GS Paper I- Indian Heritage, Culture, History and Geography of the World.
Preserving Indian History With Coins Through Numismatics.
- Old Indian coins have long been in the news for their antique value as cultural markers. Lately it is reported that old Indian currencies from pre-independence days as well as some rare collection from collectors are fetching anywhere between rupees 40k to rupees 1 lac.
- Numismatics is the study or collection of currency, including coins, tokens, paper money, and related objects. Numismatists are characterised as students or collectors of coins; the discipline also includes the broader study of money and other payment modes.
Importance Of The Subject –
- Commemorative coins of rupees 25, rupees 50, and rupees 500 have been issued to mark the silver jubilee of Shri Mata Vaishno Devi Shrine Board, the Golden jubilee of BHEL and the 3rd India-Africa Forum Summit (IAFS).
- Commemorative coins issued to mark special occasions give brief history and significance of the subject, place or event on which they are brought out, apart from details of the composition of the metal or metals, its characteristics and weight.
- Academic purpose: it helps discover history, especially that, which is not recorded in books or archives. Coins are an ideal means of teaching history which otherwise is considered a boring subject.
- Preserving history: when collected, coins are automatically preserved.
- Investment aspect: Very surprising, but most importantly, coin collection is also a good investment. If a coin is bought for ‘x’ amount, over a period the price appreciates as the supply of coins declines.
- For many, investing in coins proves to be a beneficial way of saving black money.
- On the flip side the Indian Government unlike other countries does not support coin collectors. Being bound by the Antiquities Act, one cannot export coins that are over a hundred years old. The earlier Act in 1970’s was quite absurd as those who had hundred years old coins at their homes had to declare it to the Archaeology department. This was not only a cumbersome affair, but the entire process would land up costing much more than the value of coins at that time.
- Ironically, numismatics is all about coins acquiring a value much higher than the monetary value conferred by law. Coin collectors otherwise would not spend time, effort and money if there was no underlying promise of a handsome return on investment if the coin and the market is right.
- While most old coins are valuable, just like any other market, the value of a collectible item will soar if it is in short supply.
Sources– The Hindu, Navhindtimes.
GS Paper II- Governance, Constitution, Polity and International Relations.
SC Stays Madras HC Order Directing TN Government To Waive All Crop Loans.
- The loan waiver scheme was notified by the Cooperation, Food and Consumer Protection Department on May 23 and 25 of 2016.
- The Supreme Court on Monday, 3rd July, 2017 stayed a Madras High Court order directing the Tamil Nadu government to extend its scheme to waive crop loans to all farmers, including those with land holdings of above five acres.
- A Bench led by Justice Madan B. Lokur issued notice and stayed the High Court order in a short hearing.
Highlights Of The Order-
- The government argued that the waiver scheme was only meant to benefit small and marginal farmers with land below five acres. These farmers had taken crop loans from co-operative banks and societies.
- The State argued that the April 4, 2017 order of the Madurai Bench of the High Court is “an interference in the domain of the economic policy decision of the government.”
- The petition, as an interim relief, asked the court to stay the High Court order, which also imposed on the State a deadline of three months to comply with the order.
- “Unless the impugned order is stayed, the petitioner [State] would be put to irreparable loss and damages,” the special leave petition said.
- The loan waiver scheme was notified by the Cooperation, Food and Consumer Protection Department on May 23 and 25 of 2016. The loan waiver was part of the election manifesto of the AIADMK.
- “Immediately after taking charge, the newly elected Government, to fulfil the promise made in the election manifesto, ordered that the outstanding crop loan, medium term [agriculture] loan and long term [farm sector] loan issued to small and marginal farmers by the cooperative societies/banks as on March 31, 2016 be waived,” the petition said.
- The preparation of the beneficiaries list was completed in July 2016, it said.
- “The beneficiaries list was verified by the officials, and the staff of the Central Cooperative Banks and the final beneficiaries lists were displayed in the notice boards of the respective cooperative societies. Objections received from the aggrieved persons were verified by team of officials,” the petition noted.
- Subsequently, list was published in the official website of the Tamil Nadu Cooperative Union, and waiver certificates were issued to the eligible beneficiaries in September 2016.
- The High Court order was based on writ petitions filed seeking to extend the loan waiver to all agriculturists and not just the small and marginal ones.
- Incidentally, many state governments are facing farmer protests all over the country demanding loan-waivers.
Sources– The Hindu.
GS Paper III- Technology, Economic Development.
India Bonds Slump After Central Bank Announces Open Market Bond Sale.
- Indian government bonds yields rose sharply on Monday, 3rd July, 2017 after the central bank announced an open market sale of debt to remove some of the excess cash left at lenders because of the government’s removal of a big part of currency bills last year.
- The Reserve Bank of India said late on Friday, 30th June, 2017 that it will sell 100 billion rupees ($1.55 billion) of government bonds on Thursday.
- The new 10-year bond jumped as much as 11 basis points to 6.62 per cent in early trade, its highest level since June 7, 2017, from its close of 6.51 %.
Key Points Of This Development-
- Indian government bonds yields rose sharply on Monday, 3rd July, 2017, after the central bank announced an open market sale of debt to mop up excess liquidity that filled the country’s banking sector following last year’s demonetisation push.
- The announcement from the Reserve Bank of India surprised traders, who had expected it to happen in August, 2017, near the time when the central bank must pay a hefty dividend to the government.
- The RBI has so far resorted to selling short-end securities through a special scheme to drain some of the excess cash, a method that was seen as less disruptive than removing liquidity through regular OMOs.
- Traders said the open market sale appeared intended to help offset bond redemptions of 526.20 billion rupees due July 9, 2017, with another 303 billion rupees in August, 2017, which would have added liquidity to the financial system.
- “It looks like they are timing it with bond redemptions,” said one senior dealer at a foreign bank, noting the overall impact of the open market bond operation would likely end up being broadly neutral on liquidity
- The new 10-year bond yield jumped as much as 11 basis points to 6.62 per cent in early trade, its highest level since June 7, 2017, from its close of 6.51 per cent. It was trading at 6.59 per cent at 0600 GMT.
- The five-year benchmark overnight indexed swap was at 6.34 per cent compared with its previous close of 6.28 per cent.
- Indian banks were flushed with deposits after the government abolished high-value currency notes late last year in a push to unearth billions of dollars of so-called black money, forcing people to deposit their unused notes with banks.
- The fall in bonds comes after a recent rally as lower-than-expected inflation data had raised hopes for a rate cut as early as the RBI’s policy review on Aug 2, 2017.
- Traders expect the central bank to conduct at least two to three more OMO sales in the July-September period given surplus liquidity of around 3 trillion rupees in the banking system, much above the RBI’s traditional tolerance level of 1 trillion rupees. ($1 = 64.6750 Indian rupees).
- Traders said the timing of the open market sale was a surprise as markets had expected it to happen in August to coincide with the time when the RBI must pay a hefty dividend to the government.
- The RBI has so far resorted to selling short-end securities through a special scheme to drain out some of the excess cash, a method that was seen as less disruptive.
Sources– The Hindu, Reuters.