Current Affairs 2nd Aug 2022

GST levies won’t burden the poor #GS3 #Economy

Union Finance Minister Nirmala Sitharaman on Monday asserted that the Goods and Services Tax (GST) levies on food items such as curd, lassi and wheat would not burden poor households, and took on States and the Opposition parties for seeking to suggest that the taxes were driven by the Narendra Modi administration when it was a decision taken by the GST Council with all States on board.

Stressing that the government had held inflation at 7% or lower despite multiple headwinds including the COVID-19 pandemic , the Ukraine-Russia conflict and supply chain disruptions that persist due to lockdowns in parts of China, the Minister said the government was working to reduce price rise further.

The Minister contrasted this with retail inflation trends under the UPA regime, noting that the pace of price rise was over 9% in 22 out of 28 months and had crossed 10% nine times. “That should also be remembered when we are being asked why we are not bringing it below 7%,” she said.

“When questions are constantly based not on facts, facts will have to be reminded. Even now, an Opposition member said inflation existed before COVID also. Yes, inflation existed. Let’s not forget – for a small taper tantrum by the U.S. Fed in 2008 led to problems till 2013 that led to India becoming one of the fragile five economies.

“The levy is only on pre-packaged and pre-labelled goods, so there is no impact on poor people from this. Similarly, for packs of over 25 kg, we are not levying tax because wholesale traders can supply to kirana shops without tax. Keeping the poor in mind, anything sold loose is not being taxed. It must be remembered.

Solih arrives amid anti-India stir in Maldives #GS2 #IR

Maldives President Ibrahim ‘Ibu’ Solih arrived in Delhi for a bilateral visit on Monday, amid rows within his government over ties with India, the Yoga Day attack, and a bitter row with Maldivian Speaker, former President and party colleague Mohammad Nasheed. During his four-day visit, Mr. Solih will also visit Mumbai for two days, and is expected to focus on enhancing trade and connectivity between the two countries.

Mr. Solih will become the first visiting head of State to meet President Droupadi Murmu, External Affairs Minister S. Jaishankar called on Mr. Solih. “Our Neighbourhood First and Maldives’ India First policies are complementary. They take our special partnership forward.

The infrastructure projects include the Greater Male Connectivity Project of bridges connecting the capital city to neighbouring islands, to be built by Indian company Afcon with the help of a $400 million Line of Credit and a $100-million grant from India, along with other projects under India’s $1.4-billion assistance announced during Mr. Solih’s last visit to India in December 2018.

Centre constitutes task force to monitor monkeypox situation #GS3 #SnT

In the wake of the detection of monkeypox cases in India, the Union government has constituted a task force to monitor and provide guidance on the expansion of diagnostic facilities and to explore vaccination against the infection in the country.

According to the World Health Organization (WHO), more than 18,000 cases have been reported from 78 countries. “The monkeypox outbreak can be stopped if countries, communities, and individuals inform themselves, take the risks seriously, and take the steps needed to stop transmission and protect vulnerable groups.

Monkeypox is a zoonotic disease caused by the monkeypox virus, which belongs to the same family of viruses that causes smallpox. The disease is endemic in regions like West and Central Africa, but lately, cases have been reported from non-endemic countries too.

Centre alerts States to step up vigilance over IS threat #GS3 #InternalSecurity

The Union government has alerted all States to step up vigil at vulnerable locations and conduct combing operations on possible hideouts of terror suspects. The alert follows specific inputs that IS handlers abroad had developed applications to recruit and train youth to execute a terror plot targeting vital installations, religious leaders, places of high footfall and so on.

Central and State intelligence agencies are conducting joint searches at dozens of locations in different States and detaining youth who were in touch with IS operatives on social media or mobile phone applications. Investigators claimed to have information that besides a systematic indoctrination of the jihadi ideology, the handlers were exposing the recruits to the handling of explosives, weapons, tactical warfare and so on.

Tamil Nadu Director-General of Police (DGP) C. Sylendra Babu said the police conducted searches and apprehended some youth after ascertaining that they were in touch with banned organisations.

In the arrest of Mir Idayat Ali (21) of Ambur in Tirupattur district under the UAPA, the police claimed he was recruited by the IS and was in touch with the handlers. The suspect was part of a conspiracy to cause terror attacks, the report said.

The Special Sub-Inspector said Mr. Ali was in possession of two mobile phones, a laptop and two knives. However, the police did not confirm whether there was any specific content in the devices to corroborate the allegations.

The sources said some terrorist organisations planned to disrupt the Independence Day celebrations. While security agencies were averting or intercepting consignments of arms/ammunition being supplied across the border using drones, it was possible that some could have reached them. The State police were told to enhance security at airports, seaports, railway stations, bus terminals, places of worship, malls and so on.

IAF to take part in ‘Pitch Black’ in Australia #GS2 #IR

Continuing the series of military exercises with countries in the Indo-Pacific, the Indian Air Force (IAF) will join 16 other nations, including Quad partners, later this month for Exercise Pitch Black, the biennial exercise hosted by the Australian Air Force. About 100 aircraft and 2,500 military personnel from 17 nations will arrive in the Northern Territory in two weeks to commence Exercise Pitch Black 2022.

With a four-year hiatus since the last Pitch Black due to the global pandemic, this year’s exercise will see a return of the combined force to Australian skies, enhancing interoperability and strengthening relationships.

Biden for talks on nuclear arms control #GS2 #IR

President Joe Biden called on Russia and China to enter nuclear arms control talks, saying that Moscow in particular has a duty to show responsibility after its invasion of Ukraine.

In a statement, the U.S. leader reiterated that his administration is ready to “expeditiously negotiate” a replacement to New START, the treaty capping intercontinental nuclear forces in the U.S. and Russia, which is set to expire in 2026. “Russia should demonstrate that it is ready to resume work on nuclear arms control.

Turning to China, which has been bolstering its much smaller nuclear arsenal, the U.S. President said the communist state has a duty as a permanent member of the United Nations Security Council “to engage in discussions that will reduce the risk of miscalculation and address destabilising military dynamics.

Manufacturing PMI hits 8-month high #GS3 #Economy

India’s manufacturing sector rebounded in July, with sales and output growing at the fastest pace since November, as per the survey-based S&P Global India Manufacturing Purchasing Managers’ Index (PMI). The PMI quickened last month to 56.4, from June’s 9-month low of 53.9. The index suggested ‘marked gains’ in new business orders during July, even though job creation remained marginal amid an uncertain outlook.

‘Pass-through softens’

Although costs continued to rise, the inflation rate in manufacturing inputs eased to an 11-month low. Chemicals, electronic components, metals, textiles and transportation fees were reportedly higher, even as the pass-through of higher costs to output prices moderated to the lowest in four months.

“Inflation rates, for both input prices and output charges, were most acute in the capital goods segment,” S&P Global said. “The weakest rises were… in the intermediate goods sub-sector.”

New export orders grew at the slowest pace in four months, even as aggregate new orders recovered smartly in July from the loss in growth momentum in the preceding month. It was the thirteenth month in a row that factory orders and production recorded growth.

‘Outlook. jobs subdued’

The uptick in July, however, did not alter the outlook among most producers, with 96% expecting no change in output levels over the coming year. Business sentiment was only marginally better than June, when it had slipped to a 27-month low.

The uncertainty about the future also constrained hiring, which remained marginal, with 98% of firms keeping workforce numbers unchanged as there was no pressure on operating capacities. “Despite the solid performance… overall job creation remained subdued,” S&P Global noted. The “increase in employment was… broadly similar to those seen in the current five-month sequence of growth,” it added.

Pollyanna De Lima, economics associate director at S&P Global Market Intelligence said July marked a ‘welcome combination of faster economic growth and softening inflation’ for producers. “Although the upturn in demand gained strength, there were clear signs that capacity pressures remained mild as backlogs rose only marginally and job creation remained subdued. Firms were successful in their efforts to obtain inputs amid a second consecutive improvement in supplier performance.