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10th October Current Affairs

Belt and Road initiative

In News:

Xi hails ‘steady’ China-Bangladesh friendship, seeks joint promotion of Belt & Road Initiative.

What is BRI?

The Belt and Road Initiative, reminiscent of the Silk Road, is a massive infrastructure project that would stretch from East Asia to Europe.

It was launched in 2013.

The plan is two-pronged: the overland Silk Road Economic Belt and the Maritime Silk Road- The two were collectively referred to first as the One Belt, One Road initiative but eventually became the Belt and Road Initiative.

The project involves creating a vast network of railways, energy pipelines, highways, and streamlined border crossings.

Pakistan and BRI:

To date, more than sixty countries—accounting for two-thirds of the world’s population—have signed on to projects or indicated an interest in doing so.

Analysts estimate the largest so far to be the estimated $60 billion China-Pakistan Economic Corridor, a collection of projects connecting China to Pakistan’s Gwadar Port on the Arabian Sea.

What was the original Silk Road?

The original Silk Road arose during the westward expansion of China’s Han Dynasty (206 BCE–220 CE), which forged trade networks throughout the Central Asian countries, as well as modern-day India and Pakistan to the south. Those routes extended more than four thousand miles to Europe.

How have other countries responded to BRI?

Some countries see the project as a disturbing expansion of Chinese power.

The United States shares the concern of some in Asia that the BRI could be a Trojan horse for China-led regional development and military expansion.

What does China hope to achieve?

China has both geopolitical and economic motivations behind the initiative.

The country has promoted a vision of a more assertive China, while slowing growth and rocky trade relations with the United States have pressured the country’s leadership to open new markets for its goods.

Experts see the BRI as one of the main planks of a bolder Chinese statecraft under Xi, alongside the Made in China 2025 economic development strategy.

The BRI also serves as pushback against the much-touted S. “pivot to Asia,” as well as a way for China to develop new investment opportunities, cultivate export markets, and boost Chinese incomes and domestic consumption.

India’s views:

India has tried to convince countries that the BRI is a plan to dominate Asia, warning of what some analysts have called a “String of Pearls” geoeconomic strategy whereby China creates unsustainable debt burdens for its Indian Ocean neighbors in order to seize control of regional choke points.

In particular, New Delhi has long been unsettled by China’s decades-long embrace of its traditional rival, Pakistan.

PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi)

In News:

Foodtech major Swiggy has signed an MoU with the Ministry of Housing & Urban Affairs or MoHUA to bring India’s street food vendors on to its online platform.

Details:

The initiative under PM Street Vendor’s AtmaNirbhar Nidhi or PM SVANidhi Scheme will help these vendors grow their business which was severely hit and are still struggling due to the Covid-19 pandemic.

Overview of the scheme:

It is a special micro-credit facility plan to provide affordable loan of up to ₹10,000 to more than 50 lakh street vendors, who had their businesses operational on or before 24 March 2020.

The scheme is valid until March 2022.

Small Industries Development Bank of India is the technical partner for implementation of this scheme.

It will manage the credit guarantee to the lending institutions through Credit Guarantee Fund Trust for Micro and Small Enterprises.

Loans under the scheme:

Under the scheme, vendors can avail working capital loan of up to ₹10,000, which is repayable in monthly instalments within one year.

On timely/early repayment of the loan, an interest subsidy of 7% per annum will be credited to the bank accounts of beneficiaries through Direct Benefit Transfer (DBT) on six-months basis.

There will be no penalty on early repayment of loan.

Eligibility:

The scheme is applicable to vendors, hawkers, thelewalas, rehriwalas, theliphadwalas in different areas/contexts who supply goods and services. Street vendors belonging to the surrounding peri-urban/rural areas are also included.

Financial Action Task Force (FATF)

In News:

FATF is all set to decide on Pakistan’s grey list status in a virtual meeting scheduled later this month.

It had placed Pakistan on the grey list in June 2018.

About FATF:

What is it? The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 on the initiative of the G7.

It is a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in various areas.

The FATF Secretariat is housed at the OECD headquarters in Paris.

Roles and functions:

Initially it was established to examine and develop measures to combat money laundering.

In October 2001, the FATF expanded its mandate to incorporate efforts to combat terrorist financing, in addition to money laundering.

In April 2012, it added efforts to counter the financing of proliferation of weapons of mass destruction.

Composition:

The FATF currently comprises 37 member jurisdictions and 2 regional organisations, representing most major financial centres in all parts of the globe. It also has observers and associate members.

Objectives:

To set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.

What is blacklist and grey list?

Black List: Countries knowns as Non-Cooperative Countries or Territories (NCCTs) are put in the blacklist. These countries support terror funding and money laundering activities. The FATF revises the blacklist regularly, adding or deleting entries.

Grey List: Countries that are considered safe haven for supporting terror funding and money laundering are put in the FATF grey list. This inclusion serves as a warning to the country that it may enter the blacklist.

Considered in the grey list may face:

  • Economic sanctions from IMF, World Bank, ADB.
  • Problem in getting loans from IMF, World Bank, ADB and other countries.
  • Reduction in international trade.
  • International boycott.