IASbaba’s Daily Current Affairs – 22nd December, 2015
General Studies 3:
Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
Inclusive growth and issues arising from it; Effects of liberalization on the economy
General Studies 2:
Recent Fed hike and its impact on the Global and Indian Economy
The most remarkable thing about the US Federal Reserve board’s decision to raise its interest rate — the first hike since 2006.
By raising interest rates, the US central bank has bolstered the value of the dollar, the currency used around the world to buy and sell most raw materials.
Even with global surpluses and slowing economies keeping prices lower for everything from crude oil to wheat, demand might weaken, especially from major importers in Asia like China and India that have been key drivers of commodity buying.
Why does Federal Reserve increase or decrease Interest rate?
Federal Reserve, helps maintain high U.S. employment and stable prices for consumers.
The main tool the Fed uses to influence the economy is interest rates—the price everyone pays to borrow money.
High interest rates make borrowing more expensive, so you end up paying more for things like home and car loans. Then again, there are upsides: The money you have stashed in savings and money markets accounts will earn higher interest. When interest rates are kept low, the opposite occurs. People earn lower interest on savings, but they can more easily borrow money for things they want to buy—like homes and cars.
What does Quantitative easing mean?
An unconventional monetary policy in which a central bank purchases government securities or other securities from the market in order to lower interest rates and increase the money supply. Quantitative easing increases the money supply by flooding financial institutions with capital in an effort to promote increased lending and liquidity. Quantitative easing is considered when short-term interest rates are at or approaching zero, and does not involve the printing of new banknotes.
Fed tapering is the gradual reduction in the bond buying program of the US Federal Reserves. In parallel reselling of Bonds and increase in interest rates will lead to inflow of dollars into US Economy from other countries. Thus Dollar supply will be reduced in the market (international) and Depreciation currency will be felt in the economy.
How did it impact the Economy?
Central banks can employ a variety of policies to improve growth, and they must balance short-term improvements in the economy with longer-term market expectations. If the central bank tapers its activities too quickly, it may send the economy into a recession. If it does not taper its activities, it may lead to high inflation.
Markets across the world, as well as in India, shrugged off the development, which could mean capital moving out of several economies and into the US.
On the face of it, a Fed rate hike should be a negative development for emerging market economies like India since a capital outflow should lead to a depreciation in the domestic currency.
How does it impact Indian Companies?
For Indian companies, new overseas loans are likely to start getting costlier, and the appreciation of the dollar could change corporate balance sheets as debt-servicing gets more expensive.
After the Fed move, depreciation pressure could build up for emerging market currencies and this includes the rupee. This could then spill over to other markets like stocks and bonds.
Impact ofFED hike on India:
India is better placed today (than many of its peers after the American central bank, the US Federal Reserve, raised its key interest rates) in terms of real GDP growth, lower inflation, lower current account deficit and ongoing fiscal consolidation.
Minimal impact on Indian markets and should not lead to any large-scale outflow of foreign funds.
India’s external balances have significantly improved since mid-2013, with foreignexchange reserves rising by some $65 billion to $353 billion as of November 2015.
India is benefiting from low crude prices and overall macroeconomic stability
India is less dependent than several of its peers on commodity exports, and has thus not been negatively affected by the global rout in commodity prices.
Only a small part of India’s sovereign debt is held by foreigners or is denominated in foreign currency.
India’s favourable economic growth outlook makes India relatively attractive for foreign investors.
Connecting the Dots:
What do Quantitative Easing and FED tapering mean? How does it affect Indian Economy in particular and Global economy in general?
Differentiate between Appreciation and Depreciation of Currency? Throw light on the impact of recent Federal Reserve Hike in its interest rate on Global economy and also comment on how did/can India remain immune to its impact?
TOPIC: General Studies 2
Important aspects of governance, transparency and accountability, e-governance- applications, models, successes, limitations, and potential; citizens charters, transparency & accountability and institutional and other measures.
Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.
FIR and its Constituents
While discussing about the Juvenile Law (Amendment) in one of our previous Daily News Analysis, we had made an attempt to analyse the various reasons behind the cases registered to fight against and stand up to sexual assault.
Let us highlight the various irregularities with the help of the analysis of the Mumbai Sessions Court rulings—
False cases foisted by parents—
Against young couples who had eloped
Breach of promise to marry
Men preying on children playing outdoors in slums
Wide variation in the sentences,
Societal prejudices and vulnerabilities at play
Tendency for investigating high-profile cases with greater rigour
Parents on the prowl
Most of the parents whose girl child has eloped with a boy have made false claims of the girl being a minor. The reasons may range from the notion of their reputation at stake and mostly because of inter-caste and inter-religious factor at play/
So, what starts as a love story meant to be reminisced about ends up in the following manner—
If a girl runs away with a boy from the neighbourhood
Established sexual relations between the girl and the boy
Charges of Rape added
Case Study 1— Rape & Kidnap
Mumbai& Delhi trial court judges— rarely convict in such cases, particularly if the girl does not support the prosecution’s case throughout the trial
Six cases: chose to take a strict view of age,
Two cases: convicted for kidnapping
Two cases: Pronounced rape
Two cases: Rape under the POSCO since the girl was under 18, irrespective of her consent.
Subjectivity creeps in—
When the girl is over 15 or 16 years of age and is implied that she is aware of the meaning of her decisions, some judges have not pronounced harsh decisions. Why?
Boy is considered guilty if she is a minor and now with the new law, the reduction of sentences isn’t viable.
The Criminal Law (Amendment) Act, 2013, passed by Parliament in the wake of the December 16, 2012 Delhi gang rape set a minimum sentence of 10 years for rape in the case of minors to take discretion in sentencing out of the hands of judges.
Societal prejudices at play
Societal condemnation of premarital sex: Analysing 644 cases since 2008 in which they had studied or intervened in, Majlis found that 20 per cent of the cases involved breach of promise to marry. In a quarter of such cases, the complainant was pregnant, highlighting the vulnerability of her situation
Sexual abuse by close family members: (including the father or stepfather)
Mostly of minor girls out of which eight cases resulted in convictions
In three the complainant and her mother turned hostile in court
Remaining two: Court did not believe the testimony of the child and her mother in one, while in the other, the three-year-old complainant was unable to explain her injuries or the spot of the attack to the court
Two cases: Involved the rape of a male child
Lapses during Investigation & Prosecution
16-year-old homeless girl said that she had been gang-raped—
Hospital to the police; made little attempt to:
Properly collect evidence
Correctly identify the accused
In the end: All five boys were acquitted
Alleged rape of a nine-year-old boy in a slum by his 60-year-old neighbour:
Evidence By: Child + Mother + Medical Reports
In the end: The man was acquitted because the police had failed to have the child’s statement recorded before a magistrate
Sexual assault cases can be filed under the Indian Penal Code (IPC) Sections—
366 (kidnapping a woman for marriage),
376 and 377 (rape) and
Sections of the Protection of Children from Sexual Offences (POCSO) Act
A crime should be seen just as a crime and not get tainted with the influence of it being a high profile or a low profile case. Criminalization of genuine cases has to be curbed if we want the social order of our country placed at a high pedestal.
Interpretation of law needs to be done with a just view and the errors surrounding subjectivity needs to be balanced with the correct understanding of the intention behind the FIR’s registered in the first place.
Once the case is established (and proven that the act was against/for the victim’s/person-in-question), proper interrogation, investigation and medical examinations needs to be established. Once the evidence goes against the accused, he/she should be necessarily pronounced guilty (without a third party interference)
Connecting the Dots:
Discuss the major faults and loopholes present in the cases that deal with sexual assaults and rape in the country
Do you agree with the viewpoint that the cases dealing with elopement has more to do with the family’s prestige than the love harboured for the daughter/son?
For detailed analysis of ‘Juvenile Justice in India: Rehabilitating Indian Juveniles’, refer the below link-