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Daily News Analysis 23-11-2015

S.NO.

NEWS ITEM

SYLLUBUS

ESSENCE OF THE ARTICLE

1.         

 

Give no shelter to terrorists: Modi (Pages 1 and 12)

a)     I.R

a)     PM Modi suggested a multi-pronged approach for combating international terrorism, an issue which figured in all the meetings addressed by him at different places in Kuala Lumpur during the day.

2.

ASEAN to ease travel, mobility of labour (Pages 1 and 12)

a)     I.R

a)     The ASEAN was proclaimed a community through a declaration signed by the ASEAN leaders at its 27th Summit in Kuala Lumpur on Nov 22.

3.

Hollandes takeaway will be Rafale deal (Page 13)

a)     I.R

a)    After an impasse over technicalities, India and France are working to finalise the agreement for the direct purchase of 36 Rafale fighter jets before the visit of French President Fancois Hollande to India as the chief guest of the next Republic Day parade.

4.

Obama vows to destroy IS, warns against overreaction (Pages 1 and 14)

a)     International

a)     Trying to reassure a nation on edge, President Obama said that the Islamic State group cannot strike a mortal blow against US and he warned that overreacting to the Paris attacks would play into extremists hands.

5.

Clues from the Mali attack (Page 10)

a)     International

a)    The terror attack on a hotel in Bamako (the capital city of Mali) is yet another example of the growing influence of terrorists around the world.

6.

Kerry remarks unwarranted, unfair (Page 12)

a)     International

a)     India has reacted strongly to US Secretary of State John Kerrys statement that the country will be a challenge in the coming climate change talks in Paris.

7.

Pakistan, US agree to restart stalled Afghanistan peace talks (Page 14)

a)     International

a)     Pakistan and the US have agreed to make efforts for restarting the stalled peace process between Afghanistan government and Taliban insurgents after second round of talks were cancelled in July as the news of feared Taliban leader Mullah Omars death was leaked.

8.

Ban on separatist groups to stay, says Sri Lanka (Page 14)

a)     International

a)     The Sri Lankan government clarified that groups that continued to espouse separatism would remain proscribed.

9.

RBI likely to keep interest rate unchanged in December (Pg 15)

a)     Economy

a)     Higher retail inflation (coupled with the possibility of a US Fed rate increase in December) may prompt the RBI Governor Raghuram Rajan to keep the repo rate unchanged in the December policy review.

10.

Implications of yuans rise (Page 16)

a)     Economy

a)   The IMF is poised to approve the inclusion of Chinas renminbi (or yuan) as a reserve currency later this month. The implications of that would be several.

11.

Interceptor missile engages simulated target over sea (Page 13)

a)     National

b)     S&T

a)     Indias ballistic missile defence system received a boost on Nov 22 after an upgraded version of the indigenously developed interceptor missile was successfully launched against an electronically simulated target missile over the Bay of Bengal.

 

S.NO.

NEWS ITEM

SYLLUBUS

BACKGROUND

IMPORTANT POINTS

1.         

 

Give no shelter to terrorists: Modi (Pages 1 and 12)

a)     I.R

a)     East Asia Summit (EAS)

b)     Terrorism

a)     Making an intervention at the East Asia Summit, PM Modi emphasised the need for building a new global resolve and new strategies for combating terrorism, without balancing them against political considerations.

b)     Modi said India drew strength from its diversity and his government was working to create an environment where enterprise flourished and everybody got basic needs like shelter, sanitation, water, health care and education.

c)     Modi unveiled a 12-ft bronze statue of Swami Vivekananda in Kuala Lumpur, saying the sage is neither the name of a man nor identity of a system but personifies 1000-year-old Indian culture.

2.

ASEAN to ease travel, mobility of labour (Pages 1 and 12)

a)     I.R

a)     ASEAN summit

 

a)     The ASEAN was proclaimed a community through a declaration signed by the ASEAN leaders at its 27th Summit in Kuala Lumpur on Nov 22. The leaders stated that this was a historic development and an important milestone in the evolution of the 10-member grouping since its founding in 1967.

b)    Simultaneously, the leaders endorsed ASEAN 2025: Forging Ahead Together, which charts the path for community building over the next 10 years. The forward-looking road map articulates the ASEAN goals and aspirations to realise consolidation, integration and stronger cohesiveness as a community.

c)     The ASEAN said that it would be a community, where improvements in transport linkages and infrastructure help people and businesses move efficiently. It would work more productively across borders, expand market reach and strategically source goods and services.

d)     The grouping stated the focus of ASEAN 2025 will be on strengthening community on political, economic and socio-cultural fronts.

e)   While the Political-Security Community aims at maintaining the associations centrality in regional mechanisms, the Socio-Cultural Community will focus on promoting a high quality life and equitable access to opportunities for all.

f)     The ASEAN Economic Community will focus on creating an integrated and well-connected economy which will be business-friendly, trade-facilitative and market-driven to inspire investor confidence.

3.

Hollandes takeaway will be Rafale deal (Page 13)

a)     I.R

a)     India – France relations

b)     Rafale deal

c)     Medium Multi-Role Combat Aircraft (MMRCA)

a)    After an impasse over technicalities, India and France are working to finalise the agreement for the direct purchase of 36 Rafale fighter jets before the visit of French President Fancois Hollande to India as the chief guest of the next Republic Day parade.

b)     Last week, Defence Minister Parrikar said the deal was in the final stages of price negotiations and issues such as the 50 percent offset clause had almost been sorted out. The offset issue had been one of the major sticking points in the negotiations.

c)     During his visit to Paris in April, PM Modi announced the direct purchase through a govt-to-govt deal as quickly as possible in view of the critical operational necessity of the Air Force, sidestepping the original MMRCA contest.

d)     However, negotiations by the high-powered committee set up to negotiate the terms and conditions for the deal and recommend a draft agreement hit a road block over the issue of offsets and changes in configuration sought by the Air Force.

4.

Obama vows to destroy IS, warns against overreaction (Pages 1 and 14)

a)     International

a)     Islamic State (IS)

b)     Paris terror attacks

c)     Syria and Iraq crisis

a)     Trying to reassure a nation on edge, President Obama said that the IS group cannot strike a mortal blow against the US and he warned that overreacting to the Paris attacks would play into extremists hands.

b)     The attacks in Paris last week were a deadly demonstration that the IS (once a group of militants focused on seizing territory in Iraq and Syria) has broadened its focus to attack the West.

c)     The electronic files seized in the Pentagon investigation tell the story of the groups rise, as seen through the eyes of Central Command, which oversees military operations across the Middle East.

5.

Clues from the Mali attack (Page 10)

a)     International

a)     Mali terror attacks

b)     Al-Qaeda

c)     Al-Mourabitoun

d)     Islamic State (IS)

e)     North Atlantic Treaty Organization (NATO)

a)    The terror attack on a hotel in Bamako (capital city of Mali) is yet another example of the growing influence of terrorists around the world. An al-Qaeda-linked group has claimed responsibility for the siege.

b)    Al-Mourabitoun (the group formed by the Algerian militant Mokhtar Belmokhtar) has claimed that the attack was staged in cooperation with al-Qaeda in the Great Sahara region, which has a strong presence in northern Mali. If true, this underscores the theory that al-Qaeda and Islamic State are engaged in a battle of lethal one-upmanship globally.

c)     It was just a week ago that IS staged coordinated attacks across Paris. The Mali attack signals that al-Qaeda is trying to match the terror capabilities of IS. That is indeed terrible news for the rest of the world.

d)     Mali has been a training ground for jihadists for some time now. But what exacerbated the security crisis in the West African country is the invasion of Libya by the countries of the NATO in 2011 in the name of helping the Libyan revolution. Former Libyan leader Muammar Qadhafi had ethnic Tuaregs from Mali in his forces. When the Qadhafi regime was destroyed, they fled to Mali with whatever weapons they could carry.

e)     Mali has historically had a Tuareg problem, and the well-trained Tuareg men who came from Libya joined local rebels and jihadists in the north and launched a full-blown rebellion against the govt. This rebellion morphed into a powerful Islamist insurgency as al-Qaeda outflanked the Tuareg nationalists and captured the entire northern Mali.

f)     Only then did western nations wake up to the threat that a lawless Mali poses to the African continent and also the rest of the world. But their response was typical. Instead of taking urgent steps to stabilise Libya and bolster the Malian govt, France sent troops in 2013 to fight the jihadists. The jihadists (who withdrew to their desert hideouts) continued to strike civilian centres.

g)   There needs to be a regional approach that would not only fight the jihadists on ground but also check supply of weapons, and focus on stabilising Libya. As long as Libya remains a chaotic battlefield for different groups without a central authority, the northern and western African regions are likely to remain extremely vulnerable to jihadist threats.

6.

Kerry remarks unwarranted, unfair (Page 12)

a)     International

a)     Paris Climate talks 2015

b)     Climate change

c)     Carbon emissions

d)     Global warming

e)     United Nations Framework Convention on Climate Change (UNFCCC)

a)     India has reacted strongly to US Secretary of State John Kerrys statement that the country will be a challenge in the coming climate change talks in Paris.

b)     Union Environment Minister Prakash Javadekar said there was no question of compromising on Indias stand on climate change. He blamed the attitude of the developed countries for the problem. India was trying to proactively forge a consensus on the issue.

c)     Paris Climate Conference (slated to take place from Nov 30 to Dec 11) will look to achieve a legally binding and universal agreement on climate to check global warming.

d)     He said our firm belief is Paris will be under the UNFCCC and with all its principles like CBDR, historical responsibility, polluter to pay and equity. All are embedded in the new Paris agreement.

e)     While the developed world has been looking at increased emission cuts from developing countries, the latter (including India) have sought common but differentiated responsibility.

7.

Pakistan, US agree to restart stalled Afghanistan peace talks (Page 14)

a)     International

a)     US – Pakistan relations

b)     Taliban-Afghan government peace talks

 

a)     Pakistan and the US have agreed to make efforts for restarting the stalled peace process between Afghanistan govt and Taliban insurgents after second round of talks were cancelled in July as the news of feared Taliban leader Mullah Omars death was leaked.

b)     The understanding was reached during recently concluded trip of Pakistans Army chief General Raheel Sharif to Washington, where he met a slew of military and civilian leaders including Vice President Joe Biden.

c)     Sources reported that Afghanistan was the focus of General Sharifs visit, during which he also discussed Pakistans strained ties with India, military cooperation, strategic (nuclear) issues and other regional matters.

d)     The Pakistani side is primarily concerned about the Afghan security establishment thwarting a renewed process. Pak facilitated first ever direct and open peace talks between Afghan officials and Taliban held in July in the hill resort of Murree near Islamabad.

8.

Ban on separatist groups to stay, says Sri Lanka (Page 14)

a)     International

a)     Sri Lankas internal issues

b)     Separatist groups in Sri Lanka

c)     Liberation Tigers of Tamil Eelam (LTTE)

d)     Eelam war

a)     The Sri Lankan govt clarified that groups that continued to espouse separatism would remain proscribed.

b)     Apart from the LTTE, the other banned groups are Tamil Rehabilitation Organisation, Tamil Coordinating Committee, World Tamil Movement, Transational Government of Tamil Eelam, Tamil Eelam Peoples Assembly, World Tamil Relief Fund and the Headquarters Group.

c)     In a release, the Ministry of Foreign Affairs said the govts decision to lift the ban on eight organisations and 267 individuals was taken after a comprehensive and careful review in the last 6 months. The review concluded that there was no intelligence or evidence justifying the proscription.

9.

RBI likely to keep interest rate unchanged in December (Page 15)

a)     Economy

a)     Monetary policy

b)     Repo rate

c)     Inflation

d)     Consumer Price Index (CPI) based inflation

e)     Wholesale price index (WPI) based inflation

a)     Higher retail inflation (coupled with the possibility of a US Fed rate increase in December) may prompt the RBI Governor Raghuram Rajan to keep the repo rate unchanged in the December policy review.

b)     The central bank had reduced the benchmark interest rate by 125 bps to 6.75 percent so far this year as inflation eased and the economic recovery stayed tentative.

c)     The CPI-based inflation (RBIs main gauge for measuring price rise) inched up to five percent in October, up for the third straight month, compared with 4.41 percent in the preceding month. This was mainly due to an increase in some food prices in addition to festival related demand.

d)     The RBI had expected retail inflation to go up after September as the favourable base effect wanes. The central bank has projected 5.8 percent inflation for Jan 2016. It is now expected to reduce interest rates further in 2016.

e)     WPI based inflation continued to stay in negative territory in October (at -3.81 per cent) mainly due to softer fuel prices. WPI inflation has remained negative for the last 12 months reflecting continued weakness in corporate sector demand.

10.

Implications of yuans rise (Page 16)

a)     Economy

a)     Global reserve currencies

b)     Special Drawing Rights (SDR)

c)     Chinas yuan

d)     International Monetary Fund (IMF)

e)     World Trade Organisation (WTO)

a)     The IMF is poised to approve the inclusion of Chinas renminbi (or yuan) as a reserve currency later this month. The implications of that would be several. Above all, it is an acknowledgement by the global community of Chinas economic prowess.

b)     The prospect of the yuan joining currencies such as the dollar, euro, yen and sterling in backing the IMFs SDR has been variously described as everything from a symbolic move to the dawn of a new era.

c)     SDRs are the IMFs unit of account restricted to its members. The SDR basket is the basis of IMFs lending made up of the worlds most liquid currencies and hence suitable for any member country that needs support for its balance of payments.

d)     When the yuan is formally inducted into the SDR portfolio it will be the first new currency to be so honoured since the euro was created. It effectively becomes a reserve currency.

e)     The important advantage accruing to China is the flexibility in settling all its international obligations with its own currency.

f)     For other countries, the benefit in having another reserve currency is that they can diversify their forex reserve portfolios to include renminbi. That would once again be a recognition of Chinas economic strengths.

g)     The IMF, which does a review every five years (the most recent one was in October 2015) is apparently convinced of Chinese currencys eligibility. At the previous review of reserve currencies in 2010 it was felt that Chinas exports were not high enough and world trade invoiced in yuan was not adequately high. Since then there has been a dramatic increase in these parameters in favour of the yuan.

h)     India (along with other countries) stands to benefit from the induction of the yuan in the list of reserve currencies. There are 7 reserve currencies - apart from the dollar, euro, pound sterling, Japanese yen, Swiss franc, Canadian dollar and the Australian dollar.

i)  But the world financial order is heavily skewed in favour of the dollar. About 62 percent of international currency assets are held in dollars. The euro accounts for 23 percent and yen and pound sterling 4 percent each. Induction of the yuan is certainly going to help.

j)     Reserve status will increase the demand for renminbi from central banks. A more weighty consequence would to be to integrate China with the global system and commit it to further reform.

k)     It is for these reasons that the imminent inclusion of its currency is considered to be a momentous event on a par with its joining the WTO in 2002.

11.

Interceptor missile engages simulated target over sea (Page 13)

a)     National

b)     S&T

a)     Interceptor missile

b)     Indias ballistic missile defence system

c)     DRDO

a)     Indias ballistic missile defence system received a boost on Nov 22 after an upgraded version of the indigenously developed interceptor missile was successfully launched against an electronically simulated target missile over the Bay of Bengal.

b)     India plans to deploy a two-tiered ballistic missile defence system to protect important cities and vital installations from enemy attack. The first phase of the system seeks to destroy incoming enemy missiles of 2000-km range, while the second phase envisages killing incoming missiles of more than 2000 km.

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