Current Affairs Update – 2 Jan, 2015

• Reserve Bank of India (RBI) today extended the deadline
  for submission of applications for licensing of Small Finance Banks (SFBs) and
  Payments Banks (PBs) to February 2 and clarified that a minimum capital of Rs
  100 crore is must for setting niche banking entities.
• “Keeping in view the difficulties expressed by various
  parties, it has been decided to extend the last date of receipt of applications
  to February 2, 2015,” RBI said.
• The earlier deadline was January 16.
• RBI had issued guidelines for licensing for SFBs and PBs
  in November. The aim behind setting up of such entires is to deepen financial
  inclusion and boost saving habits.
• Responding to queries from individuals and organisations
  relating to SBFs, the RBI said promoter (individual) of large business or
  industrial house cannot act as promoter himself to form a small bank.
• It also said there is no such stipulation regarding ideal
  number of branches a SBF shall have to be eligible for the license.
• RBI also clarified the proposed SBFs would be “required”
  to use ‘Small Finance Bank’ in its name and the minimum paid-up capital of Rs
  100 crore should be readily available at the time of obtaining banking licence.
• Also, after setting up of the bank, if the lender
  proposes to go for an IPO, prior approval of RBI is necessary.
• PBs are allowed to offer locker and vault facilities.
• It further said the balance at the close of business on
  any day should not exceed Rs 100,000 per individual customer in a Payment Bank.
• On payment of utility (like power and telephone) bills
  RBI said this it is not allowed for Payment Banks.

• The RBI has signed an information sharing agreement with
  US banking regulators for better coordination with them in supervising
  financial institutions.
• During Prime Minister Narendra Modi’s visit to the US in
  September last year, both countries issued a joint statement to corroborate the
  efforts of the RBI and American banking regulators and supervisors for exchange
  of information to enhance the effectiveness of cross border supervision.
• Since then, India and the US have moved fast to expand
  partnership in oversight of financial institutions, including between RBI, FRB,
  OCC and the FDIC.
• “The Reserve Bank, on December 9, 2014, concluded a
  Statement of Co-operation (SoC) on Supervisory Cooperation and Exchange of
  Supervisory Information with the Board of Governors of the Federal Reserve
  System (FRB), Office of the Comptroller of Currency (OCC) and Federal Deposit
  Insurance Corporation (FDIC),” RBI said in a notification today.

• Amending rules for NBFCs with regard to their KYC
  exercise, the Reserve Bank today relaxed the time limit during which such due
  diligence is required.
• The rules have been eased due to practical difficulties
  and constraints in getting Know-Your-Customers (KYC) documents at frequent
  intervals.
• “Full KYC exercise will be required to be done at
  least every 2 years for high risk individuals and entities.
• “Full KYC exercise will be required to be done at
  least every 10 years for low risk and at least every 8 years for medium risk
  individuals and entities, taking into account whether and when client due
  diligence measures have previously been undertaken and the adequacy of data
  obtained,” RBI said in a notification.
• However, it added that physical presence of clients may
  not be insisted at such periodic updations.
• RBI asked Non-Banking Financial Companies (NBFCs) to
  continue carrying out on-going due diligence with their clients and closely
  examine transactions to ensure their consistency, business and risk profile and
  source of funds.
• Also, NBFCs would be required to get fresh photographs of
  minor customers on becoming major.
• As per earlier norms, NBFCs were required to undertake
  KYC once in every 5 years for low risk category customers and once in two years
  for high and medium risk categories.
• Further, RBI said NBFCs need not ask for fresh proofs of
  identity and address during periodic updation for low risk clients if their
  address/identity remains unchanged.

• India’s manufacturing activity picked up in the last
  month of calendar year 2014, shows the widely-tracked HSBC Purchasing Managers’
  Index (PMI). The index rose to a two-year high of 54.5 in December, compared
  with a 21-month high of 53.3 the previous month. The job market, though,
  remained a little tight in the month, with reports of lay-offs at a few
  companies.
• A reading of more than 50 on PMI suggests an expansion
  while one below that level implies contraction. Manufacturing PMI has been in
  an expansion mode for over a year now. This might come as cheer at a time when
  official data suggested the country’s manufacturing growth rate dropped to a
  five-year low of 7.6 per cent in October.
• A decline in global commodity prices, meanwhile, kept
  inflation on a leash — that might give the Reserve Bank of India (RBI) some
  scope to lower the policy rate for boosting economic growth.
• Markit Economics, which compiles the manufacturing PMI
  data on the basis of a survey among 350 private companies, said business
  conditions in India improved at a faster pace across market groups during
  December — the sharpest expansion was seen in consumer goods.

• Former Reserve Bank of India (RBI) deputy governor
  Shyamala Gopinath has been appointed non-executive chairperson of HDFC Bank Ltd
  with immediate effect, the bank said in a statement to the stock exchanges.
• Gopinath’s appointment for a three-year term starting
  Friday was approved by shareholders through a postal ballot, the bank said.
• HDFC Bank has been without a chairperson since former
  Indian Administrative Service (IAS) officer C.M. Vasudev retired as chairman on
  26 August 2014.
• Gopinath retired as the RBI deputy governor in June 2011
  after a 39-year stint at the central bank. She was in charge of financial
  markets, banking regulation and supervision and foreign exchange management.

• Indian Prime Minister Narendra Modi has ramped up his
  target for solar energy as he bets on renewables to help meet rising power
  demand and overcome the frequent outages that plague Asia’s third largest
  economy, a senior official told Reuters.
• India gets twice as much sunshine as many European
  countries that use solar power. But the clean energy source contributes less
  than 1 per cent to India’s energy mix, while its dependence on erratic coal
  supplies causes chronic power cuts that idle industry and hurt growth.
• Modi now wants companies from China, Japan, Germany and
  the United States to lead investments of $100 billion over seven years to boost
  India’s solar energy capacity by 33 times to 100,000 megawatts (MW), said
  Upendra Tripathy, the top official in the Ministry of New and Renewable Energy.
• That would raise solar’s share of India’s total energy
  mix to more than 10 per cent. In Germany, a leader in renewable energy, solar
  accounted for about 6 per cent of total power generated in 2014.
• India had earlier set an investment target of $100
  billion for the next five years for all types of renewable energy, with wind
  taking up two-thirds of the total. In an interview, Tripathy said Modi’s new
  solar target was ambitious, “but if you do not have a higher goal, you
  will not achieve anything”.
• Canadian Solar and China’s JA solar told Reuters they are
  looking at making cells or modules – used in solar panels – in India.
  JinkoSolar Holdings said recent announcements have also raised their interest.
• U.S.-based First Solar and SunEdison Inc have sizeable
  businesses in India, and together with local firms will invest $6 billion in
  India for the fiscal year to March 31. Tripathy expects new and existing
  companies to invest about $14 billion annually starting next fiscal year through
  to 2022.
• Among First Solar’s top projects are two plants with
  Kiran Energy Solar Power and Mahindra Solar One totalling 50 MW in Rajasthan.
  SunEdison is working on a 39 MW project in India and hopes to participate in
  the solar expansion plan, said regional managing director Pashupathy Gopalan.

• All four people on board the vessel from near the
  Pakistani port city of Karachi are believed to have been killed in the dramatic
  episode, according to the defence ministry.
• The suspicious behaviour of the boat’s crew brought back
  memories of the 26/11 terror attacks in Mumbai six years ago. Then, 10 gunmen
  had travelled from Karachi in a boat, hijacked an Indian fishing vessel and
  steered it to Mumbai to go on a three-day rampage during which they killed 166
  people.
• A defence ministry official said the trawler stopped only
  after the ICG fired shots, but the crew had by then set it on fire, triggering
  a major explosion that sank the vessel. Neither the boat nor its crew could be
  “recovered” due to rough weather.
• The ICG ruled out the explosion being an accident, saying
  the men on the boat sped away because they were hiding “something really
  serious”.

• State-owned Bhel has bagged a Rs 3,810 crore contract
  from Telangana for setting up the newly formed state’s first thermal power
  project.
• “Valued at Rs 3,810 crore, the order is for setting
  up the 800 MW supercritical thermal power plant on EPC (engineering,
  procurement & construction) basis at Kothagudem in Khammam District of
  Telangana,” Bhel said in a statement.
• The order has been placed on the company by the Telangana
  State Power Generation Corporation Limited (TSGENCO).
• The project is to be commissioned in 36 months on
  fast-track basis with both Bhel and TSGENCO setting up teams to expedite
  clearances and execution of the project.
• TSGENCO has entered into an MoU with Bhel for
  construction of new thermal power plants totalling to 6,000 MW in the state in
  the next three years to meet the increasing demand for power, the statement
  said.

• Union Government on 31 December 2014 appointed M
  Sathiyavathy as Director General of Civil Aviation (DGCA). With this
  appointment, Sathiyavathy, a 1982 batch Union Territories cadre IAS officer
  became the first women DGCA and will hold the post till 28 January 2017.
• She succeeded Prabhat Kumar, a 1985-batch IAS officer of
  the Uttar Pradesh cadre, who completed his central deputation and return to his
  parent UP cadre. In January 2014, Kumar was appointed as the DGCA head for
  three years.
• At the time of appointment, Sathiyavathy was serving as
  additional secretary and financial advisor in the aviation ministry.

• To infuse a fresh lease of life into the struggling Jan
  Aushadhi chain of pharmacy outlets, set up to make affordable generic drugs
  available to people, the government plans to focus on select drugs and states,
  spruce up supply chain and encourage doctors to use generic names of drugs.
• Officials said the government is considering a proposal
  to trim the list of drugs being distributed through Jan Aushadhi outlets to
  40-50 mass consumption ones from the 320 medicines enlisted to be part of stock
  at present.
• The department of pharmaceuticals also plans to focus on
  states where the model has already picked up, before chasing its original goal
  of having at least one Jan Aushadhi special store in each of the 630 districts
  in the country.
• A study found that the mean availability of drugs at
  these stores stood at only 33%. This is partly due to overdependence on central
  public sector units.
• The government now plans to increase participation of
  private drug firms in the project. Also, a detailed plan is being drawn up to
  encourage doctors to prescribe generic drugs.
• Experts said getting doctors to prescribe drugs by their
  generic names rather than brand names is critical for the revival of Jan
  Aushadhi scheme.
• Currently, chemists are not legally allowed to substitute
  unbranded generics in place of prescribed branded generics.

• Bihar Governor Keshri Nath Tripathi today administered
  oath of office to Justice L Narashima Reddy as the new Chief Justice of Patna
  High Court.
• Prior this appointment, Reddy (61) was a judge at Andhra
  Pradesh High Court and Executive Chairman of Andhra Pradesh State Legal
  Services Authority. He succeeded Justice Rekha M Doshit.
• The swearing-in ceremony was held at Raj Bhawan and Chief
  Minister Jitan Ram Manjhi, Bihar Legislative Council Chairman Awadhesh Narayan
  Singh, Bihar Legislative Assembly Speaker Uday Narayan Chaudhary, several
  ministers, judges and officials attended it.
• Reddy was born in an agricultural family of Gavicherla
  village of Warrangal district of Andhra Pradesh, and went on to obtain Master’s
  Degree in International Law from Osmania University. He joined the bar in 1979.

• Eminent scientist Vasant Gowarikar, one of the pioneers
  of Indian rocket science and former chief of the Indian Space Research
  Organisation (ISRO), passed away after a brief illness at the city’s Deenanath
  Mangeshkar Hospital, aged 81.
• Mr. Gowarikar, a protégé of Dr. Vikram Sarabhai, was part
  of the illustrious band of scientists who initiated India’s satellite research
  programme and included luminaries such as A. P. J. Kalam, E. V. Chitnis, Pramod
  Kale and U. R. Rao, among others.
• Intimately associated with ISRO’s humble birth, Dr.
  Gowarikar once reminisced on the exciting early days of space research under
  Dr. Sarabhai when his office was in the building of the local St. Mary
  Magdalene Church in Thumba in Kerala.
• Dr. Gowarikar also served as scientific advisor to late
  Prime Minister P.V. Narasimha Rao between 1991 and 1993, was appointed as
  Vice-Chancellor, Pune University and was chairman of the Marathi Vidnyan Parishad
  between 1994 and 2000.
• Dr. Gowarikar, along with his associates, also compiled
  the massive The Fertilizer Encyclopedia(2008) that featured 4,500 entries
  detailing the chemical composition of fertilizers, and containing information
  on everything from their manufacturing and application to their economic and
  environmental considerations.
• Dr. Gowarikar, who was earlier honoured with the Padma
  Shri, was later awarded the Padma Bhushan in 2008.

• Five new countries on Thursday joined the U.N. Security
  Council as non-permanent members, while Chile assumed the rotating presidency
  for January.
• With the start of a new year, five new countries —
  Angola, Malaysia, New Zealand, Venezuela and Spain — have begun their two-year
  term, replacing Argentina, Australia, Luxembourg, South Korea and Rwanda,
  Xinhua reported.
• Octavio Errazuriz, permanent representative of Chile to
  the U.N., took over the rotating council presidency from Cherif Mahamat Zene,
  the Chadian U.N. ambassador who held the council presidency for December 2014.
• According to the U.N. Charter, the 10 non-permanent
  members of the Security Council are elected by the General Assembly, with five
  elected in October each year, to join the five permanent and veto-wielding
  members of Britain, China, France, Russia and the U.S.
• Under the U.N. Charter, the Security Council has the
  primary responsibility for the maintenance of peace and security in the world
  at large.
• The council presidency rotates among the members in the
  English alphabetical order of their names. Each president holds office for one
  calendar month.

• The Ministry stated that the matter has been examined in
  detail and it has no objection to the registration of ‘Boxing India’ (BI).
• Commenting on the development, BI President Sandeep
  Jajodia said, “We are extremely thankful to the Ministry of Youth Affairs
  & Sports – Government of India for approving the registration of ‘Boxing
  India’.
• “The registration is a stepping stone in expediting
  the administrative formalities and streamlining the overall functioning and
  activities of Boxing India,” he said.
• BI Secretary General Jay Kowli said the federation is all
  set to hold its first Elite Men’s National Championship.