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Daily Current Affairs – 2020

Topic: For Prelims and Mains

Special liquidity scheme for NBFCs and HFCs

3rd July, 2020

Why in News-

Recently, the Union Cabinet has approved the proposal of the Ministry of Finance (MoF) to launch a new Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) to improve the liquidity position of the NBFCs/HFCs amidst the COVID-19 economic crisis.

Background:

  • This scheme was announced in the  Budget of 2020-21  to provide additional liquidity facility to NBFCs/HFCs over that provided through the Partial Credit Guarantee Scheme (PCGS). In the ongoing economic crisis due to COVID-19 pandemic it has been launched to infuse more liquidity to NBFCs/HFCs.
  • NBFC and HFC sectors came under stress following a series of defaults by group companies of IL&FS in September 2018.

Key Highlights: 

  • The funds will be provided through the Partial Credit Guarantee Scheme (PCGS).
  • This facility would supplement the liquidity measures taken so far by the government and RBI.
  • An SPV will be set up to manage a Stressed Asset Fund (SAF) whose special securities will be guaranteed by the Government of India and purchased by the Reserve Bank of India (RBI) only.
  • These acquired funds and proceeds of sale securities will be used by the SPV to acquire short-term debt of NBFCs/HFCs.
  • A large public sector bank will come up with an SPV to manage a stressed asset fund.
  • The SPV will issue securities as required, subject to the total amount of securities outstanding with a maximum limit of Rs 30,000 crore.
  • The scheme will also act as an enabler for the NBFC sector to get investment grade or better rating for bonds issued so as to strengthen their position in the market.
  • The Scheme will benefit the economy by augmenting the lending resources of NBFCs/HFCs/MFls.

What are NBFCs and HFCs?

  • A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 engaged in the business of loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority.
  • Housing Finance Company(HFC) is a company registered under the Companies Act, 1956 (1 of 1956) which primarily transacts or has as one of its principal objects, the transacting of the business of providing finance for housing, whether directly or indirectly.

Topic: For Prelims and Mains

Mahadayi Tribunal’s Award

Why in News?

The Supreme Court has recently passed an interim order allowing an application by the State of Karnataka to notify the Mahadayi Water Dispute Tribunal’s award.

What has the Court said?

The implementation of the award would be subject to the final judgment of the Supreme Court in the civil appeals filed by Karnataka, Goa, and Maharashtra, challenging the allocation of water from the Mahadayi river among them.

What was the tribunal award?

  1. August 2018 tribunal award had allocated 13.42 TMC water from the Mahadayi river basin to Karnataka.
  2. Maharashtra was allotted 1.33 TMC water while Goa was given 24 TMC in the final decision of the tribunal.

The Karnataka government had petitioned the tribunal seeking the release of 7.56 TMC of water for the Kalasa-Banduri Nala project.

What is Kalasa-Banduri Nala project?

Undertaken by the Government of Karnataka to improve drinking water supply to the Districts of Belagavi, Dharwad and Gadag. 

It involves building across Kalasa and Banduri, two tributaries of the Mahadayi river to divert 7.56 TMC of water to the Malaprabha River.

About Mahadayi river:

1.    It is a west flowing river.

2.   Origin: Degaon village, Belgaum district.

3.   Called Mandovi in Goa.

4.   Travels 35 km in Karnataka; 82 km in Goa before joining the Arabian Sea.

What’s the dispute?

Goa raised objection to Kalasa-Banduri project planned in 1989. Goa filed a complaint seeking setting up of a tribunal in July 2002. Goa moved the Supreme Court in 2006 seeking the constitution of a tribunal. The Mahadayi Water Disputes Tribunal was set up in November 2010.

Appendix I

Why in News?

The Great Indian Bustard, Asian Elephant and Bengal Florican have been included in Appendix I of UN Convention on Migratory Species. 

This was done at the ongoing 13th Conference of the Parties (COP) to the Convention on Migratory Species (CMS) in Gandhinagar (Gujarat).

About Asian Elephant:

Found in India, Nepal, Bangladesh, Bhutan and Myanmar.

IUCN status: Endangered. It is also listed in Appendix I of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) and Schedule I of the Wildlife (Protection) Act, 1972.

About Great Indian Bustard:

It is one of the heaviest flying birds in the world. Its largest populations are found in the Indian state of Rajasthan. 

State bird of Rajasthan. It is listed as ‘Critically Endangered’ on the IUCN Red List. It is also listed in Appendix I of CITES and Schedule I of the Indian Wildlife (Protection) Act, 1972.

About Bengal Floridian:

In India it is found in Uttar Pradesh, Assam and Arunachal Pradesh. It has been listed as ‘Critically Endangered’ on the IUCN Red List. The bird is listed under Schedule I of the Wildlife Protection Act of India, 1972 and Appendix I of CITES.

Facts for Prelims

Stockholm Declaration:

Stockholm Declaration was adapted in 3rd Global Ministerial Conference on Road Safety held recently.

  • The global character of the road safety challenge calls for international cooperation and partnerships across many sectors of society.
  • The Stockholm Declaration was prepared in close collaboration with the conference’s steering group.
  • Building on the Moscow Declaration of 2009 ( first global conference on road safety) and the Brasilia Declaration of 2015 ( 2nd Global conference on road safety) , UN General Assembly and World Health Assembly resolutions, the Stockholm Declaration is ambitious and forward-looking and connects road safety to the implementation of the 2030 Agenda for Sustainable Development.

Vision Zero approach:

The Global Ministerial Conference on Road Safety 2020 recently embraced Vision Zero approach.

  • The basic stand point for Vision Zero is that no one should be killed or suffers lifelong injury in road traffic.
  • The concept of Vision Zero was decided by the Swedish Parliament in 1997, it turned the traditional view of road safety work upside down.
  • In short, creating a comprehensive and safe environment to ensure road safety is the essence of Vision Zero.
  • The Vision Zero elaborates that the main problem is not that accidents occur – it is instead whether the accidents lead to death or lifelong injury.
  • Vision Zero stresses that the road transport system is an entity, in which different components such as roads, vehicles and road users must be made to interact with each other so that safety can be guaranteed.

 

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