07, November 2016

1.First S4A debt recast gets approval

Source: The Hindu

Construction major Hindustan Construction Company (HCC) became India’s first firm to get debt recast under RBI’s new Scheme for Sustainable Structuring of Stressed Assets (S4A).

The RBI-mandated Overseeing Committee (OC) under the S4A has approved HCC’s Rs. 5,000-crore debt recast passed by an ICICI Bank-led joint lender forum in September 2016.

S4A Scheme for Sustainable Structuring of Stressed Assets:

S4A scheme to help resolve the corporate debt problem and strengthen the lenders’ ability to deal with stressed assets.

Unveiled by the RBI earlier this year to help resolve the corporate debt problem, a company’s debt is bifurcated into two parts —

  1. The first being sustainable debt that cannot be less than 50 per cent of existing debt and will have to be serviced over the same terms as that of existing facilities.
  2. The other unsustainable part of the loan can either be converted into equity, Redeemable Optionally Convertible Preference Share or Optionally Convertible Debentures, with clearly spelt out terms.
  • Banks can sell this stake or equity to a new owner who will have the advantage of getting to run the business with a more manageable debt.
  • Banks or lenders will formulate the resolution plan and implement the same along with necessary internal approvals.
  •  RBI mandated advisory body called Overseeing Committee (OC) will be constituted, which will review the resolution plans submitted by the Banks.

Debt recast:

  • 52% of the debt (nearly Rs. 2,600 crore) was found to be sustainable and can be serviced as per original terms and conditions, including about interest rate and tenure.
  • Out of the remaining 48% (Rs.2,400 crore) debt, 1,000 crore debt will be converted into equity for banks, which could eventually give them 25% stake in the company’s post-scheme equity capital. T
  • he remaining debt of Rs. 1,400 crore would get converted into optionally convertible debentures to be issued to the lenders. These measures would now go for approval from HCC’s shareholders.

2.Union Environment Ministry constitutes Four-Member team for Conservation of Loktak Lake

The Union Ministry of Environment, Forest and Climate Change (MoEFCC) has constituted a four-member team for conservation and management of Loktak Lake in Manipur.

 The team will visit Loktak Lake and hold discussions with the State government, its concerned agencies and other stakeholders including people living in the vicinity of the lake.

Review implementation

  • Review implementation of works undertaken with financial assistance provided by Union and State governments so far for the conservation and management of the lake.
  • Suggest further interventions required for conserving the lake in a holistic manner. Enumerate steps required to be initiated for declaring Loktak Lake as a UNESCO World Heritage Site.

Loktak Lake:

  • Loktak Lake is the largest freshwater lake in Northeast India and is famous for the phumdis floating over it.
  • Phumdis are the heterogeneous mass of vegetation, soil and organic matter at various stages of decomposition.
  • Keibul Lamjao National Park is also one of Phumdis in the lake. It is only floating national park in world and is last natural refuge of endangered Sangai deer.
  • Considering the ecological status and its biodiversity values, Loktak lake was initially designated as a wetland of international importance under the Ramsar Convention in 1990.
  • Later it was also listed under the Montreux Record in 1993. Human activity has led to severe pressure on the lake ecosystem.

3.India, Japan set to sign nuclear deal this week: report

Source: The Hindu

India and Japan are set to sign a historic civil nuclear cooperation deal during Prime Minister two-day visit to Tokyo this week, a move that will boost bilateral economic and security ties and facilitate leading U.S.-based players to set up atomic plants in India.

Civil Nuclear Energy Sector

  1. The deal would allow Japan to export nuclear technology to India, making it the first non-NPT (Non-Proliferation Treaty) signatory to have such a deal with Tokyo.
  2. It would also cement the bilateral economic and security ties as the two countries warm up to counter an assertive China.
  3. Japan is a major player in the nuclear energy market and an atomic deal with it will make it easier for U.S.-based nuclear plant makers Westinghouse Electric Corporation and GE Energy Inc. to set up atomic plants in India as both these conglomerates have Japanese investments.
  4. According to the report, India and Japan are also likely to agree that if New Delhi conducts a nuclear test, the bilateral cooperation will stop.

There was political resistance in Japan — the only country to suffer atomic bombings during World War II — against a nuclear deal with India, particularly after the disaster at the Fukushima Nuclear Power Plant in 2011.

4.India, Sri Lanka agree to form Joint Working Group on Fisheries to address fishermen issue

Source: The Hindu and PIB

The decision came fishermen of both countries failed to reach an agreement on ending fishing in Sri Lankan waters by Indian fishermen.

  • India and Sri Lanka have agreed to set up a Joint Working Group on Fisheries (JWG) and a hotline between their Coast Guards to address the long-standing issue of fishermen from Tamil Nadu.
  • These mechanisms aim to help find a permanent solution to the fishermen issues.

The JWG on Fisheries will meet every three months beginning January 2017 while the Ministers of Fisheries on both sides would meet every six months along with Naval representatives and Coast Guard to discuss the protracted issue.

The terms of reference of the JWG

Expediting the transition towards ending the practice of bottom trawling at the earliest, as well as framing procedures for returning fishermen arrested by both sides, and the possibility of joint patrolling.

However, both sides failed to resolve the issue of their seized boats which has been an emotive issue in Tamil Nadu. This issue will be discussed at the first JWG meeting.

India and Srilanka relationship:

  • The relationship between India and Sri Lanka is more than 2,500 years old.
  • Both countries have a legacy of intellectual, cultural, religious and linguistic interaction.
  • Trade and investment have grown and there is cooperation in the fields of development, education, culture and defence.
  • Both countries share a broad understanding on major issues of international interest.

India – Sri Lanka Meeting on Fishermen issues – Minister of Agriculture & Farmers

  1. Fishermen from India and Sri Lanka have been fishing over centuries in the Palk Bay area located between India and Sri Lanka. [Both the countries have mutually entered into agreement in 1974 and in 1976 to decide the International Maritime Boundary Line (IMBL) in accordance with the international rules.]
  2. Given the proximity of the two countries in the sea, the incidents of straying of fishermen and crossing the IMBL are common, especially in the Palk-Strait and Gulf of Mannar. The instances of arrest of fishermen from Tamil Nadu (while fishing in Sri Lankan waters), seizure of their boats and attack by the Sri Lankan Navy are of great concern to the Indian government.
  3. In order to reduce fishing pressure in the coastal areas and to encourage the Deep-sea fishing the Government of India is considering the modalities for implementation of a Scheme, in which it is proposed to incentivize the traditional fishermen for Deep- Sea Fishing.
  4. The fishermen issue continues to be a major irritant in the India-Lanka ties. This issue has a socio-economic dimensions, livelihood and humanitarian dimension and wants a long term solution to the problem.
  5. Sri Lanka’s Position: It accuses Indian fishermen of straying into its territorial waters. It wants Indian fishermen to immediately end to bottom trawling, a practice that depletes the ocean’s resources. It also has refused to return more than 100 trawlers seized since 2014.
  6. India’s Position: Fishermen from Tamil Nadu are only fishing in their traditional areas, especially around Katchatheevu, an islet ceded to Sri Lanka in 1974.

5.Army’s Demchok mission a success

Source: The Hindu

The Army has completed laying an irrigation pipeline for residents of villages in the Demchok region of Eastern Ladakh

Chinese troops had tried to obstruct the work, but the Indian side held firm and laid a pipeline.

The irrigation project was being built under the Mahatma Gandhi National Rural Employment Guarantee Scheme to link a village with a “hot spring”.

This is the first time since 2014 when the Chinese Army had come deep inside the Indian territory in Demchok in protest against an ongoing irrigation project.

6.Retired judges to wield the gavel again

Source: The Hindu

The Union government has agreed to a resolution passed by the judiciary in the Chief Justices and Chief Ministers Annual Conference in 2016 to use the services of retired High Court judges with proven integrity and track record to tackle pendency of cases.

Constitution:

The provision to use the services of retired judges is open to the Chief Justices of High Courts under Article 224A of the Constitution with the previous consent of the President as an extraordinary measure to tide over case pile-ups.

Background:

As per the minutes of the resolution, “keeping in view the large pendency of civil and criminal cases, especially criminal appeals, where convicts are in jail and having due regard to the recommendation made by the 17th Law Commission of India in 2003, the Chief Justices will actively have regard to the provision of Article 224A of the Constitution as a source for enhancing the strength of judges to deal with the backlog of cases for a period of two years or the age of sixty five years, whichever is later until a five plus zero pendency is achieved.

Five plus zero initiative

  • ‘Five plus zero’ is an initiative by which cases pending over five years are taken up on priority basis and their numbers are brought down to zero.
  • The conference minutes considered the report of the committees about delay in case disposal in the High Courts with great concern.
  • The reports submitted by the Delay and Arrears Committees of various High Courts have indicated a need to prioritise areas of immediate concern in the disposal of pending cases.
  • Accordingly, it was resolved that all High Courts shall assign top-most priority for disposal of cases which are pending for more than five years.

MoP on appointments

The agreement on the minutes comes at a time when the Executive and the Judiciary are trying to find a common ground on the memorandum of procedure for judicial appointments in High Courts and ths Supreme Court.

 

7.Cabinet approval to be sought for waterways project by December

Source: The Hindu

The  Union Shipping Ministry will now seek Cabinet approval for the Jal Marg Vikas project, under which National Waterways-1 is being implemented. Jal Marg Vikas’ is a  project on the river Ganga.

The Ministry is also planning a maiden issue of infrastructure bonds worth Rs 1,000 crores in two tranches to fund this World Bank-aided project.

It involves developing a 1,620-km navigable waterway between Haldia and Varanasi.

That IWAI will procure various types of vessels once they were designed to suit the riverine channel that passes through four states(Uttar Pradesh, Bihar, Jharkhand and West Bengal) with varying navigability and tide conditions.

The entire project is expected to facilitate navigation of commercial vessels with capacity upto 2000 tons. West Bengal is expected to be the transportation hub for North East.

while World Bank has sanctioned a loan that would fund 50 per cent of the project cost, efforts were on to raise resources which may then minimise the loan requirement.

Private sector has to to come in and a significant portion of the project would be through PPP.

 

 

 



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