Research Committee

Crux
The news compendium of
SIBM-B

Crux is a Research Committee endeavor which aims to provide the

students of the institute with weekly updates on the most
important news worldwide. Each news update in the newsletter
has been analyzed by the members of the Research Committee to
bring you the most relevant points related to particular news.
Along with the news updates, it also covers articles on important
topics which have been in news during the week.

With our newsletter series this time, along with the news we are
also providing useful links to allow you to delve into the topic
further.

You call it news. We call it a step towards awareness.

 Private Banks may face brunt of RBI’s new rule

 The retail and small business loan portfolio of private banks, wherein they had a competitive edge over
state-run banks, could turn out to be a drag on their margins.
 The central bank has lowered its repo rate by 110 basis points (bps) since January.
 Margins of private banks seem more susceptible to interest rate volatility because of their greater
exposure (as a percentage of their total loans) to retail and small business loans compared to their state-
run peers.
 Among the private banks, only Federal Bank and IDBI Bank have so far linked their lending rates to an
external benchmark.

 An analysis by Kotak Institutional Equities on 4 September showed that retail and small business loans
formed 65% of ICICI Bank’s loan book at the end of fiscal year 2018-19, while it was 41% and 34%
for SBI and Bank of Baroda (BoB), respectively.
 Among public sector banks, SBI, BoB, Allahabad Bank, Bank of India, Union Bank of India, United
Bank of India and Central Bank of India, among others, have started offering external benchmark-linked
products to borrowers.
 Banks can choose the repo rate, the government’s three-month and six-month treasury bill yield
published by the Financial Benchmarks India Pvt. Ltd (FBIL), or any other benchmark market interest
rate published by FBIL.

Reference:https://www.livemint.com/industry/banking/private-banks-may-face-brunt-of-rbi-s-new-rule-
1567705815937.html
 NRC in Assam

 The National Register of Citizens (NRC) is a register maintained by the Government of India containing
names & certain relevant information for identification of all genuine Indian citizens.
 The register was first prepared after the 1951 Census of India and since then it has not been updated till
recently.
 Indian state of Assam has become the first state in India where the updation of the NRC is being taken
up to include the names of those persons whose names appeared in the NRC, 1951 & still alive and/or of
their presently living descendants having permanent residence within the state.
 The purpose of NRC update in the state of Assam is to identify Indian citizens from among all the
present residents of the state thereby leading to identification of illegal migrants residing in that state.

Historical Background of immigration problem in Assam

 Following Partition and communal riots in the subcontinent, Assam initially saw an influx of refugees
and other migrants from East Pakistan. The number of such migrants other than refugees was estimated
to be around 5,00,000.
 It further escalated during the Bangladesh Liberation War of 1971.
 Even after the end of civil war & formation of Bangladesh, migration continued, though illegally.
 The issue of illegal infiltration became formidable problem in the state of Assam as migrants enjoyed
political patronage.

Timeline of NRC
1951: First-ever National Register of Citizens (NRC) of India published.
1979: Anti-foreigners' movement started in Assam leading to violent protests.

1985: Assam Accord was signed but it failed to solve the problem because it had a negotiated defect
which called for 1 January 1966 to be the precise date based on which the detection illegal immigrants in
Assam would take place and thus ironically allowing Indian citizenship for all persons coming to the
territorial limits of the present day state of Assam from "Specified Territory" (Bangladesh i.e. erstwhile
East Pakistan) prior to that date.

1999: Centre took the first formal decision to update the NRC as per the Assam Accord.

July, 2009: An NGO called Assam Public Works moved the Supreme Court pleading that the process to
update the NRC should be started. This is the first instance how the NRC matter reached the Supreme
Court.

2013: Supreme Court had ordered updating the NRC but no concrete action was taken on ground.

December, 2017: The government published the first draft of the NRC.

July, 2018: Assam government releases second NRC draft. Of the 3.29 crore who applied, 2.89 crore
were declared genuine citizens. The draft NRC excluded over 40 lakh people.
 June 26, 2019: An additional draft on exclusion list was published. This list had 1,02,462 names, taking
the total number of those left out to 41,10,169.

August 31, 2019: The government released the final version of the NRC, with over 9 lakh people in
Assam left out from the list.

Issues with NRC

 There were many examples which suggested that the exclusions were arbitrary, misleading and
incorrect. For example, in some cases, while some members of a family made it to the list, others from
the same family were excluded.
 Some scholars and experts argue that most of the people to be omitted from the final list will be from
two social groups — Muslims and Bengali Hindus.
 This will happen mainly because the government fashioned an arbitrary category entitled ‘original
inhabitants’ (OI) to include millions of Asomiya people in the register, in many cases without verifying
or with insufficient documents.
 The creation of the OI makes the whole NRC process discriminatory.
 The government is yet to specify any policy at the moment for those who did not find a place in the
NRC list. There are speculations that they might be specialized detention camps which would is
unprecedented in the history of India.

References:https://www.moneycontrol.com/news/economy/policy/nrc-in-assam-what-does-the-
publication-of-nrc-bring-to-the-masses-4389251.html
https://www.thehindu.com/opinion/op-ed/the-national-register-of-cruelty/article27061476.ece
 US Imposes Sanction on Iran

 US-Iranian relations lurched downward again Wednesday as the Trump administration unveiled
sweeping new sanctions designed to tighten its stranglehold on Iran’s oil exports, and Iran announced it
would take further steps away from restraints on its nuclear program.
 The administration took action against a shipping network it said was directed by Iran’s Islamic
Revolutionary Guard Corps-Quds Force and designed to evade US sanctions imposed in November on
Iranian oil exports.
 The new sanctions came 10 days after President Donald Trump and Iranian President Hassan Rouhani
indicated a willingness to meet.

 In starkly worded warnings to international maritime and insurance interests, the United States declared
that it would also sanction any individual or entity that did business with anyone connected to the
network.
 Iran has begun to ease away from its terms, protesting that US sanctions have taken away the economic
benefits promised in exchange for Iran’s limiting its nuclear program.
 The latest sanctions came one day after the Treasury Department sanctioned Iran’s space agency,
accusing it of trying to develop ballistic missiles under the guise of working on communications
satellites.

Reference:https://www.nytimes.com/2019/09/04/world/middleeast/iran-sanctions-oil-shipping.html
 Chandrayaan-2: What happened & what's next

 India came 0.0006 per cent close to becoming the first country to do a soft-landing on the lunar South
Pole.
 Chandrayaan 2 traveled a distance of 3,83,998 km out of 3,84,000 km between Earth and Moon.
 ISRO's plan to soft land Vikram on the lunar surface did not go as per script. Final phase of "terrifying
15 minute" landing process was going on well till the rough braking phase.

 The spacecraft began its journey towards the moon leaving the earth's orbit in the dark hours on August
14 and the spacecraft successfully entered the lunar orbit on August 20 by performing Lunar Orbit
Insertion (LOI) manoeuvre.
 On September 2, Vikram successfully separated from the orbiter, following which two de-orbiting
manoeuvres were performed to bring the lander closer to the Moon.
 Out of the total 13 payloads that Chandrayaan-2 carried, as many as seven are onboard the orbiter which
is set to collect one of the most crucial data for the mission.
 A major goal of Chandrayaan-2 is to study the chemical and mineral composition of the lunar surface.
 ISRO plans to send astronauts to space by 2022; an Orbiter mission to Mars between 2022 and 2023;
another mission to Moon -- Chandrayaan-3 -- in late 2020s; Venus mission in 2023; Mission for Sun and
will build a space station.
 During the next one year, it will continue to collect remote sensing observations that will help the
scientists at Indian Space Research Organization (ISRO) to strengthen their understanding of Earth’s
only natural satellite.

Reference:https://economictimes.indiatimes.com/news/science/chandrayaan-2-missed-history-by-0-
0006-what-happened-whats-next/articleshow/71020889.cms
 Boris Johnson loses majority in UK Parliament

 British Prime Minister Boris Johnson suffered key defections from his party Tuesday, losing a working
majority in Parliament and weakening his position as he tried to prevent lawmakers from blocking his
Brexit plans.
 On a day of acerbic debate in the House of Commons, lawmakers confronted Johnson over his insistence
that the U.K. leave the European Union on Oct. 31, even without a withdrawal agreement to cushion the
economic blow.
 As protesters on the streets outside Parliament denounced a “coup,” the lawmakers turned to a key piece
of legislation that would prevent an immediate no-deal Brexit.
 Earlier, two other prominent Conservatives signaled their intention not to seek re-election rather than
bend to Johnson’s will.
 Former Cabinet minister Justine Greening and former Foreign Office Minister Alistair Burt also signaled
their intention to stand down.
 Jeremy Corbyn, leader of the main opposition Labour Party, lambasted the weakened Johnson, accusing
him of “riding roughshod” over the constitution in order to crash Britain out of the EU without a deal.

 Changing the government would not be so simple, however. A no-confidence vote would spark a 14-day
period in which Johnson could try to overturn the result. If he failed, there would be a general election.
 During that key 14-day period, another lawmaker could try to win Parliament’s backing in a vote. If they
succeeded, Johnson should, in theory, have to step down and let the winner form a government.
 The pound sterling fell as low as $1.1960 on Tuesday, down about a cent on the day before, stabilizing
around $1.1990.
 A no-deal Brexit is considered dangerous because it will sever decades of seamless trade with Europe’s
single market of 500 million people.
 Economists warn that trade would be disrupted by tariffs and customs checks between Britain and the
bloc.
 Leaked government documents predicted disruptions to the supply of medicine, a decrease in the supply
of fresh food,freshwater shortages because of disruption to supplies of water treatment chemicals.
 Though the EU is Britain’s biggest trading partner, a no-deal Brexit would also be disruptive to Europe
— a fact not lost on Brussels.

Reference:https://time.com/5667355/uk-parliament-vote-brexit-boris-johnson/
 Data from Swiss Banks can unearth hidden wealth

 If an Indian has a bank account in Switzerland, the bank would now disclose his or her data to the Swiss
authorities, which would automatically forward the information to the Indian tax authorities and any
necessary action can be taken thereafter.
 Switzerland agreed to AEOI with India after months-long process, including review of necessary legal
framework in India on data protection and confidentiality.
 The AEOI would only relate to accounts that are officially in the name of Indian residents and they
might include those used for business and other genuine purposes.
 The data provides full details of all the accounts that were active even for a single day in the year 2018
and can be quite useful for establishing a strong prosecution case against those who had any
unaccounted wealth in those accounts.
 Besides, there are at least 100 cases of older accounts held by Indians, which might have been closed
before 2018, for which Switzerland is in the process of sharing details with India under an earlier
framework of mutual administrative assistance as Indian authorities provided evidence of tax-related
wrongdoings by those account holders.
 These relate to people engaged in businesses like auto components, chemicals, textiles, real estate,
diamond and jewellery, steel products etc.
 The AEOI is being seen as a major boost in India's fight against suspected black money stashed abroad.
Regulatory and government officials said the special focus of the analysis of the Swiss bank data could
be on identifying people with political links.

 The first despatch this month would be followed by further despatches on a yearly basis, according to
Switzerland's Federal Department of Finance (FDF). However, the details received by India would be
governed by confidentiality provisions.
 Switzerland's State Secretariat for International Finance (SIF) found India to have a network of over 100
partner countries with mutual assistance treaties. It also did not come across any documented findings of
serious human rights violations due to taxation or data exchange.

Reference:https://www.livemint.com/news/india/swiss-bank-first-tranche-details-show-enough-details-
to-identify-hidden-wealth-1567920951086.html
 News from around the world

 Senior advocate and former Union law minister Ram Jethmalani passes away
https://www.livemint.com/news/india/noted-jurist-ram-jethmalani-dead-1567915013469.html

 India's Forex reserves fall by USD 446 mn to USD 428.6

https://www.indiatoday.in/business/story/forex-reserves-fall-by-usd-446-mn-to-usd-428-6-bn-1596480-
2019-09-06

 FPIs continue to sell, pulls out INR 1,263 crore in first week of September
https://www.livemint.com/market/stock-market-news/fpis-continue-to-sell-pulls-out-rs-1-263-crore-in-
first-week-of-september-1567923160319.html

 Sonia Dhawan rejoins Paytm group

https://economictimes.indiatimes.com/news/company/corporate-trends/sonia-dhawan-rejoins-paytm-
group/articleshow/71015601.cms

 First ever Army recruitment rally for women candidates set to commence in Lucknow
https://economictimes.indiatimes.com/news/defence/first-ever-army-recruitment-rally-for-women-
candidates-set-to-commence-in-lucknow/articleshow/71025713.cms

 Zomato lays off 600 employees, says technology had created redundancies
https://www.business-standard.com/article/companies/zomato-lays-off-600-employees-reduces-
workforce-by-more-than-10-119090800016_1.html

 Equitas says considering new scheme of arrangement; seeks RBI's approval

https://www.business-standard.com/article/companies/equitas-says-considering-new-scheme-of-
arrangement-seeks-rbi-s-approval-119090701087_1.html
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