Times Top10: Today’s Top News Headlines and Latest News from India & across the World | Times of India

Citing “the sharp acceleration in headline CPI inflation in March 2022 to 7 per cent”, the Reserve Bank of India (RBI), in an off cycle monetary policy review meeting, hiked the repo rate by 0.40% — the first such hike in almost four years. It preceded the US Federal Reserve’s biggest hike in over 20 years in interest rates, by 0.50%.

A gut punch

• While a rate hike was always on the cards, it was expected to come in the June meeting of the monetary policy committee (MPC) with a hike of no more than 0.25%. However, as RBI Governor Shaktikanta Das in his press briefing said, a rate hike “at this juncture would help to preserve macro-financial stability amidst increasing volatility in financial markets.”
• Along with a hike in repo rate, to 4.4% — which the RBI said was also based on “the rebound in domestic economic activity that took hold” — the central bank also hiked the cash reserve ratio (CRR), which is the percentage of cash required to be kept in reserves against the bank’s total deposits, with the RBI, by 0.50%, to 4.5%.

The impact

• The RBI governor’s announcement decimated the stock market, with the BSE Sensex swinging over 1,500 points intra-day before ending the session with a loss of nearly 1,307 points, settling at 55,669.03 — wiping off Rs 6.27 lakh crore of investor wealth.
• The repo rate hike will also propel banks to increase their lending rates, in particular home loan interest rates, which further implies an uptick in EMIs for borrowers.

More bad news

• India’s journey to become a $5 trillion economy just got a whole lot longer, according to an International Monetary Fund (IMF) database, which shows that at the current rate of growth, the country will achieve its target only by FY29 and not by FY25, as wished for by PM Narendra Modi. The IMF cites the twin impact of Covid-19 and the Russia-Ukraine war as the reason for the delay in reaching the target.
• In fact the IMF database only gives projections till FY28, by which time it expects the Indian economy to reach a size of $4.92 trillion. The irony is that the IMF has projected a higher rate of growth for India, than the RBI — at 8.2% vs 7.2% respectively — for the current fiscal. According to Chief Economic Advisor V Anantha Nageswaran, India needs to grow at a sustained rate of 8-9% per annum to become a $5 trillion economy by FY25 or FY26 — though former RBI governor C Rangarajan believes that even with 9% GDP growth, India won’t achieve that target before FY27.

• The Centre has sought one more week’s time from the Supreme Court to respond to petitions challenging the constitutional validity of Section 124A of the Indian Penal Code dealing with sedition. This is the second such extension sought by the Centre, which last Sunday sought an extension in order to seek approval from the competent authority.
• The apex court had on April 27 granted three days’ time to the Union government to respond to a clutch of petitions challenging the validity of IPC’s colonial-era sedition provision, which has been controversially used by successive governments to silence dissenters.
• Finding the Centre amiss in filing its response to the notice issued on the petitions more than nine months ago on July 15 last year, the top court had asked the government to file its affidavit on or before April 29 and posted the final hearing on the petitions to May 5 with a caveat that under no circumstances the hearing would be adjourned.
• On July 15 last year, the Centre appeared to be on the same page with the preliminary views of the SC when it said that the court can lay down guidelines restricting the use of Section 124A in addition to the broad parameters provided by the court in a five-decade-old judgement in the Kedar Nath case as to what constituted ‘sedition’.
• The Supreme Court had said it was of the opinion that the sedition provision should be used only for protection of the nation, its security and institutions of importance in a democracy. “However, the sedition law, enacted by the British to subjugate the people of India, had been grossly misused since Independence for the last 75 years much in a similar way to quell dissent,” it had said.

Turning up the heat on Moscow over its continued assaults on Ukraine, the European Commission has proposed to ban in a month’s time all shipping, brokerage, insurance and financing services offered by EU companies for the transport of Russian oil worldwide.

How will it work?

• The measure is part of a proposed embargo that is meant to cripple Russia’s oil industry. European countries are Russia’s biggest energy customers. Moscow is currently offering its oil at heavy discounts.
• The ban would apply to Russian exports of oil worldwide, potentially affecting Moscow’s ability to find alternative buyers after the EU stops buying Russian oil.

What about India?

• Indian companies have been buying energy from Russia for several years and any sudden withdrawal will put pressure on other suppliers and jack up international prices, the energy ministry said on Wednesday.
• A Bloomberg report said India is trying to get deeper discounts on Russian crude – less than $70 a barrel – to compensate for the risk of dealing with the OPEC+ producer as other buyers turn away.

Other measures

• The EU is also planning to remove Russia’s largest bank, Sberbank, and two other companies from the international SWIFT transaction and messaging system.

Meanwhile…

• Russian forces pounded targets across Ukraine, taking aim at supply lines for foreign weapons in the west and intensifying an offensive in the east.
• The Russia military also claimed that it used sea- and air-launched precision guided missiles to destroy electric power facilities at five railway stations across Ukraine.

• A hailstorm and light showers in parts of Delhi provided much-needed respite from the blistering heat on Wednesday. Parts of Punjab, Haryana, north Rajasthan as well as west and central Uttar Pradesh also witnessed hailstorms, light rainfall and gusty winds.
• The impact will linger for another day and the maximum temperature will start increasing from Friday. However, no heatwave is predicted for another four to five days, according to private weather forecaster Skymet.
• The Safdarjung Observatory, Delhi’s base station, reported traces of rainfall. The maximum temperature settled at 39.1 degrees Celsius, a notch above normal for this time of the year. The minimum temperature was recorded at 28.8 degrees Celsius.
• The India Meteorological Department (IMD) said partly cloudy sky is predicted over the capital for the next three days. The mercury is set to rise by four to five notches over the next six days. However, no heatwave is predicted.
• A heatwave is declared when the maximum temperature is over 40 degrees Celsius and at least 4.5 notches above normal. If the mercury crosses the 47-degrees Celsius mark, it is called severe heatwave.
• A heatwave at April-end had sent the mercury soaring to 46 degrees Celsius to 47 degrees Celsius in several parts of the capital.

• Prime Minister Narendra Modi on Wednesday attended the second India-Nordic summit that primarily focused on post-pandemic economic recovery, climate change, renewable energy and the evolving global security scenario.
• PM Modi also held separate bilateral meetings with his counterparts from Norway, Sweden, Iceland and Finland during which he discussed with them ways to further deepen bilateral ties and also exchanged views on regional and global developments.
• He appreciated the Nordic countries as very reliable partners in the past 75 years of India’s journey of growth and economic development, foreign secretary Vinay Kwatra said.
• Discussions also took place on expediting the India-European Free Trade Association (EFTA) trade negotiations. India’s trade with Nordic countries stands at over $5 billion.
• The Ukraine issue figured prominently at the summit. The Nordic countries reiterated their support for India’s permanent membership of a reformed and expanded UN Security Council.
• From Denmark, Modi left for France for a meeting with French President Emmanuel Macron — the first world leader to have a face-to-face meeting with Macron following his re-election last month. More details here

Noting that it “cannot agree that there was factual error”, the Bombay High Court (HC) on Wednesday rejected a plea filed by three Bhima-Koregaon accused seeking review of the HC’s refusal of automatic bail in December last year.

Who and what

• In their plea, three of the accused in the Bhima-Koregaon violence case — Varavara Rao, Arun Ferreira and Vernon Gonsalves — contended that they had filed their bail pleas on November 30, 2018, which was four days after another co-accused, Sudha Bharadwaj filed her bail application.
• The HC, in its December 1, 2021 order, had granted bail to Bharadwaj, noting that Rao, Fereira and Gonsalves had not filed their bail application within the stipulated 60 day period after arrest and before filing of chargesheet — which the trio had cited as factual error that would lead to “gross miscarriage of justice”.

Why Bharadwaj was granted bail

• The HC, which had in its December 2021 order noted that Bharadwaj’s plea for default bail was pending on the date that Pune Police submitted its application seeking extension of time for filing the chargesheet, asked the trio if they had pointed out the so-called factual error when their applications were being heard.
• Observing that “the applications of bail were not placed before the court”, the HC ruled that “no case for exercise of review jurisdiction is made out” as the accused did not apply for bail in the stipulated period and therefore, the three accused — Rao, Fereira and Gonsalves — could not avail the order which had been upheld by the Supreme Court.

North Korea on Wednesday launched what is believed to be a ballistic missile toward its eastern waters, barely a week before a new conservative president takes office in Seoul. This is Pyongyang’s 14th round of weapons firing this year.

Cause for concern

• South Korea called the North’s repeated ballistic missile launches “an act of grave threat” to undermine international peace and security and a violation of UN Security Council resolutions banning any ballistic launch by Pyongyang.
• The new launch comes days after North Korean leader Kim Jong-un vowed to bolster his nuclear arsenal “at the fastest possible pace” and threatened to use them against rivals.

Threat to Japan, US?

• Japan also condemned Wednesday’s launch. According to Japanese Vice Defence Minister Makoto Oniki, the missile may have landed in waters outside of the Japanese Exclusive Economic Zone, but there were no reports of any damage or injury from vessels and aircraft in the area
• Last week, Kim showcased his most powerful nuclear-capable missiles targeting both the US and its allies during a massive military parade in Pyongyang.
• Observers say this unusually fast pace in weapons testing underscores Kim’s dual goal of advancing its missile programs and applying pressure on Washington over a deepening freeze in nuclear negotiations.

Another ICBM?

• It wasn’t immediately known what missile North Korea launched. One of the missiles tested recently was an intercontinental ballistic missile potentially capable of reaching the entirety of the American homeland. That missile’s launch broke Kim’s self-imposed 2018 moratorium on big weapons tests.
• Experts say Kim is also preparing for a nuclear test at its remote north-eastern testing facility. More details here

• Elon Musk fired another salvo about his latest acquisition, Twitter, suggesting that there should be a “slight cost for commercial/government users” as “some revenue is better than none!” He clarified that Twitter will continue to be free for “casual users” — implying individuals with Twitter handles not associated with any government or not tweeting for financial or monetary gains will not be charged any fee.
• Musk’s statement comes on the back of reports that he had last week informed banks of his plans to find new ways to make money off tweets — especially ones that contain vital information or go viral — and cut down on executive compensation at the microblogging site.
• Ever since he’s bought the company, Musk has been talking about making wholesale changes at Twitter, including slashing the fee for Twitter Blue, the new premium subscription service. According to the Wall Street Journal, Musk has assured potential investors that he may re-list the company in as little as three years — he plans to buy all of Twitter’s shares currently available on the stock market by the end of this year and take it private.