Adda Eco

STUDY NOTES OF
ECONOMIC & SOCIAL ISSUE

FOR
RBI GRADE B 2017 PHASE 2 EXAM
1 Adda247 | No. 1 APP for Banking & SSC Preparation

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INDEX
Contents
PREFACE ..................................................................................................................................... 4
A Brief on India: Important Facts to Learn ..................................................................... 5
Chapter 1: Growth and Development ............................................................................... 7
Chapter 2: Measurement of growth: National Income and per capita income ... 9
Chapter 3: Poverty Alleviation and Employment Generation in India................ 13
Chapter 4: Sustainable Development ............................................................................. 16
Chapter 5: Economic Reforms in India........................................................................... 20
Chapter 6: Industrial and Labour Policy ....................................................................... 25
Chapter 7: Monetary and Fiscal Policy ........................................................................... 27
Chapter 8: Privatization/Disinvestment ....................................................................... 34
Chapter 9: Role of Economic Planning. .......................................................................... 36
Chapter 10: Globalization-Opening up of the Indian Economy ............................. 48
Chapter 11: Balance of Payments, Export-Import Policy......................................... 49
Chapter 12: International Economic Institutions – IMF & World Bank ............ 53
Chapter 13: Human Development – Social Sectors in India, Health and
Education. ................................................................................................................................ 56
Chapter 14: A Brief on Economic Survey 2016-17 .................................................... 62
Chapter 15: FDI in India ...................................................................................................... 76
Chapter 16: Financial Statements & Ratios & Price Of Bond .................................. 78
Chapter 17: PRICE OF BOND AND NPV ........................................................................... 90
Chapter 17: Indian Economy Current Affairs .............................................................. 93
Chapter 19: Government Schemes Launched Recently ......................................... 101

PREFACE
Banking examinations have evolved a lot from 2016, with changes in pattern now
bank recruitment exams are dynamic in lieu of their conventional hold. During this
year we have evolved the study material for all bank examinations weather it is SBI
PO, SBI Clerk, IBPS PO, IBPS Clerk, IBPS RRB, NIACL, NICL, RBI Grade B Officer and
Assistant and now we provide you the new edition which caters to the need for
ever-progressing demands and pattern of all Banking recruitment examinations.
The aim of this book is to help students learn and understand the basics and
concepts related to Socio and Economic Studies which will help them to maximize
their scores in the upcoming RBI Officer Grade-B Phase-II competitive examination.
Overall the book is designed and categorised into proper sections of topics
expected to be asked in the RBI Grade B exam with almost every topic explained in
a simple manner to reinforce the concepts in student’s mind covering all important
finance and management topics that are being asked in the current scenario of
bank exams.
The objective is to provide students with the study material for Socio and
Economic section for RBI Grade-B Phase-II examination and encourage them to
be prepared to face toughest questions with a proper strategy. The pattern and
topics included in this edition are at par with the previous year pattern and new
difficulty level to equip candidates with basic knowledge of what to expect in RBI
Grade-B 2017. Our ultimate aim was to help students develop de rigueur skills for
success with proper approach.
We hope that our readers will appreciate our efforts and this book. Any comments
or suggestion for further improvements are welcome wholeheartedly.
Team Adda247

A Brief on India: Important Facts to Learn
Demographic profile
Population: 1,326,801,000
Population Growth Rate: 1.2 per cent (2015)
Literacy: Total population: 74.04 per cent (provisional data-2011
census)
Male: 82.14 per cent
Female: 65.46 per cent
Life expectancy: 66.9 years (men), 69.9 years (women) (2015 –
WHO 2016 Report)
Economic Profile
• Gross Domestic Product (GDP) Composition by Sector (2016
Estimate)
o Services: 45.4 per cent
o Industry: 29.8 per cent
o Agriculture: 16.5 per cent
• Forex Reserves: US$ 366.78 billion as on March 17, 2017.
• Gross Fixed Capital Formation (GFCF) at current prices: Gross
Fixed Capital Formation (GFCF) at current prices stood at Rs
8,797.63 billion (US$ 135.36 billion) in the fourth quarter of 2016.
• Value of Exports: India's exports stood at US$ 29.23 billion in
March 2017.
• Share of Top Investing Countries FDI Equity
Inflows: Mauritius (34 per cent), Singapore (16 per cent), UK (8
per cent), Japan (8 per cent), USA (6 per cent), Netherlands (6 per
cent) (as in December 2016)
• Major Sectors Attracting Highest FDI Equity Inflows: Services
Sector (18 per cent), Construction Development (8 per cent),
Computer Software and Hardware (7 per cent),
Telecommunications (7 per cent), Automobile (5 per cent), Drugs
and Pharmaceuticals (4 per cent), Chemical (4 per cent), Trading
(4 per cent) (as in December 2016)
Transportation in India
Airports: Airports Authority of India (AAI) manages 125 airports
in the country, which includes 18 international aerodromes, 78
domestic ones and 26 civil enclaves at defence airfields.
ailways: The Indian Railways network is spread over 108,706 km,

with 12,617 passenger and 7,421 freight trains each day from 7,172
stations plying 23 million travellers and 3 million tonnes (MT) of
freight daily.
Roadways: India’s road network of 4.87 million km is the second

largest in the world. With the number of vehicles growing at an
average annual pace of 10.16 per cent, Indian roads carry about 65
per cent of freight and 85 per cent of passenger traffic.
Waterways: 14,500 km

Chapter 1: Growth and Development
Economic Growth
Continuous increase in the total volume of goods and services
produced by a nation over a long period of time.
Economic Development = Economic Growth + desired changes in
the distribution of national income and other technical and
institutional changes.
If economic growth:
helps in increasing the standard of living i.e. the per capita real
income
helps in eliminating poverty, unemployment & inequalities of
income
leads to implementation of better techniques of production
positive change towards work and life, etc;
then it has led to economic development.
Thus, Economic Development=Economic Growth + Qualitative

changes in the economy
Qualitative changes in economy includes:
improvement in the level of living
reduction in inequality
rise in efficiency
improvement in techniques
fast growth of industrial sector
positive changes in attitudes
generating institutional changes
development of technology, etc.

Points on Indian Economy
Low level of Income
Predominance of Agriculture
Capital Deficiency
Technological Backwardness
Inadequate infrastructural facilities
High rate of growth of population
High rate of illiteracy .
High Infant Mortality rate
Tradition bound attitude towards work and life

Chapter 2: Measurement of growth: National Income and per capita
income
Economic growth is the change- increase or decrease, in the value

of goods and services produced by an economy. If it is positive, it
means an increase in the output and the income of a country.
Measuring Growth
Measures of national income and output are used in economics to
estimate the value of goods and services produced in an economy.
Some of the common measures are Gross National Product (GNP)
and Gross Domestic Product (GDP).
National Income Accounting

GDP is defined as the total market value of all final goods and
services produced within the country in a given period of time
usually a calendar year or financial year. GDP can be real or
nominal. Nominal GDP refers to the current year production of
final goods and services valued at current year prices.
Real GDP refers to the current year production of goods and
service valued all base year prices. Base year prices are Constant
prices. In estimating GDP, only final marketable goods and services
are considered. Gains from resale are excluded but the services
provided by the agents are counted. Similarly, transfer payments
(pensions, scholarships etc) are excluded as there is income
received but no good or service produced in return.
Market Price and Factor Cost

Market price refers to the actual transacted price and it includes
indirect taxes; custom duty, excise duty, sales tax, service tax etc.
Factor cost refers to the actual cost of the Various factors of
production includes government grants and subsidies but it
excludes indirect taxes.
Relationship between market price and factor cost.

GNP at factor cost = GNP at market price - indirect taxes +
subsidies
GDP at factor cost = GDP at market price - indirect taxes +
subsidies
Factor Costs
Factor costs are the actual production costs at which goods and
services are produced by the firms and industries in an economy.
They are really the costs of all the factors of production such as
land, labour, capital, energy, raw materials like steel etc. that are
used to produce & given quantity of output in an economy.
Transfer Payments
Transfer payment refers to payments made by government to
individuals for which there no economic activity is produced in
return by these individuals. Examples of transfer are scholarship,
pension.
GDP/GNP Calculation: Three Approaches

There are three different ways to measure GDP: Product Method,
Income Method and Expenditure Method.
1. The Product/Output Method:

In this method, the value of all goods and services produced in
different industries during the year is added up. This is also known
as the value added method to GDP or GDP at factor cost by
industry of origin. The following items are included in India in this:
agriculture and allied services; mining; manufacturing,
construction, electricity, gas and water supply; transport,
communication and trade; banking and insurance, real estates and
ownership of dwellings and business services; and public
administration and defense and other services (or government
services). In other words, it is the sum of gross value added.
2. The Income Method:

The people of a country who produce GDP during a year receive
incomes from their work. Thus GDP by income method is the sum
of all factor incomes: Wages and Salaries (compensation of
employees) + Rent + Interest + Profit.
3. Expenditure Method:
This method focuses on goods and services produced within the
country during one year.
GDP by expenditure method includes:
(1) Consumer expenditure on services and durable and non-
durable goods (C),
(2) Investment in fixed capital such as residential and non-
residential building, machinery, and inventories (I),
(3) Government expenditure on final goods and services (G),
(4) Export of goods and services produced by the people of country
(X),
(5) Less imports (M). That part of consumption, investment and
government expenditure which is spent on imports is subtracted
from GDP. Similarly, any imported component, such as raw
materials, which is used in the manufacture of export goods, is also
excluded.
Thus GDP by expenditure method at market prices = C+ I + G + (X
– M), where (X-M) is net export which can be positive or negative.
Net Domestic Product (NDP):
NDP is the value of net output of the economy during the year. The
value of this capital consumption is some percentage of gross
investment which is deducted from GDP. Thus Net Domestic
Product = GDP at Factor Cost – Depreciation.
Final Goods
Final goods are goods that are ultimately consumed rather than
used in the production of another good.
Differences between GDP and GNP

The two are related. The difference is that GNP includes net
foreign income. GNP adds net foreign investment income
compared to GDP.
GDP shows how much is produced within the boundaries of the
country by both the citizens and the foreigners. It is the market
value of all the output produced in the territory of a nation in
one year. In contrast, GNP is a measure of the value of the
output produced by the “nationals” of a country- both with-in
the geographical boundaries and outside.
NNP = GNP - Depreciation

National Income is calculated by deducting indirect taxes from Net
National Product and adding subsidies. National Income (NI) is the
NNP at factor cost.
NI = NNP - Indirect Taxes + Subsidies
Per Capita Income

Per Capita Income is per capita GDP: GDP divided by mid year
population of the corresponding year.

Chapter 3: Poverty Alleviation and Employment Generation in India
The Indian Constitution and five-year plans state social justice as

the primary objective of the developmental strategies of the
government. The First Five Year Plan (1951-56), “the urge to bring
economic and social change under present conditions comes from
the fact of poverty and inequalities in income, wealth and
opportunity”.
The Second Five Year Plan (1956-61) also pointed out that “the
benefits of economic development must accrue more & more to the
relatively less privileged classes of society”.
The government’s approach to poverty reduction was of three

dimensions.
The first one is growth-oriented approach. It is based on the
expectation that the effects of economic growth — rapid increase
in gross domestic product and per capita income — would
spread to all sections of society and will trickle down to the poor
sections also. It was felt that rapid industrial development and
transformation of agriculture through green revolution in select
regions would benefit the underdeveloped regions and the more
backward sections of the community.
Expanding self-employment programmes and wage employment
programmes are being considered as the major ways of
addressing poverty. Examples of self-employment programmes
are Rural Employment Generation Programme (REGP), Prime
Minister’s Rozgar Yojana (PMRY) and Swarna Jayanti Shahari
Rozgar Yojana (SJSRY). The first programme aims at creating
self-employment opportunities in urban areas. The Khadi and
Village Industries Commission was implementing it. Under this
programme, one can get financial assistance in the form of bank
loans to set up small industries. The educated unemployed from
low-income families in rural and urban areas can get financial
help to set up any kind of enterprise that generates employment
under PMRY. SJSRY mainly aims at creating employment
opportunities—both self-employment and wage employment—
in urban areas. Swarnajayanti Gram Swarozgar Yojana (SGSY)
has now been restructured as National Rural Livelihoods
Mission (NRLM). A similar programme called National Urban
Livelihoods Mission has also been in place for urban poor. In
August 2005, the Parliament passed a new Act to provide
guaranteed wage employment to every rural household whose
adult volunteer is to do unskilled manual work for a minimum of
100 days in a year. This Act is known as Mahatma Gandhi
National Rural Employment Guarantee Act. Under this Act all
those among the poor who are ready to work at the minimum
wage can report for work in areas where this programme is
implemented.
The third approach to addressing poverty is to provide
minimum basic amenities to the people. India was among the
pioneers in the world to envisage that through public
expenditure on social consumption needs — provision of food
grains at subsidised rates, education, health, water supply and
sanitation—people’s living standard could be improved.
Programmes under this approach are expected to supplement the
consumption of the poor, create employment opportunities and
bring about improvements in health and education. Three major
programmes that aim at improving the food and nutritional
status of the poor are Public Distribution System, Integrated
Child Development Scheme and Midday Meal Scheme. Pradhan

Mantri Gram Sadak Yojana, Pradhan Mantri Gramodaya Yojana,
Valmiki Ambedkar Awas Yojana are also attempts in the same
direction.
Also,
The government also has a variety of other social security
programmes to help a few specific groups. National Social
Assistance Programme is one such programme initiated by the
central government. Under this programme, elderly people who do
not have anyone to take care of them are given pension to sustain
themselves. Poor women who are destitute and widows are also
covered under this scheme. The government has also introduced a
few schemes to provide health insurance to poor people.
Note:
The per capita consumption expenditure level which meets the
average per capita daily requirement of 2,400 calories in rural areas
and 2,100 calories in urban areas, along with a minimum of non-
food expenditure, is called poverty line or absolute poverty.

Chapter 4: Sustainable Development
"Development that meets the needs of the present without

compromising the ability of future generations to meet their own
needs, improved living standard for all, better protected and
managed ecosystem and a safer, more prosperous future ".
On 1 January 2016, the 17 Sustainable Development Goals (SDGs)

of the 2030 Agenda for Sustainable Development — adopted by
world leaders in September 2015 at an historic UN Summit —
officially came into force. Over the next fifteen years, with these
new Goals that universally apply to all, countries will mobilize
efforts to end all forms of poverty, fight inequalities and tackle
climate change, while ensuring that no one is left behind.
The SDGs, also known as Global Goals, build on the success of

the Millennium Development Goals (MDGs) and aim to go
further to end all forms of poverty. The new Goals are unique in
that they call for action by all countries, poor, rich and middle-
income to promote prosperity while protecting the planet. They
recognize that ending poverty must go hand-in-hand with
strategies that build economic growth and addresses a range of
social needs including education, health, social protection, and
job opportunities, while tackling climate change and
environmental protection.
The 17 SDGs are as follows:

Goal 1: No Poverty
No Poverty - End poverty in all its forms everywhere
Goal 2: Zero Hunger

Zero Hunger - End hunger, achieve food security and improved
nutrition and promote sustainable agriculture
Goal 3: Good Health and Well-being

Good Health and Well-being - Ensure healthy lives and promote
well-being for all at all ages.
Goal 4: Quality Education

Quality Education - Ensure inclusive and equitable quality
education and promote lifelong learning opportunities for all
Goal 5: Gender Equality

Gender Equality - Achieve gender equality and empower all
women and girls.
Goal 6: Clean Water and Sanitation

Clean Water and Sanitation - Ensure availability and sustainable
management of water and sanitation for all.
Goal 7: Affordable and Clean Energy

Affordable and Clean Energy - Ensure access to affordable, reliable,
sustainable and modern energy for all.
Goal 8: Decent Work and Economic Growth

Decent Work and Economic Growth - Promote sustained, inclusive
and sustainable economic growth, full and productive employment
and decent work for all.
Goal 9: Industry, Innovation and Infrastructure

Industry, Innovation and Infrastructure - Build resilient
infrastructure, promote inclusive and sustainable industrialization
and foster innovation.
Goal 10: Reduced Inequalities

Reduced Inequalities - Reduce income inequality within and
among countries.
Goal 11: Sustainable Cities and Communities

Sustainable Cities and Communities - Make cities and human
settlements inclusive, safe, resilient and sustainable.
Goal 12: Responsible Consumption and Production

Responsible Consumption and Production - Ensure sustainable
consumption and production patterns.
Goal 13: Climate Action

Climate Action - Take urgent action to combat climate change and
its impacts by regulating emissions and promoting developments
in renewable energy.
Goal 14: Life Below Water

Life Below Water - Conserve and sustainably use the oceans, seas
and marine resources for sustainable development.
Goal 15: Life on Land

Life on Land - Protect, restore and promote sustainable use of
terrestrial ecosystems, sustainably manage forests, combat
desertification, and halt and reverse land degradation and halt
biodiversity loss.
Goal 16: Peace, Justice and Strong Institutions

Peace, Justice and Strong Institutions - Promote peaceful and
inclusive societies for sustainable development, provide access to
justice for all and build effective, accountable and inclusive
institutions at all levels.
Goal 17: Partnerships for the Goals

Partnerships for the Goals - Strengthen the means of
implementation and revitalize the global partnership for
sustainable development.

Chapter 5: Economic Reforms in India
India agreed to the conditionalities of World Bank and IMF and

announced the New Economic Policy (NEP). NEP consisted of
wide ranging economic reforms. The thrust of the policies was
towards creating a more competitive environment in the economy
and removing the barriers to entry and growth of firms.
This set of policies can broadly be classified into two groups: the
stabilisation measures and the structural reform measures. In
simple words, this means that there was a need to maintain
sufficient foreign exchange reserves and keep the rising prices
under control. On the other hand, structural reform policies are
long-term measures, aimed at improving the efficiency of the
economy and increasing its international competitiveness by
removing the rigidities in various segments of the Indian economy.
The government initiated a variety of policies which fall under
three heads viz., liberalisation, privatisation and globalisation.
Reforms Under Liberalisation

Deregulation of Industrial Sector: In India, regulatory mechanisms
were enforced in various ways:
(i) industrial licensing under which every entrepreneur had to get
permission from government officials to start a firm, close a firm or
to decide the amount of goods that could be produced
(ii) private sector was not allowed in many industries
(iii) some goods could be produced only in small scale industries
and
(iv) controls on price fixation and distribution of selected industrial
products.

The reform policies introduced in and after 1991 removed many of
these restrictions. Industrial licensing was abolished for almost all
but product categories — alcohol, cigarettes, hazardous chemicals,
industrial explosives, electronics, aerospace and drugs and
pharmaceuticals. The only industries which are now reserved for
the public sector are defence equipments, atomic energy generation
and railway transport.
Financial Sector Reforms:

Financial sector includes financial institutions such as commercial
banks, investment banks, stock exchange operations and foreign
exchange market. The financial sector in India is regulated by the
Reserve Bank of India (RBI). The RBI decides the amount of money
that the banks can keep with themselves, fixes interest rates, nature
of lending to various sectors etc. One of the major aims of financial
sector reforms is to reduce the role of RBI from regulator to
facilitator of financial sector. The reform policies led to the
establishment of private sector banks, Indian as well as foreign.
Foreign Institutional Investors (FII) such as merchant bankers,
mutual funds and pension funds are now allowed to invest in
Indian financial markets.
Tax Reforms
Tax reforms are concerned with the reforms in government’s
taxation and public expenditure policies which are collectively
known as its fiscal policy. There are two types of taxes: direct and
indirect. Direct taxes consist of taxes on incomes of individuals as
well as profits of business enterprises. Another component of
reforms in this area is simplification. In order to encourage better
compliance on the part of taxpayers many procedures have been
simplified and the rates also substantially lowered.
Foreign Exchange Reforms
The first important reform in the external sector was made in the
foreign exchange market. In 1991, as an immediate measure to
resolve the balance of payments crisis, the rupee was devalued
against foreign currencies. This led to an increase in the inflow of
foreign exchange. It also set the tone to free the determination of
rupee value in the foreign exchange market from government
control.
Trade and Investment Policy Reforms

Liberalisation of trade and investment regime was initiated to
increase international competitiveness of industrial production and
also foreign investments and technology into the economy. The aim
was also to promote the efficiency of the local industries and the
adoption of modern technologies. In order to protect domestic
industries, India was following a regime of quantitative restrictions
on imports. This was encouraged through tight control over
imports and by keeping the tariffs very high. These policies
reduced efficiency and competitiveness which led to slow growth
of the manufacturing sector.
The trade policy reforms aimed at
(i) dismantling of quantitative restrictions on imports and exports
(ii) reduction of tariff rates and
(iii) removal of licensing procedures for imports.
Privatisation
It implies shedding of the ownership or management of a
government owned enterprise. Government companies are
converted into private companies in two ways

(i) by withdrawal of the government from ownership and
management of public sector companies and or
(ii) by outright sale of public sector companies.
Privatisation of the public-sector enterprises by selling off part of

the equity of PSEs to the public is known as disinvestment. The
purpose of the sale, according to the government, was mainly to
improve financial discipline and facilitate modernisation. It was
also envisaged that private capital and managerial capabilities
could be effectively utilised to improve the performance of the
PSUs.
GLOBALISATION
Globalisation is generally understood to mean integration of the
economy of the country with the world economy, it is a complex
phenomenon.
It is an outcome of the set of various policies that are aimed at
transforming the world towards greater interdependence and
integration. It involves creation of networks and activities
transcending economic, social and geographical boundaries.
Globalisation attempts to establish links in such a way that the
happenings in India can be influenced by events happening miles
away. It is turning the world into one whole or creating a
borderless world.
Outsourcing: This is one of the important outcomes of the

globalisation process. In outsourcing, a company hires regular
service from external sources, mostly from other countries, which
was previously provided internally or from within the country (like
legal advice, computer service, advertisement, security — each
provided by respective departments of the company).
As a form of economic activity, outsourcing has intensified, in
recent times, because of the growth of fast modes of
communication, particularly the growth of Information Technology
(IT).
Sum Up
In the domestic economy, major reforms were undertaken in the
industrial and financial sectors. Major external sector reforms
included foreign exchange deregulations and import
liberalisation.
Globalisation is the outcome of the policies of liberalisation and
privatisation. It means an integration of the economy of the
country with the world economy.
Outsourcing is an emerging business activity.
The objective of the WTO is to establish a rule based trade regime
to ensure optimum utilisation of world resources.

Chapter 6: Industrial and Labour Policy
Industrial Policy
The Industrial Policy Resolution of 1948 defined the broad contours
of the policy delineating the role of the State in industrial
development both as an entrepreneur and authority. This was
followed by comprehensive enactment of Industries (Development
& Regulation) Act, 1951 (referred as IDR Act) that provides for the
necessary framework for implementing the Industrial Policy and
enables the Union Government to direct investment into desired
channels of industrial activity inter alia through the mechanism of
licensing keeping with national development objectives and goals.
The main objectives of the Industrial Policy of the Government are
(i) to maintain a sustained growth in productivity;
(ii) to enhance gainful employment;
(iii) to achieve optimal utilisation of human resources;
(iv) to attain international competitiveness; and
(v) to transform India into a major partner and player in the global
arena.
To achieve these objectives, the Policy focus is on deregulating
Indian industry; allowing freedom and flexibility to the industry in
responding to market forces; and providing a policy regime that
facilitates and fosters growth. Economic reforms initiated since
1991 envisages a significantly bigger role for private initiatives.
INDIAN LABOR POLICY HIGHLIGHTS

It has been evolving towards maintaining industrial peace as well
as promoting labor welfare and provides for,
a framework for employee-employer relationship
conciliation mechanism for high investment projects
creating new jobs
social security for workers
long term settlements
prioritization of fund allocation
labor reforms
amendments to labor judiciary
amendments to industrial dispute Act
more labor sectors covered under minimum wages Act
enforcement of child labor Act
enhance medical facilities for workers
providing robust industrial training
habilitation for displaced workers modern functioning of
employment exchanges

Chapter 7: Monetary and Fiscal Policy
Monetary Policy
What is Monetary Policy?
Monetary policy refers to the policy of the central bank with regard
to the use of monetary instruments under its control to achieve the
goals specified in the Act. Reserve Bank of India (RBI) is vested
with the responsibility of conducting monetary policy. This
responsibility is explicitly mandated under the Reserve Bank of
India Act, 1934.
Objective of Monetary Policy

The primary objective is to maintain price stability while keeping
in mind the objective of growth. In May 2016, RBI Act, 1934 was
amended to provide a statutory basis for the implementation of
the flexible inflation targeting framework.
The amended RBI Act also provides for the inflation target to be
set by the Government of India, in consultation with the Reserve
Bank, once in every five years. Accordingly, the Central
Government has notified in the Official Gazette 4 per cent
Consumer Price Index (CPI) inflation as the target for the period
from August 5, 2016 to March 31, 2021 with the upper tolerance
limit of 6 per cent and the lower tolerance limit of 2 per cent.
The monetary policy framework aims at setting the policy (repo)
rate based on an assessment of the current and evolving
macroeconomic situation; and modulation of liquidity conditions
to anchor money market rates at or around the repo rate.
What is MPC?
Section 45ZB of the amended RBI Act, 1934 provides for an
empowered six-member monetary policy committee (MPC) to be
constituted by the Central Government. The Members of the
current MPC are as follows:
1. Governor of RBI – Chairperson, ex officio;
2. Deputy Governor of RBI, in charge of Monetary Policy –
Member, ex officio;
3. One officer of RBI to be nominated by the Central Board –
Member, ex officio;
4. Shri Chetan Ghate, Professor, Indian Statistical Institute (ISI) –
Member;
5. Professor Pami Dua, Director, Delhi School of Economics –
Member; and
6. Dr. Ravindra H. Dholakia, Professor, Indian Institute of
Management, Ahmedabad – Member.
(Members referred to at 4 to 6 above, will hold office for a period of
four years or until further orders, whichever is earlier.)
The MPC determines the policy interest rate required to achieve the
inflation target. RBI's Monetary Policy Department (MPD) assists
the MPC in formulating the monetary policy. Financial Markets
Operations Department (FMOD) operationalises the monetary
policy, mainly through day-to-day liquidity management
operations.
Instruments of Monetary Policy
Repo Rate: The (fixed) interest rate at which the Reserve Bank
provides overnight liquidity to banks against the collateral of
government and other approved securities under the liquidity
adjustment facility (LAF).
Reverse Repo Rate: The (fixed) interest rate – currently 50 bps

below the repo rate – at which the Reserve Bank absorbs liquidity,
on an overnight basis, from banks against the collateral of eligible
government securities under the LAF.
The LAF consists of overnight as well as term repo auctions. The

aim of term repo is to help develop the inter-bank term money
market, which in turn can set market based benchmarks for pricing
of loans and deposits, and hence improve transmission of monetary
policy.
Marginal Standing Facility (MSF): A facility under which

scheduled commercial banks can borrow additional amount of
overnight money from the Reserve Bank by dipping into their
Statutory Liquidity Ratio (SLR) portfolio up to a limit [currently
two per cent of their net demand and time liabilities deposits
(NDTL)] at a penal rate of interest, currently 50 basis points above
the repo rate. This provides a safety valve against unanticipated
liquidity shocks to the banking system.
Bank Rate: It is the rate at which the Reserve Bank is ready to buy
or rediscount bills of exchange or other commercial papers. The
Bank Rate is published under Section 49 of the Reserve Bank of
India Act, 1934. This rate has been aligned to the MSF rate and,
therefore, changes automatically as and when the MSF rate changes
alongside policy repo rate changes.
Cash Reserve Ratio (CRR): The average daily balance that a bank
shall maintain with the Reserve Bank as a share of such per cent of
its NDTL that the Reserve Bank may notify from time to time in the
Gazette of India.

Statutory Liquidity Ratio (SLR): The share of NDTL that banks
shall maintain in safe and liquid assets, such as, unencumbered
government securities, cash and gold. Changes in SLR often
influence the availability of resources in the banking system for
lending to the private sector.
Open Market Operations (OMOs): These include both outright

purchase and sale of government securities for injection and
absorption of durable liquidity, respectively.
Market Stabilisation Scheme (MSS): This instrument for monetary

management was introduced in 2004. Surplus liquidity of a more
enduring nature arising from large capital inflows is absorbed
through sale of short-dated government securities and treasury
bills. The cash so mobilised is held in a separate government
account with the Reserve Bank.
Other Points to look at

Under the amended RBI Act, the monetary policy making is as
under:
a) The MPC is required to meet at least four times in a year.
b) The quorum for the meeting of the MPC is four members.
c) Each member of the MPC has one vote, and in the event of an
equality of votes, the Governor has a second or casting vote.
d) Once in every six months, the Reserve Bank is required to
publish a document called the Monetary Policy Report to explain:
i. the sources of inflation; and
ii. the forecast of inflation for 6-18 months ahead.

Fiscal Policy
Fiscal policy deals with the government policy concerning changes
in the taxation and expenditure overheads and components, while
Monetary policy, deals with the changes in the factors and
instruments that affect the supply of money in the economy and the
rate of interest. The government of India deals with fiscal policy
(through Annual Budget and other timely interventions), while RBI
is responsible for execution of monetary policy.
Types of Fiscal Policy

Neutral Fiscal Policy: This implies a balanced budget where
(Government spending = Tax revenue).
Contractionary (restrictive) Fiscal policy: This policy involves
raising taxes or cutting government spending, so that (Government
spending < Tax revenue) it cuts up on the aggregate demand (thus,
economic growth) and to reduce the inflationary pressures.
Expansionary Fiscal Policy: It is generally used for giving stimulus

to the economy ,i.e., to speed up the rate of GDP growth or during
a recession when growth in national income is not sufficient
enough to maintain the present standards of living. A tax cut
and/or an increase in government spending would be
implemented to stimulate economic growth and lower
unemployment rates.
Instruments of Fiscal Policy

Reduction of Govt. Expenditure
Increase in Taxation
Imposition of new Taxes
Wage Control
Rationing
Public Debt
Increase in savings
Maintaining Surplus Budget
Other measures of Fiscal Policy

Increase in Imports of Raw materials
Decrease in Exports
Increase in Productivity
Provision of Subsidies
Use of Latest Technology
Rational Industrial Policy
PUBLIC REVENUES
The income of the Government through all sources is called public
income or public revenue. Public revenue refers to income of a
Government from all sources raised, in order to meet public
expenditure. Public revenue consists of taxes, revenue from
administrative activities like fines, fees, income from public
enterprises, gifts and grants. Public Receipts includes public
revenue plus the receipts from public borrowings, the receipts from
sale of public assets & printing & issuing new currency notes. It
includes other sources of public income along with public revenue.
Public Revenue can be classified as Tax Revenue and Non -Tax
Revenue.
PUBLIC EXPENDITURE
Public Expenditure refers to Government Expenditure. It is
incurred by Central and State Governments. The Public
Expenditure is incurred on various activities for the welfare of the
people and also for the economic development.

Capital and Revenue Expenditure:
Capital Expenditure of the Government refers to that expenditure
which results in creation of fixed assets. They are in the form of
investment. They add to the net productive assets of the economy.
Capital Expenditure is also known as development expenditure as
it increases the productive capacity of the economy. It is investment
expenditure and a non-recurring type of expenditure.
Revenue expenditures are current or consumption expenditures

incurred on civil administration, defense forces, public health and,
education, maintenance of Government machinery etc. This type of
"expenditure is of recurrent type which is incurred year after year.
Plan and Non - Plan Expenditure

The plan expenditure is incurred on development activities
outlined in ongoing five year plan. Plan expenditure is incurred on
Transport, rural development, communication, agriculture, energy,
social services,etc. The non - plan expenditure is incurred on those
activities, which are not included in five-year plan.
PUBLIC DEBT
Public debt refers to Government debt. It refers to Government
borrowings from individuals, financial institutions, organizations
and foreign countries. If revenue collected through taxes and other
sources is not adequate to cover expenditure, the Government may
resort to borrowings. Thus public debt is one of the instruments to
cover deficits in budget.

Chapter 8: Privatization/Disinvestment
Facts related to Disinvestment

Total disinvestment proceeds during the Current Financial Year
2017-18 is Rs. 1,195.46 crore (as on 9th May, 2017)
The CPSE with the highest market capitalisation is Oil & Natural
Gas Corp.Ltd. at Rs. 2,27,212.43 crore (BSE) and Rs. 2,27,148.26
crore (NSE) (as on 31st May, 2017)
CPSEs constitute 11.78% and 11.90% of the total market
capitalisation of companies listed at BSE and NSE respectively
(as on 31st May, 2017)
VSNL was the first CPSE to be divested by way of a Public Offer
in 1999-00
Disinvestment During FY 2017-18
NAME OF CPSES % OF GOIS GOIS

SHARES SHAREHOLDING
DISINVESTED POST
DISINVESTMENT
HCL .07 82.88%
NALCO 9.2125 65.38%
Disinvestment During FY 2016-17

Chapter 9: Role of Economic Planning.
Economic Planning is the making of major economic decisions.

What and how is to be produced and to whom it is to be allocated –
by the conscious decision of a determinate authority, on the basis of
a comprehensive survey of the economic system as a whole.
Following are the characteristic features of economic planning:

Fixation of definite socio-economic targets;
Prudent efforts to achieve these targets within a given time
period;
Existence of a central planning authority;
Complete knowledge about the economic resources of the
country;
Efficient utilization of limited resources to get maximum output
and welfare.
What is the Need of Planning?

To Increase the rate of Economic Development.
To eradicate Unemployment.
To Improve and Strengthen Market Mechanism.
Fair progress of the Economy which includes:
a) Progress of Agricultural and Industrial sectors.
b) Progress of Money and Capital Market.
c) Progress in Infrastructure.
Five Years Plans in India
The main features of First five year plan (1951-1956)

To reconstruct the economy that was damaged due to
repercussion effect of partition of India and 2nd world war.
Construction of the roads, extending the transport and
communication facilities and constructing the irrigation and
water electricity projects were given priority which helps in
proper growth and development of the country.
Community development program was launched in 1952.
It plans to constitute administrative and organizational set up
necessary for enforcing the development programmes.
To introduce the mechanism in the economy this helps in
checking the Inflationary pressure.
To enhance the capacity of production in the economy.
To improve the food availability in the country.
Under the first-year plan provision was made to spend a sum of
Rs. 2378 crore. But the actual expenditure amounted to Rs.1960
crore. In this plan agriculture was given highest priority.
Target growth rate was 2.1% in the plan period. But this plan was
more than a success, achieve annual compound growth rate of
3.6% because of good harvest of last two years.
The Main features of Second Five year plan (1956-1961)

Model prepared by Professor P.C. Mahalanobis is being used in
this plan. The fundamental objective of this plan was to initiate and
accelerate the process of industrialization in a country.
Hydroelectric power projects and five steel power plants were
established in Durgapur,Rourkela and Bhilai.
The actual growth rate achieved in this plan was 4.2% as
compared to the target rate, which was 4.5%.
To increase the annual capital investment rate from 7% to 11% by
1960-61.
Expansion in employment opportunities.

During the plan period, per capita income growth rate was only
1.9% per annum but the growth rate of national income was
4.27% in the same period.
The atomic energy commission in department of atomic energy
was established on March 1st 1958.
The main stress was on the development of heavy industries
which helps in the fast progress of industrialization in the
country.
The Main Features of Third Five Year Plan (1961-1966)

To push up the economy to the take off stage of development and
self-sustaining growth in the country is the basic objective of this
plan.
To attain more than 5% annual growth rate.
National income should grow at 30%.
Per capita income should grow at annual level of 17%.
A target of 6%annual growth rate for foodgrains and 14% annual
growth rate target was fixed for industrial production.
The actual achieved growth rate of national income was 2.5%,
against the target of 5% per annum.
The actual growth rate of per capita was only 0.2% per annum.
This plan miserably fails due to war with China and Pakistan
during this plan period.
Drought was faced by India which also plays its role in the
failure of plan.
It also aims at expanding the basic good industries to follow up
the industrialization process in the economy.
It ensures the proper utilization of all resources which are
available to the country.

Three annual plans (plan holiday 1966-1969)
The fourth plan was scheduled to begin from April 1, 1966, but due
failure of the third plan, production in various sector became
stagnant.
In 1966 the government of India declared devaluation of rupees
but favorable results could not be obtained.
During this period, the main focus was on the agricultural
activities.
The transition period of agriculture begins in 1966 when green
revolution takes place in the country. High yielding varieties of
seeds is being used in the production of rice, wheat, jowar, bajra,
and maize to enhance their productivity level. For efficient use of
this technique better irrigation facility, fertilizers, pesticides have
being developed in the country.
The growth target was not set for these three years but the actual
growth rate was 3.9%.
In this plan economy tries to overcome from the failure faced by
the country during third plan.
After absorbing the shocks of third plan period it tries to make a
way out for growth and development in the country.
The Main Features Of Fourth Five Year Plan (1969-1974)

The two principal objectives of 4th plan were sustainable growth
and self-dependence. To achieve these two objectives certain
targets were laid down -:
To ensure growth rate of 5.7% for economic development of the
country.
In agriculture 5% and in industrial production 8% to 10% growth
target is set.
To develop backward areas and to remove the regional
imbalances.
Regulation and control over the money supply for the purpose of
stabilizing the prices in the economy.
Maintaining the buffer stock so that problem of food crises does
not arises in the country.
Family planning programmes was introduced during this plan
period, for improving the living standard and to keep a check on
population growth in the country.
To create employment opportunities for reducing the
involuntary unemployment.
To establishes the economic equality.
Production of commodities of general consumption has been
increased.
During the fourth plan, the annual growth rate of national
income (1993-94 prices) was only 3.8% lower than the target
growth. The annual growth rate of industrial production was
only 4% which was lower than the target growth rate. In 1971
India’s war with Pakistan and liberation war in Bangladesh
hampers the industrial development because the funds which are
supposed to be used for industrial development are utilized on
after war effort. Prices increased about 61%. Nationalisation of 14
banks and first under ground nuclear test was also performed
during this period.
The Main Features of Fifth Five Year Plan (1974-1979)

The fifth plan was structured by DD Dhar. The basic objectives of
the plan were ‘removal of poverty’ (Garibi Hatao) and self-
dependence
National programmes for essential needs in which supply of
drinkable water, education at primary level, provide medical
help to rural households, and electrification of the villages and
cleanliness of the suburbs were included.
In this plan more emphasis is placed on the policy of import
substitution and export promotion for the betterment of the
people of the country.
There should be optimum collection and distribution system to
provide benefits to the weaker section of the country.
For reducing the regional and social inequalities various fiscal
policies and institutional measures have been introduced by the
government.
Production of commodities of general use which plays important
role in day to day life was emphasized.
Many programs were introduced in the plan period on social
welfare.
The target growth rate was 4.4% but the actual growth rate
achieved was 4.7%.
When the janta government came into power, this plan was
closed in 1978 one year before its closing period which is in 1979.
Rolling Plan (1978 – 1980)

After fifth plan ended before its time period, there are two phases
of sixth plan.
When Janta government in power the plan for (1978-1983) were
introduced but this plan lapses before its time period because the
congress came into power and terminated the plan and a new plan
was introduced in the country for the period of (1980-1985). Rolling
plan is plan by Janta government for two years which is (1978-
1980). In 1979-1980 growth rate was -5.2 %( negative).
The Main Features Of Sixth Five Year Plan (1980-1985)

The first phase of sixth plan was introduced by Janta government
but it was abandoned by the congress and a new Sixth plan was
introduced for the period 1980-1985.
Increase in national income, modernization of technology, rapid
development of the domestic sources of energy and stress on the
efficient use of the energy resources.
Ensure continuous decrease in poverty and unemployment.
Minimum need programme was introduced for the qualitative
improvement in the living standard of the poor people of the
country.
Stress on minimization of regional disparities.
To ensure the participation of all categories of people in
development process by adopting institutional strategies.
Family planning methods was adopted for population control.
5.2% was the growth target but the economy has achieved the
growth rate of 5.7%.
The Main Features Of Seventh Five Year Plan (1985-1990)

This plan emphasis on self-dependence on foodgrains
production, increase in the rate of employment, with special
focus on social justice.
The major objectives was to establish a social system based on
equality and justice, to encourage self reliance by export
promotion and import substitution, energy protection and
development of non traditional energy sources, ecological and
environmental protection.
The growth rate of 5.8% was achieved in the economy during the
plan as compared to the target growth rate which was 5.0%.
Annual Plan (1990-1992)

Due to political changes at the centre the government was not
able to introduce the eighth plan on the scheduled time.
Balance of payments account is worsening during this time.

Inflation rate in 1991 was at high level specially prices of food
items increases rapidly in this year.
The government was under the danger of falling into the debt
trap.
The growth rate of 3.4% was achieved during this period.
The Main Features Of Eighth Five Year Plan (1992-1997)

Human development in various aspects is the basic motto of
eighth plan.
Priorities were given in the plan to create sufficient employment
opportunities, to impose restrictions on population explosion by
seeking people’s cooperation, to make provision for primary
health care facilities and vaccination in all the villages to cover
entire population, to strengthen the basic infrastructure (energy,
transport, communication, irrigation,) in order to support the
development process.
The average annual growth rate in agricultural and ailed
activities has been estimated at 3.9% while the target was 3.5%.
During the 8th plan the services like trading, hotels, transport and
communication made a good progress.
The inflation rate based in whole sale price index was come
down to 3.8% which was 16.3% in 1991.
The fiscal deficit during 1990-1991 was 8.3% of GDP but during
the plan period it came down to 5.23%.
The plan has achieved a growth rate of 5.8% but the target was
set to the level of 5.6% in the economy.
The Main Features Of Ninth Five Year Plan (1997-2002)

The main focus of the ninth plan was ‘growth with equity and
distributive justice’ In order to achieve this objective following four
fields were identified -:
Quality of life – To ensure a better life to the poor people,
measures for poverty elimination and providing minimum basic
services were adopted which help in creating assets and integrate
these people for the development of the country. Private
investors are interested only in profits so they generally do not
participate in basic service sector. The state takes the
responsibility of this sector to improve the quality of life of the
people in the country.
Employment promotion-It focused in creating job opportunities
by developing technology in various sectors. To break the vicious
circle of poverty national employment assurance scheme is
introduced in this period.
Regional imbalances – For removing regional imbalance, the
speed of industrialization in the less developed area was given
priority in the ninth plan.
Self- dependence – In order to achieve self-dependence the
following areas are given priority-:
i) To ascertain the balance of payment.
ii) To check the burden of foreign debt and also give measure to
curtail them.
iii) Proper utilization and protection of natural resources.
iv) To attain self-sufficiency in foodgrains and technology.
v) To increase dependence on non- debt income for the purpose of
development.
The economy was only able to achieve the growth rate of 5.5% as
compared to the target which was set to 6.5%.
The Main Features Of Tenth Five Year Plan (2002-2007)

The main focus of the Tenth Five-Year Plan was:
Universal access to primary education by 2007.
15% in poor blocks and 25% in normal blocks is the essential
amount required to extend the funds of gram-sabha during
10th plan.
Food for work programme in place of employment programmes.
For improving the conditions of the poor people especially
agricultural labor great stress is given to agricultural sector.
Sectors like real estate, transport small scale industries, transport,
IT-enabled services should grow at the accelerated rate during
the 10thplan period to get high job opportunities in these sectors
of the economy.
Maternal mortality rate (MMR) should be reduced to twenty per
thousand live births at the end of 2007 and to ten per thousand
live births at the end of 2012.
Infant mortality rate (IMR) should be reduced to forty five per
thousand live births by 2007 and to twenty eight per thousand
live births at the end of 2012.
The target growth rate was 8.1% but the economy was able to
achieve only 7.8%.
The Main Features of Eleventh Five Year Plan (2007-2012)

The basic components of this plan include broad based
improvement in life of weaker /backward section of the society like
SCs/STs, other backward classes (OBCs) etc.
Major objectives of 11th plan are as follows -:
Manufacturing sector is targeted to grow at 12%
Total fertility rate stands at 2.1 with the completion of the plan.
Reduce anemia among women and girls by 50%with completion
of the plan.
It ensures the electricity connection to the rural people.
Create 58 million new work opportunities.
Ten percent decrease in the headcount ratio of poverty.
33% share in government schemes belongs to the female
members of the country.
Treatment of water waste by the end of 2011-2012.
Efficiency of energy should be increased to 20% by 2016-2017.
Educational unemployment should be below 5%.
Increase of 20% in the real wage rate of those workers who are
unskilled.
Five percent increase in forest and tree cover.
The target growth rate was 8.1% but the economy in this period
achieves a growth rate of 7.9%.
The Main Features of Twelfth Five Year Plan (2012-2017)

The basic components are to enhance the capacity for rapid growth
in various sectors of the economy.
The main objectives of the plan -:
Real GDP must grow at the rate of 8%.
Agriculture sector must grow at the rate of 4%.
Manufacturing sector must grow at the rate of 7.1%.
Industrial sector must grow at the rate of 7.6%.
Service sector must grow at the rate of 9%.
On an average the states of the country grows at a rate which is
more than the rate of growth in 11th plan.
Head count ratio of consumption poverty to be reduced by 10
percentage points over the preceding estimates by the end of
twelfth five-year plan.
Employment opportunities around 50 million in sectors other
than agricultural.
On completion of 12th plan mean years of schooling should be
seven years.

Reduce infant mortality rate (IMR) to 25 per 1000 live births and
maternal mortality rate to 1 per 1000 live births, and child sex
ratio (0-6) to 950 by the end of twelfth five-year plan.
Reduce total fertility rate to 2.1 by the end of twelfth five-year
plan.
Increase rural tele density to 70 percent with the completion of
twelfth five-year plan.
Eastern and western freight corridors must be completed by the
end twelfth five-year plan.
Technology and innovation is the key of higher productivity so
the resources should be moved towards this direction.
Funds should be allocated to provide adequate transport
infrastructure to minimize the cost of transportation.
Increase the banking services so that every household enjoy the
facility of banking.
Direct cash payment method came in place of subsidies so that it
will help in keeping the track of government money.
To over the food and nutritional insecurities steps taken for
sustainable growth in agricultural sector.
One million hectare increase in green cover.
Various measures should be taken to improve the health
indicators.

Chapter 10: Globalization-Opening up of the Indian Economy

Chapter 11: Balance of Payments, Export-Import Policy
What is Balance of Payments (BoP)?

Balance of payments (BoP) record the transactions in goods,
services, and assets between residents of a country with the rest of
the world for a specified time period. There are two main accounts
in the BoP – the current account and the capital account.
The current account records exports and imports in goods and
services and transfer payments. When exports exceed imports,
there is a trade surplus and when imports exceed exports there is
a trade deficit. Trade in services denoted as invisible trade
(because they are not seen to cross national borders).
Transfer payments are receipts which the residents of a country
receive ‘for free’, without having to make any present or future
payments in return. They consist of remittances, gifts and grants.
They could be official or private.
The balance of exports and imports of goods is referred to as the
trade balance. Adding trade in services and net transfers to the
trade balance, we get the current account balance.
The capital account records all international purchases and sales
of assets such as money, stocks, bonds, etc.
Current account deficit is the excess of total imports of goods,
services and transfers over total exports of goods, services and
transfers. This situation makes a country debtor to the rest of the
world.
Differentiate between balance of trade and current account

balance.
Balance of trade Current account balance
It is the difference It is the difference between the values
between the values of of exports and imports of goods,
exports and imports of services and unilateral transfers of a
goods of a country. country.
1. Export of goods Export and import of goods, export
2. Import of goods and import of services, unilateral
transfers.
It records transactions It records the transactions related to
related to visible items visible items (goods) as well as
(i.e. goods) only. invisible items (services) and unilateral
transfers.
What is EXIM Policy?

Exim Policy or Foreign Trade Policy is a set of guidelines and
instructions established by the DGFT in matters related to the
import and export of goods in India. It is regulated by the
Foreign Trade Development and Regulation Act, 1992.
DGFT (Directorate General of Foreign Trade) is the main
governing body in matters related to Exim Policy. The main
objective of the Foreign Trade (Development and Regulation) Act
is to provide the development and regulation of foreign trade by
facilitating imports into, and augmenting exports from India.
Highlights of the Foreign Trade Policy (Exim Policy) 2015-20
Earlier there were 5 different schemes (Focus Product Scheme,

Market Linked Focus Product Scheme, Focus Market Scheme,
Agri. Infrastructure Incentive Scrip, VKGUY) for rewarding
merchandise exports with different kinds of duty scrips with
varying conditions. Now all these schemes have been merged
into a single scheme, namely Merchandise Export from India

Scheme (MEIS) and there would be no conditionality attached to
the scrips issued under the scheme.
Served From India Scheme (SFIS) has been replaced with Service
Exports from India Scheme (SEIS). SEIS shall apply to ‘Service
Providers located in India’ instead of ‘Indian Service Providers’.
The rate of reward under SEIS would be based on net foreign
exchange earned.
Duty credit scrips to be freely transferable and usable for
payment of custom duty, excise duty and service tax.
Business leaders who have excelled in international trade and
have successfully contributed to country’s foreign trade are
proposed to be recognized as Status Holders and given special
treatment and privileges to facilitate their trade transactions, in
order to reduce their transaction costs and time. The criteria for
export performance for recognition of status holder have been
changed from Rupees to US dollar earnings.
Manufacturers who are also Status Holders will be enabled to
self-certify their manufactured goods as originating from India
with a view to qualify for preferential treatment under different
Preferential Trading Agreements [PTAs], Free Trade Agreements
[FTAs], Comprehensive Economic Cooperation Agreements
[CECAs] and Comprehensive Economic Partnerships
Agreements [CEPAs] which are in operation.
Specific Export Obligation under EPCG scheme, in case capital
goods are procured from indigenous manufacturers, which is
currently 90% of the normal export obligation has been reduced
to 75%.
It is proposed to have Online inter-ministerial consultations for
approval of export of SCOMET items, Norms fixation, Import

Authorisations, Export Authorisation, in a phased manner, with
the objective to reduce time for approval.
EOUs, EHTPs, STPs have been allowed to share infrastructural
facilities among themselves.
Inter unit transfer of goods and services have been allowed
among EOUs, EHTPs, STPs, and BTPs.
EOUs have been allowed facility to set up Warehouses near the
port of export.
Validity of SCOMET export authorisation has been extended
from the present 12 months to 24 months.
Normal export obligation period under advance authorization is
18 months. Export obligation period for export items falling in
the category of defence, military store, aerospace and nuclear
energy shall be 24 months from the date of issue of authorization.
Goods falling in the category of handloom products, books /
periodicals, leather footwear, toys and customized fashion
garments, having FOB value up to Rs.25000 per consignment
(finalized using e-Commerce platform) shall be eligible for
benefits under FTP.
Calicut Airport, Kerala and Arakonam ICD, Tamil Nadu have
been notified as registered ports for import and export.
India has already extended duty free tariff preference to 33 Least
Developed Countries (LDCs) across the globe.
Government has already recognized 33 towns as export
excellence towns. It has been decided to add Vishakhapatnam
and Bhimavaram in Andhra Pradesh as towns of export
excellence (Product Category– Seafood).

Chapter 12: International Economic Institutions –
IMF & World Bank
A Brief on IMF
The International Monetary Fund (IMF) is an organization of 189
countries, working to foster global monetary cooperation, secure
financial stability, facilitate international trade, promote high
employment and sustainable economic growth, and reduce
poverty around the world.
Formed in 1944 at the Bretton Woods Conference primarily by
the ideas of Harry Dexter White and John Maynard Keynes, it
came into formal existence in 1945 with 29 member countries and
the goal of reconstructing the international payment system.
Membership: 189 countries
Headquarters: Washington, D.C.
Original aim of IMF:

promote international monetary cooperation;
facilitate the expansion and balanced growth of international
trade;
promote exchange stability;
assist in the establishment of a multilateral system of payments;
and
make resources available (with adequate safeguards) to members
experiencing balance of payments difficulties.
What is SDR?
A new plan of international reserves, known as SDRs was
established in 1969. The SDRs have only limited use as a reserve
asset. Its main function is to serve as the unit of a/c of the IMF.

SDRs (also known as ‘paper gold’) are allocated to member
countries in proportion to their subscription to the IMF.
SDR is neither a currency, nor a claim. Rather, it is a potential
claim on the freely usable currencies of the IMF.
SDR is an international unit of currency. The quotas of the
member countries with the Fund are now valued in terms of
SDRs.
SDR is an interest bearing source of finance, i.e., countries
holding SDRs receive interest, and the ones drawing on them pay
interest.
A Brief on World Bank Group

The World Bank is like a cooperative, made up of 189 member
countries. Established in 1944, the World Bank Group is
headquartered in Washington, D.C.
The World Bank Group has set two goals for the world to achieve
by 2030:
a) End extreme poverty by decreasing the percentage of people
living on less than $1.90 a day to no more than 3%
b) Promote shared prosperity by fostering the income growth of the
bottom 40% for every country
The World Bank Group is one of the world’s largest sources of

funding and knowledge for developing countries. Its five
institutions share a commitment to reducing poverty, increasing
shared prosperity, and promoting sustainable development. The
institutions are:
IBRD: The International Bank for Reconstruction and Development

IDA: The International Development Association
IFC: The International Finance Corporation
MIGA: The Multilateral Investment Guarantee Agency
ICSID: The International Centre for Settlement of Investment
Disputes
Note: Dr. Jim Yong Kim became the 12th President of the World
Bank Group on July 1, 2012.
A Brief on World Bank

It is an international financial institution that provides loans to
countries of the world for capital programs. It comprises two
institutions: the International Bank for Reconstruction and
Development (IBRD), and the International Development
Association (IDA). The World Bank is a component of the World
Bank Group.

Chapter 13: Human Development – Social Sectors in India, Health
and Education.
Healthcare Industry in India

Healthcare comprises hospitals, medical devices, clinical trials,
outsourcing, telemedicine, medical tourism, health insurance and
medical equipment.
The overall Indian healthcare market is worth around US$ 100
billion and is expected to grow to US$ 280 billion by 2020, a
Compound Annual Growth Rate (CAGR) of 22.9 per cent.
Healthcare delivery, which includes hospitals, nursing homes
and diagnostics centres, and pharmaceuticals, constitutes 65 per
cent of the overall market. The Healthcare Information
Technology (IT) market which is valued at US$ 1 billion currently
is expected to grow 1.5 times by 2020.
The Indian medical tourism industry is pegged at US$ 3 billion
per annum, with tourist arrivals estimated at 230,000. The Indian
medical tourism industry is expected to reach US$ 6 billion by
2018, with the number of people arriving in the country for
medical treatment set to double over the next four years.

With greater number of hospitals getting accredited and
receiving recognition, and greater awareness on the need to
develop their quality to meet international standards, Kerala
aims to become India's healthcare hub in five years.
The hospital and diagnostic centres attracted Foreign Direct
Investment (FDI) worth US$ 4.09 billion between April 2000 and
September 2016, according to data released by the Department of
Industrial Policy and Promotion (DIPP).
Government Initiatives
❖ In the Union Budget 2017-18, the overall health budget increased
from INR 39,879 crore (US$ 5.96 billion) (1.97% of total Union
Budget) to INR 48,878 crore (US$ 7.3 billion) (2.27% of total
Union Budget). In addition, the Government of India made
following announcements in the Union Budget 2017-18:
Harmonise policies and rules for the medical devices industry to
encourage local manufacturing and move towards improving
affordability for patients.
Modify the Drugs and Cosmetics Act to promote generics and
reduce the cost of medicines.
Set up two new All India Institute of Medical Sciences (AIIMS) in
Gujarat and Jharkhand.
Convert 1.5 lakh sub centres in Indian villages to health and
wellness centres
Set short and medium term targets for key health indicators and
bring down the Maternal Mortality Rate to 100 by 2018-2020 and
Infant Mortality Rate to 28 by 2019.
Prepare action plans to eliminate Kala Azar and Filariasis by
2017, leprosy by 2018, measles by 2020 and tuberculosis (TB) by
2025.

The Government of India plans to set up a single window
approval system for innovation in medical research, in order to
grant permission/approvals within 30 days from the date of
application to Indian innovation projects who have applied for
global patent.
❖ The Union Cabinet has approved signing of an agreement with
the World Health Organisation (WHO) under which WHO will
develop technical documents on traditional medicines which is
expected to lead to better acceptance of Indian systems of
medicines at an international level.
❖ A unique initiative for healthcare 'Sehat' (Social Endeavour for
Health and Telemedicine) has been launched at a government
run Common Service Centre (CSC) to empower rural citizens by
providing access to information, knowledge, skills and other
services in various sectors through the intervention of digital
technologies and fulfilling the vision of a ‘Digital India’.
Education Sector in India

India holds an important place in the global education industry.
The country has more than 1.4 million schools with over 227
million students enrolled and more than 36,000 higher education
institutes.
India has become the second largest market for e-learning after
the US. The sector is currently pegged at US$ 2-3 billion, and is
expected to touch US$ 40 billion by 2017.
The distance education market in India is expected to grow at a
Compound Annual Growth Rate (CAGR) of around 34 per cent#
during 2013-14 to 2017-18.
The aim of the government to raise its current gross enrolment
ratio to 30 per cent by 2020 will also boost the growth of the
distance education in India.
In FY 2015-16, the education market was worth about US$ 100
billion and is expected to reach US$ 116.4 billion in FY 2016-17.
Currently, higher education contributes 59.7 per cent of the
market size, school education 38.1 per cent, pre-school segment
1.6 per cent, and technology and multi-media the remaining 0.6
per cent.
India’s higher education system is the largest in the world
enrolling over 70 million students while in less than two decades,
India has managed to create additional capacity for over 40
million students.
The total amount of Foreign Direct Investments (FDI) inflow into
the education sector in India stood at US$ 1,383.62 million from
April 2000 to December 2016, according to data released by
Department of Industrial Policy and Promotion (DIPP).
The Union Budget 2017-18 has made the following provisions for
the education sector:
a) The Budget has pegged an outlay of Rs 79,685.95 crore (US$
11.952 billion) for the education sector for financial year 2017-
18, up from Rs 72,394 crore (US$ 10.859 billion) in 2016-17—a
9.9 per cent rise.
b) The Government of India has allocated around Rs 17,000 crore
(US$ 2.55 billion) towards skilling, employment generation,
and providing livelihood to millions of youth, in order to boost
the Skill India Mission.
The Government of India and the World Bank have signed a US$
201.50 million International Development Association (IDA)
credit agreement for the Third Technical Education Quality
Improvement Programme (TEQIP III), aimed at improving the

efficiency, quality and equity of engineering education across
several focus states.
Mr Radha Mohan Singh, Union Minister of Agriculture and
Farmers Welfare, has announced that the Central Government
will open at least one Krishi Vigyan Kendra in all districts of the
country, which will provide advanced agriculture technical
assistance to the farmers near their farms itself.
The Ministry of Shipping has sanctioned Rs 10 crore (US$ 1.5
million) as part of the first instalment to the Gujarat Maritime
Board under the Sagarmala project, which will be used for
capacity building and safety training of 20,000 workers involved
in the ship recycling activities at Alanag- Sosiya recycling yard in
Bhavnagar district in Gujarat.
The Ministry of Skill Development and Entrepreneurship has
launched the Pradhan Mantri Yuva Yojana, which will provide
entrepreneurship education and training to over 700,000 students
in 5 years through 3,050 institutes.
The Cabinet Committee on Economic Affairs has approved
opening of one Jawahar Navodaya Vidyalaya (JNV) in each of
the 62 uncovered districts with an outlay of Rs 2,871 crore (US$
430.6 million), which is expected to benefit over 35,000 students
in rural areas and provide direct permanent employment to 2,914
individuals.
The Union Cabinet chaired by the Prime Minister Shri Narendra
Modi has approved 'Pradhan Mantri Gramin Digital Saksharta
Abhiyan' (PMGDISHA) to make 60 million rural households
digitally literate. The outlay for this project is Rs 2,351.38 crore
(US$ 353.70 million) to usher in digital literacy in rural India by
March, 2019.

Prime Minister Mr Narendra Modi launched the Skill India
initiative – ‘Kaushal Bharat, Kushal Bharat’. Under this initiative,
the government has set itself a target of training 400 million
citizens by 2022 that would enable them to find jobs. The
initiatives launched include various programmes like: Pradhan
Mantri Kaushal Vikas Yojana (PMKVY), National Policy for Skill
Development and Entrepreneurship 2015, Skill Loan scheme, and
the National Skill Development Mission.
PMKVY is the flagship program under the Skill India Initiative
and it includes incentivising skill training by providing financial
rewards on completion of training to the participants. The Union
Government plans to set up skill development centres across
India with an investment of Rs 12,000 crore (US$ 1.8 billion) to
create job opportunities for 10 million individuals by 2020 under
PMKVY, as per Mr Bandaru Dattatreya, Minister of Labour and
Employment.
National Policy for Skill Development and Entrepreneurship
2015 is India’s first integrated program to develop skill and
promote entrepreneurship simultaneously. The Union
Government plans to provide Rs 7,000 crore (US$ 1.05 billion) to
states to spend on skill development, and thereby accelerate the
ambitious task of skilling 500 million Indians by 2022, and
encourage creation of an ecosystem of entrepreneurs.
Skill Loan Scheme is designed to disburse loans of Rs 5,000 (US$
75.3) to Rs 150,000 (US$ 2,260) to 3.4 million Indians planning to
develop their skills in the next five years.

Chapter 14: A Brief on Economic Survey 2016-17
What is Economic Survey?

It’s a flagship annual document of the Ministry of Finance,
Government of India, Economic Survey 2016–17 reviews the
developments in the Indian economy over the previous 12 months,
summarizes the performance on major development programmes,
and highlights the policy initiatives of the government and the
prospects of the economy in the short to medium term. This
document is presented to both houses of Parliament during the
Budget Session.
Finance Minister Shri Arun Jaitley presented Economic Survey

2016-17 in the Parliament. It says that the rupee performed better
than most of the other emerging market economies.
The Indian Economy has sustained a macro-economic environment

of relatively lower inflation, fiscal discipline and moderate current
account deficit coupled with broadly stable rupee-dollar exchange
rate. The survey state that such a sustenance is despite continuing
global sluggishness.
• As per the advance estimates released by the Central Statistics

Office, the growth rate of GDP at constant market prices for the
year 2016-17 is placed at 7.1 per cent, as against 7.6 per cent in
2015-16. This estimate is based mainly on information for the
first seven to eight months of the financial year.
• Fixed investment (gross fixed capital formation) to GDP ratio (at
current prices) is estimated to be 26.6 per cent in 2016-17, vis-à-
vis 29.3 per cent in 2015-16.

• There is a likelihood that Indian economy may recover back to 6
¾ per cent to 7 ½ per cent in 2017-18.
Fiscal
• Indirect taxes grew by 26.9 per cent during April-November
2016.
• The strong growth in revenue expenditure during April-
November 2016 was boosted mainly by a 23.2 per cent increase
in salaries due to the implementation of the Seventh Pay
Commission and a 39.5 per cent increase in the grants for
creation of capital assets.
FISCAL DEFICIT
2015-16 fiscal deficit, seen at 3.9 per cent of GDP, seems achievable.
Credibility and optimality argue for adhering to 3.5 per cent of
GDP fiscal deficit target.

Prices
• The headline inflation as measured by Consumer Price Index
(CPI) remained under control for the third successive financial
year. The average CPI inflation declined to 4.9 per cent in 2015-
16 from 5.9 per cent in 2014-15 and stood at 4.8 per cent during
April-December 2015.
• Inflation based on Wholesale Price Index (WPI) declined to (-)
2.5 per cent in 2015-16 from 2.0 per cent in 2014-15 and averaged
2.9 per cent during April-December 2016.
• Inflation is repeatedly being driven by narrow group of food
items, of these pulses continued to be the major contributor of
food inflation.
• The CPI based core inflation has remained sticky in the current
fiscal year averaging around 5 per cent.

Trade
• The trend of negative export growth was reversed somewhat
during 2016-17 (April-December), with exports growing at 0.7
per cent to US$ 198.8 billion. During 2016-17 (April-December)
imports declined by 7.4 per cent to US$ 275.4 billion.
• Trade deficit declined to US$ 76.5 billion in 2016-17 (April-
December) as compared to US$ 100.1 billion in the
corresponding period of the previous year.
• The current account deficit (CAD) narrowed in the first half
(H1) of 2016-17 to 0.3 per cent of GDP from 1.5 per cent in H1 of
2015-16 and 1.1 per cent in 2015-16 full year.
• Robust inflows of foreign direct investment and net positive
inflow of foreign portfolio investment were sufficient to finance
CAD leading to an accretion in foreign exchange reserves in H1
of 2016-17.
• In H1 of 2016-17, India’s foreign exchange reserves increased by
US$ 15.5 billion on BoP basis.
• During 2016-17 so far, the rupee has performed better than most
of the other emerging market economies.
External Debt
• At end-September 2016, India’s external debt stock stood at US$
484.3 billion, recording a decline of US$ 0.8 billion over the level
at end-March 2016.
• Most of the key external debt indicators showed an
improvement in September 2016 vis-à-vis March 2016. The share
of short-term debt in total external debt declined to 16.8 per cent
at end-September 2016 and foreign exchange reserves provided
a cover of 76.8 per cent to the total external debt stock.

CURRENT ACCOUNT DEFICIT
As 2016-17 current account deficit seen around 1-1.5 per cent of
GDP.
BANKING & CORPORATE SECTOR

Estimated capital requirement for banks around 1.8 trillion rupees
by 2018-19.
Proposes to make 700 billion rupees available via budgetary
allocations during current and succeeding years in banks.
Agriculture
• Agriculture sector is estimated to grow at 4.1 per cent in 2016-17

as opposed to 1.2 per cent in 2015-16; the higher growth in
agriculture sector is not surprising as the monsoon rains were
much better in the current year than the previous two years.
• The total area coverage under Rabi crops as on 13.01.2017 for
2016-17 is 616.2 lakh hectares which is 5.9 per cent higher than
that in the corresponding week of last year.

• The area coverage under wheat as on 13.01.2017 for 2016-17 is
7.1 percent higher than that in the corresponding week of last
year. The area coverage under gram as on 13.01.2017 for 2016-17
is 10.6 percent higher than that in the corresponding week of last
year
Industry
• Growth rate of the industrial sector is estimated to moderate to
5.2 per cent in 2016-17 from 7.4 per cent in 2015-16. During April-
November 2016-17, a modest growth of 0.4 per cent has been
observed in the Index of Industrial Production (IIP).

• The eight core infrastructure supportive industries, viz. coal,
crude oil, natural gas, refinery products, fertilizers, steel, cement
and electricity registered a cumulative growth of 4.9 per cent
during April-November 2016-17 as compared to 2.5 per cent
during April-November 2015-16. The production of refinery
products, fertilizers, steel, electricity and cement increased
substantially, while the production of crude oil, natural gas fell
during April-November 2016-17. Coal production attained lower
growth during the same period.
• The performance of corporate sector (Reserve Bank of India,
January 2017) highlighted that the growth of sales grew by 1.9
per cent in Q2 of 2016-17 as compared to near stagnant growth of
0.1 per cent in Q1 of 2016-17. Growth in net profit registered a

remarkable growth of 16.0 per cent in Q2 of 2016-17 as compared
to 11.2 per cent in Q1 of 2016-17.
Services
• Service sector is estimated to grow at 8.9 per cent in 2016-17,
almost the same as in 2015-16. It is the significant pick-up in
public administration, defence and other services, boosted by the
payouts of the Seventh Pay Commission that is estimated to push
up the growth in services.
Social Infrastructure, Employment and Human Development

• The Parliament has passed the “Rights of Persons with
Disabilities Act, 2016”. The Act aims at securing and enhancing
the rights and entitlements of Persons with Disabilities. The Act
has proposed to increase the reservation in vacancies in
government establishments from 3 per cent to 4 per cent for those
persons with benchmark disability and high support needs.
One Liners based on the Economic Survey

1. According to the Economic Survey, CPI based core inflation
remained stable in the current fiscal year (2016-17) averaging
around what per cent?
Answer. 5 per cent
2. As per the Survey, the total area coverage under Rabi crops as
on 13.01.2017 for 2016-17 is?
Answer. 616.2 lakh hectares
3. As per the Survey, the growth rate of GDP at constant market

prices for the year 2016-17 is placed at?
Answer. 7.1 per cent
4. The Fixed investment (Gross Fixed Capital Formation) to GDP
ratio (at current prices) in the year 2016-17 is estimated at?
5. As per the survey, the GDP growth at constant prices for the
year 2017-18 to be expected between?
Answer. 6.75 % to 7.5%
6. As per the survey, Indirect taxes during April-November 2016

grew by?
7. As per the survey, Inflation based on Wholesale Price Index

(WPI) averaged to what percent during April-December 2016?
8. As per the Survey, the exports growth rate during April-

December 2016-17 is?

Answer. 0.7 per cent (Imports declined by 7.4 per cent to US$ 275.4
billion)
9. What is the amount of trade deficit during April-December

2016-17, as per the Economic Survey 2016-17?
Answer. US$ 76.5 billion
10. In the Economic survey, it is given that Agriculture sector is

estimated to grow at how much percent in 2016-17?
11. In the Economic survey, it is given that Growth rate of the

industrial sector in 2016-17 is estimated at?

12. As per the survey, during April-November 2016-17 the growth
rate of the eight core infrastructure supportive industries, viz.
coal, crude oil, natural gas, refinery products, fertilizers, steel,
cement and electricity is?
13. In the Economic survey, it is given that Service sector is

estimated to grow at how much percent in 2016-17?
14. As per the survey, the current account deficit in the year 2016-
17 seen at around how much percent of GDP?
Answer. 1-1.5 per cent
15. What is the estimated capital requirement for banks by 2018-

19, as per the survey?
Answer. Around 1.8 trillion rupees
Abbreviations based on the Economic Survey 2016-17

1. AMRUT: Atal Mission for Rejuvenation and Urban
Transformation
2. CFPI: Consumer Food Price Index
3. CPI- IW: Consumer Price Index for Industrial Workers
4. CPI-AL: Consumer Price Index for Agricultural Labour
5. CRIS: Centre for Railway Information System
6. CSO: Central Statistics Office
7. DCRF: Debt Consolidation and Reconstruction Facility
8. DIPP: Department of Industrial Policy & Promotion
9. FRBM: Fiscal Responsibility and Budget Management Act
10. FRL: Fiscal Responsibility Legislation
11. FSI: Floor Space Index
12. GDP: Gross Domestic Product
13. GSDP: Gross State Domestic Product
14. HRIDAY: Heritage City Development and Augmentation
Yojana
15. IMR: Infant Mortality Rate
16. JNNURM: Jawaharlal Nehru National Urban Renewal
Mission
17. MNDWI: Modified Normalized Difference Water Index
18. NASA: National Aeronautics and Space Administration
19. NITI: National Institution for Transforming India
20. NRSA: National Remote Sensing Agency
21. PPP: Purchasing Power Parity
22. UDAY: Ujwal DISCOM Assurance Yojana
23. UN: United Nations
24. UNICEF: United Nations Children's Fund
25. USGS: United States Geological Survey

Chapter 15: FDI in India
Foreign direct investment (FDI) is a major source of non-debt

financial resource for the economic development of India.
Foreign companies invest in India to take advantage of relatively
lower wages, special investment privileges such as tax
exemptions, etc. The government has taken many initiatives in
recent years such as relaxing FDI norms across sectors such as
defence, PSU oil refineries, telecom, power exchanges, and stock
exchanges, among others.
The World Bank has stated that private investments in India is
expected to grow by 8.8 per cent in FY 2018-19 to overtake
private consumption growth of 7.4 per cent, and thereby drive
the growth in India's gross domestic product (GDP) in FY 2018-
19.
According to Department of Industrial Policy and Promotion
(DIPP), the total FDI investments India received during April
2016-March 2017 rose 8 per cent year-on-year to US$ 60.08
billion. Data indicates that the services sector attracted the
highest FDI equity inflow of US$ 8.69 billion, followed by
telecommunications, and computer software and hardware.
During April 2016-March 2017, India received the maximum FDI
equity inflows from Mauritius (US$ 15.73 billion), followed by
Singapore (US$ 8.71 billion), Japan (US$ 4.71 billion),
Netherlands (US$ 3.37 billion), and USA (US$ 2.38 billion).
The Union Cabinet has approved raising of bonds worth Rs 2,360
crore (US$ 365.63 million) by the Indian Renewable Energy
Development Agency (IREDA), which will be used in various
renewable energy projects in FY 2017-18.
The Ambassador of Japan to India, Mr Kenji Hiramatsu, has
conveyed Government of Japan's inclination to invest and offer
any other feasible support for various ongoing as well as
upcoming development and infrastructure projects in the North-
Eastern region of India.
The Government of India plans to scrap the Foreign Investment
Promotion Board (FIPB), which would enable the foreign
investment proposals requiring government approval to be
cleared by the ministries concerned, and thereby improve the
ease of doing business in the country.
The Government of India has approved 100 per cent foreign
direct investment (FDI) in other financial services carried out by
non-banking finance companies (NBFCs), which is expected to
attract more foreign capital into the country.
The Department of Industrial Policy and Promotion (DIPP) has
allowed 100 per cent foreign direct investment (FDI) in asset
reconstruction companies (ARC) under automatic route, which
will help to tackle the issue of declining asset quality of banks.
The government has also raised FDI cap in insurance from 26 per
cent to 49 per cent through a notification issued by the DIPP. The
limit is composite in nature as it includes foreign investment in
the form of foreign portfolio investment, foreign institutional
investment, qualified foreign investment, foreign venture capital
investment, and non-resident investment.
India’s cabinet cleared a proposal which allows 100 per cent FDI in
railway infrastructure, excluding operations. Though the initiative
does not allow foreign firms to operate trains, it allows them to
invest in areas such as creating the network and supplying trains
for bullet trains etc.

Chapter 16: Financial Statements & Ratios & Price Of Bond
A financial statement is an organised collection of information or

data prepared as per certain acceptable accounting norms and
procedures. These include the following:
1. A balance sheet,
2. A trading & manufacturing and profit & loss account (or income
statement)
3. A funds flow statement.
4. A cash flow statement.
BALANCE SHEET
A balance sheet can be defined as a statement of assets and
liabilities / financial position of a business concern on a given date
say March 31.
Liabilities are the resources (sources of funds) which the business
mobilises to acquire assets for earning income. Assets are the tools
with the help of which, income in a business is earned. The total of
liabilities would always be equal to the total of assets.
The assets and liabilities are divided into certain convenient

groups for the purpose of proper analysis of the statements.
LIABILITIES
Owned funds
Proprietor’s capital or paid-up share capital
Reserves
Long Term or Deferred Liabilities

(where funds are available to business for a period exceeding 12
months)
Debentures
Term loans raised from banks and financial institutions
Current liabilities or Short-term Liabilities

(where fund are available to business for a period up to 12 months)
Short term borrowings from banks and/or others
Unsecured loans including commercial paper repayable within
12 months
Deposits from public maturing within one year.
Sundry trade creditors (called creditors or payable also) or bills
payables
Expenses payable such as for wages, salaries, rent and other
expenses payable.
Interest and other charges.
Statutory liabilities such as provident fund dues, provision for
taxation, sales tax, excise, obligations towards workers
considered as statutory.
Miscellaneous current liabilities such as provision for
dividends, bonus, liabilities for expenses, gratuity, other
provisions, any other payments dues.
Contingent Liabilities
These liabilities are not shown in the body of balance sheet but are
recorded as a footnote. These are also called off-balance sheet
items because of this reason. They are called contingent because
their possibility of becoming a funded liability or not, depends
upon the fulfillment or non-fulfillment of certain conditions. These
liabilities include:
Pending law suits.
Claims against the organisation not acknowledged as debt.
Guarantees given by the organisation on behalf of others.
Letters of Credit issued by the banks on behalf of the
organisation.
Guarantees issued by banks on behalf of the organisation.
Taxes and duties under dispute with the Govt.
Bills and cheques discounted by banks, in case these have
already been accounted for on cash basis.
ASSETS
Assets are the properties owned by a business and are acquired to
use them for generation of income through operations.
Fixed Assets or Block Assets
These are the assets which are of relatively permanent nature
and they are not disposed off within a short period. The
examples are land, buildings and structures, machinery, tools
and equipment of all type, vehicles, furniture and fixtures,
capital work in progress.
Advances against fixed assets and other assets of long term
nature, which will become fixed assets after some time, are part
of Non-current Assets.
Current Assets
These are the assets which are required by the business for the
purpose of re-sale and are re-circulating
and arise out of usual business dealings. They are held temporarily
for subsequent conversion into cash maximum within a period of
12 months.
The following types of assets could be classified as current assets:
Cash and bank balances
Investments in quoted/tradable Govt. and other trustee
securities and fixed deposits with banks,

Receivables (or bills receivables or book debts or debtors or
sundry debtors) arising out of sales.
Instalments of deferred receivables due within one year,
Raw materials and components,
Stock-in-process including semi-finished goods,
Finished goods including goods in transit,
Pre-paid expenses,
Advances for purchase of raw materials, components and
consumable spares and other advances,
Other current assets which fulfill the criteria of being called a
Current Asset.
Intangible Assets
Certain assets in business don’t have any physical presence or in
other words these are just book entries created with certain specific
objectives. In order to account for the cost incurred on such
expenses, they are shown as assets in the books, a few examples of
which may be as under:
Goodwill,
Patents,
Copyrights,
Trade marks, etc.
PROFIT AND LOSS ACCOUNT

A statement which takes care of all the revenue earned (whether
received or not) and the expenditure incurred (whether paid or
not), and resultant profit or loss is known as profit or loss account’
or ‘revenue statement’. Whenever the income is more than
expenses, the result is profit (and vice-versa).
A Profit and loss account is divided generally in three parts :

a: A trading and manufacturing account;(for trading concerns only
trading account),
b: A profit and loss account,
c: Profit and loss appropriation account.
Objective of calculation of various Ratio

Liquidity To evaluate the liquidity position of the firm.
ratios
Leverage To evaluate the strength of the firm to raise long
ratios term loans on the strength of their own net worth
Activity ratios To examine the efficiency with which the assets
are being used
Profitability To understand as to how profitable is the business
ratios
LIQUIDITY RATIOS
The ratio which indicate the liquidity of the firm are current ratio,
acid test ratio or quick ratio and net working capital.
Current Ratio
The current ratio is the relationship between the current assets and
current liabilities. It can be worked out as under: Current assets /
Current liabilities
Acid Test or Quick Ratio

The quick ratio is the ratio between quick current assets and
current liabilities.
Quick assets include cash/bank balances + receivables upto 6
months + quickly realisable securities such as govt. securities
or quickly marketable/quoted shares and bank fixed deposits.

It can be worked out as under: Quick assets / Current
liabilities
Net working capital
It can be worked out as Current assets minus Current Liabilities.
LEVERAGE OR SOLVENCY RATIOS
Debt-Equity Ratio
The ratio is important one since it shows the dependence of the
unit on outside long term finance.
It can be worked out as under:
Long term outside liabilities/Tangible net worth
(Here long term outside liabilities are liabilities of long term nature
and tangible net worth is total of capital and reserves and surplus
reduced by intangible assets)
Higher the ratio, more the pressure on the liquidity, when
repayment of liabilities falls due. Lower the debt equity of a firm
compared to another firm, the better it is.
Debtor Service Coverage Ratio (DSCR)

The ratio explains the relationship between the funds available for
servicing the long term outside liabilities. This ratio is used for
judging repayment capacity and fixing the repayment schedules for
term loans in banks and financial institutions.
It could be worked out:
net profit + depreciation + annual amount of interest charged (or
chargeable) on the long term liabilities / annual amount of
interest charged (or chargeable) on the long term liabilities +
annual amount of instalment payable on the long term liabilities.
Note:
Tangible net worth = Net worth less intangible assets
Tangible assets = Total assets less intangible assets
ACTIVITY RATIOS
These ratios measure the efficiency of the organisation in using the
available funds, particularly the funds raised on short term basis.
The following ratios could be worked out:
Inventory turnover:
Sales / Average stocks (average of opening and closing stocks)
Debtor turnover:
Sales / average debtors (average of opening and closing
receivables)
Fixed assets turnover:
Sales / Fixed assets.
Current assets/ working capital turnover
Net sales / average working capital i.e. current assets
Debtors’ velocity or debt collection period
Average Book-debts / sales × 12
Creditors’ velocity or Creditor’s payment period
Average creditors/ purchases × 12
PROFITABILITY RATIOS
Return on investment or capital employed

The ratio can be worked out as under: Profit / Investment (or
capital employed) × 100
Return on equity
The ratio can be worked out as under: Net profits / owned funds
(or tangible net worth) × 100
Gross Profit & Net Profit Ratio
The gross profit is considered to be the surplus of sales over
the cost of goods sold and the ratio can be worked out as
under: Gross Profit / Net Sales × 100
The net profit is the surplus of gross profit after meeting other
expenses. The ratio can be worked out as under: Net profit* /
Sales × 100
*The net profit could be before or after tax.
Operating Profit ratio

The ratio is worked out as under: Operating Profit / Sales × 100
where the operating profit represents profit minus net other income
or profit from un-related activity.
EFFECT OF FLOW OF FUNDS

When the increase in long term sources is more than increase in
long term uses:
Liquidity surplus/net working capital position would improve
Current ratio and quick ratio will improve
When the increase in long term sources is less than increase in

long term uses:
Liquidity surplus/net working capital position would decline
Current ratio and quick ratio will deteriorate
When increase in short term sources is more than increase in

short term uses:
Liquidity surplus/net working capital position would decline
Current ratio and quick ratio will deteriorate

When the increase in short term sources is less than increase in
short term uses:
Liquidity surplus/net working capital position would improve
Current ratio and quick ratio will improve
BREAK EVEN POINT ANALYSIS

It is that level of activity, where the total revenue cost (comprising
of fixed revenue cost and variable revenue cost) is equal to the total
sale value or where there is not loss or no profit.
Important terms in BEP

Contribution = Selling price per unit less variable cost per unit
or total sales less total variable cost.
Fixed cost: Those costs which do not change with level of sale.
They remain constant irrespective of no. of units produced/sold.
Example – depreciation, rents etc. these do not include fixed
assets.
Variable cost: Costs which vary directly with level of
turnover/production and include costs such as cost of raw
material, packing material, power and fuel, wages of labour etc.
These costs would increase with increase in the volume of sale
and would come down with the decline in the level of sales.
Margin of Safety: No. of units above the break-even units.
FORMAT OF BALANCE SHEET FOR RATIO ANALYSIS

Liabilities Rs Assets Rs.
Net worth/ Equity Fixed Assets
• Share capital/partners’ • (Such as land and
capital/paid-up building, plant
capital/owners funds machinery etc.)
• Reserves (General • Original value
Reserve, Capital • Less deprecation
Reserve, Revaluation • Net value or book value
Reserve and Other or written down value
Reserves) • (These are purchased for
(These funds are brought long term use and are
in by the promoters as depreciated every year)
their investment in
business or generated by Non-Current Assets
and retained in business) • Investment of long term
nature in shares, govt.
Long term liabilities securities, associate or
• Term Loan (Banks or sister firms or companies.
Institutions) • Old stocks or old
• Debentures/ Bonds /disputed book debts
• Unsecured Loans • Long term security
• Fixed Deposits
deposits.
• Other Long Term
• Other misc. assets which
Liabilities
are not current or fixed
(Only those liabilities to
assets
be taken which are not
Intangible Assets
due for payment within 12
• Patents, good will, debit
months from date of the
balance of P & L account,
balance sheet)
preliminary or
Short term (or Current) preoperative expensive
Liabilities Current Assets
• Bank working capital • Cash/Bank balance
limits such as cash including fixed deposits
credit, over draft, bills, with banks
export credit. • Marketable/quoted govt.
or other securities meant
• Sundry/trade for sale
creditors/creditors/bills • Book debts / Sundry
payable debtors / debtors /
• Short duration loans or receivables / bills
deposits receivables (which are
• Expenses payable outstanding for short
• Previsions against time)
various items • Stocks / inventory (such
• Other Current as raw material, stock in
Liabilities process, finished goods,
(Only those liabilities to stores and spares meant
be taken which are due for for consumption)
payment within 12 • Advance payment of
months from date of the taxes, pre-paid expenses
balance sheet) • Other assets of current
nature
Total Total
Summary of Interpretation of Various Ratios

Name of the When do we consider When do we consider
Ratio improvement? deterioration?
Current Ratio When ratio increases When ratio decreases
Quick Ratio When ratio increases When ratio decreases
Net Working
When ratio increases When ratio decreases
Capital
Debt Equity
When ratio decreases When ratio increases
Ratio
Debt Service
Coverage
Stock Turnover When ratio increases When ratio decreases

Working Capital
turnover
Debtors Velocity When ratio decreases When ratio increases
Return on equity When ratio increases When ratio decreases
Return on
investment

Chapter 17: PRICE OF BOND AND NPV
Future Value of Rupee

FV= P(1+i)n
Here:
FV = Future Value of a Rupee
P = Principal
I = interest rate per year
n = number of years
Present value of a Rupee (PVD)

PV= FV/(1+i)n
Here:
PV = Present Value
FV = Future Value
i = interest rate per time period
n = number of time periods
Interest Rate of a Discount (IRD)

1
FV n
i=( ) −1
PV
Future Value of an Ordinary Annuity (FVOA)
(1 + i)n − 1
FVOA = A ∗
i
Here
A= Annuity

Future Value of an Annuity Due (FVAD)
(1 + r)n − 1
= (1 + r)×P [ ]
r
Present Value of an Annuity (Summation Notation)

n
A
PVA = ∑
(1 + i)k
k=1
Present value of an Annuity (PVA)

1 − (1 + r)−n
PVA = P [ ]
r
Present Value Annuity Payment

i
A = PV ∗
1 − (1 + i)−n
Formula for the monthly payment of a loan.
A = monthly payment, or annuity payment.
PV = Present value, or the amount of the loan.
Nominal Yield Formula

Annual Interest Payment
Nominal Yield =
Par Value
Current Yield Formula

Annual Interest Payment
Current Yield =
Current Market Price of Bond

Approx. YTM Percentage Formula
F−P
C+ n
Approx. YTM % =
F+P
2
C = Coupon/Interest Payment
F = Face Value
P = Price
n = YTM
Effective Interest Rate of a Discounted Bond

n FV
i= √ −1
PV
i = interest rate per compounding period
n = number of compounding periods
FV = Future Value
PV = Present Value

Chapter 17: Indian Economy Current Affairs
To enhance the passengers experience by upgrading existing fleet

of coaches with better furnishing, aesthetics & amenities and
better safety features with a view to provide a safe and
comfortable travel, Minister of Railways Shri Suresh Prabhakar
Prabhu has launched MISSION RETRO-FITMENT. The Mission
is an ambitious program to upgrade the level of furnishing &
amenities in the coaches of Indian Railways. This is one of the
largest-retro fitment project in the world as Indian Railways’
40,000 coaches will be refurbished and retrofitted in the next five
years. This Mission Retrofitment is an endeavour to provide
better travel experience as the interiors of the coaches.
Retirement fund body EPFO has enrolled over 82 lakh new
subscribers under its Employees' Enrolment Campaign 2017
started on January 1 this year. Under the scheme, the employers
got the opportunity to file the declaration of unregistered
employees under the EPFO Act, with a nominal fine of Re 1 per
annum on account of damages.
Retail inflation for the month of May hit another series-low,
coming down to 2.18 per cent. Food prices entered a deflationary
zone in May, with the Consumer Food Price Index at minus 1.05
percent.
The GST Council reduced the rates for 66 items and expanded
the scope of the composition scheme for the benefit of small
traders, manufacturers, and restaurateurs. Insulin, pickles,
printers, agarbattis, school bags, and cashew nuts are among the
66. Those were among 133 items whose rates were reviewed
following industry representation.
The IndusInd Bank has entered into an agreement with Overseas
Private Investment Corp. (OPIC) to raise $225 million loan to
support expansion of its micro, small and medium enterprise
lending programmes across India. At least 25% of the proposed
facility will support women entrepreneurs and reach to
populations who previously had no access to banking facility.
India announces mounting a National Mission on advanced
ultra-supercritical technologies for cleaner coal utilisation at a
total cost of US $ 238 million and setting up of two Centres of
Excellence on Clean Coal Technologies at US $5 million each. The
announcement was made at the 2nd Mission Innovation
Ministerial and 8th Clean Energy Ministerial at Beijing, China.
The ‘DigiYatra’ is an industry-led initiative co-ordinated by the
Ministry in line with the Prime Minister Shri Narendra Modi’s
Digital India’s vision to transform the nation into a digitally
empowered society. This follows Air Sewa which brings together
all the stakeholders on a common platform for handling
customer grievances and disseminating real-time data.
‘DigiYatra’ initiative aims to bring together entire industry to
develop a digital ecosystem that will deliver Indian customers a
seamless, consistent and paperless service experience at every
touch point of their journey.
Union Minister of Urban Development Shri M.Venkaiah Naidu
inaugurated the 9th foundation day of The Foundation for
Restoration of National Values (FRNV). Swachh Bharat’ is the
theme of the event. He said that 33,76,793 Individual Household
Toilets and 1,28,946 Community Toilet Seats have so far been
built. The Minister said that 688 cities have been so far declared
Open Defecation free (ODF) and 531 of them have been
independently verified and certified as ODF. Andhra Pradesh
and Gujarat have declared all cities and towns as ODF. He also
said that 100% Door to Door collection and transport of

Municipal Solid Waste has been achieved in 43,200 wards out of
the total 81,015 urban wards.
The Union Cabinet chaired by the Prime Minister Shri Narendra
Modi has approved the proposed Memorandum of
Understanding (MoU) between Export-Import Bank of India
(EXIM Bank) and Export-Import Bank of Korea (KEXIM) for
export credit of USD 9 billion for infrastructural development in
India and for the supply of goods and services as part of projects
in third countries.
Cabinet Committee on Economic Affairs, chaired by the Prime
Minister Shri Narendra Modi, has given its approval for
development of four laning from 'end of Pandoh Bypass to
Takoli' section of National Highway (NH)-21 in Himachal
Pradesh. The total length of the road to be developed is
approximately 19 kms.
Mr B P Kanungo, Deputy Governor of the RBI, has verified that
over 82.7 per cent of the currency has already been remonetised
so far, which is around 108 per cent in volume terms.
Cabinet Committee on Economic Affairs, chaired by the Prime
Minister Shri Narendra Modi, has given its approval to: issue
13,90,00,000 fresh equity shares of Indian Renewable Energy
Development Agency (IREDA) of Rs.10 each to the public on
book-building basis through the IPO & issue shares to retail
investors and IREDA employees at a discount of 5% on the issue
price of each equity share. The Public issue of equity will enable
IREDA to increase its equity base which will help them raise
more debt resources for funding RE projects.
Central Board of Direct Taxes (CBDT) notified a series of
exemptions to the anti-abuse provision introduced in the Finance
Act 2017 to curtail money laundering through securities

transactions. The provision was aimed at preventing the misuse
of long-term capital gains (LTCG) tax exemption through such
transactions. The bona fide acquisition of securities on which the
securities transaction tax (STT) is not paid, including employee
stock options (ESOPs), foreign direct investment and court-
approved transactions, will be exempt from LTCG tax.
Financial technology start-up Quiklo (Olmec Technologies Pvt.
Ltd), which provides loans to students for buying consumer
durables such as phones and laptops, has launched an education
finance service. As part of the new service, consumers, essentially
students, can avail loans to pay course fees or even test
preparation fees.
India has surpassed China to secure the top position among 30
developing countries on ease of doing business. The 2017 Global
Retail Development Index (GRDI), ranks the top 30 developing
countries for retail investment worldwide. The GRDI, titled ‘The
Age of Focus’, ranks China in second place.
Twenty Four (24) States have passed the State GST (SGST) Act as
on 5th June, 2017 while 7 States viz. Meghalaya, Punjab,Tamil
Nadu, Kerala, Karnataka, Jammu & Kashmir and West Bengal
have yet to pass the State GST (SGST) Act .
Minister of Road Transport & Highways and Shipping Shri Nitin
Gadkari launched INAM-Pro + in New Delhi. INAM-Pro+ is an
upgraded version of INAM-Pro, the web portal designed by
National Highways and Infrastructure Development Corporation
Ltd (NHIDCL). The portal facilitated comparison of price,
availability of materials etc. and made it very convenient for the
prospective buyers to procure cement at reasonable rates in a
transparent manner. This reduced the time and effort in

preparation of proposals and bid submissions, and helped
increase efficiency in procurement of construction materials.
RBI has permitted foreign institutional investors (FIIs)/foreign
portfolio investors (FPIs) to raise their stake from 24 per cent to
49 per cent in telecom infrastructure company, Tejas Networks.
The government has met its fiscal deficit target of 3.5 per cent of
gross domestic product for 2016-17. From official data, the deficit
in absolute terms was Rs. 5.35 lakh crore; the budgeted estimate
had been Rs 5.34 lakh crore. As a percentage of GDP (at current
prices) of Rs 151.8 lakh crore, that comes to 3.52 per cent. Total
expenditure was Rs 19.75 lakh crore; the budgeted estimate of Rs
20.14 lakh crore. Plan spending was Rs 5.72 lakh crore, compared
with estimates of Rs 5.84 lakh crore; non-Plan expenditure was
Rs 14.03 lakh crore, as against the budgeted estimate of Rs 14.3
lakh crore. Total receipts for 2016-17 were Rs 13.8 lakh crore,
compared with budgeted estimates of Rs 14.8 lakh crore. Tax
revenue showed a positive trend, partly due to increased
compliance after demonetisation. It was Rs 11.02 lakh crore; the
budget estimate was Rs 10.89 lakh crore. Total non-debt capital
receipts were Rs 63,503 crore, compared with budgeted estimates
of Rs 56,571 lakh crore. Non-tax revenue was Rs 2.74 lakh crore;
the budget estimate was Rs 3.34 lakh crore.
Asian Development Bank (ADB) and Punjab National Bank
(PNB) sign $100 million loan to finance Solar Rooftop projects.
This is the first tranche loan of the $500 million multi tranche
finance facility Solar Rooftop Investment Program (SRIP)
approved by ADB in 2016.
Credit rating agency Moody’s Investors Service projected India’s
economy to accelerate to grow at 7.5% in 2017-18 and 7.7% in

2018-19 as the government has been able to limit the negative
impact of last year’s demonetisation on the economy.
World Bank has projected economic activity to accelerate to 7.2%
in 2017-18 against the government’s estimate of 7.1%.
The subscribers base under the Atal Pension Yojana (APY) has
reached about 53 Lakhs. At present 235 Banks and Department of
Post are involved with the implementation of the scheme. The
Atal Pension Yojana became operational from 1st June, 2015 and
is available to all the citizens of India in the age group of 18-40
years. Under the scheme, a subscriber would receive a minimum
guaranteed pension of Rs.1000 to Rs. 5000 per month, depending
upon his contribution, from the age of 60 years.
Startup India was launched by the Government of India on 16th
January, 2016 to build a strong eco-system for nurturing
innovation and Startups in the country to drive economic growth
and generate large scale employment opportunities. In order to
promote entrepreneurship, the Government of India has
amended the definition of a Startup. The following significant
changes have been made to the definition of Startups –
a) Age of Startup increased: An entity shall be considered as a
Startup up to seven years from the date of its incorporation/
registration (from earlier 5 years). However, in the case of
Startups in the Biotechnology sector, the period shall be up to ten
years from the date of incorporation/ registration.
b) No Letter of Recommendation required: No letter of
recommendation from an incubator/industry association shall be
required for either recognition or tax benefits.
c) Potential of Job and Wealth Creation: The scope of definition
has been broadened to include scalability of business model with
potential of employment generation or wealth creation.

Union Minister of State (IC) for Power, Coal, New & Renewable
Energy and Mines, Shri Piyush Goyal launched the Saral
Eindhan Vitaran Application (SEVA), developed in-house by
Coal India Limited (CIL) for power sector consumers. SEVA is a
part of ‘Digital India’ initiative, which is aimed at increasing the
Consumer Connect as well as the Transparency and
Accountability in Coal dispatch.
Foreign direct investment inflows hit an all-time high of $60.1
billion in 2016-17, as the Narendra Modi government eased rules
to lure global conglomerates to set up shop in sectors such as
defence and railways.
The Union Minister of Finance, Shri Arun Jaitley, officially
launched the Portal of Operation Clean Money
(https://www.cleanmoney.gov.in) in New Delhi. The Operation
Clean Money was initiated by the Income Tax Department (ITD)
on the 31st January, 2017 with the launch of e-verification of large
cash deposits made during 9th November to 30th December
2016. In the first phase, around 18 lakh persons were identified in
whose case, cash transactions did not appear in line with the tax
payer’s profile.
India moved up 73 spots to rank 26th in the World Bank's list of
electricity accessibility in 2017 from the 99th position in 2014,
stated Mr Piyush Goyal. The government has electrified 13,000
villages so far out of the total 18,452 villages and is targeting
electrification of all villages by 2019, within 1,000 days.
Union Agriculture and Farmers Welfare Minister launch e-Krishi
Samvad, an online interface. e-Krishi Samvad is internet-based
interface and is a unique platform that will provide direct and
effective solutions to the problems faced by farmers and
stakeholders in the agriculture sector. He said that people can

directly connect to the ICAR website http://icar.org.in and get
the appropriate solutions from the subject matter specialists and
institutes through web or SMS. e-Krishi Samvad is useful to get
information pertaining to welfare and development of
agricultural stakeholders.
National Highways Authority of India launched its first overseas
Masala bond at the London Stock Exchange.
International Finance Corp. (IFC) is planning to invest as much
as $200 million in India’s largest mortgage lender Housing
Development Finance Corp. Ltd (HDFC). The World Bank’s
private-sector investment arm said it will invest by buying five-
year non-convertible debentures (NCDs) or masala bonds.
The Indian economy is expected to grow at 7.2 per cent in FY
2017-18 and 7.7 per cent in FY 2018-19, supported by fading
problem of cash shortage and progress in resolving the supply-
side bottlenecks, according to a report by the IMF.
The Indian economy will grow by 7.4 per cent in FY 2017-18 and
by 7.6 per cent in FY 2018-19 on the back of an improving
business environment created by reforms like the Goods and
Services Tax (GST) and the new bankruptcy law as per the Asian
Development Bank (ADB).
Securities and Exchange Board of India (Sebi) announced the
much-awaited commodity market reform of permitting
exchanges to launch options contracts. The move would deepen
the domestic commodity market and provide farmers and other
participants a new hedging tool, in a more cost-effective manner.
Sebi also announced a single-licence regime, allowing
stockbrokers to deal in commodities and vice versa.

Chapter 19: Government Schemes Launched Recently
Centre launches IDCF to reduce child deaths due to diarrhoea
The Ministry of Health and Family Welfare has launched the

Intensified Diarrhea Control Fortnight (IDCF) in order to intensify
efforts to reduce child deaths due to diarrhoea. Through this
initiative, the Ministry will mobilize health personnel, State
Governments and other stakeholders to prioritize investment in
control of diarrhea, one of the most common childhood illnesses. It
aims to create mass awareness about the most effective and low-
cost diarrhoea treatment— a combination of Oral Rehydration Salt
(ORS) solution and Zinc tablets.
Nearly 12 crores under 5-children will be covered during the
program across the country.
ASHA worker would undertake distribution of ORS packets to
households with under-five children in her village. ORS-Zinc
Corners will be set-up at health care facilities and non-health
facilities such as Schools and Anganwadi centres.
Note: An estimated 1.1 million children die each year in India,
including approximately 1.1 lakh deaths due to diarrhoea.
Dr. Jitendra Singh announced, “Hill Area Development

Programme” for Northeast
Union Minister of State (IC) for Development of North Eastern
Region (DoNER), MoS PMO, Personnel, Public Grievances,
Pensions, Atomic Energy and Space, Dr Jitendra Singh
announced the launch of, “Hill Area Development Programme”
(HADP) for Northeast in Imphal (Manipur).
He also stated that the hilly areas of Manipur, Tripura and
Assam have a distinct geo-physical entity and are lagging in
socio-economic development. As a result of peculiar
topography, there is a wide gap between the hill and valley
districts in terms of infrastructure, quality of roads, health and
education etc. The programme is inspired with a serious
research and deliberation.
He also observed that hill areas are less developed compared to
the plain areas. Not only this, he cited figures to state that out of
80 districts of Northeast, 3 districts of hilly areas, which ranked
lowest in the composite district infrastructure index, belonged
to Manipur and these were namely, Tamenglong, Chandel and
Churachandpur.
The Hill Area Development Programme is aimed at giving a
focused attention to the lesser developed hilly areas and will be
initiated on a pilot basis in the hilly districts of Manipur.
NITI-Aayog-launched-SATH-programme
NITI Aayog has launched SATH, a program providing
‘Sustainable Action for Transforming Human capital’ with the
State Governments.
The vision of the program is to initiate transformation in the
education and health sectors. It addresses the need expressed by
states for technical support from NITI.
SATH aims to identify and build three future ‘role model’ states
for health systems. NITI will work in close collaboration with
their state machinery to design a robust roadmap of
intervention, develop a program governance structure, set up
monitoring and tracking mechanisms, hand-hold state
institutions through the execution stage and provide support on
a range of institutional measures to achieve the end objectives.

The program will be implemented by NITI along with
McKinsey & Company and IPE Global consortium, who were
selected through a competitive bidding process.
To select the three model states, NITI defined a three-stage
process – expression of interest, presentations by the states and
assessment of commitment to health sector reforms. NITI
invited all states and UTs to participate in the program.
The program will be launched in the three selected states after
the signing of MoUs.
Shri J P Nadda launched Skill for Life, Save a Life initiative to

promote skill development in the health sector
Shri J P Nadda, Union Minister for Health and Family Welfare

launched the ‘Skill for Life, Save a Life’ initiative.
The Initiative’ aims to upscale the quantity and quality of
trained professionals in the healthcare system. Under this
initiative various courses are planned to be initiated targeting
specific competencies for healthcare professionals as well as for
general public.
Shri Nadda informed that the curriculum has been designed by
National Institute of Health and Family Welfare (NIHFW) and
AIIMS, Delhi.
The Health Minister highlighted that in India 1,324 accidents
occur on roads every day and a life is lost every 4 minutes and
measures taken in the first 10 minutes can save a life. It was thus
announced that the Ministry is initiating its’ ‘Skill a Life, Save a
Life’ program by launching First Responder course for
professionals as well as general public, to be conducted in
Central and State government training institutes across the
country in each district, to empower every single citizen of the
country to be the first person to provide first aid and initial care
in case of an emergency.
This program will provide trained and skilled people by
broadening the base to include the community. Through such
programs, we create a mass of ‘first responder’ who
complements the specialists/experts to fill vacuum of adequate
trained professionals,” Shri Mishra added.
Telangana launched single-woman pension scheme, first in India

Telangana government has recently launched the single-women
pensions scheme across the state. Single women will be given Rs
1,000 per month. It is the first such scheme in India. The
government had also increased the Kalyana Laxmi and Shaadi
Mubarak scheme amount from Rs50,116 to Rs75,116.
Govt launches ‘eSanad’ for online document verification

Human Resource Development Ministry and the External Affairs
Ministry launched an online verification portal 'e-sanad' to make
the document verification process easier for students who planning
to study abroad. 'e-Sanad' is an initiative of the Ministry of External
Affairs (MEA), in association with two other ministries with the
help of Central Board of Secondary Education (CBSE). CBSE
repository of documents like mark-sheets and migrations
certificates, has been integrated with e-Sanad. CBSE becomes the
first Board to partner with MEA for e-Sanad.
Govt launched new campaign called Darwaza Band
The centre launched an aggressive new campaign titled

'Darwaza Band' to promote toilet use and freedom from open
defecation across the country's villages.
The campaign produced by the MDWS under Swachh Bharat
Mission.
The 'Darwaza Band' campaign has been supported by the
World Bank and is being rolled out countrywide immediately. It
is designed to encourage behaviour change in men who have
toilets but are not using them.
Amitabh Bachhan & Ms Anushka Sharma are the part of this
campaign.
The campaign focuses on the need to shift people’s paradigm
from ‘open’ to ‘closed’ especially for men.
Uttar Pradesh Govt. launches JE vaccination drive in 38 districts

In Uttar Pradesh, a massive immunisation drive has been launched
in 38 districts to eradicate Japanese Encephalitis (JE). Chief Minister
Yogi Adityanath has launched the drive from Kushinagar district.
The government also launched a toll-free number to get or provide
any information about encephalitis. The number is 18001805544.
President Pranab Mukherjee launched 'Selfie with Daughter'

mobile app
President Pranab Mukherjee launched the 'Selfie with Daughter'
mobile application, aimed at raising awareness about female
foeticide and sex selection. The President urged people to take
photographs with their daughters and upload them to make the
campaign a success.
Civil Aviation Ministry to roll out ‘DigiYatra’ for air travellers

Ministry of Civil Aviation added the Digital experience for Air
Travellers through DigiYatra Platform.

This initiative will transform the flying experience for
passengers and position Indian Aviation amongst the most
innovative air networks in the world.
The initiative aims to bring together entire industry to develop a
digital ecosystem that will deliver Indian customers a seamless,
consistent and paperless service experience at every touch point
of their journey.
The initiative envisages providing airline travellers in India, a
pioneering ‘digitally unified flying experience’ across all
stages of their journey.
The platform will be built on 4 key pillars, like Connected
Passengers, Connected Airports, Connected Flying and
Connected Systems.
Health Secretary inaugurates ‘Vatsalya – Maatri Amrit Kosh’

Shri C K Mishra, Secretary (Health and Family Welfare)
inaugurated the ‘Vatsalya – Maatri Amrit Kosh’, a National
Human Milk Bank and Lactation Counselling Centre at the
Lady Hardinge Medical College, Delhi.
This would be the largest human milk bank and lactation
counselling centre available under the public sector in North
India.
With this donor human milk bank, all newborns in and around
Delhi will have access to life saving human milk regardless of
the circumstances of their birth.
“Vatsalya – Maatri Amrit Kosh” is established in collaboration
with the Norwegian government, Oslo University and Norway
India Partnership Initiative (NIPI).
Mothers Absolute Affection (MAA) programme was launched
to create awareness regarding breastfeeding as being the most
cost-effective way of enhancing the child’s immunity.
“Vatsalya – Maatri Amrit Kosh” is a national human milk bank
and lactation counseling centre that will collect, pasteurize, test
and safely store milk that has been donated by lactating
mothers and make it available for infants in need.
This facility will protect, promote and support breastfeeding of
their own healthy mothers by providing lactation support to
mothers through dedicated lactation counsellors.
TRAI launches three new apps

Telecom Regulatory Authority of India recently launched three
new apps to help customers rate quality of services, speed and
performance. The three new apps are Mycall app, MySpeed app
and 'Do not disturb (DND 2.0)' app. The apps are being launched
with the motive that there is more transparency between the
consumers and the service providers. The MyCall app, is an
Android application for crowdsourced voice call quality
monitoring. MySpeed app will enable TRAI to obtain test-data
from users in all service areas, without any action by the users. The
DND service app will enable users to register their mobile number
under DND to avoid unsolicited commercial communication/
telemarketing calls/SMS.
Road ministry launches online platform INAM PRO+ for infra

raw material
Minister for road transport and highways Nitin Gadkari has
launched 'INAM PRO+'. It is an e-commerce platform for
construction and infrastructure raw material for government and
private procurement. The website 'inampro.nic.in' launched by the
National Highways and Infrastructure Development Corporation
(NHIDCL), a road ministry public sector undertaking, will act as a
repository of all raw materials suppliers and manufacturers in the
country from where people and construction companies, along
with public sector companies, can buy construction material at
competitive rates.
Prakash Javadekar launches UGC App to fight ragging

Union Human Resource Development Minister Shri Prakash
Javadekar launched an Anti-Ragging Mobile App introduced by
the University Grants Commission (UGC) in New Delhi. This
mobile app will help students register complaints to counter the
menace of ragging. This app will work on android system on which
students can log in and register their complaints immediately.
Piyush Goyal launches mobile app 'SEVA' for quick tracking of

coal dispatch
Union Minister of State (IC) for Power, Coal, New & Renewable
Energy and Mines, Shri Piyush Goyal launched the Saral
Eindhan Vitaran Application (SEVA), developed in-house by
Coal India Limited (CIL) for power sector consumers.
SEVA is a part of ‘Digital India’ initiative, which is aimed at
increasing the Consumer Connect as well as the Transparency
and Accountability in Coal dispatch.
By using this app the common man would be able to hold the
Government accountable for the coal linkage allocations and
would be able to check any pilferage or inefficiencies in coal
consumption for power generation. This would lead to
rationalization of coal linkages and finally reduction in the
power prices in the country.
Shri Bandaru Dattatreya launches EPFOs Citizens Charter 2017 &

e-court management system
Minister of State for Labour & Employment(IC), Shri Bandaru
Dattatreya launched EPFO’s Citizens’ Charter 2017 and e-court
management system in Bangalore.
Citizens’ Charter 2017 is an attempt to bring transparency and
accountability on the part of EPFO and make service delivery
system and grievance redressal mechanism more efficient so
that it delivers goods and services to its all stakeholders in a
time bound manner with a reduced timeline from earlier
timeline of 30 days.
The timeline in case of claim settlements is 10 days and 15 days
in case of grievance redressal management.
The citizens’ charter has been launched with the vision of social
security coverage to all employees as well as implementation of
policies for benefit of all stakeholders with adequate support
level of social security.
EPFO e-court Management System has been launched with the
objective of having a transparent and electronic case
management system which will cater to aspirations of all
stakeholders – the employers, the employees, litigants and CBT.
It is a step towards paperless court system wherein court
procedure of EPF & MP Act, 1952 and EPFAT will take place in
a digital environment.
Election Commission of India Launches National Contact Centre

Election Commission of India launched National Contact Centre
with a toll-free No. 1800111950. Now any citizen from any part
of the country can call on the toll-free in English or Hindi with
any query or complaint at any time of the day.
Callers can enquire on subjects such as elections, voting dates,
EPIC, electoral roll, online registration etc. and lodge a
complaint by simply dialing in to the toll free no. Not only this,
executives also make outbound calls for educating the electors
and spreading voter awareness.
The National Contact Centre is operated on a National
Grievance Redressal System Software.
The Contact Centre is Commission’s step forward towards
bringing about electoral reforms where citizens and officials are
empowered to monitor and report any anomaly or violation of
ECI instructions in the field before, during or post elections.
Each state and UT will also soon setup and operationalize
dedicated State Contact Centre (SCC) and District Contact
Centre (DCC) to ensure seamless flow of information across the
contact centers for handling issues/ query from citizens.
ICT 2025 is about setting up core IT infrastructure and process
to consolidate multitude of election process and functions.
Digitalization is the key strategy in ICT 2025. It is the strategy of
adopting recent technologies and consolidating existing
technologies in IT to make the most of the digital resources
available in the Election ecosystem.
CCEA approves new coal linkage policy 2017

CCEA chaired by the Prime Minister Shri Narendra Modi, has
approved the signing of Fuel Supply Agreement (FSA) with the
Letter of Assurance (LoA) holders.
Allocation of linkages for power sector shall be based on
auction of linkages or through Power Purchase Agreement
(PPA) based on competitive bidding of tariffs except for the
State and the Central Power Generating companies and the
exceptions provided in Tariff Policy, 2016.
Coal drawal will be permitted against valid Long Term PPAs
and to be concluded Medium Term PPAs.
The approved framework ensures that all projects with linkages
are supplied coal as per their entitlement. This will ensure the
rights of coal supplies for FSA holders and signing of FSA with
LoA holders.
The salient features of the SHAKTI are as follows:

TPPs having LoA shall be eligible to sign FSA after ensuring
that the plants are commissioned, respective milestones met, all
specified conditions of the LoA fulfilled within specified
timeframe and where nothing adverse is detected against the
LoA holders and the TPPs are commissioned before 31.03.22.
TPPs, part of 78000 MW, that could not be commissioned by
31.03.15 shall now be eligible for coal drawal if the plants are
commissioned before 31.03.22.
Actual coal supplies to all TPPs shall be to the extent of long
term PPAs or medium term PPAs to be concluded in future.
PM Modi launches river conservation project in Madhya Pradesh

PM Narendra Modi launched the Narmada Seva Mission for the
conservation of the crucial river, which is a lifeline of Madhya
Pradesh. Narmada river captured the attention of the nation when
it became the center of a decades-long struggle to stop the raising of
the Sardar Sarovar Dam.
Cabinet approves National Steel Policy 2017

Union Cabinet chaired by the PM Shri Narendra Modi has given its
approval for National Steel Policy (NSP) 2017. It seeks to enhance
domestic steel consumption & ensure high quality steel production
& create a technologically advanced & globally competitive steel
industry. The NSP 2017 aims to achieve 300 million tonnes of steel-
making capacity by 2030.
Key features of the NSP 2017:
1. Create self-sufficiency in steel production by providing policy
support & guidance to private manufacturers, MSME steel
producers, CPSEs
2. Encourage adequate capacity additions,
3. Development of globally competitive steel manufacturing
capabilities,
4. Cost-efficient production
5. Domestic availability of iron ore, coking coal & natural gas,
6. Facilitating foreign investment
7. Asset acquisitions of raw materials &
8. Enhancing the domestic steel demand.
Cabinet approves New Central Sector Scheme – SAMPADA

CCEA chaired by the Prime Minister Shri Narendra Modi has
given its approval for re-structuring the schemes of the Ministry
of Food Processing Industries (MoFPI) under new Central
Sector Scheme – SAMPADA (Scheme for Agro-Marine
Processing and Development of Agro-Processing Clusters) for
the period 2016-20 coterminous with the 14th Finance
Commission cycle.
SAMPADA with an allocation of Rs. 6,000 crore is expected to
leverage investment of Rs. 31,400 crore, handling of 334 lakh
MT agro-produce valuing Rs. 1,04,125 crore, benefit 20 lakh
farmers and generate 5,30,500 direct/ indirect employment in
the country by the year 2019-20.
The objective of SAMPADA is to supplement agriculture,
modernize processing and decrease agri-waste.
SAMPADA is an umbrella scheme incorporating ongoing
schemes of the Ministry like Mega Food Parks, Integrated Cold
Chain and Value Addition Infrastructure, Food Safety and
Quality Assurance Infrastructure, etc. and also new schemes
like Infrastructure for Agro-processing Clusters, Creation of
Backward and Forward Linkages, Creation / Expansion of Food
Processing & Preservation Capacities.
The SAMPADA is a comprehensive package to give a renewed
thrust to the food processing sector in the country. It includes
new schemes of Infrastructure for Agro-processing Clusters,
Creation of Backward and Forward Linkages and Creation /
Expansion of Food Processing & Preservation Capacities.
The implementation of SAMPADA will result in creation of
modern infrastructure with efficient supply chain management
from farm gate to retail outlet. It will create huge employment
opportunities especially in the rural areas. It will also help in
reducing wastage of agricultural produce, increasing the
processing level, availability of safe and convenient processed
foods at affordable price to consumers and enhancing the export
of the processed foods.
HRD Minister Prakash Javadekar launched Vidya-Veerta

Abhiyan
Union Human Resource Development Minister Prakash Javadekar
launched 'Students for soldiers- a nationwide Vidya-Veerta
Abhiyan' to encourage Universities to display portraits of Param
Veer Chakra-decorated soldiers. The aim of this Abhiyan is to
instill a sense of patriotism & nationalism among students.
Centre launches 'One IP- Two Dispensaries' & 'Aadhaar Based

Online Claim Submission' Schemes
Minister of State (I/C) for Labour & Employment, Shri Bandaru
Dattatreya launched two schemes “One IP- Two Dispensaries” &

“Aadhaar based Online Claim Submission” on the occasion of
International Labour Day (1st May).
Under One IP- Two Dispensaries scheme has given an option to an
Insured Person (IP) to choose two dispensaries, one for self &
another for the family through an employer. Under Aadhaar based
Online Claim Submission scheme all EPF Members who have
activated their Universal Account Number (UAN) & seeded their
KYC (Aadhaar) with EPFO will be able to apply for PF final
settlement, Pension withdrawal benefit & PF part withdrawal from
their UAN Interface directly.
Law Minister Ravi Shankar Prasad launches Probono Services,

Legal Aid Schemes, Nyaya Mitra
Minister of Law & Justice Ravi Shankar Prasad inaugurated three
welfare initiatives of the Department of Justice. The services
launched are-
1. Pro-bono legal services- Through the Pro bono legal services,
lawyers who want to provide legal services free of cost can register
themselves on a web-based platform.
2. Tele-law service- It aims to connect marginalized communities
with lawyers through video conferencing facilities, to be set up at
Common Service Centres (CSCs).
3. Nyaya Mitra Project- It aims to reduce pendency in lower courts,
with a special focus on cases which are more than ten years old.
UP govt, Centre sign MoU for 'Power for All' scheme

Uttar Pradesh government and the Centre have signed an MoU for
the 'Power for All' scheme in the state. The aim of this scheme is to
ensure 24-hour quality power supply in the state by October 2018
and electric connection to every house and agriculture field by

2019. With the signing of 'Power for All' agreement government
also introduced UJALA Scheme under which consumers were
distributed Quality based energy saving LED bulbs, tube lights and
fans at a cheaper rate.
Prakash Javadekar launched RUSA Portal, Mobile App

Union Minister of Human Resource Development Shri Prakash
Javadekar launched the unique portal and mobile app of
Rashtriya Uchchatar Shiksha Abhiyan (RUSA), a body under
the aegis of the Ministry of Human Resource Development here
in New Delhi.
The Govt. have inaugurated 17 facilities created under
Rashtriya Ucchatat Shiksha Abiyan (RUSA) in one go in 14
states”.
Under the concept of RUSA the quality of education can go up
by improving the research labs infrastructure and creating
smart class rooms and various other programmes by which the
quality enhancement and value addition to the students
happen.
The portal is a one-stop for States’ Higher Education Plans,
decision of the States’ Higher Education Councils and details of
the resources under this scheme.
RUSA is the Centrally Sponsored Scheme (CSS) of the
Department of Higher Education, MHRD which aims to
provide strategic central funding to State Higher Education
Departments and Institutions and achieve the broad objectives
of access, equity and excellence.

Pradhan Mantri Mudra Yojana tops target for 2016-17, loans cross
target of Rs 1.8 lakh crore
Loans extended under the Pradhan Mantri Mudra Yojana (PMMY)
during 2016-17 have crossed the target of Rs 1,80,000 crore for 2016-
17. Sanctions currently stand at Rs 1,80,087 crore with final data
still awaited from some of the smaller non-banking lenders. The
Union Budget has announced a target of Rs. 2.44 lakh crore for
Mudra Loans during 2017-18.
Rajnath Singh launches Akshay Kumar’s portal ‘Bharat Ke Veer’

Union Home Minister, Shri Rajnath Singh inaugurated the web
portal and mobile application named “Bharat ke Veer”.
The portal is an IT based platform, with an objective to enable
willing donors to contribute towards the family of a braveheart
who sacrificed his/her life in line of duty. The amount so
donated will be credited to the account of ‘Next of Kin’ of those
Central Armed Police Force/Central Para Military Force
soldiers.
Union Home Minister said that the martyr’s family should get a
support of minimum Rs. one crore and the Government would
meet the gaps, if any.
This website is technically supported by National Informatics
Centre (NIC) and powered by State Bank of India.
To ensure maximum coverage, a cap of 15 lakh rupees is
imposed and the donors would be alerted if the amount
exceeds, so that they can choose to divert part of the donation to
another braveheart account or to the “Bharat Ke Veer” corpus.
Note: Valour Day is celebrated on 9th April in remembrance of
an act of unparalleled bravery displayed by a small contingent
of CRPF personnel, pitted against a full-fledged infantry
brigade of Pakistani Army, trying to overrun their post, at
Sardar Post, Rann of Kutch, Gujarat on April 09, 1965.
Madhya Pradesh CM launches 'MP e-nagarpalika' app

The Madhya Pradesh government has launched an app named
‘MP e-nagarpalika’ to provide various municipal services online.
The mobile app was launched by state Chief Minister Shivraj Singh
Chouhan. This app would offer 378 services like online payment of
property tax, seeking building permission, birth/ marriage/death
certificates etc. It will also register complaints related to garbage,
water, streetlights etc.
Union Textiles Minister launches PowerTex India Scheme

Government has launched PowerTex India, a comprehensive
scheme for powerloom sector development, simultaneously at over
45 locations in the country.
The scheme was launched in Bhiwandi, Thane district,
Maharashtra
The comprehensive scheme has the following components:

In-situ Upgradation of Plain Powerlooms
Group Workshed Scheme (GWS)
Yarn Bank Scheme
Common Facility Centre (CFC)
Pradhan Mantri Credit Scheme for Powerloom Weavers
Solar Energy Scheme for Powerlooms
Facilitation, IT, Awareness, Market Development and Publicity
for Powerloom Schemes
Tex Venture Capital Fund
Grant-in-Aid and Modernisation & Upgradation of Powerloom
Service Centres (PSCs)
Government launched two mobile apps- echallan and
mParivahan
The government has launched two mobile apps, echallan and
mParivahan, that provide access to various services and
information, and enable citizens to report any traffic violation or
road accident. 'eChallan' is an integrated enforcement solution to
manage traffic violations through an Android-based mobile app
and back-end web application, for use by the Transport
Enforcement Wing and Traffic Police.
'mParivahan' is an empowering app for the citizen which provides
access to various services, information and utilities related to the
transport sector, bring convenience to citizen and transparency in
the system and is already available for free download from Google
playstore.
Union Petroleum Ministry launches MoPNG e Seva

Minister of State for Petroleum and Natural Gas, Shri Dharmendra
Pradhan launched MoP&NG e-Seva. It is a dedicated grievances
redressal platform on Social Media for all queries and grievances
relating to Oil and Gas Sector.
Govt approves 1.17 lakh more affordable houses under Pradhan

Mantri Awas Yojana
Ministry of Housing and Urban Poverty Alleviation approved
construction of 1,17,814 affordable houses for the benefit of
urban poor in six States at a total cost of Rs.5,773 cr for which
central assistance of Rs.1,816 cr has been approved, under the
Prime Minister’s Awas Yojana (Urban).
Madhya Pradesh has been sanctioned a total of 27,475 new
houses for 43 cities and towns at a total cost of Rs.1,713 cr for
which central assistance of Rs.412 cr has been approved. These
include 20,971 houses under Beneficiary Led Construction
(BLC) component of PMAY(Urban) and 6,504 houses under
Affordable Housing in Partnership (AHP) component.
Under BLC, beneficiaries are assisted to build own houses on
the land available with them or take up improvement works for
increasing living space and other amenities. Under AHP, State
Government provides the land to house urban poor. Under both
these components, central assistance of Rs.1.50 lakh is provided
for each beneficiary.
Note: Madhya Pradesh has been sanctioned 2,09,036 houses and
is closely behind Tamil Nadu which is leading in
implementation of PMAY(Urban) with the maximum of
2,27,700 houses sanctioned.
With this, total number of houses being taken up for
construction for the benefit of urban poor under PMAY(Urban)
has gone up to 17,60,507 with total project cost of Rs.96,018 cr
for which central assistance of Rs.27,714 cr has been approved.
Solar Energy Scheme for Small Powerloom Units

The Government has approved a new scheme to provide financial
assistance or capital subsidy to small powerloom units, for
installation of Solar Photo Voltaic (SPV) plant, in order to alleviate
the problem of power cut and shortages faced by decentralized
powerloom units in India. Under the Solar Energy Scheme, the
plants have two options:
a) On-Grid Solar Power Plant where power cut/shortage is
negligible and power tariff is high.
b) Off-Grid Solar Power Plant in areas where there is power
shortage & on-grid power is not continuously available.

Govt launches new scheme for developing export linked
infrastructure
The government has launched a new scheme Trade
Infrastructure for Export Scheme (TIES) for developing export
linked infrastructure in states with a view to promote outbound
shipments.
TIES seeks to bridge the infrastructure gap and provide forward
and backward linkages to units engaged in trade activities.
The scheme, to be implemented from April 1, would have a
budgetary allocation of Rs 600 crore for three years with an
annual outlay of Rs 200 crore.
It will be implemented from 2017-18 till 2019-20.
The objective of the proposed scheme is to enhance export
competitiveness by bridging gaps in export infrastructure,
creating focused export infrastructure, first mile and last mile
connectivity for export-oriented projects and addressing quality
and certification measures.
The Central and State Agencies, including Export Promotion
Councils, Commodities Boards, SEZ Authorities and Apex Trade
Bodies recognised under the EXIM policy of Government of India;
are eligible for financial support under this scheme.


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STUDY NOTES OF

ECONOMIC & SOCIAL ISSUE

1 Adda247 | No. 1 APP for Banking & SSC Preparation

3 Adda247 | No. 1 APP for Banking & SSC Preparation

4 Adda247 | No. 1 APP for Banking & SSC Preparation

ailways: The Indian Railways network is spread over 108,706 km,

Roadways: India’s road network of 4.87 million km is the second

6 Adda247 | No. 1 APP for Banking & SSC Preparation

Thus, Economic Development=Economic Growth + Qualitative

7 Adda247 | No. 1 APP for Banking & SSC Preparation

8 Adda247 | No. 1 APP for Banking & SSC Preparation

Economic growth is the change- increase or decrease, in the value

National Income Accounting

Market Price and Factor Cost

Relationship between market price and factor cost.

GDP/GNP Calculation: Three Approaches

1. The Product/Output Method:

2. The Income Method:

Differences between GDP and GNP

NNP = GNP - Depreciation

Per Capita Income

12 Adda247 | No. 1 APP for Banking & SSC Preparation

The Indian Constitution and five-year plans state social justice as

The government’s approach to poverty reduction was of three

14 Adda247 | No. 1 APP for Banking & SSC Preparation

15 Adda247 | No. 1 APP for Banking & SSC Preparation

"Development that meets the needs of the present without

On 1 January 2016, the 17 Sustainable Development Goals (SDGs)

The SDGs, also known as Global Goals, build on the success of

The 17 SDGs are as follows:

16 Adda247 | No. 1 APP for Banking & SSC Preparation

Goal 2: Zero Hunger

Goal 3: Good Health and Well-being

Goal 4: Quality Education

Goal 5: Gender Equality

Goal 6: Clean Water and Sanitation

Goal 7: Affordable and Clean Energy

Goal 8: Decent Work and Economic Growth

Goal 9: Industry, Innovation and Infrastructure

Goal 10: Reduced Inequalities

Goal 11: Sustainable Cities and Communities

Goal 12: Responsible Consumption and Production

Goal 13: Climate Action

Goal 14: Life Below Water

Goal 15: Life on Land

Goal 16: Peace, Justice and Strong Institutions

Goal 17: Partnerships for the Goals

19 Adda247 | No. 1 APP for Banking & SSC Preparation

India agreed to the conditionalities of World Bank and IMF and

Reforms Under Liberalisation

20 Adda247 | No. 1 APP for Banking & SSC Preparation

Financial Sector Reforms:

Trade and Investment Policy Reforms

22 Adda247 | No. 1 APP for Banking & SSC Preparation

Privatisation of the public-sector enterprises by selling off part of

Outsourcing: This is one of the important outcomes of the

24 Adda247 | No. 1 APP for Banking & SSC Preparation

INDIAN LABOR POLICY HIGHLIGHTS

26 Adda247 | No. 1 APP for Banking & SSC Preparation

Objective of Monetary Policy

Instruments of Monetary Policy

Reverse Repo Rate: The (fixed) interest rate – currently 50 bps

The LAF consists of overnight as well as term repo auctions. The