Insights Daily Current Events, February 12, 2014

February 12, 2014

By Deepa.M

National-

Interim Rail Budget-

• Independent Rail Tariff Authority is being set up to rationalize fares and a proposal to expand dynamic pricing of tickets in line with the airline industry.
• The launch of 17 new premium trains, 39 express trains, ten passenger  trains and, four MEMU and three DMU trains in the coming year and providing rail connectivity to Katra and Vaishnodevi in Jammu and Kashmir, and Meghalaya and Arunachal Pradesh in the Northeast.
• FDI being enabled to foster creation of world-class rail infrastructure; several PPP projects in pipeline
• Rail infrastructure by cost sharing with governments of Karnataka, Jharkhand, Andhra Pradesh and Haryana
• Rail Land Development Authority has raised Rs. 937 crores so far
• Operating ratio likely to be 90.8 per cent; Railways will end current year with surplus
• Electrification of 4,556 km railway line completed against a target of 4,500 km
• Target of doubling gauge was also surpassed: 2,227 km was completed against a target of 2,000 km
• Railways to encourage transportation of milk
• Steps to reduce running of empty freight carriages
• Bio-toilet facility to be provided in more trains

Related information

RTA (Rail tariff authority)- The Authority will not only consider requirements of the Railways but also engage with all stakeholders to usher in a new pricing regime through a transparent process.

• The RTA is expected to lead an era of rationalisation of fares and freight structures for improving the fare-freight ratio and gradually brining down cross subsidisation between different segments.
• According to Railways, this would go a long way towards improving the financial health of the national transporter which will lead to growth to match expectations of the nation and provide stability by minimising volatility of market condition.

 

MEMU:

The Mainline Electric Multiple Unit or MEMU is a commuter rail system in India operated by the Indian Railway for semi-urban and rural areas.

• The first MEMU service in India started in 1991-92 between Raipur and Durg.
• The system uses Mainline Electrical Multiple Units (MEMU) operating on Alternating Current (AC) drawn from over-head cables through the catenary system.
• MEMU trains are designed for semi-urban and rural areas, unlike EMU (electric multiple unit) trains that are designed for urban and semi-urban areas. MEMU trains also have end vestibules (the passageways connecting two coaches) not found on EMU trains. Also, unlike EMU, MEMU trains include the utility of lavatorial facilities.
• In Kerala first MEMU train ran between Palakkad town and Coimbatore,later extended to shoranur.Now this train is running between Palakkad-Coimbatore-erode-salem,one trip to shoranur also.
• Second MEMU service begun in 2012 March 18 from Kollam to Ernakulam and vice versa.
  • Chennai – Tirupati MEMU train
  • Falaknuma – Bhongir MEMU (extended in 2013 till Jangaon)

International-

Indo-US energy dialogue–

• Cooperation in the shale gas exploration, collaboration on strategic petroleum reserves, export of LNG to India and partnership in the field of renewable energy would form the focus on the Indo-U.S.
• The meeting between the Indian officials and U.S. government would focus on mainly issues of oil and gas investment and safety, unconventional gas cooperation, energy policy, security of supply and strategic oil reserves and South Asia regional Energy Integration
• Gas scenario by 2020- issue of export of LNG from U.S. to India, the future of energy matrix and global gas scenario and its implication in the TAPI project will come up for discussion
• India would take up with U.S. the issue of enhanced shale gas and LNG exports to India. The Oil and Natural Gas Corporation (ONGC)-led consortium is likely to seek U.S. assistance and expertise in shale gas exploration and best practices for technical mapping processes
• The U.S. side is also keen on forging an collaboration between Indian universities and U.S. Petroleum Engineering Departments, including Tax A&M University at College Station, Huston and its Qatar (Doha) campus
• The U.S. side has expressed its desire to offer India assistance in development of salt caverns which often house hydrocarbon reserves and coordinate with the Ministry of Petroleum and Natural Gas in coordinating efforts with International Energy Agency (IEA) to assist in decision making regarding the different business models available for operation in such reserves
• State-owned GAIL India Ltd. has entered into a $15 billion deal for a 20-year gas import deal to buy LNG from Houston-based Cheniere Energy.
• India wants U.S. to relax its restrictive policy for other Indian companies. At present, U.S. does not allow gas exports to any country with which it doesn’t have a Free Trade Agreement (FTA) but made an exception for GAIL India Ltd. Cheniere Energy will supply GAIL with 3.5 million tonnes per year of LNG from Chenier’s Sabine Pass LNG terminal in Louisiana. At current prices, it’s a favorable deal for India and LNG deliveries are expected to start in 2017.
• On the nuclear energy front, U.S. is likely to take up with India the fact that even after seven years of signing the Indo-U.S. nuclear deal, not a single U.S. nuclear company has been able to make significant headway into India.

Environment-

Endangered Olive Ridley turtles– The olive ridley sea turtle, also known as the Pacific ridley sea turtle, is a medium-sized species of sea turtle found in warm and tropical waters, primarily in the Pacific and Indian Oceans.

• Olive ridley turtles are best known for their behavior of synchronized nesting in mass numbers
• The olive ridley is classified as Vulnerable according to the International Union for Conservation of Nature and Natural Resources (IUCN), and is listed in Appendix I of CITES.
• These listings were largely responsible for halting the large scale commercial exploitation and trade of olive ridley skins.
• The Convention on Migratory Species and the Inter-American Convention for the Protection and Conservation of Sea Turtles have also provided olive ridleys with protection, leading to increased conservation and management for this marine turtle
• Several projects worldwide seek to preserve the olive ridley sea turtle population. For example, in Nuevo Vallarta, Mexico, when the turtles come to the beach to lay their eggs, some of them are relocated to a hatchery, where they have a much better chance to survive. If the eggs were left on the beach, they would face many threats such as getting washed away with the tide or getting poached. Once the eggs hatch, the baby turtles are carried to the beach and released
• Mass nesting of endangered Olive Ridley turtles started at Rushikulya rookery coast in Ganjam district of Odisha

ECONOMY:

Global crude oil price of Indian Basket marginally declines to US$ 106.29 per bbl on 11.2.2014: Rises in rupee terms on weaker currency

• The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas went down to US$ 106.29 per barrel (bbl) on 11.02.2014.
• This was lower than the price of US$ 106.51 per bbl on previous trading day of 10.02.2014
•  In rupee terms however, the price of Indian Basket increased to Rs 6636.75 per bbl on 11.02.2014 as compared to Rs 6623.86 per bbl on 10.02.2014.
• This was due to rupee depreciation   Rupee closed stronger at Rs 62.44 per US$ on 11.02.2014 against Rs 62.19 per US$ on 10.02.2014.

The table below gives details in this regard:

Particulars	Unit	Price on February 11, 2014(Previous trading day i.e. 10.02.2014)	For Pricing Fortnight January 14 to 29, 2014  (Effective 1.2.2014)
Crude Oil (Indian Basket)	($/bbl)	106.29         (106.51)	105.17
	(Rs/bbl	6636.75       (6623.86)	6517.38
Exchange Rate	(Rs/$)	62.44          (62.19)	61.97

  RCJ/Daily Crude oil price- 12.02.2014    

Record 263.2 Million Tonne Foodgrain Production Likely this Year

Focussed Schemes, More Investment, Rising MSP and Credit Expansion Seen as Major Contributors

• India is likely to produce record 263.2 million tonne foodgrains this year (includes kharif 2013 and rabi crops in the field at present). The earlier foodgrain production record of 259.3 MT was achieved in 2011-12.
• As per the latest crop sowing data available, major crops have been sown in more area than in rabi last year.
• Wheat has been sown in 315.3  lakh hectare as compared to 298.2   lakh hectare in the last rabi; pulses in 161.9 lakh hectare as compared to 152.7  lakh hectare in the last rabi; and oilseeds in 90.1 lakh hectare as compared to 87.3 lakh hectare in the last rabi. This will translate into higher production this rabi.
• India is now the top exporter of rice and second top exporter of wheat and cotton.
• Overall agricultural exports stood at Rs. 2,01,000 crore in 2012-13.  India also is one of the top producers of milk, and fruits and vegetables.
• A number of initiatives have been taken in recent years to increase farm production and productivity.

• Some of the major initiatives include:
•  Focussed approach for improving productivity of major crops in low-productivity districts through the mega scheme, the National Food Security Mission (NFSM).

• Ø This scheme resulted in additional foodgrain production of 20 million tonne in the XI Plan.
• Ø In the current Plan, additional annual foodgrain production of 25 million tonne is planned through NFSM.
• Ø Enhancing public investment in agriculture, especially by incentivising states to invest through the Rashtriya Krishi Vikas Yojana (RKVY) scheme.
• Ø About Rs. 25,000 crore were disbursed to states under RKVY in the XI Plan and the allocation under RKVY has been enhanced.
• Ø Further, states have been given a great deal of flexibility in deciding projects for which RKVY funds are to be used.
• In the current plan, Rs. 1.35 lakh crore have been allocated for agricultural programmes as compared to Rs. 62,000 crores in the XI Plan.
• Ø An area-focussed scheme, Bringing Green Revolution to the Eastern Parts of India (BGREI) aimed at achieving fast growth in production in the eastern parts of the country.
• Ø After the launch of this scheme 3 years ago, the production of rice in the eastern region has seen fast growth.
• Ø Special programmes for production of pulses and oilseeds.
• Ø Successive increases in MSP of crops. Minimum support prices (MSP) for crops have been increased significantly over the years, thus making farming more remunerative to farmers.
• Ø Expansion of farm credit and availability of farm credit at low interest rates.
• Ø Farm credit, which was nearly Rs 85,000 crores in 2003-04, is likely to reach the target of Rs. 7,00,000 crores in 2013-14, This means, about eight times more credit is now flowing to agriculture than the credit flow ten years back.
• Ø In addition, crop loans are now available at a low interest rate of 4% to farmers who are regular in repaying their loans.

A number of other initiatives have been taken to increase the production of horticultural crops under the National Horticulture Mission, and for dairying under the National Dairy Plan.

Focus also is on improving yield of inland and marine fisheries, meeting the growing demand for feed and fodder, making quality / certified seeds available to farmers, and covering more farmers under crop insurance.

Ministry of Micro,Small & Medium Enterprises

Employment Generation by KVIC(Khadi and Village Industries Commission)

• Estimated employment opportunities generated by the Khadi and Village Industries Commission (KVIC) in the rural and urban areas in the country during the last three years and the current year is:

Year	Estimated employment generated(cumulative) (in lakh persons)
	Khadi	Village Industries	Total
2010-11	10.15	103.65	113.80
2011-12	10.45	108.65	119.10
2012-13	10.71	114.05	124.76
2013-14* (upto 31 January 2014)	10.89	129.40	140.29

* Figures are provisional

• KVIC has been implementing a number of schemes for the holistic development and promotion of khadi and village industries in the country, inter alia, for creation of employment in the non-farm sector.
• Funds released and utilized by KVIC for implementation of various schemes during the last three years and the current year is:

(Rs. crore)

*including balance funds of previous year

• Mahatma Gandhi Institute for Rural Industrialization (MGIRI) is a national- level institute for research, design and extension activities in the rural industries sector including training of stakeholders.  MGIRI has provided training to a total of 602 persons during last 3 years (2010-11 to 2012-13).

• The Ministry of Micro, Small and Medium Enterprises (MSME) has already been implementing a credit-linked subsidy programme named Prime Minister’s Employment Generation Programme (PMEGP) with KVIC as nodal agency at the national level for generating employment for various categories of persons including war widows, ex-servicemen and their dependent in rural areas in the Country by setting up of micro-enterprises in the non-farm sector. Under PMEGP, general category beneficiaries can avail of margin money subsidy of 25% of the project cost in rural areas and 15% in urban areas.

• For beneficiaries belonging to special categories such as scheduled castes, scheduled tribes, OBCs, minorities, women, ex-servicemen, physically handicapped, beneficiaries belonging to North Eastern Region, hill and border areas, etc.,  the margin money subsidy is 35% in rural areas and 25% in urban area. The maximum cost of project is Rs. 25 lakh in the manufacturing sector and Rs. 10 lakh in the service sector.

• Under PMEGP, 2.30 lakh projects have been assisted till 31.12.2013 creating employment opportunities for an estimated 20.90 lakh persons utilizing margin money subsidy of Rs. 4331.92 crore.