of 1.8 per cent.
Output of the manufacturing sector, which constitutes over 75 per cent of the index, rose 8.5 per cent in January, compared to 8.1 per cent in the same month last year. Besides, output of consumer goods grew 20.2 per cent in January, as compared to 8.3 per cent in the same month last year. The production of the non-durable consumer goods segment has shown signs of improvement and grew by 42.1 per cent in the month under review.



   




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