Banking, Financial and Economic Awareness
1. Term of 15th Finance Commission extended by one year
- The term of 15th Finance Commission has been extended for the second time that will now continue till October 30, 2020.
- The Commission will now present the first report for the 2020-21 and second report for the financial years, 2021-22 to 2025-26, by October 30, 2020.
- The commission has been given extra time to compare estimates for financial projections considering economic reforms done during the last financial year.
- The Commission assessed the requirements of some states wherethe Model Code of Conduct was imposed in recent elections. The extension of the term will help the Commission in considering requirements of these states also.
- As per the provision of section 83 of the Jammu and Kashmir Reorganisation Act, 2019, the Union Territory of Jammu and Kashmir will also be included in its Terms of Reference after recommendation by the President.
- Finance Commission:
- The Finance Commission is a constitutional body under Article 280 of the Constitution of India.
- NK Singh is the chairman of the 15th Finance Commission.
2. Andhra Pradesh to establish a new steel plant in Kadapa district and World Bank has agreed to think about funding the State’s watershed project
- The steel plant will be established at Jammalamadugu Mandal of the Kadapa District, Andhra Pradesh.
- AP High-Grade Steel Corporation will be formed, and 3,295 acres of land will be acquired.
- NMDC (National Mineral Development Corporation) will supply iron ore for the plant.
- World Bank hasalso agreed to think about helping the AP government through 70 million dollar loan over a period of five years forthe state’s watershed project.
- In the first phase, the amount will be used to cover the backward areas of Rayalaseema and Prakasam district.
- World Bank:
- It was established in 1944.
- It is headquartered in Washington.
- It has 189 member countries.
- Its goal is to end extreme poverty at the global level.
3. SEBIhas announced guidelines for listed Real Estate Investment Trusts (REITs)
- The guidelines will be followed by listed REITs for preferential issue of units and institutional placements of units.
- Securities and Exchange Board of India (SEBI) has recommended that issuance is required to have minimum listing period of 12 months for enabling a listed REIT to make a preferential issue of units or institutional placement of units.
- In a financial year, more than 200 investors (excluding institutional investors) cannot be offered through private placement.
- The preferential issue is defined by Regulation 2(1) (zd) of the Securities and Exchange Board of India (Real Estate Investment Trusts) Regulations, 2014.
- Preferential issue means the issue of units to some selected persons only.
- Institutional placements mean a preferential issue of units to institutional investors.
- Real Estate Investment Trusts (REITs):
- REITs are established as a trust under the Indian Trusts Act, 1882
- The Securities and Exchange Board of India (SEBI) regulates REITs.
- REITs are similar to mutual funds.
4. Google’s Threat Analysis Group (TAG) reports more than 500 snooping attempts of government-backed hackers from India
- The number of snooping attempts in India was higher than in China.
- WhatsApp, which is owned by Facebook, has also reported similar attempts of spying over its users by Pegasus malware of Israeli NSO Group.
- The Israeli company said that it provides the spyware only to governments for helping them fight against terror and crime.
- Google’s Threat Analysis Group (TAG) keeps track of over 270 targeted or government-backed hackers from over 50 countries.
- In Cybercrime, snooping means trying to access data of any person or company by using software without obtaining permission.
5. Moody’s estimatesunion government’s fiscal deficit to be at 3.7 percent of GDP
- As per Moody’s recent estimates,the fiscal deficit of the union government will remain at 3.7 percent of GDP as spending pressures on government have continued for long time, and economic growth has been slow.
- The combined fiscal deficit of all States will remain at three percent of GDP.
- Union government’s fiscal deficit target for 2019-20 was 3.3 percent.
- Fiscal deficit is the amount by which total expenditure of government differs from its total revenue. The borrowings of a government are not included in fiscal deficit. A high fiscal deficit means that the government's expenditure is more than its revenue. Fiscal deficit is generally expressed as a percentage of country's GDP.