Daily Current Affairs : 30th and 31st August

Daily Current Affairs for UPSC CSE

Topics Covered

1. Project-75I 
2. Bank Frauds
3. Intergovernmental Panel on Climate Change (IPCC) “special report” on oceans and Earth’s frozen zones
4. Merger of Banks
5. West Bengal (Prevention of Lynching) Bill, 2019
6. GDP Growth Rate
7. Facts for Prelims : Dindigul lock and Kandangi saree, MRD, RBI’s Balance sheet, Great Barrier reefs

1 . Project-75I 

Context : Russia is likely to offer India its conventional submarines on the government-to-government route under the Navy’s Project-75I at the summit between Prime Minister Narendra Modi and President Vladimir Putin at Vladivostok next week, Russian officials said.

About Project 75

• The P75I project is part of a 30-year submarine building plan that ends in 2030.
• As part of this plan, India was to build 24 submarines — 18 conventional submarines and six nuclear-powered submarines (SSNs) — as an effective deterrent against China and Pakistan.

About the proposal

• The Navy is looking to buy six advanced conventional diesel-electric submarines under Project 75I that, after several delays, has made progress in the past several months. The procurement is under the Strategic Partnership (SP) model, and is the second project to be processed through this route after the Navy’s tender for utility helicopters.
• The Russian submarine will likely be based on the Amur 1650 conventional submarine, modified to suit Indian requirements. The contenders for Project-75I are the Naval Group of France, Rosoboronexport Rubin Design Bureau of Russia, ThyssenKrupp Marine Systems of Germany and Saab Group of Sweden.

2 . Bank Frauds

Context : Bank frauds saw a whopping 73.8% jump in value in 2018-19 as compared to the previous year. In terms of number of cases, it was up 15%, the RBI’s annual report said.

Details of the Report

• The number of cases of frauds reported by banks increased by 15% in 2018-19 on a year-on-year basis, with the amount involved rising by 73.8%, though mostly related to occurrences in earlier years
• Banks had taken 55 months, on an average, to report large frauds (100 crore and above)
• The overall average lag between the date of occurrence and its detection by banks was 22 months, the RBI report said.
• Among bank groups, public sector banks (PSBs), which constitute the largest market share in bank lending, have accounted for the bulk of frauds reported in 2018-19.
• “Cheating and forgery was the major component, followed by misappropriation and criminal breach of trust

Other important points provided in the report

• Total number of counterfeit notes detected had fallen in 2018-19 to 3,17,384 pieces from 5,22,783 pieces in the previous years, what’s interesting is that 717 such notes of ₹1,000 denomination had been detected.
• The ₹1,000 notes were withdrawn from circulation on November 8, 2016. The number of ₹2,000 counterfeit notes detected also increased in 2018-19 to 21,847 pieces from 17,929 pieces, the data showed.
• There was also a sharp increase in the new ₹500 notes category, with 21,865 counterfeit notes detected as compared to 9,892 in the previous year.

3 . Intergovernmental Panel on Climate Change (IPCC) “special report” on oceans and Earth’s frozen zones

Context : The same oceans that nourished human evolution are poised to unleash misery on a global scale unless the carbon pollution destabilising Earth’s marine environment is brought to heel, warns a draft UN report

Details of the Report

• World could see a steady decline in fish stocks, a hundred-fold or more increase in the damages caused by superstorms, and hundreds of millions of people displaced by rising seas, according to the Intergovernmental Panel on Climate Change (IPCC) “special report” on oceans and Earth’s frozen zones, known as the cryosphere.
• As the 21st century unfolds, melting glaciers will first give too much and then too little to billions who depend on them for fresh water
• Without deep cuts to manmade emissions, at least 30% of the northern hemisphere’s surface permafrost could melt by century’s end, unleashing billions of tonnes of carbon and accelerating global warming even more.
• The 900-page scientific assessment is the fourth such tome from the UN in less than a year, with others focused on a 1.5-Celsius cap on global warming, the state of biodiversity, and how to manage forests and the global food system.
• All four conclude that humanity must overhaul the way it produces and consumes almost everything to avoid the worst ravages of climate change and environmental degradation.

Effects

• By 2050, many low-lying megacities and small island nations will experience “extreme sea level events” every year, the report concludes.
• Even if the world manages to cap global warming at two degrees Celsius, the global ocean waterline will rise enough to displace more 250 million people.
• The report indicated this could happen as soon as 2100, though some experts think it is more likely to happen on a longer timescale.

Note : IPCC covered under Current Affairs of 9th August

4 . Merger of Banks

Context : Finance Minister Nirmala Sitharaman announced a slew of banking reform measures, including merger of 10 public sector banks into four entities. This would take the number of banks in the country from 27 in 2017 to 12

Background

• Banks were chosen for mergers on the basis of ensuring that there is no disruption in the banking services, and that the banks should benefit from increased CASA [current account savings account] and greater reach
• The banks that are being merged with each other run the same or very similar platforms, and so there will be no disruption in their activities.
• There will be no retrenchment due to these mergers.
• Following mergers, the country will have a total of 12 public sector banks

About the Mergers

• The largest of the mergers announced is that of Punjab National Bank with Oriental Bank of Commerce and United Bank. The amalgamated entity — to be called Punjab National Bank — will become the second-largest public sector bank in India, after the State Bank of India. It will also become the second-largest bank in India in terms of its branch network, with a combined total of 11,437 branches.
• The second merger announced was that of Canara Bank and Syndicate Bank, which would render the merged entity the fourth-largest public sector bank. The merger also has the potential to lead to large cost reductions due to network overlaps
• The third merger is of Union Bank of India with Andhra Bank and Corporation Bank, the merged entity the fifth largest public sector bank. This merger would have the potential to increase the post-merger bank’s business by 2-4.5 times
• The fourth merger announced is of Indian Bank and Allahabad Bank. This, too, would lead to a doubling of the size of the business and would also lead to a huge potential for scaling up due to the complementary networks of the two banks.

Benefits and other important points of merger

• Bank mergers will lead to the creation of big banks with an enhanced capacity to give credit.
• After Merger banks would be able to compete globally and increase their operational efficiency by reducing their cost of lending.
• Improvement in Asset quality of the merged entity
• Geographical synergies : For example Allahabad Bank, headquartered in Kolkata, is stronger in east and north India, while Indian Bank has strong presence in the south.
• Technological Synergies : In all the four sets of merger, there is technological synergy as all the banks in a particular bucket have similar core banking solution platforms.

Other Reforms

• In order to make the management accountable to the boards of the banks, a board committee would be made in charge of appraising the performance of officers of the rank of general managers and above, including the managing director.
• The banks have also been allowed to recruit chief risk officers from the market, at market-linked compensation to attract the best available talent.
• Other reform measures were aimed at increasing the engagement of non-official directors, allowing bank boards to reduce or rationalise the number of committees, and increasing the effectiveness of the directors on the Management Committees of Boards by increasing the length of their terms.

5 . West Bengal (Prevention of Lynching) Bill, 2019

Context : The West Bengal Assembly on Friday passed a Bill to prevent and punish mob assaults and lynching. The West Bengal (Prevention of Lynching) Bill, 2019 was passed with Left and Congress legislators joining the Treasury benches in supporting it.

Details of the Bill

• Bill aims to protect the constitutional rights of vulnerable persons and prevent incidents of lynching. It also proposes action against those involved in perpetrating the crime.
•  It defines lynching as any attempt or act of violence by a mob on the “grounds of religion, race, caste, sex, place of birth, language, dietary practices, sexual orientation, political affiliation, ethnicity, or any other ground
• The legislation prescribes the appointment of a nodal officer for periodic assessment of local intelligence inputs on potential flashpoints, and mandates that lynching incidents be investigated by an officer not below the rank of an inspector.
• It also calls for witness protection and compensation for victims, adding that any allegation of threat, coercion or inducement of witnesses must be brought to the notice of a court within 24 hours.
• The legislation also pitches for a jail term, which may vary from three years to life for those involved in assaulting and injuring a victim.
• In case of death of the victim, persons responsible for the incident would be punished with rigorous life imprisonment and fine up to Rs 5 lakh, the bill said.

6 . GDP Growth Rate

Context : India’s gross domestic product (GDP) growth rate slowed to a six-year low of 5% in the first quarter of the 2019-20 financial year, the government announced on Friday, led by a dramatic slowdown in the manufacturing sector.

About the News

• The data show that the manufacturing sector grew at a two-year low of 0.6% in the first quarter of 2019-20, down from 12.1% in the same quarter of the previous year.
• The agriculture sector also saw a dramatic slowdown in growth to 2% from 5.1% over the same period.
• The plight of the real estate sector was also highlighted by the slowdown in its growth rate to 5.7% in the first quarter of this financial year, compared with 9.6% in the same quarter of 2018-19.
• “The growth slowdown was led by private final consumption expenditure, which grew 3.1% only (18 quarter low)
• Investment demand also remained lacklustre and fixed capital formation grew 4%. Only government expenditure provided support to growth and increased 8.8%.
• Electricity and power generation, which is a leading indicator across the world, grew by 8.6%, a good sign of green shoots towards higher growth

Prelims Facts : Data is released by National Statistical Office (NSO)

7 . Facts for Prelims

Dindigul lock and Kandangi saree

• Two well-known products from Tamil Nadu — Dindigul lock and Kandangi saree — have been given the Geographical Indication (GI) tag by The Geographical Indications Registry in Chennai.
• The application for the lock was made by the Dindigul Lock, Hardware and Steel Furniture Workers Industrial Co-operative Society Limited. The Amarar Rajeev Gandhi Handloom Weavers Co-operative Production and Sales Society Limited filed the application for the Kandangi saree.
• The Dindigul locks are known throughout the world for their superior quality and durability, so much so that even the city is called Lock City. Government institutions such as prisons, godowns, hospitals, and even temples use these locks instead of other machine-made ones. The abundance of iron in this region is the reason for the growth of the industry.
• The Kandangi sarees are manufactured in the entire Karaikudi taluk in Sivaganga district. They are characterised by large contrast borders and some are known to have borders covering as far as two-thirds of the saree which is usually around 5.10 m-5.60 m in length. Worn in summer, these cotton sarees are usually bought by customers in bulk.

MRD

•  3.8-million-year-old skull could help rewrite our knowledge of human evolution. Two new studies published on the specimen could clarify the origins of Lucy, the well-known ancestor of modern humans.
• While 3.2-million-year-old Lucy belonged to a species of hominins (which include humans and their ancestors) called Australopithecus afarensis, the newly investigated skull belongs to the older species Australopithecus anamensis.
• The skull that was studied was in the form of a nearly complete cranium (the portion that encloses the brain). It was discovered at a palaeontological site in Ethiopia in 2016. Researchers named it MRD-VP-1/1, or MRD for short. 

RBI’s Balancesheet

Great Barrier Reef

• The Great Barrier Reef’s long-term outlook has been dropped from “poor” to “very poor” in a new report that calls for urgent action on climate change and other threats to the natural wonder.
• Rising sea temperatures and marine heat waves are doing the most damage to the reef’s health
• The Great Barrier Reef is a site of remarkable variety and beauty on the north-east coast of Australia. It contains the world’s largest collection of coral reefs, with 400 types of coral, 1,500 species of fish and 4,000 types of mollusc.
• It also holds great scientific interest as the habitat of species such as the dugong (‘sea cow’) and the large green turtle, which are threatened with extinction.