2.

ECONOMIC AND INDUSTRIAL ISSUES Inter-State movement of Goods by the Principal to the
Job-worker
E-WAY BILL Inter-State Transport of Handicraft goods by a dealer
E-way is an electronic billing system for traders who exempted from GST registration
are moving their goods for sale beyond 10 km radius.
Current status at the state-level over the e-way bill:
Under the system, transporters carrying goods worth
Ten states have started trial runs of the e-way bill
Rs 50,000 will be required to get goods pre-registered
system.
before transporting them from one location to another.
Karnataka implemented the system in September 2017,
According to notified e-way bill rules, every registered
followed by Rajasthan, Uttarakhand and Kerala.
supplier will require prior online registration on the e-
way bill portal for the movement of these goods. Six more states - Haryana, Bihar, Maharashtra, Gujarat,
Sikkim and Jharkhand - also started trial runs for e-way

R
Any supplier/recipient/transporter can generate an e-way
bills.
bill.
New criteria for classifying MSMEs

E
Presently, enterprises qualify as micro, small or medium
enterprises if their investment in plant and machinery

T
(for manufacturing units) and equipment (for service
providers) is within the limits laid down in Section 7 of
S
the MSMED Act 2006, which are as follows:

E-Way bill will be generated when there is a movement Type of Investment in Investment in
Enterprise Plant of Equipment
A
of goods in a vehicle/ conveyance of value more than Rs. Machinery
50,000 (either each Invoice or in aggregate of all Invoices Micro Not exceeding Rs Not exceeding Rs 10
in a vehicle/ Conveyance) - 25 lakh lakh
M

Small More than Rs 25 More than Rs 10 lakh

a. In relation to a 'supply'
lakh but not but not exceeding Rs
b. For reasons other than a 'supply' (say a return) exceeding Rs 5 2 crore
crore
c. Due to inward 'supply' from an unregistered person
Medium More than Rs 5 More than Rs 2 crore
For this purpose, a supply may be either of the crore but not but not exceeding Rs
S

following: exceeding Rs 10 5 crore

a. A supply made for a consideration (payment) in the The revised classification and eligibility thresholds will
IE

course of business be as follows:

b. A supply made for a consideration (payment) which Type of Annual Turnover
may not be in the course of business Enterprise
Micro Not exceeding Rs 5 crore
c. A supply without consideration (without payment)
Small More than Rs 5 crore but not
In simpler terms, the term 'supply' usually means a: exceeding Rs 75 crore
1. Sale - sale of goods and payment made Medium More than Rs 75 crore but not
exceeding Rs 250 crore
2. Transfer - branch transfers for instance
3. Barter/Exchange - where the payment is by goods Objectives of amendment:
instead of in money a. To enhance ease of doing business, make MSME
Therefore, e-Way Bills must be generated on the classification norms growth oriented and associate
common portal for all these types of movements. them to new indirect tax regime Goods & Services
Tax (GST).
For certain specified Goods, the e-way bill need to be
b. To increase direct and indirect employment in the
generated mandatorily even if the Value of the
MSME sector of the country.
consignment of Goods is less than Rs. 50,000:

23
Benefits:
a. To assist in having non-discretionary, transparent
and objective criteria.
b. To assist in removing the need for inspections and
make classification system progressive and
evolutionary.
c. To assist in overcoming uncertainties associated with
classification based on investment in plant &
machinery and equipment and employment.
d. To assist in providing flexibility to Government to
improve the classification of MSMEs as per the
changing economic scenario.
DELHI MUMBAI INDUSTRIAL CORRIDOR
(DMIC)
It is a huge infra-structure project with the total
investment of around $90 billion.
The financial & technical assistance to this project is
provided by Japan.
It covers the total length of 1483 KMs between Delhi
and Mumbai.
Its main aim is to create an environmentally
sustainable and technological advanced
A
infrastructure utilizing cutting age Japanese
technologies.
M
It also aims to develop world class manufacturing
and investment destinations in this region.
It will cover six States - U.P, NCR of Delhi, Haryana,
Rajasthan, Gujarat and Maharashtra.
It will start from Dadri in the National Capital Region
S
of Delhi and will terminate at Jawaharlal Nehru Port
near Mumbai.
Rajasthan (39) and Gujarat (38%) together constitute
IE
77% of the total length of the alignment of freight
corridor.
Note: This project has attracted interest from
companies based in Canada, the U.S., Singapore
and Taiwan.
24
INDIRA GANDHI CANAL
It is one of the largest canal projects in India and starts
from the Harike Barrage (Harike), in Punjab and
terminates in the Thar Desert in the North West
Rajasthan.
A new loan agreement has been signed by Rajasthan
Government with the New Development Bank for
revamping of Indira Gandhi Canal and its
distributaries.
Benefits:
It will solve the problems of water loss and water-locking
R
in the agricultural fields.
It will also provide continuous supply of irrigation water
E
to the farmers at the tail-ends of the project.
KALESHWARAM IRRIGATION PROJECT
T
Kaleshwaram project is a branch of the original
Pranahitha-Chevella Lift Irrigation Scheme that was
S
initiated in 2007 during the time of undivided Andhra
Pradesh.
The TRS government redesigned the project after
Telangana was formed in 2014 on the ground that original
plan had too many environmental issues and had very
low water storage provision (16.5 tmcft).
A highly advanced Light Detection and Ranging (LiDAR)
survey was conducted for two months by the
government.
It was decided to separate the original component serving
the Adilabad area as the Pranahitha project and renamed
the rest as Kaleshwaram by redesigning the head works,
storage capacity and the canal system based on the data
of availability of water at different locations along the
course of the Godavari and tributaries.
This project can store upto 148 tmcft with plans of
utilising 180 tmc ft.
It can irrigate very large areas of (over 18.47 lakh acres)
uplands in the districts of Karimnagar, Nizamabad,
Warangal, Medak, Nalgonda and Ranga Reddy.
It has many unique features, such as the longest tunnel
to carry water in Asia (81 km long) between the
Yellampally barrage and the Mallannasagar
reservoir.
It would also utilise the highest capacity pumps (139
MW power) in the country to lift water.

Note: Tmcft is one thousand million cubic feet.
IRAQ OVERTAKES SAUDI ARABIA AS OIL
SUPPLIER TO INDIA
Iraq has overtaken Saudi Arabia by a wide margin to
become India's top crude oil supplier. Iraq meets
more than 20% of the country's oil needs in 2017-18.
Saudi Arabia traditionally has been India's top oil supplier.
Iran is the third largest supplier followed by Venezuela
and Nigeria.
Note: India is 80% dependent on imports to
meet its oil needs.
BLUE ECONOMY
A Central Plan scheme on "Blue Revolution:
Integrated Development and Management of
Fisheries" is being implemented by the Union
government.
Its main objective is to obtain economic prosperity
of the country.
A
It also strives to achieve the economic development
of the fishermen through utilization of full potential
of water resources for development of fisheries in
M
a sustainable manner.
Note: In 2017, Government has notified the
'National Policy on Marine Fisheries, 2017' in
order to achieve the above objectives.
S
The policy assists to promote 'Blue Growth Initiative'
which focuses on opening the ways for 'Blue Revolution'.
IE
Energy transition Index
It is released by World Economic Forum and is based
on the report titled "Fostering Effective Energy
Transition".
It ranks 114 countries on the basis of how well they
balance energy security and access with
environmental sustainability and affordability.
In 2018 list, Sweden was ranked one followed by
Norway and Switzerland at the 2nd and 3rd position.
India has been ranked at 78th by the Index lower than
Brazil and China.
The report also states that India has taken certain
important measures to improve energy access, energy
efficiency, and to improve the deployment of renewable
sources of energy.
White label ATM (WLA)
These types of ATMs are set up by non-banking entities.
In a White Label ATM, the logo displayed on the ATM
machine and in the ATM premises pertain to the WLA
operator instead of a bank.
At present, cash deposits are not accepted at WLAs
because it is not permitted by the RBI.
The first WLA in India was set up by Tatas' Indicash in
2013.
Non-bank entities were allowed by the RBI to set up
White Label ATMs as banks won't be able to provide
R
their ATM facilities in each and every place..
UTTAM App
E
It stands for Unlocking Transparency by Third Party
Assessment of Mined Coal and is jointly developed by
T
Ministry of Coal and Coal India Limited.
It monitors the process of Third Party Sampling of coal
across CIL subsidiaries for all citizens and coal consumers.
S
It provides a platform for monitoring of sampling and
coal dispatches.
Benefits:
It also leverages technology to facilitate a bidirectional
channel between Coal India Limited and a common
citizen.
It ensures transparency and efficiency in the coal quality
monitoring process and brings coal governance closer to
people.
Salient features:
 Sampling Coverage
 Subsidiary wise quality parameters
 Complaints pertaining to quality of Coal
 Sampled Volume
 Imported Coal
Micro Irrigation Fund
It has been setup with NABARD under Pradhan Mantri
Krishi Sinchayee Yojana.
Under this fund, NABARD will provide the loan to
state governments on concessional rate of interest
during this period. This loan shall be paid back in
seven years including the grace period of two years.
The lending rate under Micro Irrigation Fund has been
25
proposed at 3% lower than the cost of raising the fund
by NABARD.
This cost would be met from the ongoing scheme of
Pradhan Mantri Krishi Sinchayee Yojana-Per drop more
crop component by amending the existing guidelines.
FDI confidence index
It is an annual survey, prepared by A.T. Kearney which
provides a ranking of the top 25 countries.
It tracks the effect of likely political, economic, and
regulatory changes on the foreign direct investment
intentions and preferences of CEOs, CFOs, and other
top executives of Global 1000 companies.
It also includes detailed analysis on the markets and the
effect of variety of global trade issues that have on their
FDI attractiveness.
India ranking:
India has been ranked 11th and remains the second
highest ranked emerging market on the Index.
India's rank was 8th in last year ranking.
India remains among the top investment destinations due
A
to its market size and rapid economic growth.
M
Global ranking:
US is ranked first, followed by Canada and Germany at
2nd and 3rd place respectively.
Switzerland and Italy enter the top 10 for the first time
in more than a decade.
S
STRATEGIC PETROLEUM RESERVE (SPR)
PROGRAMME
IE
Under this program, the Government of India had
decided to set up 5 million metric tons (MMT) of
strategic crude oil storages at three locations
namely, Visakhapatnam, Mangalore and Padur (near
Udupi).
The main objectives are to ensure energy security of
the country and to serve as a cushion during any
external supply disruptions.
These strategic storages would be in addition to the
existing storages of crude oil and petroleum products
with the oil companies.
In the second phase, two more facilities will be set up
Chandikhole in Jajpur district of Odisha and Bikaner in
Rajasthan.
26
The construction of these Oil Storage facilities is being
managed by Indian Strategic Petroleum Reserves Limited.
Note: Indian Strategic Petroleum Reserves
Limited is a Special Purpose Vehicle, wholly owned
subsidiary of Oil Industry Development Board
under the jurisdiction of Ministry of Petroleum &
Natural Gas.
Note: The first oil cargo for India's strategic
petroleum reserve has been shipped by Abu Dhabi
National Oil Company at Mangalore.
Under an agreement signed between Indian Strategic
Petroleum Reserves Ltd and ADNOC, India can utilize
R
the entire available crude oil stored (5.86 million barrels)
by ADNOC in the Mangalore facility during an emergency
E
situation.
It also allows Abu Dhabi National Oil Company to sell
some of the crude oil to Indian refineries on commercial
T
basis while abiding to mutually agreed minimum crude
storage which is exclusively for the use of the Indian
S
government.
Kishanganga Hydropower Station
It is a 330 megawatt hydropower station in Jammu
and Kashmir which was inaugurated by the Prime Minister
of India recently.
It is built on the river Kishanganga, which is a tributary
of Jhelum.
It was delayed for several years as Pakistan dragged India
to the International Court of Arbitration, which ruled in
India's favor in 2013.
The main benefit of the project is that it will provide
13% free power to Jammu and Kashmir including
1% for local area development fund (Rs133 crore
annually).
PRAAPTI
It is a web portal and an App which stands for
Payment Ratification And Analysis in Power
procurement for bringing Transparency in Invoicing
of generators.
It has been officially launched by Union Power ministry.
Its main aim is to bring transparency in power
purchase transactions between Generators and
DISCOMS.
Its other function is to capture the Invoicing and payment
data for various long term Power Purchase Agreements
(PPAs) from the Generators.
Advantages:
 The main benefit is that it will assist the
stakeholders in getting month-wise and legacy data
on outstanding amounts of DISCOMS against power
purchase.
 It would provide relative assessment of various State
DISCOMs on "Ease of making payments" to various
Generation Companies.
It will also increase the transparency of the

transactions in the power Sector.
Bad Bank
The Bad Bank concept was pioneered at the Pittsburgh-
headquartered Mellon Bank in 1988 in response to
problems in the bank's commercial real-estate portfolio.
According to McKinsey & Co, the concept of a "bad
bank" was applied in previous banking crises in Sweden,
France, and Germany.
Bad bank is also known as PARA (Public Sector Asset
Rehabilitation Agency).
It was proposed in Economic Survey 2016-17.
It is an institution which specializes in loan
A
resolution process, so that banking system is free
to focus on core banking solutions.
M
It is a centralised resolution of NPA crisis.
Benefits:
 Early resolution so that Funds for creation of new
credit can be used
S
 Willful Defaulters cannot escape because of non-
coordination in Joint Lenders' Forum
 Large Defaulters comprise more value of NPAs, as
IE
50 top defaulters account for 71% of NPAs.
Therefore, PARA, with focus on top cases can lead
to faster recovery
 PARA with its mandate on time-bound resolution
may be better equipped with decision making
capabilities, in comparison to bank management,
who feared CVC and CAG enquiry on debt write-
offs.
 ARCs have not been successful, as they have bought
only 5% of NPAs, according to ES 2016-17
 Without PARA, banks have resorted to refinancing,
which leads to delaying the cases. This further leads
to lack of credit and investment in the economy.
 PARA helps to enhance investment in banks and
improves credit ratings, so that Indian firms have
access to cheap global credit.
NIITI AAYOG DRAFT FOR METHANOL
ECONOMY
NITI Aayog has formulated a comprehensive plan to
replace 20% of crude imports from Methanol.
It will be achieved by India by adopting Methanol as
its own indigenous fuel at the cost of around Rs. 19
per liter.
Methanol Economy is called as the connecting link
to complete Hydrogen based fuel systems.
The Methanol Economy concept is actively pursued by
various countries across the world such as China, Italy,
R
Sweden, Israel, US, Australia, Japan etc.
Benefits:
E
 It will be at least 30% cheaper than any available
fuel.
T
 This program of blending Methanol with petrol will
further reduce the fuel bill by at least Rs. 5000
crore annually in next 3 years.
S Note: Methanol is a scalable and sustainable
fuel, that can be produced from Natural Gas,
Coal (Indian High Ash Coal), Bio-mass, Municipal
Solid waste and also from CO2.
Advantages of Methanol as a fuel:
 Methanol is a clean and can replace both petrol &
diesel in transportation sector.
 It can also replace LPG, Wood, and Kerosene in
cooking fuel area.
 It burns efficiently in all internal combustion engines
and is almost pollution free.
 It doesn't produce particulate matter, soot, Sulfur
oxide and Nitrogen oxide emissions.
DAM REHABILITATION & IMPROVEMENT
PROJECT (DRIP)
It is a six-year project, implemented by the Union
Ministry of Water Resources with assistance from
the World Bank.
The coordinating and supervising agency for the Project
implementation is Central Dam Safety Organisation
of Central Water Commission, which is assisted by a
Consulting firm.
Objectives:
 Rehabilitation and improvement of about 223 dams
27
 in four states ( Kerala, Madhya Pradesh, Odisha,
and Tamil Nadu)
Note: Later on in Karnataka, Uttarakhand and
Jharkhand (DVC) joined DRIP and total number
of dams covered under DRIP increased to 250.
 To promote new technologies and improve
Institutional capacities for dam safety evaluation and
implementation at the Central and State levels and
in some identified premier academic and research
institutes of the country
 To improve the safety and performance of selected
existing dams and associated appurtenances in a
sustainable manner
 To strengthen the dam safety institutional setup in
participating states as well as at central level.
UPI 2.0 (UNIFIED PAYMENT INTERFACE)
UPI 2.0 is an upgraded version of UPI and has the
following new features:
a. Payment transfers can be scheduled at a later date
with pre-authorisation.
b. Customers can link their overdraft (OD) account
A
with UPI. (Only current and savings account can be
linked in UPI 1.0)
c. Users can now verify UPI credentials using a QR
M
code and can now receive invoices from merchants
directly in the inbox to verify the authenticity of
credentials.
Note: UPI is an instant real time payment
system developed by the National Payments
S
Corporation of India (NPCI) with the main
aim to facilitate faster and smoother digital
payments.
IE
Under this platform, a customer can pay directly from
a bank account to another bank account & different
merchants. Its benefit is that it doesn't require the credit
card details, IFSC code, or net banking/wallet passwords.
INDIA POST PAYMENTS BANK (IPPB)
It has been incorporated as a public sector company
under the Department of Posts with 100%
Government of India equity.
It provides savings account up to a balance of Rs 1
Lakh, along with digitally enabled payments and
remittance services of all kinds between individuals.
IPPB will also provide current accounts and access
to third party financial services like insurance,
28
mutual funds, pension, credit products, forex, etc
in near future.
Its headquarters will be in New Delhi and it plans to
launch 650 branches across the country in 2019,
which will be linked to rural post offices.
It would have a representation from other government
departments like the Department of Posts, Department
of Expenditure, etc.
Note: Payments banks are conceptualised by
the Reserve Bank of India (RBI) with the
main aim to meet financial inclusion target
of the Union government and increase
R
banking connectivity, especially in rural areas.
They mainly deal in remittance services.
E
Its main activities are acceptance of demand deposits,
remittance services, Internet banking and other
specified services.
T
Payments banks can accept deposits up to Rs. 1 lakh
per account from individuals and small businesses, but
S
cannot undertake lending services.
They will have to deploy their funds in government papers
and bank deposits and Non-resident Indians (NRIs) are
not allowed to open accounts.
The promoter's minimum initial contribution to equity
capital will have to be at least 40% for the first five
years.
They can issue ATM/debit cards and other prepaid
payment instruments, but not credit cards.
They can distribute non-risk sharing financial products
such as mutual funds and insurance products.
Lakhwar Multipurpose Project
A memorandum of understanding (MoU) has been
signed by the Central government with 6 states namely
Uttarakhand, UP, HP, Rajasthan, Haryana and Delhi
with the main aim to construct Lakhwar Multipurpose
Project on Yamuna (Dehradun).
Benefits:
it will generate 300 MW of Power, (b) It will create
33,780 Hectare Irrigation Potential and (c) It will also
create huge amount of Water Availability.
Centre will provide 90% of the funds for the Irrigation
Component, and the remaining 10% will be borne
by the Six States and water will be shared
proportionately.
 Note: Lakhwar Project is a multipurpose power
station, on river Yamuna at Dehradun in
Uttarakhand.
A 204 m high concrete dam on river Yamuna near Lohari
village will be constructed under this project.
Vyasi HEP (2×60 MW) (Hathiari power station) will be
made downstream of Lakhwar Hydro Electric Project
(HEP).
A barrage will also be constructed at Katapathar about
3 Km downstream of Hathiari power station on Yamuna.
Upper Yamuna refers to the stretch of River Yamuna
from its origin to the Okhla Barrage in Delhi.
DENA BANK, VIJAYA BANK AND BANK OF
BARODA MERGER
Union government has announced the merger of Bank
of Baroda, Dena Bank and Vijaya Bank to create
India's third largest bank under public sector banking
reforms.
The merger is a part of the government's aim of
consolidation of public sector banks (PSBs), which
A
was proposed by Alternative Mechanism (August
2017) with an aim to facilitate consolidation among
the Nationalised Banks to create strong and
M
competitive banks.
Benefits:
a. It will improve economies of scale and reduction in
the cost of doing business. E.g. improving technical
S
inefficiency, which is a main factor for banking crisis.
b. Mergers help small banks to gear up to international
standards with innovative products and services with
IE
the accepted level of efficiency.
c. Mergers assist many geographically concentrated
PSBs to expand their coverage beyond their
outreach.
d. It leads to better and optimum size of banks to
offer more products and services and assist in
integrated banking sector growth.
e. It will also abolish the unhealthy and intense
competition going on even among public sector
banks and Indian banks will gain greater recognition
and higher rating globally.
f. It will lower down the volume of inter-bank
transactions, resulting in saving of time in clearing
and reconciliation of accounts.
g. It will abolish large number of posts (CMD, ED,
GM and Zonal Managers), resulting in monetary
savings and also reduce unnecessary interference
by board members in banks' affairs.
h. It will strengthen bargaining strength of bank staff
and improve their better wages and service
conditions in order to reduce the wide disparities
between the staff of various banks.
Concerns:
a. Pension liability provisions (due to different
employee benefit structures) and harmonisation of
accounting policies for bad loans recognition will
have a negative impact.
b. It will lead to immediate job losses due to
R
considerable number of people taking VRS and slow
down/ freezing of recruitment, worsening the
unemployment rate in country.
E
c. It will result in transferring the issues of small weak
banks to bigger strong banks.
T
Causes of Depreciation of Indian Rupee
against US Dollar
S
1. Turkish currency Crises: The Indian currency had
plunged by Rs 1.08, or 1.57 per cent, to a record
low of 69.91 against the US currency amid fears
that Turkish currency turmoil could turn out into
global financial crisis.
2. Steep rise in oil prices has pulled down the rupee,
by pushing up dollar demand.
3. Global Trade war triggered by US and China's
retaliatory import tariffs has also weakened Rupee.
Major reasons behind rising oil prices in India
1. Steep increase in Global crude oil which have
touched $80/ barrel.
2. Steep fall of the rupee has contributed to increase
in petrol diesel prices in India.
3. United States sanctions (from Nov 2018) on Iran
due to Nuclear program have also increased oil
prices as Iran is one of the world's largest oil
producer.
4. Increased taxes and duties on petrol and duties by
the Union and state governments.
Note: Petroleum products contributed 24%
of Centre's revenue and 8% of States'
revenue in 2016-17.
OPEN ACREAGE LICENSING POLICY (OALP)
It comes under the Hydrocarbon Exploration and
Licensing Policy (HELP) of Government of India.
29
Under this policy, exploration companies are given the
alternative to select the exploration blocks on their own,
without the formal bid round from the Government.
Under this policy, 2.8 million square kilometres of
sedimentary basins will be open up for exploration and
eventual production.
Note: Hydrocarbon Exploration & Licensing
Policy (HELP)
 This policy opens up the sedimentary basin of India
for domestic and foreign investment under easy,
transparent and investor -friendly fiscal and
administrative regime.
 Under this policy, investors will be given:
1. A ready access to large amount of seismic data
available in National Data Repository (NDR)
2. Flexibility to carve out exploration acreages
through an open acreage licensing process
3. Increased operational autonomy through a new
revenue sharing model.
 The National Data Repository will be a key
facilitator and provide proper access to whole of
the Exploration & Production data process through
A
a digital medium to all investors to use the potential
of India's large basinal area.
M
GLOBAL SKILLS PARK (GSP)
It will be the First Multi-Skills Park in India, to enhance
the quality of Technical and Vocational Education And
Training (TVET) System in the State and create a more
skilled workforce.
S
The Project will engage international TVET partners to
support advanced training at the GSP who will bring
IE
global best practices in TVET management, training
infrastructure, industry cooperation, and quality
assurance.
The GSP campus will consist of core Advanced Training
Institutes including the Center for Occupational Skills
Acquisition and the Center for Advanced Agricultural
Training as well as other support services focusing on
entrepreneurship, training of trainers, and skill-related
research.
The campus will have training facilities focusing on skills
for manufacturing, service, and advanced agricultural jobs,
benefitting about 20,000 trainees and trainers.
Benefits:
a. The Project will help improve the quality and
relevance of the State's TVET programs and will
30
help impart advanced job-ready skills training of
international standards that can meet the
employment needs of the State's emerging sectors.
b. The Project will also help in modernizing 10
industrial training institutes across the state by
renovating training infrastructure and upgrading skills
courses to align with industry and market needs.
Note: Asian Development Bank (ADB) and the
Government of India have signed a $150 million
Loan Agreement to establish a Global Skills
Park (GSP) in Madhya Pradesh.
Currency swap agreement between India and
R
Japan
A $75-billion currency swap arrangement has been signed
E
between Japan and India to help meet short-term liquidity
mismatches of India as it faces a slide down in the rupee's
value.
T
It will provide greater stability to foreign exchange &
capital markets in India.
S
It will serve as a second line of defence for the rupee
after the $393.5 billion of foreign exchange reserves that
the Reserve Bank of India (RBI) has at its disposal.
Under the arrangement, India can acquire dollars from
Japan in exchange for rupees and Japan can also seek
dollars from India in exchange for yen.
Significance:
 To improve the confidence in the Indian market
and enable the agreed amount of capital being
available to India as and when the need arises.
 To bring down the cost of capital for Indian
companies when they access the foreign capital
market.
 To assist in enabling greater stability to foreign
exchange and capital markets in India.
 To further improve in bringing foreign capital
(Foreign Direct Investment) for developmental
needs of India.
Note: Currency Swap Arrangement is an
arrangement, between two countries having
regular trade.
It means trading in their local currencies and paying for
import and export trade at the pre-determined rates of
exchange, without involving in third country currency
i.e. US Dollar.
It eliminates the issues about exchange variations as no
third country currency is involved.
AGMARK ONLINE SYSTEM
It is an online platform for processing applications related
to quality certification mark 'Agmark' for agricultural
products and is being implemented across the country
to conduct quality control functions.
 It will be available 24×7 and the main benefit is
that it will make process of application is simple,
quick, transparent.
 Certificate of authorisation (domestic), permission
of laboratories (domestic), permission of printing
press and services related to laboratory information
management system will be provided online through
this system.
Benefits:
a. It will make processes easy, reliable and cost
effective.
b. It will also provide online receipt of fees from the
applicants through bharatkosh.gov.in website.
Note: Agmark is certification mark that assures
conformity to set of standards approved by
Directorate of Marketing and Inspection and is
A
legally enforced by Agricultural Produce (Grading
and Marking) Act of 1937 (amended in 1986).
It covers quality guidelines for 205 different commodities
M
such as cereals, pulses, vegetable oils, essential oils, fruits
& vegetables, and semi-processed products (vermicelli).
Yuva Sahakar-Cooperative Enterprise Support and
Innovation Scheme
S
It is a youth-friendly scheme launched by National
Cooperative Development Corporation (NCDC) to cater
the needs and aspirations of the youth & attract them to
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cooperative business ventures.
Its main aim is to motivate cooperatives to venture into
new and innovative areas.
More incentives will be provided for cooperatives of
North Eastern region, Aspirational Districts and
cooperatives with women or SC or ST or Persons with
Disability members.
Cooperative Start-up and Innovation Fund (CSIF) worth
Rs 1000 crore has been created by NCDC with user
friendly features to allow youth to avail the scheme.
80% of the project cost will be funded for these special
categories as against 70% for others. Under the scheme,
2% less than the applicable rate of interest will be given
n term loan for the project cost up to Rs 3 crore including
2 years moratorium on payment of principal.
All types of cooperatives in operation for at least one
year are eligible.
Note: NCDC is a statutory Corporation under
Ministry of Agriculture & Farmers Welfare.
It was established by an Act of Parliament in 1963.
There are many regional centres under this organization
to provide the financial assistance to Cooperatives/
Societies/Federations.
Government Initiatives in MSME Sector
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12 measures have been announced by Prime Minister
Modi to boost the Micro, Small and Medium Enterprises
(MSME) sector. These measures are mentioned below:
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1. To create a portal that would help units to get loan
up to Rs 1 crore in 59 mins.
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2. 2% tax rebate on incremental loans of up to Rs 1
crore for MSMEs registered under GST.
3. An increase in interest rebate has been given from
S 3-5% to exporters who receive loans in pre- and
post-shipment period.
4. All public-sector companies and corporates with
turnover exceeding Rs 500 crore will have to
mandatorily register on Trade Receivables Electronic
Discounting System portal. This will improve the
cash cycle for MSMEs as it will enable entrepreneurs
to access credit from banks, based on their
upcoming receivables.
5. Public-sector undertakings will have to buy their 25
percent of their inputs from MSMEs from 20
percent earlier. 3 percent of procurement will have
to done by women entrepreneurs or women-led
MSMEs out of the 25 percent.
6. All central public sector enterprises will have to
come on board of Government e-Marketplace so
that they can procure goods from MSMEs listed on
the portal.
7. Technology upgradation support will be given to
MSMEs. About 20 technological centres will be
made as hubs and 100 centres as tool rooms will
be created at the cost of Rs 6,000 crore.
8. Clusters will be created for pharma MSME
companies so that they can reach customers directly.
About 70 percent of the cost for creating these
clusters will be borne by the central government.
9. MSMEs will have to file only one return under eight
labour laws and 10 central rules against two returns
earlier.
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10. Inspection would be done based on computerised
random allotment and report of inspection will have
to be submitted within 48 hours on the reporting
portal. This will free MSMEs from Inspector Raj
(regime).
11. Process of environmental clearance has been
simplified, and MSME will require only one approval
for "environmental clearance" and "consent to
establish" under Air and Water Act.
12. Ordinance has been approved for simplifying levy
of penalty for minor offences under Companies Act.
This will avoid unnecessary harassment to small
business owners, and they won't have to approach
courts, but can correct minor violations through
simple procedures.
Note: The portal is set up by the Small Industries
Development Bank of India. MSMEs can register
and apply for a loan.
SOCIETY FOR WORLDWIDE INTERBANK
FINANCIAL TELECOMMUNICATION (SWIFT)
The SWIFT is a global member-owned cooperative,
headquartered in Brussels, Belgium.
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It was founded in 1973 by a group of 239 banks from 15
countries which formed a co-operative utility to develop
a secure electronic messaging service and common
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standards to facilitate cross-border payments.
It carries an average of approximately 26 million financial
messages each day.
SWIFT does not facilitate funds transfer but sends
payment orders, which must be settled by correspondent
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accounts that the institutions have with each other.
The SWIFT is a secure financial message carrier and
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transports messages from one bank to its intended bank
recipient.
Messages sent by SWIFT's customers are authenticated
using its specialised security and identification technology.
Encryption is added as the messages leave the customer
environment and enter the SWIFT Environment.
Messages remain in the protected SWIFT environment,
subject to all its confidentiality and integrity commitments,
throughout the transmission process while they are
transmitted to the operating centres (OPCs) where they
are processed-until they are safely delivered to the
receiver.
EASE OF DOING BUSINESS INDEX 2018
This index is an aggregate value releases by World Bank
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that includes various parameters defining the ease of
doing business in a country.
It ranks 190 countries based on 10 indicators from
starting a business to resolving insolvency (life-cycle of a
business).
It measures 11 areas of business such as procedures,
timelines and cost related to construction, protection of
minority investors, payments of tax, time and cost to
export a product or import it and to resolve commercial
dispute, the quality of the judicial process and time taken
and the cost for resolution or insolvency.
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2018 Ranking
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India's rank has improved by 23 places to 77 from 100
(2017).
India topped in South Asia for the first time and is ranked
third among the BRICS.
EXTERNAL COMMERCIAL BORROWINGS
(ECBS)
These are loans availed by Indian corporations and PSUs
(public sector undertakings) from non-resident lenders
(foreign commercial banks and other institutions) in
foreign currency.
They have a minimum average maturity of 3 years.
The funds are available for relatively long term and
interest rates are less compared to domestic funds.
Note: The Reserve Bank of India (RBI) has eased
hedging norms for firms that raise funds through
external commercial borrowings, and will
decrease the cost of hedging. It will help reduce
costs for companies that raise foreign funds.
OPEN MARKET OPERATIONS (OMO)
It refers to the buying and selling of government securities
in the open market by the Central bank of the country
(RBI in India).
Its main objective is to increase or decrease the amount
of money in the banking system. When the central bank
buys the securities then money is injected into the banking
system and liquidity is increased which encourages
growth.
Sale of securities by the central bank decreases the
liquidity in the system which contracts the economy and
restricts growth.
They are done on a day-to-day basis in order to control
inflation and assist banks to continue to lend.
OMO is a tool used by RBI along with repo rate, cash
reserve ratio and statutory liquidity ratio in order to
balance the amount and price of money in the system.
Note: RBI will increase the liquidity in the economy by
buying government securities worth ?40,000 crore in
December 2018.
PORTAL FOR AFFORDABLE CREDIT &
INTEREST SUBVENTION ACCESS (PAISA)
It is a centralized electronic platform for processing
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interest subvention on bank loans to beneficiaries under
Deendayal Antyodaya Yojana - National Urban Livelihoods
Mission (DAY-NULM).
It is designed and developed by Allahabad Bank (Nodal
bank).
Benefits:
Another effort by the government to connect directly
with the beneficiaries for ensuring greater transparency
and efficiency in delivery of services.
DBT of subvention on monthly basis under DAY-NULM
will give the necessary financial support to small
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entrepreneurs in a timely manner.
All 35 States/UTs & all scheduled commercial banks, RRBs
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and Cooperative Banks are expected to be on board the
PAiSA portal the year end.
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