Business & Economy Current Affairs 2017

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Union Cabinet gives nod to 10% stake sale in Indian Oil Corporation (IOC)

The Union Cabinet has given nod to the proposal to divest 10% government stake in Indian Oil Corporation (IOC). The move expected to fetch around Rs. 3,750 crore to the exchequer at the current market price. Currently, the government controls 78.92% stake in IOC.

IOC is India’s largest oil refiner and has a market capitalization of Rs. 54,519 crore. It posted a net profit of Rs. 5,005 crore in 2012-13, up from Rs. 3,954 crore in 2011-12. IOC sells fuel at below-market prices, for which it is partially compensated by the government.

The government has set a disinvestment target through PSU stake sales in the current financial year is Rs. 40,000 crore. So far, it has managed to garner only around R929 crore through stake sale in MMTC, Hindustan Copper and National Fertiliser.

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Health Ministry revokes Pioglitazone suspension

Screenshot_3As per a notification issued by the Union Health Ministry, the suspension imposed on the diabetes drug Pioglitazone and all its combinations has been repealed.

Why Pioglitazone was banned earlier?

Under the Drugs and Cosmetic Act 30-B, sale of any drug, the use of which is prohibited in the country of origin, is banned in India until clinical data substantiate that it is risk free. There are several health risks involved with PioglitazoneThough it is generally used in against type 2 diabetes and hyperglycemia, there has been higher occurrence of fractures hands and feet in female diabetics given this drug and is also associated with bladder cancer and congestive heart failure as found in some Western studies.

What are the new guidelines for the sale of Pioglitazone?

The Drug Technical Advisory Board (DTAB) has recommended that the drug may be allowed to be sold and consumed in the country, with sufficient caution. It suggested that the manufacture and sale of Pioglitazone may be allowed, provided the manufacturer clearly mentions on the package insert and promotional literature of the drug that Pioglitazone may not be used as a first line of therapy for diabetes. It has also recommended that the manufacturers carry a box warning, clearly mentioning the risks/side effects of the drug in bold red letters on the package. It has also asked the doctors to make sure that the drug is not used in persons with active bladder cancer or a history of bladder cancer in the family. Doctors should review the safety and efficacy of the drug after three to six months of prescription and the drug maybe continued only if the patient seems to be deriving any benefit.

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CCEA nod to create Special National Investment Fund

The Cabinet Committee on Economic Affairs (CCEA) has approved a mechanism to bring down the government shareholding in its six sick companies to the required 90% or less. As per CCEA decision, a Special National Investment Fund will be created to transfer shares of these companies — HMT, Scooters India, Hindustan Photo Films Manufacturing Co, ITI, Andrew Yule & Co and Fertilizers & Chemicals (Travancore) Ltd.

What will Special National Investment Fund do?

 The government has decided to sell the 90% of less of the equities it holds in the above mentioned six sick companies. As per the SEBI’s minimum public holding norms, all government-owned units will have to have at least 10% of public holding.   The number of shares required to make the six companies compliant with the minimum public share holding norm will be transferred to the Special National Investment Fund out of government share holding on an irrevocable basis, without any consideration (meaning, money changing hands). The fund will be managed by independent professional managers. It will sell the transferred shares within 5 years. The funds realized from the sale would be used for social sector schemes of the government.

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