Current Affairs > Daily Current affairs

My notes 04-12-2015

Chennai floods

  • Heavy rainfall of greater than 34cm on a single day is unprecedented in last 100 years.
  • More than the rainfall, there are many reasons in urban planning and management for this havoc.
  • Unregulated growth of real estate, clogging of drains, illegal occupation of flood plains of rivers all of them can be cited as reasons. Added to this, drainage system was not upgraded to facilitate the needs of growing city.
  • However, the resilience shown by the Chennai people to fight back the disaster need to be appreciated.

Division of history

  • Historical periodization of Ancient, Medieval and Modern is based on developments in Europe and need a rethink.
  • The word modern was used to identify the changes brought in by enlightenment period based on rationalism, scientism, objective thinking. Earlier periods was described as medieval or dark age of stagnation, religiosity and superstition.
  • It was seen as a gift of Europe to Humanity during 18th and 20th century with industry, democracy, capitalism, individualism, secularism etc. as its hallmarks.
  • This entire periodization ignored the developments occurred in Asia, Europe that had wider implications for the world. For ex - china inventions of compass, printing are totally ignored.  Eisenstaedt has clearly expressed this saying - There is only one modernity is a fallacy.
  • One specific feature that is attributed to modernity is the fast pace of change. It Ignores that, this change depends on the accumulated things of past. So, History need to be made value neutral.


New technologies to fight climate change

  • Electro mobility - Mass production of affordable electric cars
  • Solar roads
  • High quality public transport systems and sustainable urban mobility practices.

Gold Bonds


  1. Under this scheme instead of buying physical gold, Indian residents can buy the gold bonds which will be related to the weight of the gold.



  1. The bonds will be issued in 10gm, 50 gm, 100gm for a term of five years and 7 years.
  2. There will be a cap of 500 grams that a person can purchase in a Year.


Gold monetisation scheme

The scheme allows a minimum deposit which can be as low as 30 grams by individuals and even talks of exempting gold deposit from capital gains tax, income tax and wealth tax. - See more at:




 The prime objective of these plans is to curtail gold import into the country.

This will help in reducing the demand for physical gold by shifting a part of the estimated 300 tonnes of physical bars and coins purchased every year for investment into gold bonds. Since most of the demand for gold in India is met through imports, this scheme will, ultimately help in maintaining the country’s current account deficit within sustainable limits.

Gold Monetisation Scheme

The gold monetisation scheme is aimed to mobilise the surplus gold holdings held with Indian households and institutions as deposits.  “Under the scheme, gold lying idle with people can be deposited in banks and generate interest.

The return from these deposits is totally tax free. The deposited gold will be melted and make available for jewelers as raw material so as to restrict the increased dependence of imported gold.”

Sovereign Gold Bond Scheme

Under the Sovereign Gold Bond Scheme, instead of buying gold in physical form investors can park their money in bonds which are backed by gold. The bonds will be available both in demat and paper form. These bonds will be issued in denominations of 5, 10, 50 and 100 grams of gold or other denominations.

Sovereign Gold Bond has more or equal advantage against the physical gold. The bond will be issued by RBI on behalf of the Government of India. The bond would be restricted for sale to resident Indian entities and the maximum allowable limit is 500 grams per person per year.

The government will issue bonds with an appropriate rate of interest and which shall be payable in terms of grams of gold. Banks/NBFCs/Post offices may be authorised to transact on these bonds on behalf of the Government for a fee. The bonds will be available in various denominations and the minimum tenor of the bond could be around 5 to 7 years.

These bonds can be used as collateral for loans. The Loan to Value ratio is to be set equal to ordinary gold loan mandated by the RBI from time to time. They can be easily sold and traded on exchanges to allow early exits for investors who may so desire. Capital gains tax treatment will be the same as for physical gold for an ‘individual’ investor.

On maturity, the redemption will be in rupee amount only. The rate of interest on the bonds will be calculated on the value of the gold at the time of investment. The principal amount of investment, which is denominated in grams of gold, will be redeemed at the price of gold at that time. If the price of gold has fallen from the time that the investment was made, or for any other reason, the depositor will be given an option to roll over the bond for three or more years.

KYC norms will be the same as that for gold.


Factors necessary for low cost of funds

  • Sustained low inflation
  • Robust banking




Topics –  History, climate change, Chennai floods, Gold Bonds







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