This PPT contains the facts related to all the current affairs of 2016 which are important for an MBA aspirant. The session was conducted by the Quzzing Club of IIM Raipur in association with the Admissions Committee.

1. Current Affairs
QUIZZING CLUB
IIM RAIPUR
PRESENTS

2. Tata Crisis

3. Introduction
• In a dramatic development, the Tata Sons board on Monday,
24th October 2016, sacked Cyrus Mistry, less than four years
into his term as the chairman of Tata Sons.
• The board gave no reason for the abrupt removal of the 48-
year-old Irish citizen and named his predecessor Ratan Tata,
78, as interim chairman.
• On Monday, in a letter to group employees , Tata had termed
the decision to replace Mistry as a well-considered but
difficult and a serious one which was "absolutely necessary
for the future success of the Tata Group".

4. Ratan Tata
• Ratan Tata is the 78-year-old chairman of Tata Trusts, the
charitable bodies that own a majority stake of around 66 percent
in Tata Sons, the flagship holding company of the salt-to-software
conglomerate.
• Between 1991 and 2012, Ratan Tata was the chairman of Tata
Sons as well as of various group companies, many of them listed,
in which Tata Sons holds a stake.
• He is widely credited as firmly establishing the business house as
a storied institution globally, with a reputation for conducting
business in an ethical manner.
• In December 2012, upon attaining the age of 75, Tata hung up his
boots at Tata Sons and passed on the baton to Mistry, 50.

5. Cyrus Mistry
• Mistry is the son of Pallonji Mistry, chairman of
construction major Shapoorji Pallonji Group, whose
family owns an 18.4 percent stake in Tata Sons.
• Mistry has been a director on the board of Tata Sons since
2006 and was also part of the selection committee that
was mandated with the task of finding Tata‟s successor.
• Tata and Mistry are also related since the latter‟s sister is
married to Noel Tata, Ratan Tata‟s half-brother.

6. The Crisis
• Four years later, the succession story has gone all wrong with
the board of Tata Sons, on October 24, voting in favour of
ousting Mistry as its chairman.
• Ratan Tata is back as interim chairman “in the interest of
stability and continuity so that there is no vacuum” in the top
management of the group, he told the CEOs of various group
companies during a meeting on October 25.
• Ratan Tata has said that he will hold fort for four months, in
which time a selection committee is to identify Mistry‟s
successor.

7. Mistry’s Allegations
• Mistry has cried foul. In a letter addressed to Tata Sons‟
directors and members of the Tata trusts on 25th October,
Mistry wrote that he was “shocked beyond words” at what
had transpired and the treatment meted out to him.
• Mistry has levelled a series of allegations against Ratan Tata
in the letter and said he was pushed into a position of a
"lame duck chairman". He accused the board members of
replacing him without giving him an opportunity to defend
himself.
• Mistry then proceeded to outline the various challenges
faced by group companies including Tata Steel, Tata Motors,
Indian Hotel Co. Ltd, Tata Power and others.

8. • He also argued that the group‟s global acquisition strategy, barring
Jaguar Land Rover and Tetley, had left “a large debt overhang” on
it.
• He continued that a realistic assessment of the fair value of the
businesses of IHCL, Tata Motors‟ passenger vehicles division,
Tata Steel Europe, Tata Power‟s power plant in Mundra and Tata
Teleservices could potentially result in a write-down over time of
around Rs 1.18 lakh crore.
• In addition, he cited various instances of alleged lack of corporate
governance within the group.
• In the face of the above challenges, I had to take many tough
decisions with sensitive care to the group‟s reputation as well as
containing panic amidst internal and external shareholders,”
Mistry said in the letter.

9. Tata’s Arguments
• On Nov. 10, the Tata Group finally rebutted Mistry‟s arguments. The
conglomerate‟s letter came after the group replaced Mistry as chairman
of software giant Tata Consultancy Services (TCS), too. Mistry had
remained the TCS chairman even after his ouster from the group.
1. No Profits to show :
In its letter, the group said dividends from the group companies
declined from Rs1,000 crore in 2012-13 to Rs780 crore in 2015-16.
Tata Consultancy Services was the only saving grace when it came to
generating profits, it said.
2. Wresting control :
The letter says that Mistry was “consciously” dismantling many of the
group companies and reducing Tata Sons‟ control and influence over
them.

10. 3. Hurt by criticism of legacy
 In his letter, Mistry had raised concerns about his helplessness
over handling many of the “legacy hotspots” at the group.
These included the group‟s decision to launch an airline
business and the Tata Nano car.
 Tata group said “Nobody will deny that there were some
problem companies,”.
 “The three major problem companies are Tata Steel Europe,
Tata Teleservices/Docomo, and the Indian operations of Tata
Motors.
 The fact is that even after four years, there is no noticeable
improvement in the operations of these companies, and in fact
they have got worse as shown by continuing huge losses,
increasing high debt levels and declining share in their
respective markets.”

11. 4. Badly-managed Tata Steel Europe and Docomo
“Critical reports have been received of the handling of the Tata
Steel Europe problems in the UK and the negotiations with
Docomo of Japan in the respective countries,” the letter said.
5. Devious plans
 “Having been replaced as chairman of Tata Sons, where the
majority of the board and the major shareholders had expressed
a lack of confidence, Mr. Mistry is trying to gain control of
IHCL with the support of the independent directors of the
board,” the group said.
 “He has cleverly ensured over these years that he would be the
only Tata Sons representative on the board of IHCL in order to
frustrate Tata Sons‟ ability to exercise influence and control on
IHCL.”

12. 6. Why raise write down issue?
The Tata group has now asked in its letter whether Mistry
had “informed the boards of these companies at any time in
the past specifically of the above mentioned potential write-
downs?” adding that “surely he could not have „discovered‟
such a large potential liability only a day or two after he was
replaced as the chairman of Tata Sons.

13. Facts
• While Tata Consultancy Services and Tata Motors outperformed
the benchmark BSE Sensex during Mr. Mistry‟s reign
appreciating as much as 92 per cent and 81 per cent respectively,
four other key group companies underperformed.
• The DoCoMo issue :
Mistry‟s handling of the separation of Tata Teleservices‟
partnership with Japanese telco NTT DoCoMo didn‟t go down
well with Tata.
• Tata Steel’s European Woes :
Another sore point was Mistry‟s intention to pare debt at Tata
Steel, by monetising the company‟s loss-making operations in
UK. A part of the business, the long products division, has already
been divested to Greybull Capital pursuant to a deal announced in
April, 2016 and completed in May, 2016; and efforts were
underway to find a partner for the rest of the business as well.

14. FACTS ON
DEMONETISATION

15. • Many countries have experimented with the process of
demonetization in the past. Some countries benefited
tremendously from the move while some terribly failed at it.
Here is a list of some countries that have implemented the
policy of demonetization:
• France
• US (1969)
• Britain (1971)
• Ghana (1982)
• Myanmar (1987)
• Nigeria (1984)
• Zaire (1990)
• Congo (1990)
• Soviet Union (1991)

16. Historical Facts about
demonetization in India
• On 12th January 1946, 500, Rs. 1,000 and Rs. 10,000 notes
were declared invalid as legal tender.
• New notes of Rs. 1000, Rs. 5000 and Rs. 10,000 came into
economy in 1954.
• On 16th January 1978, the Morarji Desai led-Janata
Party demonetized banknotes of Rs. 1000, 5000 and 10000.
Note that, the finance minister at that time was H.M. Patel.
• RBI introduced a new banknote of Rs. 500 into the economy
in 1987 to contain inflation.
• On 8th November 2016, the old banknotes of Rs. 500 and Rs.
1000 were barred from being legal tender and new notes of Rs.
2000 were soon introduced.

17. Legal Facts about
Demonetization in India
• The legal basis for the order demonetizing currency can
be found in Section 26 of the Reserve Bank of India
Act, 1934. Under sub-section (2) of this Section, the
Union Government is given the power to declare that
any notes issue by the Reserve Bank will no longer be
legal tender.

18. Role of Government & RBI in
Demonetization
• The introduction of Pradhan Mantri Jan Dhan Yojana
(PMJDY) and Income Disclosure Scheme (IDS) were
done to ensure that everyone has a bank account and gets
ample time to declare their incomes.
• Before the Prime Minister issued an order to demonetize
certain currency, he consulted the RBI and the Finance
Minister.

19. Here is a list of the rules set in place continuously over a time
of 20 days since the PM announced demonetization:
Events
• 8th Nov: PM declares the Rs. 500 & Rs. 1,000 notes invalid.Exchange of
cash up to Rs. 4,000 allowed at banks, ATM withdrawal limited to Rs.
2,000.
• 9th Nov : Banks remain shut for a day.
• 10th Nov : Banks open. Massive queues ensue as millions line up to
exchange old currency or deposit their money.
• 12th Nov : Reports come in that people died waiting in the queues.
The Sensex registers the biggest single-day fall in 9 months.
• 13th Nov : ATM withdrawal limit raised to Rs. 2,500. Cash exchange limit
raised to Rs. 4,500.

20. • 15th Nov: Banks are asked to apply indelible ink marks on people
exchanging money. The election commission raises concerns
regarding this.
• 16th Nov: Parliament session begins; opposition parties up the ante
against the
government over the suffering of the poor.
• 17th Nov : Currency exchange limit lowered to Rs. 2,000.
• 18th Nov : India‟s Supreme Court says many are “frantic” over
demonetisation.
• 22nd Nov: RBI says banks have received Rs. 5.3 lakh crore in
deposits since Nov.08.
• 24th Nov: Old notes can now only be deposited at banks and not
exchanged.
• 27th Nov: RBI governor Urjit Patel justifies demonetisation, says the
new notes are difficult to counterfeit.

21. IMPACT
• Deposits rose 13.9% or Rs 12.7 lakh crore to Rs 105 lakh crore against a
10% rise last year, according data released by the Reserve Bank of India.
• The surplus liquidity in the banking system, created by demonetisation, will
lower borrowing costs and increase the access to credit. This will boost
economic activity with multiplier effects,“ said Arun Jaitley, finance
minister, during the Union Budget speech on Wednesday.
• While deposits grew, credit growth didn't pick up as it remained muted at
around 5% with total outstanding bank credit standing at Rs 74 lakh crore.
• Since Modi's announcement, Paytm, a popular e-wallet, has seen a threefold
increase in new sign-ups, while Oxigen Wallet‟s daily users spiked by 167%
• India‟s finance minister claimed that direct tax collection has increased
14.4% and the federal government‟s indirect tax collection rose by 26.6%.

22. Business world

23. Mergers and Acqusitions
• The $28.1 billion acquisition of LinkedIn by Microsoft
• Cyient Inc has acquired a 100% equity of Certon Software
Inc.
• Cognizant acquired Australia based consulting, business
transformation and IT services provider Adaptra
• A new European eyewear giant is set to emerge as Italian
frames maker Luxottica - maker of brands like Ray-Ban and
Oakley joins with French lens manufacturer Essilor in a
multibillion-euro merger.

24. Major news around the
globe
• Pressure on free trade. A decades-long movement toward free trade
and globalization appeared to stop in its tracks as presidential
candidates Donald Trump and Hillary Clinton both vowed to
withdraw from the Trans-Pacific Partnership, which would have
relaxed trade restrictions with Asian nations. Trump threatened to
pull out of the North American Free Trade Agreement if Mexico
doesn‟t renegotiate the deal and to slap Mexico and China with tariffs
of 35% and 45%, respectively. His aim: to partly reverse the millions
of layoffs at U.S. factories as jobs were offshored to China, Mexico
and other countries. But many economists say those jobs aren‟t
coming back and tariffs risk retaliation that could ravage U.S. exports
and jobs.

25. Major news around the
globe
• Wells Fargo's scandal. In September, the San Francisco-based bank
agreed to a $185 million settlement with federal regulators after an
investigation showed Wells Fargo had secretly opened millions of
unauthorized deposit and credit card accounts that weren‟t authorized
by customers
• Unemployment rate falls. The unemployment rate, which hit 10%
in 2009, continued its remarkable descent, falling to 4.6% in
November from 5% early in the year. Many economists believe that
rate, the lowest since August 2007
• Fake news fears. Fake news bubbled up during the political
campaign and became a business issue for the place where many
people get their news: Facebook. A post-election analysis
by BuzzFeed found that fake stories shared on Facebook
outperformed real news stories during the final three months of the
campaign cycle.

26. Digital Payments in
India
CASHLESS INDIA
The Digital India program is a flagship program of the
Government of India with a vision to transform India into a
digitally empowered society and knowledge economy.
“Faceless, Paperless, Cashless” is one of professed role of
Digital India.

27. Definition
•Digital payment is a way of
payment which is made through
digital modes. In digital payments,
payer and payee both use digital
modes to send and receive money.
It is also called electronic payment

28. Different Types of Digital
Payments
UPI apps:BHIM, SBI, HDFC, iMobile, PhonePe
AEPS
USSD
Cards: Credit cards, Debit cards, Prepaid cards
E-Wallets: State bank buddy, ICICI Pockets, Freecharge,
Paytm etc.
POS
Micro-ATMs

29. Advantages of Digital
Payments
• Easy and convenient
• Pay or send money from anywhere
• Discounts from taxes
• Written record
• Less Risk

30. Drawbacks of Digital
Payments
• Difficult for a non-technical person
• The risk of data theft
• Overspending

31. Future of Digital
Payments:
• In 2015-16, a total of Rs. 4018 billion transacted through
mobile banking as compared to Rs. 60 billion in 2012-13
• There are many factors which are affecting the future of
digital payments.
Digital revolution : India has more than 100 crore
active mobile connections and more than 22 crore
smartphone users as of March 2016

32. Government’s support
• https://upipayments.co.in/digital-payment/

33. IMMIGRATION BAN

34. IMMIGRATION BAN
• Suspended the entire US refugee admissions system for 120 days.
• Suspended the Syrian refugee program indefinitely.
• Banned entry from seven majority-Muslim countries – Iran, Iraq,
Libya, Somalia, Sudan, Syria and Yemen – for 90 days.
• Temporarily banned entry of dual-nationals who are from those
seven countries but have an additional passport for 90 days
following the signing f the order.
• Prioritized refugee claims on the basis of religious persecution.
• Lowered the total number of refugees to be accepted from any
country in 2017 to 50,000, down from 110,000.

35. H1B Reforms

36. H1B
• Non-immigrant visa in the United States which allows U.S. employers to
temporarily employ foreign workers in specialty occupations.
• The duration of stay is three years, extendable to six years
• 65,000 foreign nationals are issued a visa in a fiscal year
• “Minimum wage" guaranteed to an H1B holder is USD 60,0000
established in 1989 and unchanged since then.
• Top H1B employer of in terms of Visas approved is CTS with 15680
visas followed by Infosys (8,991) and TCS(6,339) in 2015

37. Proposed reform
• Bill on High-Skilled Integrity and Fairness Act of 2017 has been
introduced in the US House of Representatives
• Seeking to double the minimum salary of H-1B visa holders to
US$130,000
• Was introduced by California Congressman Zoe Lofgren
• The legislation also seeks 20 per cent of the annually allocated H-1B
visas for small and start-ups.
• According to a study by the Bank of America Merrill Lynch, every
10% hike in H1B visa holder abroad would amount to 5% negative
impact on an average on a company‟s earnings.

38. IMPACT
• Indian IT stocks went into a tailspin
• BSE IT index cracked 4 per cent
• TCS, the largest IT player by sales, saw its stock tumble 4.61 per cent
• Infosys, the second largest IT firm, declined 3 per cent
• Shares of HCL Technologies were trading 4.85 per cent lower
• Tech Mahindra slumped 4.12
• IT midcaps Mastek and MphasiS fell 4 per cent each
• Wipro slumped 2.89 per cent

39. UNION BUDGET 2017

40. HIGHLIGHTS
Budget agenda - transform, energise and clean India - TEC India.
 Foreign investment promotion board (FIPB) to be abolished .
 Allocation for infrastructure stands at a record rs 3,96,135 crore.
 Government to set up strategic crude oil reserves in Odisha and
Rajasthan.
 Defence expenditure excluding pension at rs 2.74 lakh crore.
 Fiscal deficit for 2017-18 pegged at 3.2 percent of GDP.
 Fiscal deficit target for next three years pegged at 3 percent.
 1.25 crore people have already adopted bhim app for digital
payments.
 Aadhaar pay- an app for merchants- to be launched' 20 lakh
aadhaar-based pos by september 2017.

41. One crore houses for poor by 2019.
Safe drinking water to cover 28,000 arsenic and
Fluoride-affected habitations in the next four years.
For senior citizens, Aadhar cards giving their health
condition will be introduced .
Two new All India Institute of Medical
Sciences(AIIMS) to be set up in Jharkhand and
Gujarat.
 Food subsidy estimated at Rs 1.45 trillion in 2017/18
versus Rs 1.35 trillion revised estimate for 2016/17

42. Railways
3500km railway lines to be put up.
Service charge on rail tickets booked through IRCTC to
be withdrawn.
Rail safety fund with corpus of Rs 100,000 crore will be
created over a period of five years.
500 rail stations to be made differently abled-friendly by
providing lifts and escalators .
A new metro rail policy will be announced, this will open
up new jobs for our youth.

43. Rural Economy
 The approach in preparing the Budget has been to spend more on
rural areas, infrastructure and poverty alleviation with fiscal
prudence .
 Agriculture sector is expected to grow at 4.6%, agriculture
expenditure targeted at Rs 10 lakh crore.
 Total allocation for rural, agricultural and allied sectors for 2017-
18 is Rs 187223 crore, which is 24% higher than last year .
 133-km road per day constructed under Pradhan Mantri Gram
Sadak Yojana as against 73-km in 2011-14 .
 Allocation under MNREGA increased to 48,000 crore from Rs
38,500 crore. This is highest ever allocation

44. Taxation and Banking
 India's tax-to GDP ratio is very low. We are largely a tax non compliance society,
when too many people evade taxes burden falls on those who are honest.
 Out of 3.7 crore who filed tax returns in 2015-16, only 24 lakh persons showed
income above Rs 10 lakh.
 Of 76 lakh individuals who reported income of over Rs 5 lakh, 56 lakh are salaried.
 Small firms with turnover up to Rs 50 crore to pay 25% tax now, instead of 30%.
 Black money SIT has suggested no cash transaction above Rs 3 lakh. The
government has accepted this recommendation.
 Maximum cash donation any party can receive will be Rs 2000 from one source.
 Political parties will be entitled to receive donations by cheques or digital modes.
 An amendment being proposed to RBI Act to enable the issuance of electoral bonds
for political funding.
 Jaitley reduces income tax rate from 10% to 5% for tax slab of Rs 250,000 to Rs
500,000.
 Surcharge of 10% for those whose annual income is Rs 50 lakh to 1 crore.
 15% surcharge on incomes above Rs 1 crore to continue.
 Government is considering introduction of new law to confiscate assets of offenders
who escape the country.

45. Opinion
 Budget aims at the underprivileged section of the society and
it lays out a series of steps that should incentivize the
creation of markets that can provide the goods and services
the marginal segments of the population need. For e.g. –
Affordable housing has got infrastructure status. Thus instead
of providing doles and freebies the government focuses on
mechanisms to enable all wage earners to buy goods and
services at affordable rates.
 On the corporate front, budget brings reduction in corporate
tax rate only for the MSMEs while on the personal income
tax front, large swathes of the middle class have been left
untouched while the rich bear the cross.
 Few persistent demands of India Inc., like lowering the
headline corporation tax rate and eliminating Minimum
Alternate Tax (MAT) were not considered, giving little
incentive to the corporate sector.

46. THANK YOU