December 2019

Daily Current Affairs (29-12-19)



Related Topic in KAS Prelims Syllabus:

Economy [Paper-II]: Structure of Indian Banking and Non- Banking Financial Institutions and reforms


Reserve Bank of India released the 20th issue of the Financial Stability Report (FSR).

About the Report

  • The Report reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability, as also the resilience of the financial system.
  • The bi-annual Report also discusses issues relating to development and regulation of the financial sector.

Overall assessment of systemic risks

  • India’s financial system remains stable notwithstanding weakening domestic growth.
  • The resilience of the banking sector has improved following recapitalisation of public-sector banks by the government, which aims to infuse 70,000 crore into state-owned banks this fiscal.

Global and domestic macro-financial risks

  • Factors such as a delay in Brexit deal, trade tensions, whiff (a smell that is only smelt briefly or faintly) of an impending recession, oil-market disruptions and geopolitical risks caused uncertainties, leading to a significant deceleration in growth.
  • These uncertainties weighed on consumer confidence and business sentiment, dampened investment intentions and unless properly addressed are likely to remain a key drag on global growth.
  • The revival of twin engines of India’s economic growth — private consumption and investment — while being vigilant about the events and developments taking place in global financial markets remains a critical challenge.
  • Aggregate demand has slumped in the second half of the current financial year ending March 2020, adding to an already slowing economic growth.
  • While the outlook for capital inflows remains positive, India’s exports could face headwinds in the event of sustained global slowdown.
  • Current account deficit is likely to be under control reflecting muted energy price outlook.

Financial Institutions: Performance and risks

  • Gross Non-Performing Asset (GNPA) ratio of Public Sector Banks (PSBs) is expected to increase from 9.3% in September 2019 to 9.9% by September 2020, primarily due to change in macroeconomic scenario, marginal increase in slippages and the denominator effect of declining credit growth.
  • Provision Coverage Ratio (PCR) of all banks rose to 61.5% in September 2019 from 60.5% in March 2019, implying increased resilience of the banking sector.
  • Credit growth for the overall banking sector took a hit amid the slowdown. Credit growth remained subdued at 8.7% year-on-year in September 2019. However, private banks witnessed a double-digit credit growth of 16.5%.

Financial sector: Regulation and developments

  • Reserve Bank has initiated policy measures: to introduce a liquidity management regime for NBFCs; to improve the banks’ governance culture; for resolution of stressed assets and for the development of payment infrastructure.
  • The issue of bad loans, which slowed the performance and growth of private, public-sector banks and even non-banks, has largely been tackled under the Insolvency and Bankruptcy Code (IBC).

[Source: Livemint,]



Related Topic in KAS Prelims Syllabus:

Economy [Paper-II]: Recent fiscal and monetary policy issues and their impact, structure of Indian Banking and Non- Banking Financial Institutions and reforms

Why in News?

Finance Minister Nirmala Sitharaman announced that no Merchant Discount Rate (MDR) will be applicable on transactions through homegrown RuPay and UPI platforms from January 1, 2019.

News in Detail

  • The Department of Revenue (DoR) will soon notify RuPay and UPI as the prescribed modes of payment for digital transactions without any MDR.
  • All companies with a turnover of Rs 50 crore or more will be mandated by the government to provide the facility of payment through RuPay Debit card and UPI QR code to their customers.
  • The move is expected to boost payments via home-grown real-time payments system Unified Payments interface (UPI) at merchant locations, along with RuPay debit cards.

What is MDR?

  • It is the cost paid by a merchant to a bank for accepting payment from their customers via digital means.
  • The merchant discount rate is expressed in percentage of the transaction amount.
  • It is also applicable for online transactions and QR-based transactions.
  • The amount that the merchant pays for every transaction gets distributed among three stakeholders–the bank that enables the transaction, vendor that installs the point of sale (PoS) machine and the card network provider such as Visa, MasterCard, and RuPay.
[Source: Indian Express, Livemint]




Related Topic in KAS Prelims Syllabus:

Geography [Paper-I]: Physical, Social, Economic Geography of World, India and Kerala


Indian Army has rescued about 1,500 tourists who were stranded in Nathu La after heavy snowfall blocked the Jawaharlal Nehru road in Sikkim.

About Nathu La

  • It is a mountain pass in the Himalayas in East Sikkim district. It connects the Indian state of Sikkim with China’s Tibet Autonomous Region.
  • The pass, at 4,310 m above mean sea level, forms a part of an offshoot of the ancient Silk Road.
  • It was closed after the Chinese aggression on India in 1962 but was reopened in 2006 as the governments of the two countries decided to enhance their trade through land routes.
  • Nathu means listening ears and La means pass in Tibetan.

Additional Info

A mountain pass is a navigable route through a mountain range or over a ridge.

[Source: All India Radio]



  • National Symposium of Poets – 2020 was organized by All India Radio.
  • The poet symposium was attended by select poets of all 22 languages recognized in the constitution. It is being held continuously every year since 1956.
  • China announced the successful launch of the Long March 5 rocket, sending a communication satellite into Earth’s high orbit.
  • The Long March 5 is a new generation launch vehicle with close to twice the payload capacity of the most powerful older Chinese rocket, making it crucial to China’s major plans over the next decade.
  • These include missions to Mars, the lunar Polar Regions, and a solar polar orbit telescope project.
  • The 57-meter high, 867,000-kilogram launcher has an optional third stage.
  • The first stage uses liquid hydrogen and liquid oxygen propellant in contrast to the toxic hypergolic mix used by older Long March launchers.
  • The Long March 5 is capable of delivering 14 metric tons to geostationary transfer orbit and 8.2 tons to trans lunar injection.
  • The derivative Long March 5B will be able to deliver 25 tons to low Earth orbit and is designed to launch modules for the Chinese Space Station.
  • A seven-member Group of Ministers (GoM) has been constituted to fast-track and oversee the implementation of the 69,000 crore revival plan for state-owned telecom corporations BSNL and MTNL.
  • The high-level group will expedite smooth implementation of recent decisions taken on revival of BSNL and MTNL that includes crucial elements like allocation of 4G spectrum and asset monetisation.
  • The GoM includes Defence Minister Rajnath Singh, IT and Telecom Minister Ravi Shankar Prasad, Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal and Oil Minister Dharmendra Pradhan.
  • Group of ministers are appointed by the GoI under Transaction of Business Rules, 1961.
  • Ministry of Statistics and Programme Implementation has constituted a Standing Committee on Statistics (SCES) chaired by former Chief Statistician Pronab Sen.
  • It will deliberate and develop methodologies for surveys on industry, services and employment in place of multiple panels on these issues.
  • SCES will subsume in it the four standing committees on labour force statistics, industrial statistics, services sector and unincorporated sector enterprises.
  • It will review and develop the country’s surveys on employment, industry and services sector amid criticism of official statistics.
  • The UN General Assembly approved a resolution that will start the process of drafting a new international treaty to combat cybercrime over objections from the European Union, the United States and other countries.
  • The Russian-drafted resolution was approved by the 193-member world body by a vote of 79-60 with 33 abstentions.
  • The resolution establishes an expert committee representing all world regions.
  • It will elaborate a comprehensive international convention on countering the use of information and communications technologies for criminal purposes.
  • Budapest Convention was the first ever treaty on cyber crime that addressed internet and computer crimes. It was drawn by Council of Europe.
  • Kerala government has organized aNight Walk for Women’ in selected 100 locations in state to send out the message of women safety.
  • Organised in association with the Department of Woman and Child Development, women will take to the roads from 11 pm to 1 am on December 29 which is observed as Nirbhaya Day.
  • The walk is aimed to send out the message ‘Pothu Idam Entedhum’ (public space is mine too).
  • It also aims to create general awareness and to strengthen the defence systems and to establish the rights of women at public spaces.

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