Chanakyaiasacademy:: Current Affairs 31st Mar 2016

1. PM asks UN to address challenge posed by terrorism [Security & IR]

• In the backdrop of terror attacks last week, Prime Minister Narendra Modi highlighted the dangers posed by terrorism to the world and said the UN should address such major challenges failing which the global body could be rendered irrelevant.
• It is unfortunate that the UN was still unable to define terrorism and act on a resolution which prescribes action against the countries which support or give shelter to terrorism.
• Underlining that terrorism needs to be delinked from religion, Mr. Modi said the menace posed challenge to humanity and those believing in humanity should collectively fight it.
• Terrorism cannot be defeated only by guns, but an environment needs to be created in the society to ensure that the youth are not radicalised.
• The world was jolted by 9/11. Till then the world powers did not understand what India was going through. India has been facing this menace for over last 40 years. But India never bowed to terrorism and there is no question of bowing before it.
• UN has all means and mechanism to deal with war. But unfortunately the UN does not know what the definition of terrorism is and how to address it.

2. Pace of job growth slows to six-year low [Economy]

• New jobs in eight labour intensive industries fell to a six-year low in the first nine months of 2015 - with just 1.55 lakh new jobs being created compared to over three lakh jobs over the same period in 2013 and 2014, according to Labour Bureau data.
• Our industrial growth has been low and employment takes place only when production is up. There is a lot of rationalisation of staff in the corporate sector and the government itself is not recruiting people. The main idea of growth is to create jobs. Ultimately, we need to create jobs at all levels, which is not happening.
• There was a sharp decline in hiring of contract labour in 2015. Contractual jobs declined by 21,000 in January-September 2015 against an increase of 1.20 lakh in the corresponding period of 2014.
• The Labour Bureau, under Ministry of Labour and Employment, started conducting this quarterly survey after the 2008-09 global crisis to gauge its impact on employment in eight crucial sectors - textiles, leather, metal, automobiles, gems and jewellery, transport, information technology (IT) and handloom.

3. Centre gives nod for 100% FDI in e-commerce retail [Economy]

• The government has allowed 100 per cent foreign direct investment (FDI) through the automatic route in the marketplace model of e-commerce retailing, bringing in long overdue clarity on FDI policy for the sector as well as definition of marketplace format.
• As per the guidelines issued by the Department of Industrial Policy and Promotion (DIPP) on FDI in e-commerce, foreign direct investment has not been permitted in inventory-based model.
• At present, 100 per cent FDI is permitted in B2B (business-to-business) transactions under the automatic route.
• The marketplace model has been defined as providing an "information technology platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller."
• DIPP said that the e-commerce marketplace may provide support services to sellers in warehousing, and logistics, order fulfilment, call centre, payment collection and other services. However, such entities will not exercise ownership over the inventory.

4. Short-term loans to get cheaper [Economy]

• The benchmark rates are expected to be lower by 80-90 basis points (bps) for short-term credit as banks price new loans on basis of marginal cost of funds.
• It will drive financially sound companies' hunt for the best lending rate (for shortterm credit) under new regime, leading to some competition among banks.
• This could also hit the issuance of commercial papers (CPs) as companies begin to avail of credit limits than to use the money market for short-term need.
• The Reserve Bank of India (RBI) has prescribed the new system to improve transmission of monetary policy.
• The RBI has cut key policy rate (repo rate) by 125 bps, since January 2015 to 6.75 per cent now. Responding to the central bank's actions, banks also reduced their benchmark lending rates (base rate) but not in same proportion. They brought down deposit rates by 85-100 bps in past 12 months.
• Along with benchmark rates (for loan), banks could also change (reduce) interest rate on deposits to bring-down cost of funds further. The sharp cut in rates on small savings deposits is giving enough room for banks to tweak rates further.
• Under the new regime, instead of one benchmark rate, banks would indicate at least five, varying by tenure. Starting with a rate for a fortnight, they would quote rates for buckets of a month, three months, six months and a year. The RBI has left it to banks to decide on more rates for longer tenures.
• At present, banks are following different methods in computing their BR - on the basis of average cost of funds, marginal cost or blended cost of funds (liabilities). BRs based on marginal cost of funds should be more sensitive to changes in RBI policy rates.

5. SC upholds rules to support Good Samaritans [Governance]

• The Supreme Court upheld a Central notification issuing standard operating procedure (SOP) for the protection and examination of 'Good Samaritans' - those who help road accident victims - and make it binding on all State governments and authorities.
• A Bench led by Justice V. Gopala Gowda endorsed the January 21, 2016 notification issued by the Transport Ministry as a positive signal for a concerted effort to change the public's attitude of turning away from helping a road accident victim reach critical medical care.
• More lives of accident victims can be saved if law can be made to protect Good Samaritans from legal and procedural hassles at the hands of police and hospitals.
• Assuring them anonymity and protecting them from any civil or criminal liability for taking the victim to the nearest hospital.
• The government has highlighted that bystanders or passers-by, who chose to help a person in distress on the road, should be "treated respectfully and without discrimination on the grounds of gender, religion, nationality, caste or any other."
• Other SOPs include complete anonymity in case the Good Samaritan does not want to reveal his name or details, use of video-conferencing in case of any further interaction with him by the authorities and provision for the police to examine him at his residence or office or any place of his convenience. This should be done only once and in a time-bound manner.