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12th August 2017 Part-4: Daily News Analysis
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0/20 Rule for domeatic airlines is curbing their International Air traffic growth

Jatin Verma is teaching live on Unacademy Plus

Jatin Verma
Have appeared in UPSC CSE thrice. Have been taking Unacademy Plus courses Academics- Polity, Economics & Current Affairs.

U
Unacademy user
enikkum nangaparvath thettipoyi..mount k2 marked
ഞാനും
Anoopdas Vs
9 months ago
Njnum
Shabeeb C
9 months ago
ഒരു dbt ആ ക്ലാസ്സിൽ sir അത് പറഞ്ഞില്ലല്ലോ
Hello Jatin sir..!! You are doing an astounding work I must say and that too non-stop. Wonder how you manage to collate a plethora of facts for a particular news and deliver them at the right time. Sometimes, even in the last stages in the explanation of some news by you, there are usually a lot of facts to be noted down. Hats off for your exemplary efforts :)
Sir Why govt borrow money for waivering loan..???? You said by reducing expenditure on welfare schemes they have done loan waivering....but when teach about impact on demand i.e. crowding out impact on higher borrowings....You said govt borrow money from banks which leads to reducing the amount of which the bank wants to give to private sectors.....so my question. is..why govt borrowm money from bank to waiver a farm loan...??? please clear my doubt
Hello sir,you are really doing a great job especially for aspirants like me who are completely new in this field. I just wanted to ask one question that whatever news you filter out from The Hindu and discuss here, are the only one that are relevant or are there other news as well that we need to pay attention to? Kindly clear my doubt. I will be really grateful
Vaibhavi
2 years ago
*are they the only one
Hello sir,you are really doing a great job especially for aspirants like me who are completely new in this field. I just wanted to ask one question that whatever news you filter out from The Hindu and discuss here, are the only one that are relevant or are there other news as well that we need to pay attention to? Kindly clear my doubt. I will be really grateful
Hello sir,you are really doing a great job especially for aspirants like me who are completely new in this field. I just wanted to ask one question that whatever news you filter out from The Hindu and discuss here, are the only one that are relevant or are there other news as well that we need to pay attention to? Kindly clear my doubt. I will be really grateful
Ujjawal Prakash
2 years ago
Trust me they are more than enough ... additionally you can try to relate them issue wise with the GS syllabus and prepare short notes only containing keywords ... revise again and again & u r done
  1. DAILY NEWS ANALYSIS from THE HINDU, TO 2TH AUGUST 2017 By JATIN VERMA Educator Unacademy For Daily The Hindu News & Editorial analysis- Visit my Unacademy profile- www.unacademy.com/user/studiousjatin


  2. Page-l1:Survey backs U.P model on farm loan waivers The Economic Survey assumes that other States will follow Uttar Pradesh's example and waive farm loans, taking the full waiver amount to 32.2-2.7 lakh crore. The Survey's own calculations find that only a few States have the fiscal space for such waivers, and so most will have to either cut expenditure or increase taxes.The total impact of waivers could be to lower demand by as much as 0.7% of the GDP . . It is assumed that waivers will apply at the loan rather than household level, since it will be administratively difficult to aggregate loans across households. "It is also assumed that other States will follow the U.P model of waivers up to lakh for all small and marginal farmers. On this basis, an upper bound of loan waivers at the All-India level would be between 32.2 and 32.7 lakh crore . The Survey says the waivers will have four effects on aggregate demand: [ilon private consumption impact via increases in private sector net wealth, [i]public sector impact via changes in government expenditure/taxes, [ii] crowding out impact via higher borrowings by State governments,and [iv]crowding in impact via higher credit availability as bank NPAs fall. . Loan waivers will increase the net wealth of farm households. Since loan waivers are assumed to increase aggregate income by 28%, consumption is estimated to increase by 7% or about 55,000 crore


  3. . The survey estimated that for States with fiscal space, loan waivers would add about 76,350 crore to demand via the additional interest costs and for States without space, waivers could reduce demand by about? I .9 lakh crore. The Survey's calculations show that while Andhra Pradesh, U.P, Rajasthan, Himachal Pradesh, Kerala, Odisha, and Chhattisgarh have no fiscal room to waive farm loans, States such as Maharashtra, West Begal, Karnataka and Gujarat have ample space.


  4. Page 10 World News: India keen to run Sri Lanka airport [G.S. -2:Bilateral Relations] India has expressed interest to operate Sri Lanka's second international airport situated in Mattala, about 40 km from the southern town of Hambantota, where China has majority stake in a strategic port it built. The Sri Lankan government cleared Civil Aviation Minister's request for a committee to study the Indian government's proposal. India proposes to "operate, manage, maintain and develop" the airport through a joint venture, holding 70% of the equity for 40 years According to the Minister's Cabinet paper, India is to invest $205 million in the venture, while Sri Lanka would pitch in the balance $88 million The development comes less than a fortnight after Sri Lanka signed a $1.I billion deal with China, giving the state-run China Merchants Port Holdings a 70% stake in a joint venture to run the port. Additionally, Colombo also roped in China to help develop an industrial zone in the adjoining land, spanning some 15,000 acres. Chinese loans: Built in 2010 by the government of former Sri Lankan President with Chinese loans, the port was deemed commercially unviable by his successor government, which decided to sell a majority stake to service part of the $8-billion debt Sri Lanka owes China. Beijing sees the port as a useful link in its ambitious One Belt One Road initiative Amid New Delhi and Washington's known apprehension over the Hambantota agreement-given the town's strategic location on the islands southern coast Colombo tweaked the port deal last month and said no foreign naval ship could call at the port without prior clearance


  5. . Businesspagell:llPshrinks 0.1%at 4-year low Industrial activity in June contracted 0.1%,the lowest reading since June 2013, driven primarily by a 6.77%contraction in capital goods. Data for growth in the Index of Industrial Production (IIP) for May was revised to 2.8%. The fall in capital goods production was the most drastic contraction since September 2016. Manufacturing drags:Data showed manufacturing contracted by 0.41% in June, from a growth of 2.61% in the preceding month. Unsurprising factors: [il unfavourable base effect, [i] reduction in inventories ahead of the transition to the GST, and [ slide in growth of non-oil exports culminated in a marginal contraction of 0.1% in the lIP in June 2017, . . While mild, the year-on-year de-growth in June 2017 was pervasive, with 15 of the 23 sub-groups of manufacturing and four of the six use-based industries, recording a contraction in that month. A) The mining sector witnessed a slight acceleration in growth to 0.4%, from 0.2% in May. B) Growth in the electricity sector slowed drastically from May's 8.29% to 2.15% in June. C) Consumer durables also witnessed contraction of 2.13% in June, from a growth of 0.8% in previous month. Consumer durables and non durables continue to provide mixed signals regarding demand, with the former contracting by 2 1% in June 2017 and the latter rising by 4.9% in the same month, recording the best performance among the use-based groups


  6. The year-on-year contraction in capital goods output for the third consecutive month highlights the continuing sluggishness in private sector investment activity. The outlook, however, seems more optimistic with a favourable monsoon and the Seventh Pay Commission payout projected to bolster consumer demand. . Since GST has already kicked in, the restocking of inventories will take place that is likely to boost industrial output.


  7. Survey red flags telcos' rising share in bad loans . The Economic Survey has raised red flag over the telecom sector's rising share in non-performing assets (NPAs) Though the total telecom NPAs with the public sector banks had decreased to 2,335 crore in 201 6-17 from 3,465 crore in 201 5-16,the share of the NPAs in total NPAs of infrastructure sector rose 8.7% in 2016-17 from 5% in 2015-16. . An inter-ministerial panel to examine the financial woes of the telecom sector held several meetings in June with stakeholders, including telecom operators and banks. Its report is expected soorn. . 'Price war': Stiff competition, price war, reduced revenue has trapped telecom sector into highly leveraged with interest coverage ratio turning less than I since Q3 of 2016-17 The adjusted gross revenue of the top three telecom companies in India -- Bharti Airtel,Vodafone India and Idea Cellular, decreased by 7.98%, 5 14% and 491 % respectively, during Q3 of 2016-17 as compared to its previous quarter Interest Coverage Ratio: The ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by the company's interestexpenses for the same period.


  8. Ease norms for airlines to fly abroad, . The Economic Survey has suggested a mix of protectionism for domestic airlines and liberal norms for flying abroad to bolster their share in international air traffic. . The Survey said a large increase in capacity entitlements under bilateral air service agreements with foreign countries has helped foreign carriers in gaining a large share in the international traffic to and from India as domestic carriers have under-utilised their rights. About 38% people fly in and out of India through Indian carriers as per estimates for January-March 2017 . Indian domestic airlines have a very low share in international traffic to and from India. Reasons:[] foreign airlines utilising the sixth freedom of the air, [ilexpansion of capacity entitlements under bilateral air service agreements with foreign countries, [iij lower utilisation of India's own capacity entitlements, [iv]the 0/20 rule and fleet constraints are responsible for the same. 'Sixth freedom': Sixth freedom is the bilateral air traffic right to fly from a foreign country to another foreign country while stopping in one's own country.For instance, Emirates operates flights betweern India and the U.K. while stopping at Dubai, its home state. Sixth freedom traffic constituted 61.14% of the total international traffic in 20 l 5-16, increasing from 59.15% in 2014-1 5.The Survey said this had reduced the share of direct, long-haul flights for Indian carriers from 25% in 201 1-12 to 20.5% in 2015-16. hile stopping atDubaiaitinho oms 9.15%in2014-151112 to 20.5%)


  9. . Capacity entitlements between Dubai and India have increased sixfold between 2003 and 2017.It increased ninefold in the case of Oman and 12-fold in the case of Qatar. . While capacity entitlements are reciprocal in nature, the benefit of such increases in capacity entitlements have accrued more to the foreign partner vis-a-vis India. This is because Indias utilisation of these rights is lower than the foreign counterparts . Solution: The Survey said the 0/20 rule to allow for overseas operations should be further diluted. According to the present norm, known as the 0/20 rule, a domestic airline needs to deploy at least 20 planes in the domestic sector before getting the right to fly on international routes from India. . In its 2016 policy, the Central government had diluted the contentious 5/20 rule' that required an Indian airline to have five years of domestic flying experience and 20 aircraft in its fleet before it could fly to overseas destinations. The Survey said that the government should focus on building its own aviation hubs as "India is as advantageously placed in terms of geographic location as Dubai or Singapore."


  10. Chrome File Edit View History Bookmarks People Window Help 70% Wed 9:53 PM a E UPSC ( dh Secure https://unacademy.com/user/jatimerma71 Jatin Search O credits Jatin Verma Follow Worked at Citi Bank. Books, movies, travelling, share trading. Have appeared in UPSC CSE twice. Preparing again. Activity 29 Counses 128.9k Followers 5 Following Impact Jatin Verma added a new lessorn th 3,024,634 9th August 2017 Editorial-1: Food for Action (on NFSA) National Food Security Act 2013: A Complete Analysis Jatin Verma replied on a comment 2h "sir will this state food commission be a quasijudicial body??" Harpreet Singh Kalsi Jatin Verma 2h you can say.. in loose sense of the term, though. Show All