26&27, February 2017

1.RBI to frame standard procedure for FDI approvals post FIPB

Source: Indian Express

In order to further improve ease of doing business, the government has decided to abolish Foreign Investment Promotion Board and form a new mechanism.

  • The Reserve Bank is expected to formulate standard operating procedure (SOP) for approval of FDI proposals by ministries following the government decision to phase out FIPB.
  • The proposal for setting up norms for foreign direct investment (FDI) approvals in sensitive sectors, which are currently under government approval of the FDI policy, was discussed at a recent inter-ministerial meeting.
  • It includes representatives from the RBI, Finance Ministry, the Department of Industrial Policy and Promotion, and the Home Affairs Ministry.
  • RBI is the nodal agency for administration of foreign investments and foreign exchange. The committee is expected to submit its report within two months which will give guidelines on FDI approval procedures in the sensitive sectors.

FDI inflow zooms 18% to USD 46 billion in 2016: DIPP

  • Foreign direct investment (FDI) in India grew 18 per cent during 2016 to touch $46 billion, data released by the Department of Industrial Policy and Promotion (DIPP) showed.
  • The country attracted FDI of $39.32 billion in 2015.
  • The main sectors which attracted the highest foreign inflows include services, telecom, trading, computer hardware and software and automobile.
  • Bulk of the FDI came in from Singapore, Mauritius, the Netherlands and Japan.
  • Foreign investments are considered crucial for India, which needs around $1 trillion for overhauling its infrastructure sector such as ports, airports and highways to boost growth.

A strong inflow of foreign investments will help improve the country’s balance of payments situation and strengthen the rupee value against other global currencies, especially the U.S. dollar.

2.Indian Navy Concludes Theatre Level Exercise Tropex 2017 – INS Vikramaditya

Source: PIB

The Indian Navy’s Annual Theatre Level Readiness and Operational Exercise (TROPEX 17) was conducted on the Western Seaboard.

The month long exercise saw participation of over 45 ships from both the Western and Eastern Naval Commands of the Indian Navy, including the aircraft carrier INS Vikramaditya, 05 submarines including the nuclear powered Chakra, 50 Naval aircraft, 11 ships from the Coast Guard, troops from the Army and 20 aircraft from the Air Force including Su 30s, Jaguars and AWACS.

Key facts:

  • The exercise, in complete coordination with the Army and Air Force, was conducted in phases to test the various facets of war-fighting and joint combat capabilities of the armed forces to respond to given threat situations.
  • The Joint Work Up Phase witnessed various weapon firings by ships, submarines and aircraft from both the Indian Navy and Air Force.
  • The 2017 edition of TROPEX included the conduct of large scale ‘Out of Area Contingency’ in island territory, which saw participation of all three services and their special forces.

TROPEX 2017 assumes great significance in the backdrop of current security scenario. The exercise provided an apt-opportunity to test the combat capability of the Indian Navy, Indian Army, Indian Air Force and Coast Guard, and strengthened inter-operability and joint operations in complex conflict situation.

3.Why did Barren Island volcano erupt again?

Source: The Hindu

India’s only active volcano — the Barren Island volcano — in the Andaman and Nicobar Islands is again spewing lava and ash, according to a team of scientists from the Goa-based National Institute of Oceanography (NIO).

The Barren Island

  • The Barren Island, about 140 km from Port Blair, is a tourist destination and surrounded by waters ideal for scuba diving and is home to a wide variety of aquatic life.
  • It’s the only active volcano along a chain of volcanoes from Sumatra to Myanmar.
  • The 354-metre-high island is the emergent summit of a volcano that rises from a depth of 2,250 m.
  • The small, uninhabited 3-km-wide island contains a roughly 2-km wide caldera (a volcanic crater) with walls 250-350 metres high.

Background:

  • Historically, the first record of the volcano’s eruption dates back to 1787. It was known to have erupted at least five times over the next 100 years. Then there was silence for a century. In 1991, it spewed so massively that smoke billowed out for about six months. Ever since, there have been eruptions every two-three years, the last in February 2016.
  • All of these recorded eruptions lie on the lowest end of the so-called Volcanic Explosivity Index that ranks volcanoes from 1-8 based on the quantity of volcanic material spewed and the strength with which it does so. The latest eruption was a mere ‘2’ on the scale.
  • However, detailed studies have shown that the volcano first erupted 1.6 million years ago and sits on a 106-million-year-old crust.
  • However benign this may seem, the renewed volcanic activity over the past few decades has some scientists worried about the amount of unreleased pressure stored in the continental plates that support the volcano. An eruption in 2005 was linked to the previous year’s Indonesia-Sumatra earthquake that triggered the destructive tsunami that ravaged India’s southern coast.

In 1991, the volcano’s eruption was catastrophic for several animal species. According to a report from the Geological Survey of India, a scientific team visited Barren Island on April 8-9, 1993, to assess the impact of the 1991 eruption on the distribution, habit, and abundance of fauna. Gas emissions still seemed to be oozing. The eruption reduced the number of bird species and their population.

4.India, ADB ink $375 million loan pact for industrial corridor

Source: Indian Express

India and Asian Development Bank (ADB) has signed $375 million pact for loans and grants to develop 800 km Visakhapatnam-Chennai Industrial Corridor.

It is the first phase of a planned 2,500-km East Coast Economic Corridor. Earlier in September 2016, ADB had approved $631 million in loans and grants for the industrial corridor.

Keyfacts

  • The loans comprises $500 million multitranche facility to build key infrastructure in the four main centres along the corridor — Visakhapatnam, Kakinada, Amaravati, and Srikalahasti (Yerpedu) in Andhra Pradesh.
  • The first tranche of $245 million will finance subprojects to develop high-quality internal infrastructure in 2 of the 4 nodes of the corridor — Visakhapatnam and Yerpedu—Srikalahasti.
  • It also has $125 million policy-based loan that will be used for capacity development of institutions engaged in corridor management. It will also provide support to enhance ease of doing business and for supporting industrial and sector policies to stimulate industrial development.

East Coast Economic Corridor (ECEC)

  • ECEC is India’s first coastal economic corridor along eastern coast. It stretches about 2,500 kms from Kolkata (West Bengal) in the north to Kanyakumari (Tamil Nadu) in the south.
  • It will connect long eastern coastline and strategically located ports with the multiple international gateways to connect India with global value chains (GVCs) in East and Southeast Asia.
  • It supports Union Government’s flagship Make in India campaign, which aims to boost manufacturing by attracting foreign investment and facilitating the establishment of manufacturing hubs.
  • ECEC also aligns with port-led industrialisation under Sagarmala initiative and Act East Policy by linking domestic companies with vibrant global production networks of East and Southeast Asia.

ADB: It is Manila based regional development bank. It was established in 1966 and is owned by 67 members of which 48 are from the Asian region.

5.India, Germany ratify social security agreement

Source: The Hindu

India and Germany have ratified the Social Security Agreement (SSA), which will come into force from May 1 this year, to help promote more investment flows between the two countries.

Key facts

  • The SSA establishes the rights and obligations of nationals of both countries and provides for equal treatment and unrestricted payment of pensions even in case of residence in the other contracting state.
  • It also integrate the provisions of the 2008 social insurance pact and is expected to reduce the operational costs of companies on both countries active in either of the countries.
  • Under it, requirements to be entitled to pension can be met by aggregating periods of insurance completed in India and Germany, whereby each country only pays pension for insurance periods covered by its laws.
  • This comprehensive SSA will favorably impact the profitability and competitive position of Indian and German companies with foreign by reducing their cost of doing business abroad.
  • It will also help promote more investment flows between the two countries.

Background

  • India and Germany had earlier signed an Agreement on Social Insurance in October 2008.
  • It exempted detached workers of the two countries from making social security contributions in either countries as long as they were making such contributions in their respective countries.
  • Later, both countries, negotiated for a wider encompassing SSA including totalisation of benefits and was signed in October 2011. So far, India has signed and operationalized similar agreements with 18 countries, including Australia, Canada, France, South Korea, Belgium and Japan.

6.Pests eat away India’s 35% of total crop yield: ICAR scientist

Source: The Hindu

According to Indian Council of Agricultural Research (ICAR) scientist, pests eat away about 30-35% of the annual crop yield in India. Such large-scale crop-loss is having an adverse effect on the agricultural biosafety which is paramount to food security of the country.

Keyfacts

  • Among such pests, nematodes (microscopic worms many of which are parasites) have emerged as a major threat to crops in the country. They have caused loss of 60 million tonnes of crops annually.
  • They are causing loss of crops to the tune of almost 60 million tonnes or 10-12 % of crop production every year.
  • Indian farmers are still not fully aware about these potential crop-destroyers. In the past particular kind of nematode had affected plants such as potatoes and tomatoes in India. The Potato Cyst Nematode was first discovered in Nilgiris and now has spread to various parts of the country.

What are Nematodes?

  • Nematodes are microscopic worms many of which are parasites consisting of roundworms, threadworms and eelworms.
  • They have successfully adapted to nearly every ecosystem from marine (salt or brackish water) to fresh water, to soils, and from the tropics to the harsh polar regions, as well as the highest to the lowest of elevations.
  • Depending on the species, a nematode may be beneficial or detrimental to plant health.
  • The predatory nematodes breed by soaking a specific recipe of leaves and other detritus in water. Crop rotation of agricultural plants with nematode-resistant species or varieties is one of the simplest way of managing parasitic infestations of nematodes.



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