What Britain’s Double Dip Recession Means for Binary Traders

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Contents

What Britain’s Double Dip Recession Means for Binary Traders

Binary traders who have positions in the Euro or GBP need to play their hands with extreme caution. Britain has now officially joined the ranks of the Eurozone countries facing a second recession. Coming right on the heels of the disastrous economic downturn in 2008, this second recession is bound to be a tough pill to swallow even if it is ‘mild’ as economists predict.

The Fate of Eurozone Currencies

Currencies are likely to be severely dented and remain so for a good while even if the economy does start to limp back to normalcy in a relatively short while. This is because the currencies have not even had a chance to stabilize post 2008. The double dip has occurred even as fluctuations were constantly taking place with currency values.

A recession is termed a ‘double dip’ only when the economy falters again post recession without ever touching its previous high of economic output. However, in the case of Britain and many other Eurozone nations like Italy, the Netherlands and Spain, the currency never even gained a semblance of stability thanks to severe and constant economic turmoil.

A Poor Start to 2020

Britain has also started off on the wrong foot right at the beginning of the year 2020, it appears. In the final quarter of 2020, the economy shrank by 0.3% and the beginning months of this year have only exacerbated the situation. A further 0.2% decline has been recorded over the first quarter. While analysts had not expected Britain to show a remarkable recovery from the 2008 recession, expectations had been that a second recession would be avoided, however narrowly.

The Future Remains Bleak

Given these happenings, indications are that good news may not be coming this way in the near future. Analysts do not expect this bleak state of affairs to last long but they do advice that investors have a realistic picture of what the economy will look like in the coming months. The overall situation is not set to improve dramatically any time soon and currencies will remain subdued until then.

Boffy’s Blog

Analysis of Politics, Philosophy and Economics from a Marxist Perspective

Wednesday, 30 June 2020

They Really Have No Shame

The AWL really do have no shame! I’d given up visiting their site a long time ago, because I’d decided they really were beyond all hope. But, as Leftists, curiosity is one of our central traits. Even though over recent months they have deleted various of my comments, criticising some of their wackier ideas, even though these comments met their stringent criteria exactly, I’d started to post the odd comment.

Such was the case, over the last couple of days, in this thread Bolsheviks Come To Power. One of the reasons for commenting was precisely in support of Jason, who had himself had some of his comments deleted for committing the heinous crime of including in his comment a hyperlink, that was deemed to be “advertising”.

In a short comment, I pointed out that the AWL were setting up an obvious Catch 22 here. They had replied to one query, about whether all links to other Left sites, would be classed as “Advertising” with the perfunctory – “yes”. I pointed out, therefore, that, if the ideas you wanted to cite, in support of your argument, were contained in such another site, then, not being able to link to them rather places a serious constraint on rational debate. If you avoided that by setting out those ideas, in detail, in your comment, then you would fall fould of the AWL’s other restriction, which is that they will delete comments they deem to be too long!

Jason responded, to this comment, by thanking me for pointing that out, and went on to add that, of course, the AWL could delete your comments, if all else failed, with the “catch-all” – concept of them being “inappropriate”. He added that, at least, the AWL do allow comments. I responded to that comment, in turn. Having just gone back, to see if there had been further comments, I found that not only had BOTH of my comments been deleted, but Jason’s own comment had been edited so that his initial remarks, to me, were removed.

They clearly have no shame, as well as no credibility or support. As I pointed out, in my second comment, the fact that they are afraid of critical comments, on their site, that force them to defend their politics, the fact that they are even afraid of comments providing links, to other Left sites, where there young comrades might be exposed to alternative ideas to the brainwashing of the AWL, speaks volumes about how little confidence they have in their ability to defend their ideas. The way they delete comments to their site, edit comments such as Jason’s, to cover up their bureaucratic, Stalinist methods is mirrored in the way they selectively quote from the works of Trotsky and others, deleting entire sentences and paragraphs so that the meaning of what was written is reversed, in order to comply with the current version of the truth as made up by Big Brother. But, again, as I pointed out in my comment, if I’d just stood in the General Election and only got 75 votes – last place and even less votes than the other cranks standing – then I’d doubt more than just my politics, because almost anyone, including the cranks, could get more votes than that just from their family and friends.

Clearly, the AWL not only have no political support, but they are a Johhny No Mates as well. Given their behaviour, its no wonder.

Heading For A Crash

For the last year, I have been arguing that the Long Wave Boom means that the probability of the Financial Crisis, and subsequent recession, turning into a Depression, or even a more serious double-dip recession was low. I am in the process of a re-evaluation of that view. The reason is simple. As I suggested back in 2008, the problem of bank debt could turn into a problem of sovereign debt, as States were forced to come in behind those banks, some of which had Balance Sheets bigger than the economies in which they were situated. That sovereign debt crisis is not yet fully upon us, and sensible policies by States and Central Banks – essentially printing money to cover the debts, and not cratering economies and growth by fiscal tightening – could easily avoid it. But, then there is politics. One the one hand, there are political manoeuvres within the Eurozone, as different states attempt to gain advantage, and political parties seek to address the concerns of their voter base. At the same time, there is manoeuvring between European Capital and US Capital. European Capital is seeking to make the US and China do all the heavy lifting of increasing economic activity and trade, so that it can benefit from increased exports without committing its own funds to a global fiscal stimulus.

In the run up to the Falklands War, Maggie Thatcher and Galtieri both engaged in sabre rattling to garner political support within their respective nations. Both, after all, were facing severe criticism and opposition from their respective populations, at the time. Both were forced to continually ratchet up the rhetoric until eventually they were both backed into a corner, and were forced into a War that neither really wanted – there had been an agreement already reached between Britain, Argentina, the US and South Africa to divide up the Falklands in order to exploit potential resources – and out of which no one benefited. The situation in Europe today is similar, as Governments seek to present themselves as fiscally conservative, in an attempt to calm the nerves of the markets. In fact, their policies, in threatening the continuation of the recovery, have, in recent weeks, done the opposite. Markets are in a state of panic. In fact, as a consequence, renewed fears are emerging over the banking sector, and banks have once again begun to restrict lending to each other in a way similar to that leading up to the Financial Crisis at the end of 2008. Interbank rates are rising sharply again – which could actually mean that some of the smaller, regional banks like the Spanish Cajas actually are placed in jeopardy – and the US has had to re-open a $450 billion window again to European banks, because they were simply unable to get the dollars needed from each other to finance dollar trade.

I continue to believe that the Long Wave remains in place, and that, over the medium term, growth will resume as a result. In fact, a crisis now could result in even more robust growth later. However, even if, as again I believe to be the case, the permanent State acts to stifle the economic madness, of fiscal tightening, being attempted by various Governments, the policies that do get through, the measures already taken, may, even in themselves, be sufficient to cause a double-dip. On top of that, the fundamental problems I have referred to, in respect of developed Western economies – basically living standards are unsustainably high compared to those in developing economies like China, India etc. without a massive shift of Capital to higher Value production – and the disproportionalities arising from that creates its own dynamics that could cause severe problems. Some of those problems, of disproportion, are not just in the allocation of capital, but are intra-generational disproportions too, particularly in relation to housing wealth.

I quoted the other day the views of RBS in that regard – RBS warns Of Cliff-Edge. Today, the Independent has a lead story about the likelihood of a housing crash. How long Can The Housing Market Avoid A Crash. They point to a number of factors including the continued problems in getting mortgages, the difficulty some buyers have in raising necessary deposits, an increase in supply, and the difficulties households will have over the next four years as its forecast that wages will lag behind price rises. In fact, as I’ve repeatedly pointed out, the likelihood is that inflation will rise way above that being forecast – the real figure as opposed to the official figure being even higher still. The Independent quote the figure of 5.3% on RPI that is current today, and accept the official view that it will fall by year end, before pointing out that the VAT rise will send it up again in January. But, I do not believe that inflation will fall by year end. It has consistently moved against such predictions by the Bank of England over previous months, even when economic activity has been slow or even negative. There has been massive money printing that, in the past, has always resulted in inflation, two years down the road. Even with sluggish economic activity, inflation will rise, as that liquidity is soaked up by rising costs. The pound has fallen against the dollar in which oil, and many basic commodities continue to be priced, which means that the import cost of those items rises for Britain. On top of that, China has now sort of floated the RMB, and it is rising in value. China’s costs have risen significantly, as the prices of raw materials and food have risen, on the world market – in large part because of Chinese and Asian demand. In addition, Chinese workers, with the support of the State, are demanding, and receiving, huge pay increases of between 30% and 50%, as the Chinese State seeks to shift the balance of its economy away from exports to the domestic market, and away from low value production towards higher value production. The consequence of that is that the masses of imported cheap Chinese goods, that have kept workers living costs down, in the West, for the last 10-20 years, are about to become MUCH more expensive, but without the potential for import substitution. Inflation is going way up. That was also the basis of the prediction I quoted the other day from Dennis Gartman that the price of Gold is going to go parabolic – Gold To Go Parabolic. It is that inflation will soar, paper currencies will get trashed, and there will be a flight to real money.

On top of the problems facing workers, from falling real wages, through inflation, we now know that the Tories policies, according to the Treasury, will lead to one and a quarter million extra people being unemployed, the majority of those from the private sector. Unemployment To Soar. In fact, if the Tories actually did manage to cut by £60 billion, the actual rise in unemployment would be more like two and a half million. Even the uncertainty arising from all this will have a negative effect on economic activity. No one is going to think about laying out large sums of money for a new house if they think they might lose their job, or their living standard is going to crater. No business is going to take on workers, or invest any large sums, if they think the economy is going to go down the tubes. That in itself will reduce effective demand in the economy, and lead to exactly those kinds of consequences. Already, we have seen some private companies hammered, as a result of the Tories announcements, even before orders from the Public Sector start being cancelled. Nor does it take account of the hundreds of thousands of actions that have the same economic consequences, like the Public Servant the other day who was interviewed having just bought his lunch, who said that in future he would have to resort to making sandwiches, thereby demolishing the businesses of tens of thousands of town centre shops, and their suppliers.

Under those conditions, the 5% fall in house prices mentioned by the Independent seems a gross underestimate, and the people it interviewed, who said they couldn’t reduce the prices of their houses any further, are going to find they will have to do just that. Recently, economist Richard Koo was interviewed, from Japan, by Newsnight. He related how the Japanese Government had made the same mistake the Tories are making now, in 1997. They began a fiscal tightening when the economy was just starting to recover, and sent it into a renewed tailspin, from which it still has not recovered. On that occasion, property prices, in Japan – which had already fallen significantly during the early 90’s – dropped by 80%! One of the disproportionalities that arose over the last 30 years was precisely this rise in asset prices – houses, and shares in particular – as the massive increases in liquidity, pumped into the economy, found their way into a series of asset price bubbles, whereas cheap imported goods from Asia, kept consumer price inflation low. In a “reversion to the mean”, that process is about to be reversed. Consumer price inflation will rise sharply, and as living standards are squeezed, the amount of disposable income, available for allocation to assets, will drop considerably. Whilst, rising profits for the rich may mean that the fall in share prices may be muted, and disguised by rising inflation, the one asset which the majority of workers spend their money on – housing – will tank. In 1990, house prices fell by 40%. Since then they have bubbled up again. It has created another of those disproportions, this time inflating the “wealth” of the older generation, who bought their houses decades ago, and immiserating young workers unable to afford the inflated prices. A fall in house prices of 50-80%, is quite possible if the economy enters a double-dip – a double dip, which, as Nouriel Roubina points out, governments are not now in a position to deal with, because they have used up most of their ammunition. That “reversion to the mean” would rebalance the intra-generational divide, and would begin to make housing affordable to young workers. The immediate effect would, however, be to give yet another downward twist to the economy.

Tuesday, 29 June 2020

Its Begun

I’ve been saying for some time that the permanent State bureaucracy would frustrate the Liberal-Tories attempts to slash the size of the State, thereby sending the economy into a serious recession. Yesterday, the BBC headlines covered statements by senior doctors at the BMA Conference saying that cuts being introduced by Health Authorities were already resulting in decisions being made that impacted healthcare adversely. This in the NHS, which is supposed to be ringfenced under the Liberal-Tory proposals.

Today, the BBC headlines have highlighted statements by senior Police Officers that proposed cuts will inevitably lead to a drop in the number of Police Officers out on the streets. Its no coincidence that in opinion poll after opinion poll it is the number of cops out on the beat that the Public see as being most important. We can expect to see a flurry of such stories, intensifying in their description of the horrors that will result from any cuts to budgets.

Anyone that has worked in Local Government or any other bureaucracy will be familiar with this. The top bureaucrats when asked for cuts will look for the most unpopular, the most visible things to cut, and offer those up first. In Local Government, if you can find something to cut in some of the more influential Councillors wards, all the better. This opens the door to putting forward some smaller, more acceptable cuts as part of the negotiation. In most cases this works its way out as low status services, employing usually low-paid, low status workers being cut back or axed, and some reorganisation of departments and services as a result. The reorganisation usually requires some higher status bureaucrats to be seen to be taking on greater responsibility, and requiring a higher salary for doing so, usually accompanied by a bigger office, new equipment for it etc., and possibly a couple of lower tier bureaucrats extra to assist with the task.

For example, under CCT at the Council where I worked the Manual workforce of over 1,000 was decimated. Where a handful of fairly low grade Supervisors and one manager had been able to deal with this 1,000 manual employees the situation changed dramatically as the work was farmed out to private companies. Now a fairly high status “Contract” manager was required, as well as an equivalent “Client” manager. Considerable work was created for quite high status legal staff, to check Contracts, and similarly considerable work was created for simialrly high paid Accountants to ensure that the Contracts were kept within budgets, payments made properly and so on. But, in addition to that it was necessary to employ a clutch of middle ranking Supervisors whose job it was to monitor the performance of the Contracts, and so on.

The Manual workforce all but disappeared, but a sizeable management, supervisory and administrative bureaucracy sprang up in its place. All good for the top bureaucrat whose salary and status rose in line with the number of other bureaucrats he now had within his Empire. Expect the same here.

Monday, 28 June 2020

Budget Causes “Friendly-Fire” Casualties

The Liberal-Tories Budget was intended to look after their rich friends in business. But, even here their ineptitude has shown through. Before the ink is dry one firm that relies on Government expenditure Connaught through its involvement in Social Housing has been slammed. Its share price fell about a third yesterday, and has fallen another third today.

What was that the Liberal-Tories said about the Private Sector growing to take the place of the Public Sector.

Gold To Go Parabolic?

Over the last few years I have been saying that Gold would continue to rise in price. Over all that time, with slight corrections, it has indeed continued to rise. In part, the rise is due to the normal course of Gold during the Long Wave, in part it also reflects the fact that huge amounts of paper money tokens, and electronic, and credit money has been pumped into the economy. Over the last few years, the dollar has collapsed in value for that reason, and because of the underlying long term decline of the US economy, of which it is a symptom, for a time the Euro benefitted from that as the Chinese and Japanese intervened to print more of their currencies to keep the value down against the dollar. Now the Euro is falling too. I suggested some time ago that all of the adverts encouraging people to sell their gold were an indication that the smart money was buying as much Gold as it could, wherever it could get its hands on it. At some point when supplies dried up, and prices began to rise, prompting a far wider range of people to become buyers, the price could go parabolic.

That is basically the scenario being put forward now by Dennis Gartman, who produces the influential Gartman Letter.

“The market starts slowly and takes several years to build.
Then, in the last 10% of the time frame you get 50% of the price movement. I’ve seen it time after time in 35 years of doing this. And I get the sense that gold is about to do that same thing.”

Gartman also feels that gold has room to run because it’s something he calls the anti trade. “It’s anti dollar, anti euro and anti the British pound,” he says.

“And if you’re worried that we’re looking at a bubble because retail investors are driving the run in gold, don’t be. According to Gartman it’s largely institutional money and not money from Main Street.”

RBS Warn Of Cliff-Edge & Monster Money Printing

An article on the CNBC website details the extent to which analysts at RBS are becoming very jittery. They see a collapse of Equity markets and of Commodity prices. Banks and financial houses status is being talked up, and they see the need for a monster money printing.

More Fantasy Politics

The other day I wrote about the Fantasy Budget. It was a fantasy because most of it was based upon calculated savings that are completely outside the Government’s control. They have announced that they are going to make cuts of 25% in non-protected budgets. But, no one seriously believes that will happen. They have no idea what they would cut to achieve that kind of figure, and so no idea whether they could actually get away with making such cuts without destroying services completely, without provoking unmanageable civil unrest, or without causing significant economic dislocation. No Government including Thatcher’s has achieved cuts on that scale. They are not in the interests of Capital, and certainly not in the interests of the permanent State bureaucracy, which will do all in its power to frustrate them. On that basis alone the Budget calculations, and that for the deficit could be out by tens of billions of pounds.

The Tories have also said that they are going to make cuts in Welfare Payments. But, here too the only actual savings that the Tories can count on are the savings arising from scrapping particular payments, and the savings from indexing to earnings or else to CPI rather than to RPI, at a time when RPI is set to rip. In reality, not only do they have no idea how much they might save from Welfare Payments, but the consequences of their Cuts, and other deflationary measures in the Budget could push unemployment up by hundreds of thousands – in fact if they did actually push through those 25% cuts, unemployment would rise by around 2.5 Million -and as a consequence could send Welafe payments through the roof.

Now the Toies are coming out with more such guff in relation to Incapacity Benefits. over the last 20 years successive Governments have attempted to reduce the number of IB claimants by continually toughening the criteria, by introducing medical exams by hired-in private doctors and so on. But, the numbers have not fallen, which suggests that the reason is that people claiming IB are doing so for the simple reason that they are not capable of work. In fact, there have been many reported cases where people have been turned down who clearly were unfit for work, such as the woman who was told she was fit for work despite needing to be on oxygen for 14 hours a day, or the other who was awaiting a heart transplant! Its not surprising that the majority of people who appeal against being turned down win their appeals.

The Tories claimed that under Labour fraudulent claims were costing £80 per second. They said they would slash this by introducing a policy of stopping all benefit for three years to anyone cuationed or convicted of fraud three times. But the BBC’s Mark Easton checked this out and found that the number of people who this would have affected would have been precisely zero. Even if you took those only cautioned rather than convicted, twice, the number came to just 69 people last year.

So how much of that £80 per second would that save? Just 1 penny per second. Given the huge cost of trying to administer and polcie such a system, its certain that it would in fact mean greater cost rather than a saving. The only thing that could be saiud for it would be that at least it would provide some people with jobs in the bureaucracy administering it. But, didn’t the Liberal-Tories claim they were going to reduce such bureaucacy and waste, not increase it?

If that is what they desire then rather than pick on a few poor souls reduced to scraping a living off Incapacity Benefit they would find that a cost-benefit analysis would show that putting the same resources into claiming the £120 billion of tax that is avoided each year by big companies, and the very rich would be far more effective. Greece has come in for considerable scorn for the fact that it is incapable of collecting taxes, but the reality is that in Britain taxes are only collected from the working class and middle class, and from those rich people who effectively volunteer to pay. The Liberal-Tories will not take action to collect in that tax from the rich – which would pay off the deficit in one year – despite the election propaganda of the Liberals, because the reality is that it is these uber rich who are the backers of the Liberal-Tories, and it is their interests they exist to cater for.

Sunday, 27 June 2020

Soul Boy

A couple of years ago I wrote a blog Still Not Souled Out about the film my son was crewing on about Northern Soul, being made in Stoke at that time. At that time it had the working title, “Souled Out”. Tomorrow the film gets its Premiere in London. My son’s going down for it, not just because he was crewing, but also because he had a minor part as a bartender.

The interesting thing here, and its not surprising given the nature of Northern Soul as a working-class phenomena, is that it combines the two things discussed on this blog – Soul Music, and politics. The film is after all set in 1974 during the great Miners Strike of that year that brought down the Heath Tory Government. The choreographer on the film is the guy who did the Northern Soul dancing on Duffy’s “Mercy” video

In the meantime one of the lead actors Nichola Burley has appeared in another dancing film “Streetdance”. I still think the Northern dancers are better personally, but then I would. I wish I’d gone and done some dancing on it as an extra now.

All On Our Bikes Together

Back in the 1980’s, when the mass unemployment caused by Thatcherism led to rioting, the response of Tory Norman Tebbit (who was nicknamed by the press The Chingford Boot Boy) was to tell the millions of unemployed they should “Get On Their Bikes”, and look for non-existent jobs, non-existent because the Tories policies had destroyed them all, and encouraged their friends the bosses to go in search of cheap labour in other parts of the world. It was not surprising then that as the Liberal-Tories look set to try to take us back to 1980’s Thatcherism, and a similarly disastrous economic situation, a proposal from Ian and Duncan Smith to encourage the unemployed to move would be compared to Tebbitt. Yet another example, of the ineptitude of the Liberal-Tories.

Labour leadership hopeful, Ed Balls, called the proposal “unfair” according to a report by the BBC. But, the Left has to be a bit careful here. That Ed Balls should oppose such a move is understandable, because as his position on Immigration Controls has showed he does not really favour the free movement of labour. But, the Left does. It is rather difficult to argue in favour of workers being free to move from one country to another in search of work or better living standards, and yet pooh pooh the idea that they should move WITHIN the same country to achieve the same thing!

There is actually nothing wrong with the idea that workers should be given assistance to move in search of employment or better conditions. In fact, such policies have been in place for decades. There has long since been a policy of offering Council houses to some Public Sector workers if they move to other parts of the country. It has tended to be less used over the last 20 years, because many workers have been owner-occupiers, and have wanted to buy houses, accompanied by a shortage of Council houses to offer. If there is unfairness in the Tories proposal it is this that in providing such housing for workers moving from high unemployment areas, it will by pass other workers in those areas who given the shortage of social housing, will have been waiting a long-time themselves.

But, what the Tories proposal shows is just how much they are out of touch with the real-life of the majority of people. On the proposal itself it was a common feature of Council Housing that tenants all along could arrange their own “Swaps”. That is a tenant in one area if they wanted to move to another, could arrange a swap with a tenant in that area, who wanted to move to their house. From an economic efficiency point of view it is what makes such social rented housing much more effective than owner-occupation, because a tenant does not have to wait until they have sold their house before they can move.

It is not this that makes mobility difficult. The Liberal-Tories proposal assumes that unemployed households are comprised entirely of people who are unemployed. In some areas of chronic unemployment that may be true, but in most cases there may be one person who is unemployed, but all other members of the family in employment. Or their may be one person in quite good employment but a number of other members of the family who are unemployed. What do the Tories propose that an unemployed husband should be encouraged to move, whilst his wife gives up her job to move with him? What then would be done to deal with the now unemployed wife? Or is the Tories proposal to split families up in the way was done with black workers in South Africa, the unemployed person being sent off to where the work was, and the partner left behind? Would that not mean then providing two houses?

But, the other point is that it is all very well and good moving home in search of work if you are reasonably well-off – or alternatively if you are virtually destitute you may have nothing to lose – because most of the jobs better off people tend to move to are relatively stable and secure. But, the jobs, that the majority of unemployed that the Tories are referring to, do are far from stable and secure. That is one of the reasons they are unemployed and living in Council housing in the first place. The jobs they do are, low status, low paid, often temporary, frequently part-time, casualised employment where you could be back on the dole the next week. You are not going to leave behind all of your family and friends, and the support network that provides, in order to take up a job at the other end of the country, that might disappear tomorrow leaving you not just back to square one, but in an even worse position, living in an area where the cost of living is higher, and with no one to turn to.

The Liberal-Tories want to tell us we are all in it together, but the reality is that they do not even understand the basics of working-class life. That was demonstrated by the story in the
Sunday Mirror about the £450 a head party that Cameron’s Tories are holding. They say,

“Rich Tory backers can buy one ticket for an eye-watering £450, pay £4,500 for a table for 10, buy a “benefactor” ticket at £1,000 or blow £10,000 for a de luxe table for ten”

“Organisers have lined up 432 bottles of champagne – more than one each for the 400 guests, who will include City financiers and Tory donors. The event is expected to raise more than £1million for Conservative party funds”.

You can’t imagine that unemployed workers living in those Council houses will be tucking into a similar Sunday lunch today can you? What was that about all in this together?

Saturday, 26 June 2020

Its Health & Safety Gone Mad

The number of British troops killed, in Afghanistan, over the last 9 years, has now reached the terrible toll of more than 300. We all know the stories about the inadequate equipment that the troops are provided with, in carrying out their duties. The fact, that the troops, killed or badly maimed, knew what they were letting themselves in for, in taking up the profession of War, is no solace to those who have lost members of their family. The repeated ceremonies for those killed, and the TV coverage of them are understandable, as are the TV interviews with those that have lost sons or husbands, wives or daughters.

Yet, year after year, even more workers are killed and badly maimed also doing their jobs. Last year 180 workers lost their lives due to industrial accidents. HSE Statistics. That figure was actually slightly down on the figure of 220, which was the average for the previous five years. Put, another way as many workers are killed by Capitalism in industry every 18 months, as have been killed by capitalism on the battlefield in the whole of the Afghanistan campaign.

The difference being that, although soldiers know, when they begin their employment, that their job is to kill, and to be killed, that forms no part of the job description of the ordinary worker. The least the ordinary worker should be able to expect is that the conditions under which they work are safe. Yet, despite the fact that there is this terrible loss of life for workers, there is no comparable coverage in the media of industrial deaths compared to soldiers deaths. We see no anguished interviews with the loved ones of industrial workers killed in the name of profit.

On the contrary, the gutter press, in particular, can only ridicule the need for Health & Safety in the work place, falsifying stories, sensationalising, and exaggerating those things which at root are extremely rational and necessary. In fact, when it comes to the real reasons why many practices HAVE been banned, it has nothing to do with Health & Safety legislation, and everything to do with the fact that organisations are afraid of being sued by individuals, egged on by an ambulance chasing culture of litigation, that has spread from the US, and which is itself a symptom of the kind of money centred, grasping culture that Capitalism itself promotes.

Its not surprising that, at the same time as demanding that workers work until they drop dead from old age, the Liberal-Tory government are also proposing to reduce workers protection by Health & Safety legislation. Perhaps we should demand that, just as they do with soldiers, who die for the greater glory of British Capitalism, Government Ministers should have to write to the families of those workers who die each year for the same cause in industry. Perhaps we should demand that, just as they answer for not providing the troops with adequate equipment, to protect their lives, they answer in person the question of why those workers who died did not need the protection of Health & Safety laws they now propose to axe!

Northern Soul Classics – Your Magic Put A Spell On Me – L.J. Johnson

Last week’s offering was posted by Ian levine on Youtube, this week’s offering from the days of Blackpool Mecca was produced by Ian Levine too following his success with Evelyn Thomas. There’s interesting background in the comments on Youtube. I was looking for the instrumental version – “Spellbound” to post as well, but so far no luck.

Friday, 25 June 2020

How To Pay For The Deficit

The Liberal-Tories say they had no alternative to swingeing cuts and attacks on the poorest to pay off the deficit. There is a simple solution that requires no such draconian measures, that meets the requirements for fairness, and that does not impose taxes that might choke off consumption or investment. It does not even involve printing money that might lead to inflation, and higher interest rates.

The total value of shares listed on the Stock Exchange is way over a trillion pounds, but let us take a trillion as a round figure. If the Government passed a measure requiring that Companies create 10% new shares, and hand them over to the Government, the Government would possess shares with a value of £100 billion. It could sell these shares on the market through the arms length body it set up to handle its shares in the Banks, as and when the best moments arose to do so.

Because, the Government would take payment of this Tax on Capital in shares rather than cash it would mean that the profitability of the comapnies was not affected, and nor would be their ability to invest, nor would be their cash flow. Of course, by creating 10% extra shares the value of these shares might fall, as and when the extra supply came to market. However, whenever there are periodic stock market panics resulting from some unforeseen event, we frequently see in the newspapers that tens and even hundreds of billions of poiunds has been wiped off the value of shares. If such events occur naturally with no benefit, then surely it is worth the risk that shares might fall by 10%, for the “good of the country”, given that we are “all in this together”.

Besides, it is not at all clear that share prices would fall. Because, using this method would mean that the deficit would be paid off without actually taking money out of the pockets of consumers or businesses, it would mean that economic growth would be that much higher than it would otherwise have been. Indeed, it might mean avoiding a serious recession. Higher economic growth under all economic models leads to higher rates of investment, and Capital Accumulation. That means that the underlying value of Capital Assets rises, it means that the discounted future earnings of companies, on which share prices are usually assessed, will be higher, thereby justifying higher not lower share prices.

Not, only would such a strategy mean that any pain was placed firmly on those that are by far the most able to bear it, but as demonstrated above, it is not clear that there is actually ANY pain that would result from it. But, why will the Liberal-Tories not pursue such a measure. The reason is simple. Unlike, Income Tax, VAT, or even Capital Gains Tax, which fall unavoidably on workers and the middle class, this measure falls directly on Capital itself. It represents not a transfer of income within the working classes as all redistributive taxes do, but a transfer from Capital to Labour. The Liberal-Tories are the political representatives of Capital, whatever they say about ruling in the name of the people, or about us all being in this together. They will not propose such a policy.

But, they have said they want us to tell them how to clear the deficit. This tax on Capital could do it quickly, and simply, and fairly, with little if any economic cost.

Wednesday, 23 June 2020

Progressive Budget

The Liberal-Tory Government has claimed that its Budget was “progressive”. The Institute For Fiscal Studies has challenged that description. Not surprisingly. According to one analysis, although the top 10% of income earners are the worst affected by the Budget the next worst affected are the worst paid 10%. Moreover, the fact that the top 10% are worst affected does not take into account the fact that they are far better placed to suffer than are the worst paid 10%.
On the “Dispatches” programme the other night about how to save £100 billion, one Consultant said that it was quite reasonable for a Public Sector worker earning £25,000 to lose £3,000 in pay cuts, and additional pension payments. The question I would have asked her is, are you then prepared to hand over all of your income above that £22,000 for the good of the economy? If not why not, if we are “All in this together”.

But, this way of presenting things is in any case dishonest. The same is true about the proposals for withdrawing benefits from better off workers and middle class families. The fraud is perpetrated by confusing income with wealth. The wealthiest people are by no means those with the highest income as traditionally understood. The wealthiest people rather are those that own Capital, and whose wealth grows exponentially not from income, but from the growth in the value of that Capital. Unfortunately, sections of the Left that have abandoned the traditional Marxist position that real changes in wealth and power can only arise from changes in ownership of the means of production, and substituted it for it the old Fabian notion of redistributive Socialism have been accomplices in the Right pulling off this fraud. The reality is that this redistributive Socialism is not only Utopian, but what it really means is creating a division within the working class, and between the working class and its natural allies within the middle class, because rather than redistributing wealth and power from Capital to Labour, it merely redistributes within Labour, from better off workers and the middle class to poorer workers, and the underclass.

Consider the position with Universal benefits. There were rumours that the Tories intended to withdraw some Benefits from those who it was claimed did not need them. But hold on. If I pay my car insurance as I am required to do to cover the possibility that I might have an accident, I do not expect the insurance company to turn round and say, we’ll have your premium, but we won’t pay your claim, because you can afford to pay for the damage yourself. If I am likewise being asked to pay National Insurance to similarly cover unforeseen events, such as unemployment, ill-health, and so on, or to cover known events where an income or payment is required, such as retirement, or having children, why on Earth should I not likewise be entitled to a payment under that insurance scheme. If I can’t, then I should have the right not to pay into such an insurance in the first place!

Of course, the left that has collapsed into a bourgeois redistributive socialism sees something progressive in such an idea, even if it generally opposes Means Testing. It has turned its attention from the real enemy Capital, into a short-sighted politics of envy against the Middle class, that ends up extending to better paid workers too. But, of course, the true rich, as opposed to the Middle Class are unaffected by this. They are so wealthy that paying for private healthcare or education are insignificant for them. And because their wealth is based on the ownership of Capital not on earned income, they are unaffected by income taxes, and largely by taxes on Capital too.

Forbes Magazine commented a few years ago,

“According to a newly published study by accountancy firm Grant Thornton and commissioned by the Sunday Times newspaper, U.K. billionaires paid income tax totalling £14.7m ($29.1m) on their £126 billion combined fortunes last year, and only a handful paid any capital gains tax.

Grant Thornton estimated that three in five billionaires paid no personal income taxes, although they would have paid indirect taxes such as value-added and council (local authority services) taxes. Business income would have been tucked away in offshore trusts and companies. Most of the rest who did pay taxes would have paid themselves in dividends rather than with a salary. Dividends are taxed at an effective rate of 25% rather than the 40% higher rate of income tax.”

Yet, the Liberal Tory Government – by the way why do the Liberals and Tories both get to put up spokesepeople against Labour on TV now they are effectively one Governing party? – did nothing to tax Capital in the Budget. The Liberals during the election had proposed a Mansion Tx to fund their increase in Income Tax allowances to £10,000. Not only did the latter not happen, but their was no sight of the former. The Tories had proposed a tax on “Non-Doms” to fund their Inheritance Tax giveaway to the super rich. Again there was no sight of that either. On the contrary, the Liberal-Tories have given money back to Capital in a number of ways. They have reduced Corporation Tax, which means that the asset value of Capital will rise accordingly increasing the wealth of the billionaires, and will also mean more profit is available to be paid out in those dividends referred to above that the billionaires largely pay no tax on either. In addition they have given employers a reduction in the National Insurance contributions they have to pay, but have given no such concession to workers.

The Liberal Tories claimed that they had no choice but to raise VAT, which will hit the poorest hardest. But, the above shows that they had lots of options. In Spain if you spend more than six months of the year in the country you become subject to Spanish taxes whether you live there or not. Spain has a Wealth Tax, which is payable on your Global Wealth, not just your assets in Spain. If the Liberal-Tories had introduced such a Wealth Tax at a rate of say 10%, they could have raised billions of pounds from all of those billionaires like Lord Ashcroft.

But, there was another way the Liberal-Tories could have raised all the money needed to pay off the deficit without affecting ordinary working class and middle class people. Regularly, we see that there has been a bad day on the Stock Exchange where the fall in share prices has wiped hundreds of billions of the value of shares. The total value of shares in the FTSE 100 is more than a trillion pounds. If the Government simply raised a tax on that Capital Value of 10%, it would raise £100, billion plus. It could do that quite easily. All it would need to do would be to require that every Limited Company, issue 10% more shares, and hand those over to the Government. The Government could then simply sell those shares, and pay off the debt with the proceeds. That would not affect the profitability of the companies, it would not affect their ability to invest and so on. It would, however, do what the Liberal-Tories claim they want to do, it would mean ensuring that those with the ability to pay did so, whilst protecting everyone else.

The Liberal-Tories say they want to involve all of us in determining what cuts should be made. We should take them at their word, as well as their claim to want to ensure that “We are all in this together”. The LP and Trade Unions, and the Co-operatives should organise Labour Movement conferences in each area to discuss the Cuts, and to place before the majority of working class and middle class people the facts, and the kinds of alternatives suggested above. The Liberal-Tories have already adopted the Thatcherite Mantras of the 1980’s such as TINA (there is no alternative), and that unemployment is a price worth paying. Its nonsense there are always alternatives, and unemployment is only an acceptable price for those who are not going to be made redundant. The Liberal politicians, of course, who now make this argument, have been quick to ensure that they have lined themselves up with lucrative Government jobs. We should not simply respond in the way the left has done in the past by simply opposing the Cuts, which really meant defending the Capitalist status Quo. We should respond by providing our own, truly progressive alternative, an alternative that begins by challenging the power of Capital rather than looking for easy scapegoats within the middle class, or better off sections of workers, solutions that demand that real wealth and power in the means of production are transferred into the hands of workers.

Tuesday, 22 June 2020

Fantasy Budget

The budget today reminded me of those things that were the fashion a few years ago where you drew up a fantasy football team and so on. It was a fantasy Budget in which the Chancellor listed a number of measures he’d like to see implemented, but most of which are outside his control, and will never happen. Even Norman Lamont, interviewed on BBC said that the proposal to cut unprotected Budgets by 25%, was only “an ambition”.

What is interesting in the Budget from that perspective is the Cuts that are within their control, and the main means by which those Cuts will be effected. So, one of the biggest savings will be through freezing Public Sector wages. Provided, of course, that the Government can impose such a freeze – and they have made that more likely both by putting the frighteners on Public Sector workers with the threat of huge job losses resulting from a 25% cut in Budgets, and by dividing the workforce by guaranteeing a flat rate pay rise for all Public Sector workers earning less than £21,000 a year – then the saving in real terms from that is a known figure. If, as I have been arguing for some time, the real means of reducing the deficit is achieved through a hefty dose of inflation, then the higher that inflation, the bigger the nominal saving achieved.

My belief that they intend to cut the deficit via inflation has been strengthened by other factors in the Budget. Firstly, they have made a big play of restoring the link between Pensions and incomes. But, of course, given that a large number of workers – in the Public Sector – will be experiencing a pay freeze, and wages in the private sector are unlikely to be rising rapidly, that is hardly something Pensioners should look forward to. Having suffered for the last 20 years or so as wages outpaced prices, they are now to get their pensions linked to wages just at the time when prices are going to outpace wages! Secondly, the Liberal-Tories have said that they are going to link Public Sector pensions, and benefits to the Consumer Prices Index rather than the Retail Price Index. All of these indices are a con, because they significantly understate the price rises most workers face, and understate the price rises faced by low-paid workers, and pensioners even more so. But, of the two the CPI is far more of a con than the RPI. It excludes many items that comprise normal expenses. As a result, whereas the CPI is currently at around 3%, the RPI is standing at nearly 5.5%! Given all those factors I have been warning about for months – and China has now effectively scrapped the peg of its currency to the dollar, which means that Chinese export prices will rise, sending the prices of all those multitude of things we now import from China soaring, especially as Chinese workers are now demanding with the support of their Government pay rises of between 30-50%! – which, with the loose money policy will send inflation much higher before the end of the year, and with the deliberate boost to that inflation that the Liberal-Tory VAT “Tax Bombshell” will now impose, pegging benefits and Public sector pensions to CPI will mean a huge real terms cut. The Liberal-Tories must know this, must know that inflation is going to rise, because the only reason for making this switch – and they have admitted that the switch will bring in several billions in savings – can only work if that is the case.

And, of course, the VAT rise, which is not a rise of just 2.5%, but is actually a rise of around 12%, will more than wipe out the small benefit for lower paid workers of the rise in the basic rate Tax Allowance. Before the election when the Liberals were campaigning against the Tories VAT tax bombshell, they said that it would take around £375 out of the average person’s pocket. The change in Tax Allowances, which goes nowhere near the rise to £10,000 the Liberals had been asking for, will save them only £175. That is before the losses from all the other Benefits are taken into account. As I said before the main emphasis would be on hitting Benefits, because it hits people who are atomised, and in no position to effectively resist. But, the Liberal-Tories’ VAT rise will also itself mean more people put on Benefits. They both opposed Labour’s proposed National Insurance increase as a “Jobs Tax”, but any tax which takes effective demand out of the economy under such conditions is a Job’s Tax. By increasing the prices of the things people have to buy every day, and transferring that money via the Government’s coffers into the pockets of the bankers and financiers who lend to the Government – that’s right those same people who caused the financial crisis inh the first place – it will lead to ordinary people buying less. Reduced demand will mean, reduced income for businesses, reduced work for those employed by them. In short it means directly raising unemployment, a fact that was even set out in the figures provided by the Government’s new Quango, the Office For Budget Responsibility. In so doing, it will mean raising unproductive Government Spending in benefits, just as happened under Thatcher in the 80’s, to pay people to do nothing, whereas previously they were actually producing new value – a consequence, which is also itself inflationary – at the same time as reducing the income received in taxes on profits, and from Income Tax. What it will do as was Thatcher’s policy in the 80’s, is that by raising unemployment it will act to put pressure on workers to accept lower wages, thereby boosting profits. So much for the idea that we are all in this together.

But, the other big feature of the Budget was the announcement of that 25% cut in non-protected budgets. Of course, the details of that are not to be set out until the CSR in the Autumn. Let’s be clear, a 25% cut would be a big deal. But, put it in context. It in now way comes close to reversing the massive increase in Public Spending introduced by Labour even just over the last few years. Even at the most alarming estimate it would mean around half a million job losses in the Public Sector, whilst under Labour Public Sector employment rose by more than a million. Also to put it in context, it amounts to around a 5% cut per year. If as I expect inflation rises rapidly a large part of that cut could be effected by that means alone. But, the truth is, as Norman Lamont hinted at, there is no way in hell that such a cut is going to happen. In the 1980’s under the rapacious Thatcher Government, at a time when year’s of industrial disputes had left the Trade Unions isolated as the passive majority sought some form of “order”, with a Labour Movement subdued after a series of defeats culminating in the defeat of the Miners, and despite the public pronouncements of that Government that it intended to cut the State down to size, the opposite happened. The size of the State continued to rise, just as it did under Thatcher’s evil Twin, Reagan in the US.

Yes, there will be attacks, there will be cuts in places, but the reality is that Capitalism needs a big State. Whatever, the intentions of the Government, the permanent State bureaucracy will frustrate any large cuts in the size of the State, which might threaten the economic recovery. Not only would such cuts not be in the interest of Capital under the current conditions, but they would certainly not be in the interests of that permanent State bureaucracy, which has its own vested interests, which it pushes whenever it can. If cuts come, whatever the intentions of the government, that bureaucracy will ensure that they come in frontline services where the most public opposition will be raised. It will ensure that at the same time it buttresses the back-room staff – who are usually higher status higher paid, and therefore, more significant in the process of Empire Building for the top bureaucrats. As in the past the consequence will be a bigger State in terms of more, higher paid, higher status bureaucrats employed, with a diminution in the actual services provided.

Of course, that is no reason not to oppose the Liberal-Tory plans. They claim to want to involve everyone in determining where those cuts should fall, though they didn’t apply that to today’s Budget. After last night’s “Dispatches” Programme where in general there was support for defending most services etc., and support for reducing Britain’s Defence commitment significantly down to the European average, the Liberal-Tories might decide that such involvement would not be a good idea. But, now they have proposed it, we should take it up. The Labour Party and the Unions should organise local Conferences in each area to discuss what should be cut, and what should not. But, more than that, if we really want to mobilise the majority of people, we have to address some of those real concerns that they have over the inadequacy, the bureaucracy and inefficiency of many Public Services like the NHS. We have to address those concerns by arguing that we need at least far greater democracy in the way such services are controlled. In truth we have to point out that such democratic control can only ever be achieved if we bring these services directly under our own ownership, and out of the hands of the bosses bureaucratic state.

Sunday, 20 June 2020

Northern Soul Classics – Love On A Mountain Top – Robert Knight

What a gem, and a current video posted by legendary Producer,Ian Levine. A while ago I posted about the period during the early 70’s when Northern Soul was at its height, and companies like Pye were reissuing songs on its “Disco Demand” series, that led to many singers who had taken up ordinary jobs, finding that all of a sudden they were topping the charts in England.

Robert Knight was one of those singers. I remember first hearing “Love On A Mountain Top” probably in the late 60’s, or 1970. It was one of those records that everybody had to have after it started being played, and I duly went up to Bews in Burslem to get my copy. It was several years later before it got into the Top 10 in the UK Pop Charts, and a rather bemused Robert Knight came over to perform it. In fact, he had been better known, to the extent he was known at all in the UK, for another record, which I’m also posting, and which was in turn better known for its cover version by the “Love Affair” – “Everlasting Love”, which was a big Mod sound in the 1960’s.

I’d also suggest checking out the extended version of the latter on Youtube.

Friday, 18 June 2020

Buncefield

Three firms were found guilty over the Buncefield Oil Depot explosion three years ago as the BBC reported today – Buncefield.

At the time I wrote a blog about the events, which is as relevant today.

I was watching the pictures, of the effects of the explosion, at the oil storage facility, in Henel Hempstead, today, like many other people. I don’t know the area, where the storage depot was, but I guess its not a leafy, middle class suburb. I know, from having sat on a Planning Committee, that whenever applications, for anything that might be environmentally hazardhous, dirty or unsightly, comes along a strange red (or probably blue) mist seems to cloud the vision of planning officers and Councillors alike.

Whenever an application for something like this is submitted, for some area out in the country, planning officers reel out all the objections to spoiling the countryside, Tory Councillors, who are often elected from these areas by a few voters and some sheep, of course, are outraged that their constituents should have to come into contact with anything so working class, and Labour politicians, even if for the best environmentalist reasons, dislike the idea of despoiling the Green Belt too. Yet, despite the fact that, often, for facilities such as this oil storage depot, out in the wilds is the best place for them, where they pose little risk to anyone, the same planners and politicians have no qualms about siting dangerous facilities in the midst of, or at least close to, working class areas, where, presumably, they think people already have a completely shitty environement so shitting it up a bit more won’t matter. The same is true about the Government’s policies for cramming even more houses or businesses on to inner city, brown field sites, when, in fact, what needs to happen, to these sites, is for them to be greened up, to provide a better environement for people stuck inside built up towns and cities, to give kids somewhere to play, and to provide a “green lung” to improve air quality.

Its not even a matter of people being given a backhander by the firms that want to site these facilities in working class areas, its more a matter that the idea that workers can be shat on from a great height is taken for granted. The companies often have economic reasons for wanting to site them in these areas (e.g. because they are close to customers) as well as knowing they are more likely to get approval for an application there than in the countryside (because especially in run down working class areas, where residents have little history of organising and standing up for themselves, they will not put up a fight, whereas, out in the country, the middle class residents will, and the local Tory candidate will give the directors grief), and planning officers go along for many of the same reasons (plus they are more likely to live in the leafy suburbs than on a run down estate).

Workers should not count on any of these people having a change of heart. They have to organise on the etsates through their own organisations to oppose such developments through direct action if (as it usually is)necessary. They need to make links with the Trade Unions in the firms involved to gain support, to link up the concerns of workers in these industries over Health and Safety with their own concerns in that regard.

Clegg “Blooded”

We expect bourgeois politicians to be unprincipled, but, as professionals, the one thing they shouldn’t be is inept. New Labour showed a significant degree of ineptness – accepting money from bernie Ecclestone, then exempting F1 from the ban on cigareete advertising; the 75p rise in Pensions; the abolition of the 10p tax rate. All are examples of actions, which unnecessarily drew criticism, and a subsequent loss of support. The announcements yesterday by the Liberal-Tory Government of a series of measures cutting programmes previously agreed by Labour are of the same order.

Some of the decisions seem just petulant. A number of hospital building programmes were agreed, but one for Hartlepool in deep Labour territory was scrapped, despite promises by the Tories and liberals prior to the election. None of the measures cut amount to a hill of beans in terms of the total amounts the Government proposes to cut, and so why these particular programmes is at first hard to fathom. Its one thing to simply reduce future spending that no one had been expecting, but to cut programmes that people had already thought had been agreed is to invite opposition.

The highest profile was the decision to scrap the £80 million loan to Sheffield Forgemasters, a decision which has already provoked the understandable reaction of workers within the City. The decision seems perverse. On Newsnight, last night, the Government did not even put up a Government Minister to defend the decision, but instead put up an old Thatcherite MP, Michael Fallon. His argument was ridiculous on a number of counts. Firstly, the Government line has been that these cuts were necessary because the books were worse than even they had thought they were. That is an obvious statement that any new Government is going to make to blame the previous Government. The trouble is that over the last few months the official data has been showing that actually things were BETTER than had previously been expected. To make that worse for the Government, the new Office of Budget Responsibility that they have set up as an independent assessor of how the Public Finances stand, has confirmed that view. The Government said it needed this £2bn of cuts, because they had found a further black hole, but the OBR had already said that actually the finances were £30 billion better than Alistair Darling had assumed in his calculations!

Worse, he repeatedly spoke about this not being sustainable because it amount to being a cost of half a million pounds per job. But, there was no such cost. It was n’t a grant to the company, but a loan at a 3% rate of interest. Rather than it costing the Government money, they would have been receiving money from it! Rathger than there being a cost per job, there would have been income per job. That is before you consider the income that would be received in Tax from wages and profits, and so on. If this is the mathematical skills of the new Government let alone its grasp of Economics it does not speak very well for the prospects for the future! The decision seems perverse for another reason. The Government like Labour has spoken about the need to rebalance the economy to promote manufacturing, as well as to shift reliance in places like Sheffield, from the Public to the private Sector.

This is a company, which with assistance from the previous Government had done a deal with the giant US Westinghouse Corporation to produce equipment for the latest generation of nuclear power stations. Everyone knows that in thye coming years Governments in Europe, and around the world will be increasing their investment in such new nuclear power stations in order to meet their carbon reduction targets. This was an opportunity for an efficient British company to become a world leader in this technology, in a high value added sector, employing skilled labour. It is precisely the kind of industry Britain needs to develop to compete on the world market, and if British workers are to have any chance of avoiding a huge drop in living standards as they compete in the world market with low wage economies in Asia and elsewhere. For the Tories to withdraw this loan, to save just £80 million now, that they would have got back with interest seems inexplicable. But wait.

At first glance another factor also seems inexplicable, perverse, and inept. Sheffield is also the City in which Deputy Prime Minister, Nick Clegg is MP. Why would he shit in his own back yard? Remember another one of the Tories election promises – they promised to bring back fox hunting, one of the favourite pastimes of the Public School brigade whose members make up a large number of the Government benches. In Fox Hunting they have a ritual in which the young aristos, and aspiring nouveau riche kids, are inducted on their first hunt by being “blooded”. That is they are daubed with the blood of the first fox killed. It basically means that they are no longer just along for the ride, but are as blood soaked as all the other chinless wonders. Clegg has been “blooded”. By making this cut in his City, Clegg is now irrevocably tied to his Tory masters. He cannot claim, “it was all their fault Guv.” The workers of Sheffield have been sacrificed on the high altar of Tory-Liberal ritual, in order that Clegg could be inducted into the club. That is no surprise, the workers are always the ones asked to pay the price for the rituals, dogmas, and adventures of the ruling class, from just an economic price to the price of their lives sacrificed on the battlefield when the ruling classes engage in some new pointless war.

Labour Leaddership hopefuls have begun to stand up verbally to the Tories assault. That is good. It would be more believable had they been standing up for workers over the last 13 years too. But, the fact they are standing up now is a start, and something that we can use. We need more than bold words from them, we need actions. After 1979, Michael Foot led massive marches in Cities around the country to oppose the Tories cuts, and attacks on workers. During that period Labour soared to over 50% in the opinion polls. We should demand these Labour leadership candidates do at least the same now. But, more than marches are needed. We need action committees in each area to resist the Tories plans. The government says, it wants to consult the people on what to cut. Let’s take them at their word.

Local Labour parties and trades Councils, should immediately be organising local Conferences to discuss what we think should be cut. Here are some initial suggestions.

1. The Queen wants a 15% pay rise. The Tories say “We are all in this together.” Okay then, instead of a pay rise, scrap the Civil List payments to the rich, royal scroungers, and let them pay their own way. Better still scrap the Monarchy altogether.

2. The Tories propose to cut Public Sector worekrs wages. Start at the top. All Public Officials, from MP’s, to Judges, to the Military Top Brass to be only paid the average wage.

3. The Liberals argued in the election that they could pull in billions by collecting unpaid tax by the rich. Properly staff the tax offices so we can get in the estimated £120 billion in tax unpaid by the rich and big companies.

4. Scrap Trident. Again the Liberals said they would, so let’s hold them to that.

5. Pull all the troops back from abroad not just from Afghanistan. Defence is one thing, but why do you need to be occupying other people’s country for defence? Then we would need need all those billions of pounds worth of ships, aeroplanes, and so on either. We could sell them off to pay down the debt. The workers now employed building such useless things could be employed instead to build hospital equipment to treat the sick. And, if we really were concerned with defence that could be done by concentrating resources on developing an effective militia, with universal conscription into it.

6. Similarly, the Tories and liberals propose bringing in some democracy to the Police Force. But, the most democratic police force, would be one in which the whole population participated, in the same way that people participate in Jury Service. Everyone could be organised into local groups to police their own neighbourhoods, and each local group could employ its own specialists. That would save a fortune. If the rich and the bosses want a police force to protect their property, and to break strikes like they did against the Miners let them pay for it themselves, not have the cost covered by workers in their taxation to the bosses state.

7. The Tories say they are in favour of Co-ops to run Public Services. So am I provided those Co-ops have real control, provided workers in local communities can determine the level of service they want subject to national minimum requirements. But, in things like the NHS private companies rip them off big style inb payments for drugs, equipment and so on. If we are to have Co-ops to run Public Services, we should equally have Co-ops to run these private companies. There is £800 billion now in workers Pension Funds. Give us the basic right to demcoratically controlo those funds, so that we can take over the biggest, most important, strategic companies in the country and run them as Worker Owned Co-ops.

Now is the time to take the the fight to the Liberal-Tories. Now is the time for the labour leadership candidates to prove they are worth consideration.

Thursday, 17 June 2020

Whither The Eurozone?

Europe will almost certainly face a recession next year which might generate “social unrest” and the kind of populist nationalism seen in the 1930s. “That’s the real danger of the present situation – that by imposing fiscal discipline at a time of insufficient demand and a weak banking system. you are actually. setting in motion a downward spiral,” George Soros warned yesterday. His comments follow those in a similar vein quoted in my last blog from Nouriel Roubini.

Today The Independent has a front page article on the crisis in Spain, which is now taking over from Greece, as being emblematic of the problems facing the Eurozone. In fact, according to some comments on CNBC yesterday, traders have known for some time that Spain was getting frozen out of international credit markets. Its likely that the success of some of the recent debt issuances has been down to purchases by the ECB. A few weeks ago the ECB began to do what I said was the obvious solution for the Eurozone – it began to print money to buy up the Bonds issued by the Club Med governments. Unfortunately, under pressure from Monetary hawks, particularly in Germany, it agreed to sterilise this money creation, by withdrawing an equivalent amount of money from circulation elsewhere, by taking money out of commercial banks. Its suspected though that it has not fully sterilised the money it has printed. If as seems likely Spain needs to be bailed out such sterilisation will not be possible. That is good.

Over recent weeks the problems of Spain’s financial sector have become apparent. The problem does not lie with its main banks. Unlike the banks of Northern Europe, Spanish regulations appear to have prevented the big Spanish banks from engaging in the purchases of the various derivatives of US sub-prime debt that threw banks like RBS into turmoil. The problem in Spain appears to lie with the “Cajas”. These are small local banks, similar to a Building Society in Britain, and with a similar function. Given the huge bubble in Spanish property that blew up over the last 10-20 years, it is not surprising that these Cajas had a lot of dodgy debt on their books. In essence the problem was the same as that with the sub-prime debt in the US, except this debt was not so sub-prime to begin with. Many of those who borrowed money to build houses for themselves, or as a speculation, were good for the money, and given that demand for housing in Spain continued to rise during all that period, lending money for such ventures or purchases seemed a safe bet. But, the Credit Crunch, and subsequent recession brought that to an end. The assets that sat on these banks Balance Sheets, suddenly did not look so solid as houses. The holders of mortgages might well have lost their jobs, or seen their businesses fold, as the construction boom ended in bust, with massive unemployment in the construction sector. Even now the value of property for sale in Spain is probably two or three times what it should be, as I wrote recently. When that reality makes itself felt, the crisis of personal debt in Spain will be crushing. If the Spanish Government, and the EU want to prevent a repeat of the crisis of 2008, they have to prepare for that now, and take action now, because as Roubini said the other day, if another major credit crisis is allowed to erupt now, states do not have the bullets left to fire that they had 18 months ago. It would mean something approaching a Depression, it could mean the kind of resort to nationalism that Soros speaks of.

But, that by no means HAS to happen. Back in 2008 I wrote of the possibility of this kind of development.

“The problem that could arise given the scale is that the same causes of breakdown of trust and relations between Banks, which led to the Crunch could simply be transferred to the relations between States now acting as banks. We have already seen that to some extent. It was seen over the actions of the Dutch, Belgian and Luxembourg governments over Fortis. It was seen in the scramble for advantage when Ireland stepped in to guarantee all Bank deposits, threatening a stampede out of deposits in other EU countries. Most classically, it has been seen in the conflict between Britain and Iceland over deposits in Icelandic banks, and which was reminiscent of the 1970’s Cod War. It is certainly the case that some of these banks such as UBS of Switzerland have Balance Sheets bigger than the GDP of their host nations.

If this problem does begin to materialise – and it is clear even now that the huge sums put in by States will have to be increased – there are essentially only three solutions. The first is the Libertarian/Free Market solution, which I saw presented on TV the other day by Peter Schiff. It is essentially for the State to withdraw and allow the market to have its way. The argument is that the Banks that brought this on themselves by their actions will go bust – those that make this argument never consider that the biggest losers will not be the bankers who made the decisions, but will be the workers who lose their jobs, but who never had any say in the decisions that caused the crisis – and those Capitalists – in Banking or otherwise – who acted responsibly will do well and pick up the pieces. The Capitalist State will never adopt that position under current conditions. Were this at the beginning of a Long Wave downturn it might have no choice, and would prepare to promote fascism as it did in the 1930’s, to beat down the inevitable social eruption. For now, it has no need of so risky a strategy. Rather, it will either simply pump even more money into resolving the problem – a few years ago Ben Bernanke earned himself the nickname “Helicopter Ben”, because he argued that the fed could defeat deflation by simpling printing dollars and dropping them from helicopters – or else it will seek to encourage the trillions of dollars held in various Sovereign Wealth Funds to come in and re-capitalise the collapsing financial system.”

That is what the State in the US has done, and continues to do. As with the crisis in the Gulf of Mexico now, the US State is able to intervene to bail-out a single state, or in this case a number of states by mobilising its central resources that dwarf those of the individual states. Other States around the globe from China to Brazil, have done a similar thing in order to overcome the economic crisis, and to promote economic growth. If there were a single EU State, it would have done the same thing. But, currently there is not. Therein lies the problem. Capital has a need, and a tendency to concentrate and to centralise. It does that at the level of the individual firm, but it also does it at the level of the market. This is historically, a hugely progressive development. It is what subsumes all previous divisions between human beings, based on the ridiculous concept that they have some innate attachment to the place where they just happened to be born, and that this attachment ties them ineluctably to others who were also born there.

But, this concentration and centralisation like everything else within Capitalism, is a contradictory process, because like the functioning of Capitalism itself it is driven by a largely blind process. It is not a process that is thought out, and planned in advance, but proceeds on the basis of the needs of Capital becoming expressed via its own operation, and the interaction of various Capitals. As Marx puts it in Capital, Competition, begets Monopoly, and Monopoly begets Competition. Competition between firms leads to some becoming bigger, more efficient, and others eventually going bust. The bigger more efficient firms pick up their market share, and become even bigger, even more efficient. Then they can simply buy up even those efficient firms that are simply small, and lack the Capital to resist their advances. But, the same process that leads to the development of huge firms, with huge amounts of fixed capital tied up in production, requires ever larger markets so that this large scale production can be sold. That is why new economies like the US rapidly passed from the stage of segregated markets, to a single large domestic market. Numerous attempts have been made to do the same thing in Europe. World Wars I and II could be seen in that vein. The attempt to establish the EU after WWII, has been an attempt by Capital to bring it about without the need for a single national Capital to exert hegemony within it.

As I have written in the past these attempts at establishing such larger economic units, are in fact part of that historic drive of Capital to create a single World Economy. Imperialism & War. But, that process is racked by contradiction. That contradiction arises from the anarchic nature of Capitalism, and from the continued separate interests of individual Capitals, fractions of Capital, and the refraction of that through the competing interests of political elites. That process is what is being played out in Europe today.

The reality is that the debt problems of both the UK, and of the Club Med economies could be dealt with, without massive economic dislocation, and the social unrest that will flow from it. Some economists, and even some bourgeois politicians are themselves setting out that process now that I outlined several weeks ago. The first thing that is required is the recognition of the need for a strong centralised EU State. History suggests that the best political framework for Capital Accumulation, and through which Capital transmits its ideas to this State is that of bourgeois democracy – such a State could have arisen under the jackboot of German Nazism, for instance, but Capital would ultimately have had to replace it with bourgeois democracy. That means that the facade of the European Parliament has to be replaced with a body with real democratic credentials, with real legislative power, and control over the Executive. It means that this State must be the sole, or prime issuer of State debt, that it must have prime control over fiscal policy and so on.

That would enable such a State to implement policies that not only prevented bankruptcy in individual states, but which utilised fiscal and monetary policy to promote growth within the EU. Such growth, together with a monetising of the debt, would resolve the problem over a few years without any major economic crisis. But, such a policy removes control over monetary, and fiscal policy largely from individual states and hands it to such a central state. At the moment, individual EU countries, because of those contradictions referred to above, are not prepared to make that step. Even so, countries like the UK that retain control over fiscal and monetary policy, and over their own currency, could follow such a policy. The fact, that they are not proposing to do so reflects the political character of the governing parties, which are largely tied to the more backward, more nationalistic sections of Capital. The Tories, at least in their public pronouncements, for example, have to give vent to those kinds of concerns from the middle class, and small business people that make up the backbone of its membership, and of its core voters. But, the State as opposed to the Government is tied directly to, and reflects the interests of, the dominant sections of Capital, not these backward elements. The interests of big Capital, of multinational Capital are not to plunge Britain, Europe, or the World Economy into an unnecessary downward spiral – even if due to the Long Wave boom such a downward spiral would be of relatively short duration. It is likely to resist with all its bureaucratic might any attempts to pursue policies that lead to such a result.

At the end of the 19th Century, Tories like Disraeli with his “Young England” movement, reflected the reactionary interests of the past, of the old landed aristocracy, whereas the Liberals who represented the industrial bourgeoisie reflected the progressive interests of the future, of the breakdown of all of that old, statist, monopolistic and paternalistic society. Today, there is no difference between the Tories and Liberals. Sections of both parties reflect the interests of Big capital, for a more pro-Euro future, but the coalition is hog-tied by the reliance of the dominant Tory Party on its reactionary base. That is one reason that both parties will have to restructure down the lines of that fracture. But, just as at the end of the 19th Century, workers had an interest in forming an alliance with Liberals against the Tories, with a struggle for a progressive future rather than a reactionary past, they had no reason to simply subsume their particular interests within those of the Liberal bourgeoisie. The same applies today. The working class has a definite interest in replacing the remnants of those old national borders with a single European state. It certainly has an interest in opposing anything that fosters those “nationalist” sentiments referred to by George Soros above. To the extent that the Liberal bourgeoisie pushes through such measures, workers should welcome it. But, our task as Marxists is to point out that it will have carried out such actions for ITS benefit not for ours. Capital will not be able to carry through such an agenda smoothly, if at all, just as it cannot even guarantee bourgeois democracy consistently, because the logic continually throws up a contradiction with its own immediate interests. Our task is to argue for our own Workers Europe.

What Britain’s Double Dip Recession Means for Binary Traders

April 29th, 2020

In order to clear space for stashing away fresh grains, several options are being considered by the Govt, including providing more food-grain into the PDS (Public Distribution System) and selling extra wheat via a re-worked open market sale scheme.

The government plans to push in an additional 14 million tonnes of grains in the PDS this year, over and above last year’s allocation of 56 million tonnes. A high-powered meeting on storage and procurement issues on April 30, 2020 is anticipated to discourse all alternatives to vacate storage space. It will be chaired by PM Manmohan Singh.

UK economy in double-dip recession

April 29th, 2020

The UK economy has returned to recession, after shrinking by 0.2% in the first 3 months of 2020.

The Office of National Statistics held that a sharp fall in construction O/P was behind the surprise contraction.

The UK economy shrank by 0.3% in the fourth quarter of 2020. The UK economy was last in recession in 2009.

What is Recession?

A Recession is defined as two consecutive quarters of contraction. A period of general economic decline; typically defined as a decline in GDP for two or more consecutive quarters. Thus, in economics, a recession is a business cycle contraction, a general slowdown in economic activity.

What is Double Dip Recession?

When gross domestic product (GDP) growth slides back to negative after a quarter or two of positive growth. A double-dip recession refers to a recession followed by a short-lived recovery, followed by another recession.

The causes for a double-dip recession vary but often include a slowdown in the demand for goods and services because of layoffs and spending cutbacks from the previous downturn.

A double-dip (or even triple-dip) is a worst-case scenario. Fear that the economy will move back into a deeper and longer recession makes recovery even more difficult.

Thus, Double Dip recession is, the recession happening two times with the small gap in b/w.

China offers $8 billion loan to South Sudan

April 29th, 2020

China has offered $8 billion in loan to South Sudan to fund a broad range of infrastructure projects over the next 2 years. The funds would be used to build roads, bridges and telecom network. China wants to maintain good relations both with Sudan, its established friend and with the South Sudan which became independent in 2020.

RISAT-1 placed in final Polar Sun-synchronous orbit

April 29th, 2020

India’s indigenously built Radar Imaging Satellite (RISAT-1), launched on April 26, 2020 has been placed in its final Polar Sun-synchronous Orbit.
On April 27-28, 2020 the satellite’s propulsion system was used in 4 orbital manoeuvres to raise the height of the orbit of RISAT-1 to 536 km. In the coming days, various elements of the C-band Synthetic Aperture Radar (SAR) will be tested and calibrated as a prelude to payload operations.

  • In compared to the optical remote sensing satellites that depend upon sunlight, the Synthetic Aperture Radar of RISAT-1 transmits its own radar pulses to study the objects on Earth. This facilitates cloud penetration and imaging even without sunlight.
  • Images sent by the 1,858 kg RISAT-1 will facilitate agriculture and disaster management.

Indian Ambassador asks US students to stay alert on effects of protectionism

April 29th, 2020

Addressing the students at University of Florida, India’s Ambassador to the United States Nirupama Rao has asked American students to be alert to the crushing effects of protectionism as it is retrogressive and blocks economic growth and development in the age of globalization.

She held that the borders b/w nations are becoming increasingly porous, and in time, they will be progressively immaterial, as people are allowed to move freely to transact trade and commerce, and to travel without obstruction and ‘Protectionism’ in such a situation becomes a obstruction to economic growth and development because it seeks to check the flow of people, of goods and services, of ideas and technologies, building walls and is thus retrogressive.
She asked students to use their education to make the world a better place and desired they would become the builders of an even improved and high yielding partnership b/w the two democracies, India and the US.

Aditya Mehta stuns Pankaj Advani for Asian snooker title

April 29th, 2020

India’s Aditya Mehta stunned compatriot Pankaj Advani to become only the third Indian ever to clinch the Asian Snooker Championships in Doha. Aditya sealed the match 7-5. Aditya is the 3 rd Indian to lift the Asian Snooker Title and gets the championship trophy home after 8 year long wait.

President on 9-day state visit to Seychelles and South Africa

April 29th, 2020

The President Mrs.Pratibha Devi Singh Patil is on a 9-day state visit to the Seychelles and South Africa. She will discuss issues of bilateral, regional and International concerns with her counterparts in the two nations. Increasing bilateral trade relations with both the African countries is high on the agenda.

Govt proposes a board for growth of auto sector

April 28th, 2020

NAB: National Automative Board

The government has finalized the proposal to set up NAB under the Department of Heavy Industry to support fresh initiatives for the growth of the automobile sector. NAB would be set up as an autonomous body constituting technical and domain experts to take up and synergise the ongoing and fresh go-aheads of the government for the growth of the automobile sector.

What will be the key functions of NAB?

The key functions of the board include:

Administration, regulation and synergizing the operations of the testing centres, alleviate collaborative R&D activities and issue of testing and homologation certificates based on test reports submitted to NAB by the testing centres.

Why NAB?

As part of its endeavour to encourage sustainable development of Indian automotive segment,the Government of India has decided to establish a NAB. The basic idea of setting up NATRiP is to establish new automotive testing and R&D Centres across the country, besides upgrading the existing centres.

  • The NAB needs to be in position before the National Automotive Testing and R&D Infrastructure Project (NATRiP) centres are commissioned and NATRiP Implementation Society (NATIS) is wound up.
  • NATRiP has 3 centres across the India including The Vehicle Research and Development Establishment at Ahmednagar, Automotive Research Association of India at Pune, in western India and International Centre for Automotive Technology at Manesar, in the north Indian state of Haryana. Besides the upgradation of these three automotive testing and R&D centres, NATRiP’s other roles included establishing four greenfield facilities at various major destinations pan India, including Chennai, Rae Bareilly, Indore and Silchar for the purpose of automotive testing, coupled with homologation and R&D
  • NATIS is the apex body for implementation of NATRiP.

Jan 16, 2020 troop movement was purely training drill: Govt

April 28th, 2020

Discounting a media report on “non-notified” troop movement by army, the government informed Rajya Sabha that the exercise was undertaken for training purpose directed at refining mobilization drills and preparedness of the force. Defence Minister A K Antony held that the movement was purely for training purpose aimed at refining the mobilization drills and ascertaining operational preparedness of the Army in spite of untoward weather conditions.

As per a report by the Indian Express newspaper, the central intelligence agencies reported that on the night of January 16, there was an unanticipated and non-notified movement by key military unit around Delhi in the direction of the capital.

Nevertheless, Antony did accept in his reply that the 2 units did move from their bases. The para commando unit moved from Agra to the location of another unit in Gurgaon and the armoured division unit moved from its location (reportedly in Hisar) to Bahadurgarh on the night of January 16/17, 2020.

I ndia forecasts average monsoon rains this year

April 28th, 2020

Earth Sciences Minister Vilasrao Deshmukh held that India is probable to experience average monsoon rains this year, thus forecasting a third straight year without drought. Deshmukh held that the rains during the June-September season are probable to be 99% of the long-term average. The state-run India Meteorological Department (IMD) considers rains between 96-104% of a 50-year average of 89 cms in the entire 4-month season as normal. The last time there was a drought with rains below this range was 2009 and before that, in 2004.

The rain forecast ardently watched by traders and policymakers. Monsoon rains, essential for agricultural output and economic growth, irrigate about 60% of farms in the world’s 2nd-biggest producer of rice, wheat, sugar and cotton. The farm sector accounts for nearly 15% of India’s nearly $2 trillion economy.

This most recent government forecast is also in conformity with last week’s estimate of a global weather forum.

IMD held that the Monsoon is probable to have average rainfall in 2020 in spite of fears that the El Nino weather pattern may come forth in the second half of the season. In 2009, the El Nino weather pattern turned monsoon rains patchy, leading to the most terrible drought in almost 4 decades. Rains were within long-term averages in following years, assisted by La Nina. El Nino, an abnormal warming of waters in the equatorial tropical Pacific, is linked with poor rains or a drought-like situation in Southeast Asia and Australia. The La Nina weather pattern, which is linked with heavy rains in south Asia and flooding in the Asia-Pacific region and South America, and drought in Africa, finished in March. In the meantime before El Nino appears, weather officials articulate a neutral condition continues over the tropical Pacific.

EC relaxes Model Code of Conduct ahead of June 12 by-polls

April 28th, 2020

The EC (Election Commission) has settled to relax the Model Code of Conduct, on an experimental basis, by permitting partial implementation of developmental schemes in those districts where by-polls will be held on June 12, 2020.

Why this decision was taken by EC?

The EC order came after several states, where by-elections are being held, gave representations stating that the enforcement of model code affects the developmental works in the entire district, while only a part of the district may be involved in the election process.

NOT applicable to the entire districts: Thus, the EC has now decided on an experimental basis that the model code shall now be applicable only in respect of areas falling in the Assembly constituencies / Parliamentary constituency going for bye-election and not to the entire districts in which such constituency is situated.

Applicable to the entire districts: The EC yet, held that all other existing instructions on Model Code of Conduct on matters like tours of ministers, vehicles, advertisements, use of government guest houses, and all persisting Commission’s instructions including transfers of officers etc. shall persist to remain applicable to the whole districts in which the constituency having the bye-election is located.

Rural banks told to double home loan limit for priority sector

April 28th, 2020

The RBI has demanded all RRBs (Regional Rural Banks) to double the limit for home loans to Rs 10 lakh from Rs 5 lakh for lending for the Priority Sector. The increment in the limit will be applicable for the bank loans extended to non-governmental agencies, sanctioned by National Housing Bank for their refinance, on-lending for the function of construction or reconstruction of individual dwelling units and rehabilitation of slum dwellers.

PM inaugurates “Guru Gobind Singh Refinery” in Bathinda

April 28th, 2020

Prime Minister Dr. Manmohan Singh inaugurates the “Guru Gobind Singh Refinery” at Bathinda in Punjab.

  • Guru Gobind Singh Refinery (GGSR) is a refinery owned by Hindustan Mittal Energy Limited (HMEL) a joint venture between HPCL and Mittal Energy Limited, a company owned by L N Mittal. It is located in village Phulokheri, Bhatinda, Punjab, India.

3 day India-Nepal crafts festival begins in Nepal

April 28th, 2020

In Nepal, a 3-day India-Nepal crafts festival began in the capital Kathmandu. Inaugurating the festival, Nepal’s President Dr. Ram Baran Yadav held that such a common platform which would help artisans in both Nepal and India.

IOC signs pact with Nepal oil body

April 28th, 2020

Nepal Oil Corporation (NOC) and Indian Oil Corporation (IOC) inked an agreement on the supply of petroleum products for the next 5 years. As per the agreement, IOC has agreed to waive off 2.5% Price Adjustment Factor, which includes refinery and transportation charges among other technical losses under IOC’s existing price formula. As per NOC, this will assist Nepal to save 2 billion Nepali rupees yearly. IOC has also settled to add a fresh port in Mumbai to allow Nepal Oil Corporation easily distribute petroleum products in mid- western and far western regions.
At present fuel has been supplied by IOC to Nepal via Haldia port in West Bengal. They also agreed to forward the process to enhance the supply of cooking gas to Nepal from other Indian refineries, which presently is supplied via Haldia and Mathura refineries.

Sexual Offences against Children Bill approved with stringent punishment for crime

April 28th, 2020

The Union Cabinet sanctioned a bill dealing entirely with sexual offences against children. The ‘Sexual Offences Against Children Bill’ aims rigorous punishment for sexual intercourse or contact with sexual intent with a child below 18 years.

  • The punishment ranges from 3 years’ imprisonment to life term for a person who commits sexual harassment, sexual assault, penetrative sexual assault or aggravated penetrative sexual assault.
  • The Bill recommends 10 years of imprisonment extendable to life imprisonment and fine for aggravated sexual assault.
  • It will be treated as an aggravated offence where the child victim is below 12 years or has mental or physical disability or the sexual offence causes grievous hurt or injury to the child with long term adverse effect on the child’s mind and body.

Monsanto maize seeds hit roadblock in Gujarat

April 27th, 2020

The Gujarat Government has decided to stop procuring double-cross hybrid maize seed made by seed major Monsanto, which were distributed among the farmers in the tribal areas of the state under the tribal a development scheme. The seeds sold under the brand name ‘prabal’ were being distributed to farmers in the tribal regions under the Sunshine Project, which falls under the Vanbandhu Kalyan Yogna, since 2008. It is estimated that the seeds were distributed among half a million farmers by the Tribal Development Department.

It has been decided not to procure Monsanto seeds which were distributed among the farmers of tribal area. Instead, the farmers would be asked to buy government approved seeds of their own choice for which the government would provide financial support.

Why this move was taken?

This has been done to break the monopoly of Monsanto Company in Gujarat.

The state government’s decision follows several representations by the Bharatiya Kisan Sangh (BKS) and some MLAs from the tribal areas. In last session of state assembly in March, opposition had demanded ban on maize seeds of Monsanto, claiming that there were ill-effects of Monsanto’s maize seeds which were being distributed by the state government in tribal areas.

April 27th, 2020

Armed with the surface-to-surface BrahMos supersonic cruise missile, a medium range gun and anti-submarine rockets, guided missile frigate INS Teg will be commissioned into the Indian Navy today at the Yantar shipyard in Russia.

INS Teg:

  • It is a modern warship with advanced technologies to make it stable, fast and stealthy.
  • The Teg class of ships have been built to meet specific Command and Control needs of Indian Navy for coordinated surface, air and underwater missions.
  • INS Teg’s weapons suite includes surface-to-air and surface-to-surface missile systems, 100 mm medium range gun, close-in weapon system, torpedo tubes and anti-submarine rockets. The BrahMos surface-to-surface missile system is capable of engaging targets at extended ranges at supersonic speed.
  • The ship is also armed with an anti-submarine cum airborne early warning helicopter and its weapons suite and sensors are fully integrated with latest Combat Management System (CMS).

Sachin, Rekha, Aga nominated to Rajya Sabha

April 27th, 2020

The government has nominated Sachin Tendulkar to the Rajya Sabha, along with actress Rekha and industrialist Anu Aga. The nomination of the 3 eminent personalities was approved by President Pratibha Patil. Article 80 of the Constitution provides for nomination of persons having special knowledge or practical experience in matters such as literature, science, art and social service.

Under Article 80 of the Constitution that allows the President to nominate 12 members to the 250-member Upper House.

The names of Tendulkar, who has brought many a laurel to the country through his exploits in the game; Rekha, known for her brilliant and emotional portrayals in Hindi cinema in the 80s; and industrialist and social worker Aga were sent by the Prime Minister to the home ministry yesterday for approval by the president.

Sachin Tendulkar: He completed the historic achievement of scoring 100 international centuries in March 2020. He would be the first active sportsman and a cricketer to be nominated to Rajya Sabha. Tendulkar is the first sports personality to be nominated to Rajya Sabha while there have been several film personalities who have been nominated in the past.

Rekha: The 57-year-old Rekha was one of the top heroines of the 80s in Hindi films and and had won several national awards in her acting career.

Anu Aga: The 70-year-old Aga, former chairperson of Thermax Industries and a member of the Sonia Gandhi-led National Advisory Council, is a social worker who had figured among the richest Indians in a list by Forbes.

EPF interest rate hiked to 8.6%

April 27th, 2020

Interest rate on Employees’ Provident Fund will be increased from 8.25% to 8.6% in the current fiscal. The Employees’ Provident Fund Organisation (EPFO) had brought down the rate of interest to 8.25% for 2020-12 from 9.5% provided in 2020-11.
The retirement fund body EPFO has parked in excess of Rs 55,000 Crore in the Special Deposit Schemes, aimed at providing better returns to non-government provident funds and other such funds.

NET to be objective; no negative marking: UGC

April 27th, 2020

The National Eligibility Test, NET, will be completely objective type from June 2020. The test conducted by University Grants Commission, UGC, will consist of 3 papers. As per the new examination pattern, there will be no negative marking.
The National Educational Testing Bureau of the UGC conducts NET to determine eligibility for lectureship and award of Junior Research Fellowship, JRF, to ensure minimum standards for entrants in teaching and research.

Integrated Vaccine Complex to come up in Tamil Nadu

April 27th, 2020

The Centre proposes to set up an integrated vaccine production park in the country. It will be located at Chengalpattu in Kanchipuram district of Tamil Nadu. To be known as Integrated Vaccine Complex, it will produce and supply vaccines for the Universal Immunization Programme in the country. The proposed complex will manufacture drugs for measles, Hepatitis B, anti-Rabies and Japanese Encephalitis besides BCG vaccine.
The Health Minister Ghulam Nabi Azad held that the funds for the project will be allotted after approval from the Competent Authority and the project is expected to be operational three years after the allocation of funds.

Mullaperiyar dam structurally & hydrologically safe: Panel

April 27th, 2020

Setting at rest the controversy over the safety of the 116-year-old Mullaperiyar dam, the Empowered Committee, headed by the former Chief Justice of India A.S. Anand, held that the dam is “structurally and hydrologically safe, and Tamil Nadu can raise the water level from 136 to 142 feet after carrying out certain repairs.”

The Empowered Committee also held that “The dam is seismically safe.” Last year’s earth tremors in that region “did not have any impact on the Mullaperiyar dam and the Idukki reservoir and there was no danger to the safety of the two dams.”

The committee’s conclusion is expected to bring relief to both Kerala and Tamil Nadu after apprehensions were raised on the Mullaperiyar dam’s safety following mild tremors in that region. The committee gave its findings on the basis of the reports, studies and investigations conducted by various agencies constituted to go into the safety aspects.

On Kerala’s demand for construction of a new dam, the committee said that in view of the age of the existing reservoir, building a new one could be considered as an alternative proposal. If a new dam was constructed, the maximum water level (MWL) should be fixed at 155 ft and a fresh agreement inked b/w the two States on water sharing and maintenance.

RS passes amendment in Central Education Institutions Reservation Bill to ensure equity

April 27th, 2020

The Rajya Sabha passed the Central Educational Institutions Reservation in Admission Amendment Bill 2020. The bill was passed by a voice vote.
Objective: It provides that the State seats if any, in a Central Educational Institution situated in the tribal area will be governed by such reservation policy for the Scheduled Castes, Scheduled Tribes and other backward classes. The amendments to the Act aim at safeguarding interests of the tribal population in far-flung and remote areas of the North-Eastern States by providing a balance b/w the local policy at the State level and the national policy on reservation. The amendments would thus ensure equity and inclusiveness and meet the regional aspirations.

India’s Chrome ore production sufficient to meet demand

April 27th, 2020

Government held that India’s production of Chrome ore is sufficient to meet domestic consumption and exports and the export of chrome ore is not directly impacting the steel industry. Further, there are no proposals to completely ban the export of chrome ore.
India has 203 million tons of chrome ore. Out of this only 54 million tons are reserved.

IMF lowers India’s growth forecast to 6.9% for 2020

April 27th, 2020

­­The IMF (International Monetary Fund) lowered India’s growth forecast to 6.9% for this year. The lowered growth outlook in 2020 owes much to a slowdown of investment which partly reflects structural factors IMF called for renewed efforts to revive the flagging structural reform agenda. It also pointed out that domestic factors too have played a role in India’s growth slowdown over the second half of 2020. However, the IMF has retained India’s growth estimate at 7.3% for 2020. As per the IMF, the national economy grew by 7.1% last year.
Emphasising that economic rebalancing remains a policy priority for much of Asia, the IMF said the best way for the region to protect itself against external shocks is by strengthening domestic sources of growth.

Over 250 lakh CFLs distributed under Bachat Lamp Yojana

April 27th, 2020

Minister of State for Power, Mr. K.C. Venugopal held that over 259 lakh Compact Fluorescent Lamps (CFLs) have been distributed under Bachat Lamp Yojana, BLY and the scheme is proposed in the 12th Plan with modifications. The BLY scheme has been designed on PPP (Public Private Partnership) mode.

SC panel to recommend SIM card issuance procedure to Telcom firms

April 27th, 2020

The Supreme Court has set up a joint expert panel to recommend the procedure for the telecom firms for properly identifying the customers before issuing SIM cards to them. The panel comprising officials of the DoT (Department of Telecommunications) and the TRAI (Telecom Regulatory Authority of India) will submit its report to the government within 3 months.

  • The Supreme Court passed the order on a plea by a petitioner seeking its direction to the government to frame guidelines for telecom firms for issuing SIM cards.

PM congratulates Indian scientists over successful launch of RISAT-1

April 26th, 2020

The PM Dr. Manmohan Singh heralded the successful launch of PSLV carrying RISAT-1 and preened the scientists linked with the project. India’s first indigenous all-weather Radar Imaging Satellite (RISAT-1), whose images will facilitate agriculture and disaster management, was launched successfully on board the PSLV-C19 from Sriharikota in the early hours on April 26, 2020. It was the 20 th consecutive successful launch of the PSLV, thus a vital milestone in India’s space programme and it demonstrates ISRO’s mastery of the complex launch vehicle technology.

Indian scientists achieve success in converting sea water into drinking water

April 26th, 2020

Indian scientists have accomplished noteworthy success in converting sea water into drinking water. Under a pilot project of the Earth Sciences Ministry, the Indian scientists have developed the Low Temperature Thermal Desalination technology to convert seawater into drinking water. This indigenously developed environment- friendly technology is suited for island territories and coastal areas.

So far, 4 plants have been commissioned in India, located at: Kavaratti, Minicoy and Agatti in Lakshadweep and at the Northern Chennai Thermal Power Station in Chennai. 6 more plants are to be installed in Lakshadweep. They will be located at Amini, Chetlet, Kadamath, Kalpeni, Kiltan and Andrott islands of the Union Territory.

Each plant has a capacity to produce 1,00,000 litre of potable water every day. The operational cost of producing one litre of drinking water from the saline water is 19 paise and efforts to further reduce the production cost are taking place.

What is Low-temperature thermal desalination (LTTD)?

Principle behind this technology :

Low-temperature thermal desalination (LTTD) is a desalination technique takes advantage of the fact that water boils at low pressures, even as low as ambient temperature.

The system uses vacuum pumps to create a low pressure, low-temperature environment in which water boils at a temperature gradient of 8 to 10 °C between two volumes of water. Cooling water is supplied from sea depths of as much as 600 metres (2,000 ft). This cold water is pumped through coils to condense the evaporated water vapour. The resulting condensate is purified water. The LTTD process may also take advantage of the temperature gradient available at power plants, where large quantities of warm waste water are discharged from the plant, reducing the energy input needed to create a temperature gradient.

The principle of LTTD is known for a long time, originally stemming from ocean thermal energy conversion research. LTTD was studied by India’s National Institute of Ocean Technology (NIOT) from 2004. Their first LTTD plant was opened in 2005 at Kavaratti in the Lakshadweep islands. The plant’s capacity is 100,000 litres/day, at a capital cost of INR 50 million (€922,000). The plant uses deep water at a temperature of 7 to 15 °C.

Shiveluch volcano spews ash to nearly 11 kms above sea level in Russia

April 26th, 2020

In Russia, the Shiveluch volcano on Far Eastern Kamchatka Peninsula ejected an ash cloud to as high as almost 11 km above the sea level. There was no instant danger for the population, and no emissions of volcanic dust were supervised in neighbouring villages. This was the heftiest eruption of ash recorded this year at Shiveluch which has been active for more than 4weeks.

Shiveluch volcano : Shiveluch is the northernmost active volcano in Kamchatka Krai, Russia. It is sometimes called Sheveluch or Sopka Shiveluch. It is one of Kamchatka’s largest and most active volcanoes. Shiveluch is one of the biggest and most active of a line of volcanoes that follow the spine of the Kamchatka Peninsula in easternmost Russia. The volcanoes and peninsula are part of the tectonically active “Ring of Fire”, a zone of active volcanoes and frequent earthquakes that nearly surrounds the Pacific Ocean.

SpaceX confirms plans to launch first private spaceship to ISS

April 26th, 2020

SpaceX confirmed its plans to launch a rocket and capsule on May 7, 2020 in a historic first flight of a private spaceship to the ISS (International Space Station). SpaceX held that its unmanned Dragon capsule is due to ride on a Falcon 9 rocket from Cape Canaveral Air Force Station in Florida.

SpaceX aims to carry out a fly-by of the ISS and a berthing operation in which the reusable spacecraft, the Dragon, will approach the ISS as the crew aboard the orbiting outpost uses a robotic arm to dock it.

What is “SpaceX”?

Space Exploration Technologies Corporation, or more popularly and informally known as SpaceX, is a space transport company headquartered in Hawthorne, California. It was founded in 2002 by former PayPal entrepreneur Elon Musk. It has developed the Falcon 1 and Falcon 9 space boosters, both of which are built with a goal of becoming reusable launch vehicles. SpaceX is also developing the Dragon spacecraft to be flown into orbit by the Falcon 9 launch vehicle.

NASA awarded SpaceX a contract to develop and demonstrate a human-rated Dragon as part of its Commercial Crew Development (CCDev) program to transport crew to the ISS. SpaceX is planning its first crewed Dragon/Falcon9 flight in 2020, when it expects to have a fully certified, human-rated launch escape system incorporated into the spacecraft.

Planning Commission constitutes National Monitoring Committee to support Nalanda University

April 26th, 2020

Planning Commission has constituted an 11 member National Monitoring Committee to support Nalanda University for the development of basic infrastructure and facilities and timely flow of funds to the university. The committee will be headed by the Deputy Chairman Montek Singh Ahulwalia. The members of the committee include, National Security Adviser, Foreign Secretary, Vice-Chancellor of Nalanda University, Finance Secretary and Secretary of Ministry of Human Resource Development.

RBI doubles home loan limit to Rs. 10 lakh to promote housing for low income groups

April 26th, 2020

The RBI has doubled the limit for home loans from Rs 5,00,000 to Rs 10,00,000 for consideration under Priority Sector Lending. This move was taken by RBI in a bid to encourage housing for low income groups in key cities. The RBI has been decided to increase thiss limit for the bank loans extended to non-governmental agencies, approved by the National Housing Bank (NHB) for their refinance, for on-lending for the purpose of construction or reconstruction of individual dwelling units or for slum clearance and rehabilitation of slum dwellers.

  • As per the existent norms, banks have to offer 40% of the total credit to the prescribed priority sectors including housing for weaker section.
  • Loans of such nature fall under indirect finance to housing sector as the final disbursement is done through NHB approved non-governmental agencies.

PM constitutes EGoM to deal with apprehended drought

April 26th, 2020

PM Manmohan Singh established an Empowered Group of Ministers (EGoM) headed by Finance Minister Pranab Mukherjee for efficacious management to deal with drought like situation. The 11 member EGoM, will be. The EGoM is allowed to reassess the situation and take rapid and well-timed decisions on policy issues as well as other issues for effectual management of drought and linked issues.

India launches first indigenously developed anti-Malarial drug Synriam

April 26th, 2020

India in a major breakthrough in its fight against Malaria, has indigenously developed an anti-Malarial drug ‘Synriam’. Health and Family Welfare Minister Ghulam Nabi Azad held that it is land mark accomplishment in the whole pharmaceutical sector. Mr Azad urged the manufacturing company to keep the price of the drug at affordable levels so that poor and needy people are able to access the drug in remote and backward districts of India.
Minister Ghulam Nabi Azad held that India’s pharmaceutical industry is now the third largest in the world in terms of volume and 14 th in terms of value.

Madhuri Dixit gets Master Dinanath Vishesh award

April 26th, 2020

Actor Madhuri Dixit awarded the prestigious “Master Dinanath Vishesh award for her contribution to cinema. The award comprises a memento and Rs 1,00,000 cash.

Govt gives in-principle nod to free diesel prices

April 25th, 2020

Minister of State for Finance, Namo Narain Meena held that the government has taken an in-principle decision to link diesel prices with market rates. Yet, there is no proposal currently to completely deregulate cooking gas price. He also opined that the government continues to fix the price of diesel in order to protect the common man from the affect of rising crude oil prices and the ensuant inflation.

While petrol prices are market-linked, the government fixes the rates of LPG, kerosene and diesel, which results in a large budgetary expenditure on subsidies.

China to introduce new ‘talent visa’

April 25th, 2020

China is planning to bring in a fresh visa regime titled “talent introduction” in an attempt to pull more skilled professionals from abroad. A draft law in this respect has been submitted to the China’s top legislature.

US helping India to establish community colleges

April 25th, 2020

As per the US State Department spokesperson Victoria Nuland, United States is working with India to flesh out an initiative to set up hundreds of community colleges in India on the American pattern and the State Department has been working with the Indian side to flesh out the initiative. Over the acceptance of Indian degrees in United States, she held that it on a case-by-case issue depending upon where they graduate from and where they’re looking to get accredited from. She also held that US has also not altered its policy for the issue of student visas after the closure of a couple of sham universities which affected hundreds Indian students, but rather the US institutions get greater scrutiny.

India aims to double LNG supply from Qatar

April 25th, 2020

India intends to double its Liquefied Natural Gas (LNG) imports from Qatar to 15 million tonnes a year. India, the world’s 8 th largest importer of LNG, annually buy 7.5 million tonnes from Qatar under a long-term deal. In addition, India has asked Qatar to meet “to supply instant requirement” of 3 million tonnes of LNG, which could assist to make up for falling local gas output and soaring demand for the cleaner fuel.

Standard & Poor’s lowers India’s rating outlook to negative, warns of downgrade

April 25th, 2020

Standard and Poor’s (S&P), the Global rating agency has lowered India’s rating outlook to -ve citing slow progress on its fiscal situation, as well as deteriorating economic indicators. S&P has also warned of a further downgrade India’s rating in 2 years if there is no improvement in the fiscal situation.

  • The lowering of outlook from stable, to -ve is expected to make ECB (External Commercial Borrowings) expensive for Indian companies.
  • It may also have implications for the capital market.

S&P held that the investment and economic growth slowed whilst the CAD (Current Account Deficit) widened. In 2020, S&P had stripped the U.S. of its respected AAA credit rating.

ISRO proposes to undertake Mars Mission in October-November, 2020

April 25th, 2020

The ISRO has proposed to undertake a Mars Orbiter Mission in October-November, 2020. It will be India’s first step towards exploring the planet Mars. The proposal is currently under examination for government approval.
The Mars spacecraft will be placed in an elliptical orbit around the red planet after a voyage of almost 300 days. During the orbital life of the spacecraft around Mars, the on-board instruments will be used to carry on scientific experiments. The aimed Mars Mission is meant to exhibit India’s technological capability to reach the Martian orbit to augment the understanding of its atmosphere. It would also pave the way for future scientific exploratory missions in the solar system.

SC extends deadline for 2G license auction from June 2, 2020 to August 31, 2020

April 25th, 2020

The Supreme Court has extended the deadline for fresh auctioning of 2G spectrum licenses from June 2, 2020 to August 31, 2020 and the existing licenses for 2G spectrum will continue to be operational till September 7, 2020. The February 2, 2020 order SC cancelling 122 licenses, allocated during the tenure of A Raja, will remain operational.

Pak successfully test-fires Hatf IV, Shaheen 1A missile

April 25th, 2020

Pakistan successfully test-fired long-range Hatf IV, Shaheen 1A ballistic missile in the Indian Ocean. The missile’s range and technical parameters have been improved while it is capable of carrying nuclear warhead.
Pakistan has tested the long-range missile just a week after India test fired its first ICBM (Inter-Continental Ballistic Missile) Agni-V on April 18, 2020.

NRI children brought in Delhi from Norway

April 25th, 2020

The 2 NRI children Abhigyan and Aishwarya, who were kept in foster care by authorities in Norway for nearly a year, arrived in New Delhi after a protracted legal battle. The children came with by their foster father. A Norwegian court handed over the 2 NRI children in foster care to their paternal uncle, ending months of custody row that saw India escalating diplomatic pressure on Norway to send back the children. The children were taken away from their parents Anurup and Sagarika Bhattacharya by Norway’s Child Welfare Agency in May 2020 on grounds of “emotional disconnect”.

Rural Ministry to share 1 % of its budget with Panchayati Raj Ministry

April 25th, 2020

Panchayti Raj Minister, V Kishore Chandra Deo held that the Rural Development Ministry has agreed to share 1% of its Rs 1 Lakh Crore budget for fortification of the institution of Panchayati Raj in the country. Mr. Deo also held that this was for the first time that the Rural Development Ministry would be sharing some of its allotted funds with the Panchayati Raj Ministry.

World Bank sanctions Rs 32 Crore for Rural Electrification at Sagar Island in Sunderbans of West Bengal

April 24th, 2020

Rs 32 Crore sanctioned by the World Bank for Rural Electrification at Sagar Island in Sunderbans of West Bengal. The project for house to house power connection will be inaugurated at Rudra Nagar in Sagar Island. Under the scheme 42 gram panchayats will be electrified. The entire project will be completed by next three years in which around 2,50,000 people will be benefited.

Sagar Island:

  • Lies on the continental shelf of Bay of Bengal about 100 km (54 nautical miles) south of Kolkata
  • Governed by the State government of West Bengal
  • Area: nearly 300 km²
  • It has 43 villages and a population of over 160,000
  • A famous Hindu pilgrim place

Justice Ranjan Gogoi was today sworn in as a Supreme Court judge

April 24th, 2020

Justice Ranjan Gogoi was today sworn in as a Supreme Court judge, raising the strength of the SC to 27 against the approved strength of 31. On 2 April, 2020 Mr Justice Fakir Muhammad Ibrahim Kalifulla was elevated to the SC from Jammu and Kashmir High Court.

Loktantra Diwas celebrated in Nepal

April 24th, 2020

6 th anniversary of Loktantra Diwas celebrated in Nepal to mark the People’s Movement of 2006 for reinstatement of the democracy in the country.The day also commemorates the abdication of throne by King Gyanendra and reinstatement of the dissolved House of Representatives.

10 French nationals deported from Bihar for alleged links with Maoists

April 24th, 2020

10 French nationals including 6 women have been deported from Bihar for their alleged links with Maoists. A verdict to this effect was taken by the Bihar state government. They were detained by police in Nawada district of the state. These nationals were found moving in naxal hotbeds and holding farmers meeting. Bihar Govt held that the French nationals have desecrated visa terms and all of them were working for an NGO supposed to have links with frontal organizations of Maoists. Out of 10 French nationals 9 had come to India on tourist visa and one had an employment permit to work in Bhopal. Bihar police has also alleged that as per the intelligence reports these French nationals had maoist links.

6 Indian-origin scientists elected to the prestigious Fellowship of the Royal Society for 2020

April 24th, 2020

Royal Society (RS):

Founded in 1660 to recognise, promote and support excellence in science, has over the years awarded the Fellowship to nearly approximately 1,450 individuals, including Albert Einstein, Stephen Hawking, Isaac Newton and Tim Berners-Lee. The Fellowship is made up of the most eminent scientists, engineers and technologists from the UK and the Commonwealth. Fellows are elected for life through a peer review process on the basis of excellence in science. There are approximately 1,450 Fellows and Foreign Members, including more than 80 Nobel Laureates.

The 6 Indian-origin scientists are among 44 experts elected for 2020. They are:-

  1. Mr. Tejinder Singh Virdee, Professor of Physics, Department of Physics, Imperial College London
  2. Mr. Krishnaswamy Vijay Raghavan, Senior Professor and Director, National Centre for Biological Sciences, Tata Institute of Fundamental Research, Bangalore
  3. Mr. Chandrashekhar Bhalchandra Khare, Professor of Mathematics, Department of Mathematics, University of California, Los Angeles
  4. Mr. Mathukumalli Vidyasagar, Cecil H. & Ida Green Chair, The University of Texas at Dallas
  5. Mr. Shankar Balasubramanian, Professor of Medicinal Chemistry, Department of Chemistry, University of Cambridge and Senior Group Leader, Cancer Research UK, Cambridge Research Institute
  6. Mr. Varinder Kumar Aggarwal, Professor of Synthetic Chemistry, School of Chemistry, University of Bristol

SC dismisses PIL challenging appointment of next Army Chief

April 24th, 2020

The Supreme Court dismissed the PIL challenging appointment of Lt. General Bikram Singh as the next Army Chief as the apex Court did not find any justifiable ground to entertain the petition.
The Supreme Court adjudged that the dismissal of the PIL shall not affect any pending proceedings against Lt. Gen. Singh and it also observed that the Government had gone through all allegations against Lt. Gen. Singh before clearing his appointment.

What this dismissal of plea may mean?

This dismissal of plea by Supreme Court now clears the way for appointment of Lt. General Bikram Singh as the next Army Chief.

Exercise ‘Dosti –XI’: India, Lanka, Maldives hold joint naval exercises

April 24th, 2020

The Sri Lankan Coast Guards are participating in a joint sea exercise with the Indian and Maldivian Coast Guards in the seas off Male.

What is Dosti-XI?

A Joint 5-day Sea Exercise b/w Srilanka, India and Maldives code named ‘Dosti XI’.
Objective : With international piracy extending its tentacles to Indian Ocean, Coast Guards of India, Sri Lanka and Maldives are taking part in a joint exercise off the coast of Male, aimed at achieving inter-operablity. The exercise will focus on Maritime Search and Rescue, Marine Pollution Response and Boarding Operations.
6 warships are taking part in the five-day exercises code named ‘Dosti XI’.

  • Indian Coast Guard ships: ‘Sankalp’ and ‘Subhadra’
  • Maldivian Coast Guard ships: ‘Huravee’, ‘Ghazee’ and ‘Shaheed Ali’
  • Sri Lankan Navy’s offshore patrol vessel: ‘SLNS Sagara’

Due to its geo-strategic significance, it is crucial for the Coast Guards of the 3 nations to ascertain the safety and security of the Indian Ocean for all sea-farers.

current affairs april 2020

Punjab bans use of dangerous pesticides

April 24th, 2020

Responding to National Human Rights Commission’s (NHRC) directions, the Punjab Government has:

  • Banned the manufacture, import and use of pesticides which are harmful to health.
  • Withdrawn registration of some such pesticides in addition to limiting use of some unsafe pesticides.
  • Made arrangements for educating farmers on judicious use of pesticides and their healthcare.

Why this action was taken by the Punjab Government?

These actions have been taken by state government in response to National Human Rights Commission’s (NHRC’s) suo motu cognizance of a media report which held that the disease of cancer among farmers in the Malwa region of Punjab is caused by the excessive use of pesticides.

India, Kuwait ink MoU to strengthen medical co-operation

April 24th, 2020

India and Kuwait inked MoU.

Objective: To strengthen medical co-operation and promote medical tourism b/w the two nations.

  • Degrees and other qualifications issued by institutions in medicine, including traditional medicine, nursing, medical technicians and paramedical recognized by government bodies will be treated at par for suitable job placements and gains by Kuwait’s Ministry of Health.
  • Suitable training will be rendered to Kuwaiti doctors in centres of excellence in the field of traditional and modern medicine and allied health specialties in India.
  • There are provisions for treatment of Kuwaiti patients in the sanctioned speciated Indian hospitals.

Abhishek Manu Singhvi steps down as Chairman of Parliamentary Standing Committee

April 24th, 2020

Congress leader and Rajya Sabha Member Abhishek Manu Singhvi resigned from the post of the Chairman of Parliamentary Standing Committee on Law, Justice, Personnel and Grievances. Mr. Singhvi held that he resolved to resign in order to avert even the slenderest possible Parliamentary disturbance concerning the alleged CDs being circulated about him and he unconditionally stated that the fabrications and false allegations are being spread about supposed conversation in the CD.

Govt demands FCI to hire private godowns to store fresh crop

April 24th, 2020

Food Minister K V Thomas held that the state-run FCI (Food Corporation of India) has been called for to hire private godowns in order to store fresh crop and he called food-grains storage as a challenging task in view of the record yield. He held that efforts are on to make extra storage capacity for storing fresh wheat crop being procured presently by FCI. The government currently has capacity to store 66 million tonnes of wheat and rice. He said the FCI has also been asked to enhance its capacity utilization beyond the existing 85 per cent. He also said that the government could consider releasing wheat and rice in the open market and through ration shops.
To this, Food Secretary B C Gupta endorsed that in order to relieve pressure on storage, the Food Ministry is taking a proposal before the panel of Ministers to apportion extra 8 million tonnes of food-grains to BPL families.

As per the latest data released by the Agriculture Ministry, the nation is approximated to have harvested record rice crop at 103.41 million tonne and wheat crop at 90.23 million tonnes in the 2020-12 crop year.

President: ‘Country never to forget contribution of freedom fighter Veer Kunwar Singh’

April 24th, 2020

Participating in a function organized by Veer Kunwar Singh Foundation on the occasion of 155th Vijayotsav, the President Ms Pratibha Devisingh Patil said that the nation will never forget the contribution of freedom fighter Veer Kunwar Singh, one of the leaders of the Indian rebellion of 1857. She lauded Veer Kunwar Singh and said the younger generation will be inspired by his sacrifice. During India’s first war of Independence, Veer Kunwar Singh actively led a select band of armed soldiers against the troops. Kunwar Singh assumed command of the soldiers who had revolted at Danapur on July 5, 1857.

Veer Kunwar Singh (1777–1858), one of the leaders of the Indian Rebellion of 1857 belonged to a royal Kshatriya (Rajput) house of Jagdispur, presently a part of Bhojpur district, Bihar state, India. At the age of 80 years, during India’s First War of Independence (1857), he actively led a select band of armed soldiers against the troops under the command of the East India Company, and also recorded victories in many battles.

In his last battle, fought on April 23, 1858, while crossing the Ganges on way to his ancestral seat at Jagadispur, Veer Kunwar Singh was wounded in the arm. Unshaken, Veer Kunwar Singh as a gift of Ganga, cut his injured hand and flung it into the river Ganges, as is was his last offering to the Ganges. Soon after, he completely routed the British forces in the battle on April 23, 1858 and died the next day on April 24, 1858.

RISAT-1 all set for launch at Sriharikota

April 23rd, 2020

On April 26, 2020 India’s Radar Imaging Satellite (RISAT-1) will be launched from the spaceport at Sriharikota. The 4-stages of the PSLV-XL (Polar Satellite Launch Vehicle – Extra Large) have been piled up.

  • Essentially a remote-sensing satellite.
  • ISRO’s first radar-imaging satellite.
  • Weighs 1858 kg
  • ISRO’s heaviest remote-sensing satellite.
  • Heaviest satellite to be put in orbit by the PSLV.
  • RISATs uses Synthetic Aperture Radar (SAR) and the big benefit of RISATs is that it can take pictures of the earth at all times, through rain, sun, clouds, fog and cyclones.
  • A powerful PSLV-XL is being used to put RISAT-1 in polar orbit at an altitude of 480 km. The satellite’s propulsion system will then be used to take it to the final orbit at an altitude of 536 km.
  • Life-span is 5years.

Why PSLV-XL?

RISAT-1 (1858 kg) is the heaviest satellite to be put in orbit by the PSLV. The rocket is called PSLV-XL (XL stands for “extra-large”) because it uses 6 more powerful strap-on motors than those used in the standard PSLV version. If the normal PSLV version’s six strap-on motors each use nine tonnes of solid propellants, each of them in the PSLV-XL use 12 tonnes of propellants.

This is the third time the ISRO is using a PSLV-XL version with the first one used in October 2008 to put Chandrayaan-1 in orbit and second one used in July 2020 during the GSAT-12 launch.

What will be the applications of RISAT-1?

Pictures from RISAT-1 would be used to estimate the crop yield – especially to monitor paddy crop, assess its acreage and predict its health during the kharif season, when the sky is covered with clouds. The satellite’s images can be used for disaster management during cyclones and floods, to assess how much area has been inundated and so on.

Why SAR is used and what are the benefits of SAR?

Contrasting the normal, optical remote-sensing satellites, the RISATs use Synthetic Aperture Radar (SAR). This radar emits waves in a special way and collects part of the reflected radiation. From this reflected radiation, images of the earth can be built and these images have excellent clarity. Since it is difficult to carry a radar/antenna with a big aperture on a satellite, an SAR is used because it can synthesise (artificially create) a larger aperture electronically. Therefore it is called SAR.

Active Microwave Remote Sensing provided for cloud penetration and day-night imaging capability. These unique characteristics of C-band (5.35 GHz) SAR enables applications in agriculture, particularly paddy monitoring in kharif season and Management of natural disasters like flood and cyclone. Thus, SAR helps taking pictures of the earth at all times, through rain, sun, clouds, fog and cyclones.

Is this the first time ISRO is launching a RISAT?

NO. Although this is the first time the ISRO is launching its own RISAT, it has twice launched Israel’s RISATs in orbit using the PSLVs from Sriharikota.

  • In January 2008, the ISRO first put Israel’s RISAT, “Tecsar”, in orbit.
  • In April 2009, ISRO deployed Israel’s ‘RISAT-2’ in orbit.

Both Tecsar and RISAT-2 are reconnaissance/surveillance satellites. Whilst Israel utilizes the images from ‘Tecsar’, India uses the images from ‘RISAT-2’ for surveillance.

CBI blames Sajjan Kumar for 1984 anti-sikh riots

April 23rd, 2020

The CBI has blamed Congress leader Sajjan Kumar for 1984 anti-Sikh riots. CBI held that Mr. Sajjan Kumar played a very negative role during 1984 anti-sikh riots and he was on the site of crime and incited rioters. The CBI held that the riots were a part of a high-profile conspiracy as they were not a spontaneous response but a masterminded operation.

TRAI set base price for spectrum auction

April 23rd, 2020

TRAI (Telecom regulator Telecom Regulatory Authority of India) set Rs 3,622.18 Crore as the base or minimum price for pan-India spectrum in the auction of radio waves which is to be held after the Supreme Court cancelling 122 licenses. This minimum or base price (Rs 3,622.18 Crore) set is around 10 times higher than the floor price at which the former Telecom Minister A. Raja had allocated spectrum and telecom licenses to companies like Unitech Wireless and Swan in 2008.

  • TRAI has advocated a reserve price for 800 Mhz band (used for CDMA service) and 900 MHz band (used for GSM service), at least two-times higher than that of minimum price for 1800 MHz band.
  • The TRAI has also advocated that the auction keep out companies which already hold airwaves in excess of the approved limit.

Centre Govt won’t take stand on Ram Setu, asks Supreme Court to decide

April 22nd, 2020

The Central government refused to take any point of view on the issue of announcing the mythological Ram Setu a national monument and, rather, demanded the Supreme Court to take a call. The government would stand by its 2008 affidavit, in which it held that it honoured all religions but it was of view that it should not be called upon to react to the matters of faith, except in realizing their being.

Rama Setu – Sethusamudram project Controversy in detail…

Firstly,

What is Rama Setu?

  • Adam’s Bridge or Rama’s Bridge or Rama Setu.
  • It is a chain of limestone shoals, b/w Pamban Island, also known as Rameswaram Island, off the southeastern coast of Tamil Nadu, India, and Mannar Island, off the northwestern coast of Sri Lanka.
  • Geological evidence suggests that this bridge is a former land connection b/w India and Sri Lanka.
  • The bridge is 18 miles (30 km) long and separates the Gulf of Mannar (southwest) from the Palk Strait (northeast).
  • It was discovered by NASA space missions including the Shuttle Radar Topography Mission in February 2000. The mission beamed photographs that clearly showed a bridge-like link in the region.
  • The Rama Setu has spiritual significance, and it is believed that the Lord Rama and his army (vaanar sena) had built it some 17,25,000 years ago.

What is Sethusamudram project?

  • The Sethusamudram Shipping Canal Project was inaugurated by Prime Minister of India, Dr. Manmohan Singh on July 2, 2005 at Kodiakarai near Vedaranyam in Madurai, in the Indian State of Tamil Nadu.
  • The project aims to build a ship channel in the shallow portion of the sea to connect the Gulf of Mannar and the Bay of Bengal through the Palk Bay via north of Adam’s Bridge.
  • This would provide a continuous navigable sea route around the Indian Peninsula.
  • The shipping channel is proposed to be 30 m wide, 12 m deep and 167 km long.

What is the issue all about?

  • The Janta party President Subramanium Swamy had filed a plea for declaring the mythological Rama Sethu in the Palk Strait be announced a ‘National Monument’.
  • The Supreme Court halted work at Ram Setu in August 2007 on an application filed by Mr Swamy who argued that the there were deep illegalities rooted in the project.
  • Mr Swamy also alleged that the execution of the project will seriously damage the mythological bridge.
  • The Supreme Court on March 27, 2020 had asked the central government to unambiguously state whether the mythological Rama Sethu could be announced a ‘National Monument’.
  • The Supreme Court had also directed the Central Government to lay before it the report of the group headed by environmental expert R.K. Pachauri on the viability of executing the Sethusamudram project off Dhanushkodi, a town at the southern tip of the Rameswaram Island of the Tamil Nadu.

Now, the Central government refused to take any point of view on the issue of announcing the mythological Ram Setu a National Monument and, rather, demanded the Supreme Court to take a call.

What are the proposed benefits of the Sethusamudram project?

  • It is pointed out that though Indian subcontinent’s southern part is surrounded by sea, the coast of India does not have a continuous navigation channel connecting the east and west coasts. At present the ships coming from the west coast of India has to navigate around Srilankan coast to go to Eastern ports. This is because the existing water way (lying in between Indian subcontinent and Srilanka) is shallow and not suitable for voyage of ships.
  • The proposed channel will allow ships and boats to navigate in the passage between India and Sri Lanka without having to circle Sri Lanka (as is being done currently).
  • This may save about 400 nautical miles voyage on the West Coast.
  • This project will connect the National Sea Route.
  • This canal will shorten the length of the sea route for ships. Rs. 21 crore per year for fuel expenditure of ships will be saved.
  • This may benefit all the coastal districts of Tamil Nadu economically and may not be good for Srilankan Ports.
  • Another aspect is that Indian Navy ships also have to navigate around Srilanka.

Thus, it is held that the project is of strategic military importance to India, in addition to having economical motives.

What are the criticisms of the proposed Sethusamudram project?

  • The project has far reaching strategic and economic implications for Sri Lanka as this project may benefit all the coastal districts of Tamil Nadu economically and may not be good for Srilankan Ports.
  • The Sethusamudram Project will create an unavoidable by-pass that would inevitably divert this sea traffic through India’s own maritime waters.
  • Many experts have demanding that the ship channel project itself be scrapped as it has become a White Elephant. Several people have repeatedly questioned the financial viability of the Sethusamudram Ship Channel Project. They have pointed out that only nominal time and money would be saved — and that too by some vessels on certain routes.
  • Many experts and Hindu Organizations have held that the proposed project will damage the Ram Setu.

Why so much stress on declaring Ram Setu a “National Monument”?

  • There is a stress from certain individuals, group, and organizations for awarding “National Monument” status to Ram Setu, so as to ensure its protection. It is alleged that the proposed Sethusamudram project will damage the mythological bridge. Thus, declaring it as a National Monument will call for either termination of the Sethusundaram project or a change in the proposed channel’s route.

Green tribunal says ‘NO’ to Jindal Steel

April 22nd, 2020

The National Green Tribunal (NGT) set aside the Environmental Clearance (EC) granted to the 4 MTPA Coal Mining Project of Jindal Steel and Power Ltd and 4 MTPA Coal Washery at Gare in Raigarh district of Chhattisgarh

Why this verdict was made by NGT against Jindal Steel’s Project?

This verdict from NGT came on grounds of faulty public hearing. NGT after viewing the CD of the public hearing conducted on 5.1.2008, held that the entire “public hearing was a farce and makes a mockery of the public hearing process“.

The company had been granted EC in May 2009. The NGT has directed that the public hearing may be conducted again but not under the Additional District Magistrate (ADM) who conducted it earlier.

What is National Green Tribunal (NGT)?

April 22nd, 2020

‘Maternal Death Reviews — Implications for Quality of Care,’ (MDR) a review of maternal deaths done by the Federation of Obstetric and Gynaecological Societies of India (FOGSI) in Jhunjhunu and Sikar districts of Rajasthan b/w November 2020 and March 2020 has revealed that 90% of these deaths had occurred during transit to a higher health centre. Thus, as per the study conducted on pregnancy-related deaths, a large number of women die during transit to a health facility or returning home after a delivery.

What is Maternal death?

Maternal death is defined as the death of a woman who dies from any cause related to or aggravated by pregnancy or its management (excluding accidental or incidental causes) during pregnancy or child birth or within 42 days of termination of pregnancy, irrespective of duration and site of the pregnancy.

What is Maternal Mortality Ratio (MMR)?

Maternal Mortality Ratio (MMR) is the number of women who die from any cause related to or aggravated by pregnancy or its management (excluding accidental or incidental causes) during pregnancy and childbirth or within 42 days of termination of pregnancy, irrespective of the duration and site of the pregnancy, per 1,00,000 live births.

What is Maternal Death Review?

The Maternal Death Review (MDR) was rolled out in 2020 under the Reproductive and Child Health programme as an important strategy to improve the quality of obstetric care and to reduce maternal mortality and morbidity. It provides detailed information on various factors at the facility, district, community, regional and national levels that need to be addressed to reduce maternal deaths. Analysis of these deaths can identify the delays that contribute to maternal deaths at various levels and the information can be used to adopt measures to fill the gaps in service.

What is FBMDR (Facility Based Maternal Death Review) and CBMDR (Community Based Maternal Death Review)?

Maternal Death Review is contemplated to be implemented in two forms – Facility Based Maternal Death Review (FBMDR) and Community Based Maternal Death Review (CBMDR), which are defined as below:

  • FBMDR is a process to investigate and identify causes, mainly clinical and systemic, which lead to maternal deaths in the health facilities; and to take appropriate corrective measures to prevent such deaths. Page 3 of 56
  • CBMDR is a process in which deceased’s family members, relatives, neighbours or other informants and care providers are interviewed, through a technique called Verbal Autopsy, to elicit information for the purpose of identification of various factors – whether medical, socio-economic or systemic, which lead to maternal deaths; and thereby enabling the health system to take appropriate corrective measures at various levels to prevent such deaths.

What are the major causes of deaths in maternal deaths in India?

Major medical causes :

  • Abortion
  • Obstructed labour
  • Haemorrhage
  • Hypertensive disorders
  • Sepsis

Other factors :

  • Delay in initiating treatment
  • Substandard care in hospital
  • Lack of blood, equipment and drugs in hospitals coupled with lack of staff at health facility
  • At the community level, absence of ante-natal check ups, delay in seeking care, referral, getting transport, mobilising funds and not reaching the appropriate facility in time are some other factors of maternal deaths, besides prevailing beliefs and customs that prevent women from going to a health facility at the appropriate time.

Experts believe such deaths could possibly have increased because of an emphasis on institutional deliveries and a lack of corresponding clinical infrastructure — the Janani Suraksha Yojana gives women financial incentives for delivering at a health facility, but are often taken to the health facility as a mere formality and often asked to go home immediately after delivery because of lack of infrastructure to deal with the heavy patient load, which puts the life of the child and mother at huge risk.

Trade deficit records new high at US $185 billion

April 22nd, 2020

Although India had earlier announced that it had surpassed the export target of $300 billion for 2020-12, the rising trade deficit, touching $184.9 billion mark, was a worrying factor for India. The Indian government had set a target of $150 billion trade deficit.

Exports:

  • Exports soared up by 21% to $303.7 billion in 2020-12 as a result of strong growth in petroleum, pharmaceuticals and engineering products. India managed to go past the export target by adopting product and market diversification strategy.

Imports:

  • Indian Imports however, surged by 32.1% to $488.6 billion, leaving the highest-ever trade deficit of $184.9 billion.

Trade Deficit = Imports – Exports = $ (488.6 – 303.7) bn = $ 184.9 bn

Commerce Secretary Rahul Khullar held that owing to the huge trade deficit, the Current Account Deficit (CAD) is probable to be approximately an uneasy 4% of GDP in 2020-12.

‘Tea’ to be declared National Drink of India by April 2020

April 22nd, 2020

Tea will be declared as national drink of India by April 2020. This was announced by Planning Commission Deputy Chairman Montek Singh Ahluwalia at Jorhat in Assam at a function celebrating the 212 th birth anniversary of first Assamese tea planter and Sepoy Mutiny leader Maniram Dewan .

Assam government has already declared tea as the ‘State Drink’ and also asked the Centre to declare it as the ‘National Drink’.

  • Assam Tea Planters Association was the first tea producers’ association formed by the Indian planters during the pre-independence period. It was come into being on 23rd June in 1935 by 17 tea planters of the region.

Kurukshetra Zila Parishad of Haryana chosen for National Panchayati Raj Award

April 22nd, 2020

  • Kurukshetra Zila Parishad of Haryana chosen for National Panchayati Raj Award for implementing all Central Government schemes in all 419 villages in the district.
  • Kurukshetra Zila Parishad ranks at the top in the Haryana and among 15 those Zila Parishads in India which have provided all basic amenities in rural areas.

Scientists identify 33 genes linked to autism, related disorders

April 22nd, 2020

Scientists at Massachusetts General Hospital Centre for Human Genetic Research claim to have identified 33 genes linked to autism and related disorders. The discovery may pave the way for better treatments for the medical condition. They have distinguished the precise points where the DNA strands are disrupted and segments exchanged within or b/w chromosomes in such cases. Children with neuro developmental abnormalities, including autism are known to have abnormal chromosomes.

G-20 pledges more than $430 billion for IMF

April 22nd, 2020

The Group of Twenty (G-20) advanced and emerging market economies, along with the broader IMF membership, agreed on pledges to boost the institution’s lending capacity by more than $430 billion.

Why this move?

The International Monetary Fund has been advocating the need to build a stronger global firewall of additional resources to contain any further financial crises. The move is to effectively double IMF’s lending capacity and protect the global economy from the euro zone’s debt crisis.
Although the global lender would be able to use its increased firepower to help any country or region in need, Europe’s crisis was the driving force behind the push for more funding.

India, Nepal agree to expedite work on proposed Jayanagar-Baridabas rail link

April 22nd, 2020

India and Nepal have accorded to speed up work on the proposed Jayanagar-Baridabas rail link which will lead to easier and faster connectivity b/w the two nations.

India and Nepal reviewed the progress on the execution of two rail links, namely 17.65 km Jogbani in Indian side linking Biratnagar in Nepal and 68 km Jayanagar in Indian side to Baridibas in Nepal. These projects are under Phase-I of the cross- border rail link.

Centre to undertake study on dams coming up in Arunanchal

April 22nd, 2020

Prime Minister Dr. Manmohan Singh held that the Centre will soon take on a study on about 100-odd dams coming up in Arunachal Pradesh.

India test-fires ICBM Agni-5 successfully

April 20th, 2020

India performed a successful test-fire of its indigenously developed nuclear capable “Agni-V” ballistic missile from a test range off Odisha coast. The missile was test-fired from a mobile launcher from the launch complex-4 of the Integrated Test Range (ITR) in Wheeler Island near Odisha coast.

What is the significance of this launch of Agni-V?

  • Agni V is considered to be of the category of Inter-Continental Ballistic Missile (ICBM).
  • The long range missile with a strike range of over 5,000 km is capable of reaching deep into China and Europe.
  • Only the U.N. Security Council permanent members – China, France, Russia the United States and Britain – along with Israel, are believed to have the capability to operate an ICBM at present.
  • The Indian-made Agni V is the crowning achievement of a now-mothballed missile programme developed primarily with a possible threat from neighbouring China in mind.

Some features of Agni V:

  • Strike range of over 5,000 km.
  • The surface-to-surface missile.
  • Height: 17.5 m
  • Diameter: 2 m
  • 3-stage solid propellant missile.
  • Warhead: Can carry a nuclear warhead
  • Payload: 1500 Kg
  • Speed: 24 Mach
  • Manufacturer Defence Research and Development Organization (DRDO), Bharat Dynamics Limited (BDL)
  • The Agni V is the most advanced version of the indigenously built Agni, or Fire, series, part of a programme that started in the 1960s. Earlier versions could reach old rival Pakistan and Western China.

Did this launch encounter criticism from other nations?

NO Criticism from West BUT from China noted the launch with disapproval.

The launch attracted none of the criticism from the West as faced by hermit state North Korea for a failed bid to send up a similar rocket last week. BUT China noted the launch with disapproval.

  • China’s Global Times newspaper published: “The West chooses to overlook India’s disregard of nuclear and missile control treaties”.
  • Chinese Communist Party’s main mouthpiece the People’s Daily published: “India should not overestimate its strength”

BSNL increases minimum broadband download speed to 512 kbps

April 20th, 2020

State-run telecom operator BSNL has increased the minimum broadband download speed to 512 kbps from 256 kbps for most of its existing wire-line customers at current tariffs. BSNL in its a statement held that wire-line broadband has over 64% market share with more than 8.5 million customers.

What is kbps?

Short for kilobits per second, a measure of data transfer speed. Modems, for example, are measured in Kbps.

Here Kilo = 1,000 or Kilo =1,024 ?

  • Note that one kbps is 1,000 bits per second, whereas a KB (kilobyte) is 1,024 bytes.
  • Where, “b” denotes a “bit” and “B” denotes a “Byte”.
  • 1 Byte = 8 bits
  • Data transfer rates are measured using the decimal meaning of ‘k’ (i.e. Kilo=1,000) whereas data storage is measured using the powers-of-2 (binary) meaning of ‘K or Ki’ (i.e. Kilo=1,024). So, k- stands for kilo, meaning 1,000, while Ki- stands for kilobinary (“kibi-“), meaning 1,024. The standardized binary prefixes such as Ki- were relatively recently introduced and still face low adoption. K- is often used to mean 1,024, especially in KB, the kilobyte.
  • Technically, ‘kbps’ should be spelled with a lowercase ‘k’ to indicate that it is decimal but almost everyone spells it with a capital ‘K’.
  • So, it should be technically, “kpbs” for data transfer and “KB or KiB” for storage.

Winners of the 2020 Pulitzer Prizes

April 20th, 2020

Columbia University on Monday announced the winners of the 96 th yearly Pulitzer Prizes, among the most esteemed recognitions for achievement in US journalism and the arts.

Following are the winners in each category:

Project completion highest in years, pipeline robust

April 20th, 2020

In a period of unpleasant news for Govt, the Centre for Monitoring the Indian Economy (CMIE) has sprung a pleasing surprise. In its latest data, the research body CMIE held that projects worth Rs 4 Lakh Crore were completed in FY12, the highest in the last few years. In the previous couple of years, the corresponding numbers were Rs 3.4 lakh crore and Rs 3.8 lakh crore, respectively.

There’s more pleasant news: The existing pipeline of projects is strong enough to sustain for the next several years. And, FY12 has seen a dramatic pick-up in completion of some of those outstanding projects. As per CMIE, at the end of March 2020, outstanding investment in projects totalled nearly Rs 140 lakh crore. That is 6 times India’s yearly Gross Fixed Capital Formation. As per CMIE, the pipeline of outstanding projects is so large that even if no new project is declared for the next 4-5 years, the Indian economy can preserve to grow at a fast pace.

It is for this reason that the completion of outstanding projects is a far more significant number to look out for than fresh projects. In all the noise about a slowdown in fresh investments, this rise in project completion has gone unobserved.

  • The Centre for Monitoring Indian Economy is an independent economic think-tank headquartered in Mumbai, India.

IMF pegs India’s growth in 2020 at 6.9%

April 20th, 2020

The IMF (International Monetary Fund) has pegged growth in India’s GDP for 2020 at 6.9%, scaling down the forecast by 0.1% points, compared to its projection in January 2020.

It attributed the moderating growth outlook to policy dubiety, supply constrictions, high interest rates and low external demand. Step-up of the euro zone crisis and tensions in West Asia were listed as external risk factors to the growth outlook in the IMF’s World Economic Outlook 2020 report. For 2020, it forecast is that India would grow at 7.3%, thus hinting a recovery. It, nevertheless, cautioned the room for further monetary easing was constrained in India, as underlying inflation pressures persisted, adding there was less fiscal room now, equated to 2007.

Production begins in AP’s first uranium mine ‘Thummalapalli’

April 20th, 2020

Production commenced in the first uranium mining and processing plant of Andhra Pradesh, at Thummalapalli in YSR District.
About the new plant :

    • Capacity of mining and processing: 3,000 tonnes uranium a day.
    • Reserves: With over 48 million tonnes of reserves, the Thummalapalli mine has been estimated one of the world’s largest uranium mines.
    • Cost: The new plant is built at a cost of over Rs 1,100 Crore.

Built on 900 hectares of land, this new plant will furnish a major boost India’s much needed uranium fuel for nuclear programme.

The Tummalapalle Mine is a uranium mine in Tumalapalli village located in Kadapa of the Indian state of Andhra Pradesh. Results from a research conducted by the Atomic Energy Commission of India in 2020 made the analysts conclude that this mine might have one of the largest reserves of uranium in the world. This finding substantially increased India’s capability of producing energy from nuclear plants. As of 2020, India was producing about 3% of its energy from nuclear plants. These findings suggest that this output can be increased to more than 30% by 2050. This domestic uranium find would not only boost India’s nuclear energy plans but also help to reduce costs by switching from expensive sources of power like coal.

India’s exports grow by 21%

April 20th, 2020

Commerce Secretary Rahul Khullar held that:

  • In the 2020-12 fiscal, India’s exports grew 21%, to US $303.7 billion, equated to the previous fiscal.
  • imports shot up 32.1%, to US $488.6 billion, leaving a trade deficit of US $184.9 billion.
  • This was the highest trade deficit and was a grave concern.
  • Gold imports, which added in heightening the import bill, are anticipated to turn down in the present fiscal owing to the duties imposed by the government.

Haryana to have India’s first Electronic Toll plaza

April 19th, 2020

The National Highways Authority of India (NHAI) rolled out the India’s first Electronic Toll Collection (ETC) system in Haryana, substituting the existing cash payment method. The Radio Frequency Identification (RFID) technology-based toll collection plaza at Chandimandir near Punchkula in Haryana on Delhi-Chandigarh highway inaugurated on pilot basis, which will be replicated pan-India.
How these RFID Technology based ETCs will be useful?

The RFID technology based ETCs will help users to make payment without stopping at toll plazas and will thus reduce traffic congestion and commuting time.

How this technology works?

Using the passive RFID technology, the ETC consists of 2 components:

1) The Tag

2) The Reader

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Working and checks for its misuse by vehicles…

RBI announces Monetary Policy

April 19th, 2020

Making the first policy rate cut in 3 years, the RBI on April 17, 2020 declared the Monetary Policy for the year 2020.

Repo Rate

  • The repo rate reduced under the liquidity adjustment facility (LAF) by 50 basis points from 8.5% to 8.0% with immediate effect.
  • Repo rate is the rate at which banks borrows money from RBI.

Reverse Repo Rate

  • The Reverse Repo Rate under the LAF, determined with a spread of 100 basis points below the Repo Rate, stands adjusted to 7.0% with immediate effect.

Marginal Standing Facility

In order to provide greater liquidity cushion:

  • Rise in the borrowing limit of Scheduled Commercial Banks under the Marginal Standing Facility (MSF) from 1% to 2% of their Net Demand and Time Liabilities (NDTL) outstanding at the end of second preceding fortnight with immediate effect.
  • Banks can continue to access the MSF even if they have excess Statutory Liquidity Ratio (SLR) holdings, as hitherto.
  • The MSF rate, determined with a spread of 100 basis points above the Repo Rate, stands adjusted to 9.0% with immediate effect.

Bank Rate

  • The Bank Rate stands adjusted to 9.0% with immediate effect.

Cash Reserve Ratio

  • The Cash Reserve Ratio (CRR) of scheduled banks has been retained at 4.75% of their NDTL.

The policy actions taken are expected to:

  • Stabilise growth around its current post-crisis trend;
  • Contain risks of inflation and inflation expectations re-surging; and
  • Enhance the liquidity cushion available to the system.

RBI Governor, Dr. Duvvuri Subbarao held that the liquidity conditions were moving towards RBI’s comfort zone and added that there is a need to increase fuel prices for macroeconomic stability. Reacting to the RBI’s cut in repo rate, leading banks of India he held that lending rates will fall after the RBI’s action.

Vodafone issues notice to Indian Government over tax issue

April 19th, 2020

Vodafone issued notice to the Indian government under Bilateral Investment Treaty over tax issue between India and the Netherlands.

Why Vodafone served this Notice?

The Dutch subsidiary of Vodafone: Vodafone International Holdings BV (VIHBV) served a notice of dispute on the Indian government regarding proposals in the Finance Bill 2020 which it claimed, violated the international legal protections granted to Vodafone and other international investors in India.

In the Budget, the government has announced a proposal to amend the Income Tax Act to bring overseas deals under tax net after the Supreme Court held that the UK firm was not liable to pay the 11,000 crore rupees in taxes.

What is expected from India under the BIT b/w India and Netherlands?

Under the BIT between India and the Netherlands, the Indian Government is obliged, amongst other things, to accord fair and equitable treatment to investors; provide full protection and security; not breach the legitimate expectations of investors in making investments; not deny justice or breach formerly provided assurances; and not take steps to indirectly expropriate the investment.

Menik Farm IDP camps to be closed in next two months: Sri Lanka

April 19th, 2020

The Sri Lankan authorities informed Indian joint parliamentary delegation that the Menik Farms camps will be closed in the next two months as the government here are hoping to resettle the last of the war displaced civilians by June 2020. Indian joint parliamentary delegation, led by Leader of the Opposition Sushma Swaraj, visited the camp on Wednesday morning for a first-hand study of the situation there.

What are Menik Farm Camps?

Menik Farm Welfare Centre was set up in 2009 for the war-displaced Tamils of the Northern Province in Sri Lanka. They are largest refugee camp in over 40 years in South Asia.

The Menik Farm IDP camp once accommodated close to 3 lakh Internally Displaced Persons (IDPs). About 6,000 IDPs remain in the camp, about 300 km from Colombo. Most of the IDPs hail from the mine-contaminated areas of the adjoining Mullaitivu district, where the government forces wiped out the Tamil Tigers in May 2009. The Sri Lankan government hopes to complete the demining process in the Mullaithivu area in the next two months after which the remaining IDPs will be sent back to places where they belong.

The IDPs primarily raised two issues with the Indian delegation:

  1. Housing: These IDPs are not entitled to the 50,000 houses that India is assisting in building in Sri Lanka, nor are they part of any other scheme.
  2. Job/Means of Livelihood: Finding a job is a problem for IDPs. The troubles get intensified as the Army is elaborately involved in economic activity in the North.

ECB norms for power companies eased

Central Govt has liberalized the ECB (External Commercial Borrowing) norms for power sector. The Power companies can now use up to 40% of loans to refinance their rupee debt but the rest 60% must be utilised for investments in new projects. Earlier, power companies were allowed to use only 25% of the ECB to refinance their domestic rupee-debt loan.

Objective: The policy decision will increase access to cheaper funds for companies in the power sector.

In another decision, the government has also opened the ECB route for capital expenditure on the maintenance and operations of toll systems in the roadways and highways sector provided these are part of the original project.

Objective: The policy decision will provide an added source of low-cost capital and encourage greater investment in road construction projects.RBI is likely to issue relevant notifications within 7 days giving effect to these decisions.

TRAI issues new regulations for mobile banking

April 19th, 2020

The TRAI (Telecom Regulatory Authority of India,) issued the fresh regulations for mobile banking in order to ascertain quicker and reliable communication for banking via mobile phones. TRAI held that the mobile companies will have to enable banks to complete a transaction within 10 seconds under the new rules.
Telecom companies have to give banks and customers the option to transact using either:

  1. SMS, or
  2. IVR (Interactive Voice Response), or
  3. USSD (Unstructured Supplementary Service Data)

The service providers can also optionally facilitate the bank to use WAP or SIM Application Toolkit (STK).

All the operators are already using these platforms and hence do not have to make additional investments.

The response time for delivery of messages for mobile banking services generated by the customer or the bank will be within the prescribed time-frame of:

a) Less than 10 seconds for SMS, IVR, WAP and STK

b) Less than 2 seconds for USSD

Objective of this move: The regulations are directed at ascertaining that mobile operators offer good services to banks that launch Mobile Banking Services.

TRAI issues recommendations on Exit Policy for telecom licenses

April 19th, 2020

The TRAI (Telecom Regulatory Authority of India) issued recommendations on Exit Policy for various telecom licences. The regulator held that at the moment there is no need for a separate Exit Policy for all types of licences and the entry fee paid by the licensees will continue to be non-refundable as per their license terms and conditions. The current conditions in several licences with regard to their surrender shall continue to be applicable and the licensee can surrender its licence by giving at least 60 days notice, 30 days in case of Internet Service Provider (ISP) licence.
On February 2, 2020, the Supreme Court had ordered cancellation of Unified Access Services (UAS) licences given on and after January 10, 2008. On 26th March 2020, in view of the judgment, comments of the stakeholders on pre-consultation paper, and its own analysis, TRAI issued a draft response paper on Exit Policy for several telecom licences.

London Olympics: Motto revealed as ‘Inspire a generation’

April 19th, 2020

In Britain the official London 2020 motto has been revealed as ‘Inspire a generation’.

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