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Trouble is brewing in the financial sector in India

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rouble is brewing in the financial sector in India

Shimla- All is not well in the financial sector in India. For the past few years, the  financial sector in India has been in the news for all the wrong reasons; be it the loan given to the liquor baron Vijay Malaya; the revelation of  Nirav Modi saga; ever mounting NPA amount in the public sector banks; payment default by  Infrastructure Leasing & Financial Services  (IL&FS); for weeks the RBI and the Government were at  the loggerheads- that culminated with the infelicitous resign of the Governor prior to his completion of term; or be it woes the various private sectors banks like ICICI, Bandhan Bank, Kotak  Mahindra Bank or Yes bank are facing.

All these incidents are not only disconcerting but can have a preponderant impact on the financial markets. Off late, banks stocks have been on the downslide because of the uncertainty and pessimism caused in the market by the series of such unwanted events. There have been rumors of liquidity crunch in the market for some time now, the credit growth has been bleak, impacting the investment and hence job creation. 

After the series of payment default by the Infrastructure Leasing & Financial Services (IL&FS), the Modus Operandi of non-banking financial companies in India is under serious scrutiny. The systematic risk associated with shadow banking in India might require a major relook. 

RBI has put 11 Public Sector banks under Prompt Corrective Action framework, and the majority of them are running in losses hence requiring a massive capital infusion. The problem of NPA is far from over in Public Sector Banks. 

The trouble with the private sectors banks will capitulate the demand for privatization of Public Sector banks, as these incidents have proved ownership of banks is not the root cause of the problems of Public Sector banks; moreover, these incidents proved private sector banks are not immune to troubles and changing ownership will not help much, as far as the problems of Public Sector banks are concerned. 

All this will have a bearing on India’s worldwide credit rating too, adversely affecting the investment ecosystem required for strong and stable economic growth. 

All this does not augur well for India’s development. The financial sector plays a critical role in the development of any nation. To reap the benefit of the economic potential, a robust and healthy financial sector with strong fundamental is required, along with an independent and accountable Central banker coalesced with a fair financial market regulator. 

At the moment there is a lot to cogitate for us. Our image, worldwide, has taken a dent, it needs to be restored. We cannot persist with the beleaguered financial system for too long. The financial sector is full of various risks, the key, however, is to infer the rumblings early and prepare to minimize such risks. 

We have a serious problem in our hands and we must act fast. If we don’t act in time, the problem may exacerbate further. And our Lehman Brother moment may not be far if we don’t manage these conspicuous risks. For a stable and sustainable growth, we need to put an end to these troubles brewing in the financial sector. It’s high time.

Misc News/Press Release

447 Cases of Adverse Effect Including 3 in Himachal Reported Post COVID-19 Vaccination

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Shimla– Amid skepticism over the COVID-19 vaccination, India has reported over 400 cases of adverse effect post-vaccination, informed the Ministry of Health. To be more specific, a total of 447 Adverse Event Following Immunization (AEFIs) were reported on 16th Jan & 17th Jan’21.

Out of these, three required hospitalization. Of these, one was discharged from Northern Railway Hospital Delhi within 24 hours; one was discharged from AIIMS Delhi, and one is under observation in AIIMS Rishikesh and is being monitored.

Most of the AEFIs reported so far are minor like Fever, Headache, Nausea etc.

In Himachal Pradesh, about three cases of AEFIs were reported on day 1 of vaccination drive. These were reported from Dr Rajendra Prasad Government Medical College Tanda, Kangra, Civil Hospital Paonta Sahib, and Maharishi Markandeshwar University Medical College, Solan.

In these cases, symptoms reported included dizziness, anxiety, nausea and shivering and persons recovered after management as per protocol, it was informed.

In Himachal, 2,499 health care workers were to be administered dose through 27 identified sites in the State on January 16. However, only 1535 healthcare workers could be vaccinated on the first day. It was 61 percent of this set target. The second round would be held today.  

Two types of COVID-19 vaccines have been supplied for the vaccination drive. These include Covishield vaccine (made by Serum Institute of India Ltd) that has been supplied to all States/UTs.

The second is Covaxin vaccine (made by Bharat Biotech International Ltd) that has been supplied to 12 States.

An Adverse Event Following Immunization (AEFI) is any unexpected medical occurrence which follows immunization. It may not be related to the vaccine or vaccination process. The Ministry had laid down protocols for reporting, immediate case management at vaccination session site, transportation and hospitalization and further care of such cases. Protocols are also in place for systematic investigation and causality assessment of serious AEFIs, the Ministry said.

India has vaccinated the highest number of persons on Day1 under its COVID19 vaccination program, the world’s largest such exercise.

Total of 2,24,301 beneficiaries have been vaccinated till today as per the provisional report.

The second day of the massive countrywide COVID-19 vaccination program was also conducted successfully. A total of 553 sessions were held in six States. As many as 17,072 beneficiaries were vaccinated on Day2, as per the provisional reports.

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Farmers Welcome SC Order to Stay Implementation of Farm Laws But Suspicious About Formation of Committee

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New Delhi: The Supreme Court on Tuesday stayed the implementation of three contentious farm laws passed by the Centre Government, which has led to huge protest from hundreds of farmer groups. The stay implies that the Centre Government can’t take any executive actions based on these laws till further order. 

“The implementation of the three farm laws (1) Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020; (2) Essential Commodities (Amendment) Act, 2020; and (3) Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, shall stand stayed until further orders,”

said the order passed by a panel headed by the Chief Justice of India (CJI) Sharad A Bobde on Tuesday.

Further, the MSP system would continue as it was before the enactment of the laws.

“As a consequence, the Minimum Support Price System in existence before the enactment of the Farm Laws shall be maintained until further orders. In addition, the farmers’ land holdings shall be protected, i.e., no farmer shall be dispossessed or deprived of his title as a result of any action taken under the Farm Laws,”

the order said.

With this order, the SC hoped to end the ongoing impasse over the contentious farm laws.

The farmers who have been protesting for over the last 45 days, welcomed the SC’s order.

However, at the same time, the Apex Court ordered the formation of a committee to listen to both sides and make recommendations to the court. The committee, which would comprise of Agriculture economist Ashok Gulati, Bhupinder Singh Mann, Dr Prmod Kumar Joshi, former director of National Academy of Agricultural Research Management), and Anil Ghanwat from Shetkari Sangathan, was asked to submit its report in the court within two months.

The CJI, in its order, speaking about the purpose of this “extraordinary” order, said,

“While we may not stifle a peaceful protest, we think that this extraordinary order of stay of implementation of the farm laws will be perceived as an achievement of the purpose of such protest at least for the present and will encourage the farmers’ bodies to convince their members to get back to their livelihood, both in order to protect their own lives and health and in order to protect the lives and properties of others.”

Though a stay on the implementation of laws was welcomed by protesting farmers, several unions said that they would not accept this committee and the protest will continue. They said the Government is trying to form this committee through the Supreme Court. This committee, they said, included persons who have already been justifying the farm laws. They said the purpose of this committee is nothing more than creating a diversion. The protest would be armed up and only a repeal of laws would be accepted, the unions said. 

At the same time, the SC was undeterred with these statements and said there is nothing that can stop it from forming a committee. The SC asked the farmers to cooperate with the committee.

On the other hand, the Government was more concerned about that other political parties would think of the stay as a “political victory”.

Further, the Government has also expressed apprehension about security breach due to the tractor rally planned by protesting farmers on the Republic Day.

K.K. Venugopal, Attorney General, told the court that there are reports that the farmers’ bodies may take out a tractor rally on January 26, 2021, disrupting the Republic Day Parade and celebrations However, the same was stoutly denied by Dushyant Dave, learned senior counsel appearing for a few of the farmers’ bodies on the ground that at least one member of the family of each of the farmers from Punjab is in the Army and that they would not disrupt the Republic Day celebrations.

The Court, in its order, said that several rounds of talked between farmers and the Government have failed and there was no solution in sight.

“The situation on ground is: (i) that senior citizens, women and children are at site, exposing themselves to serious health hazards posed by cold and covid; (ii) that a few deaths have taken place, though not out of any violence, but either out of illness or by way of suicide,”

the order said.

The court also lauded the farmers for carrying on the agitation peacefully without any unwanted incident.

Further, the Court orders also mentioned separate petitions filed by individuals/residents of the NCR complaining of blockade of roads/highways leading to Delhi and terming it an infringement of the fundamental rights of other citizens to move freely and to carry out trade and business.

Stay on 3 Farm Laws and Formation of Committee: Read Full Order of Supreme Court

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New Corona Variant More Transmissible and Affecting Younger Population, Indian Govt Issues SOPs

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Indian Govt SOPS for new COVID-19 variant

Delhi-A new variant of SARS- CoV 2 virus has been reported by the Government of the United Kingdom (UK) to the World Health Organization (WHO). This variant is estimated by the European Center for Disease Control (ECDC) to be more transmissible and affecting the younger population, the government informed. This variant is defined by a set of 17 changes or mutations. One of the most significant is an N501Y mutation in the spike protein that the virus uses to bind to the human ACE2 receptor. Changes in this part of the spike protein may result in the virus becoming more infectious and spreading more easily between people.

The new VUI-202012/01 variant has been identified in several countries including Australia, Denmark, Italy, Iceland and the Netherlands.

“Preliminary reports by the UK are that this variant is more transmissible than previous circulating viruses, with an estimated increase of between 40% and 70% in transmissibility (adding 0.4 to the basic reproduction number R0, bringing it to a range of 1.5 to 1.7). Laboratory studies are ongoing to determine whether these variant viruses have different biological properties or alter vaccine efficacy. There is not enough information at present to determine if this variant is associated with any change in the severity of the clinical disease, antibody response or vaccine efficacy,”

said WHO on Tuesday.

Indian Ministry of Health has issued SOP for Epidemiological Surveillance and Response for the same. The Standard Operating Procedure (SOP) describes the activities to be undertaken at the point of entry and in the community for all International passengers who have travelled from or transited through the UK in the past 4 weeks (from 25th November to 23rd December 2020). Any reference to testing in this SOP implies RT-PCR testing only.

The flights from the UK are suspended temporarily from 23rd December till 31st December 2020 or till further orders. All the passengers travelling from or transiting through airports in the UK and disembarking in India during the intervening period from 21st to 23rd December 2020 would be subjected to RT-PCR test on arrival. In the case of a positive sample, it is recommended that spike gene-based RT-PCR test should also be performed.

 Passengers testing positive will be isolated in an institutional isolation facility in a separate (isolation) unit coordinated by the respective State Health Authorities. Necessary action to send the samples to National Institute of Virology (NIV), Pune or any other appropriate lab for genomic sequencing will be initiated at the facility level. If the genomic sequencing indicates the presence of a new variant of SARS-CoV-2 then the patient will be kept in the separate isolation unit and treated as per the clinical protocol.

Those who are found negative on testing with RT-PCR at the airport would be advised quarantine at home. Prior to check-in, the traveler will be explained about this SOP and In-flight announcements must also be made.

Those international travelers from the UK who arrived in India since last one month will be contacted by District Surveillance Officers and monitored in the community.

State Governments/ Integrated Disease Surveillance Programme will ensure that all the contacts of those travelers from the UK or transiting through the UK in the last four weeks will be traced and monitored. They will also be tested as per protocol and contacts of positive cases would be subjected to institutional quarantine in separate quarantine centers for effective isolation and monitoring.

Read Complete List of SOPS

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