Insights Daily Current Events, 03 September 2015

Insights Daily Current Events, 03 September 2015

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Paper 2 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Why there was Nationwide strike yesterday?

Some 15 crore workers across India were on one-day strike yesterday against changes in labour laws that they believe will put jobs at risk.

Other main reasons behind the strike:

• trade unions are demanding that the government dump plans to sell off stakes in state-run companies and shut down unproductive factories. Instead, the sick units should be revived, say unions.
• Trade unions claim that if the government amends key laws – Factory Establishment Act, Bonus Act and Industrial relations – 75% of the workforce will be out of the purview of labour laws.
• The government plans to take small factories, which have up to 40 workers, out of the labour laws. Unions say this would take away the job security of most of the workforce.
• The workers on strike were from the banking, manufacturing, construction and coal mining sectors. The new labour laws are expected to diminish the influence of trade unions and make the labour market more flexible.
• Hawkers, domestic workers and daily wage labourers had also joined the strike to demand an increase in the minimum wage.
• The strike was also against the Road Safety Bill and Transport Act.
• Trade Unions also want the government to stop privatisation and foreign investment in railways, insurance and defence, banning speculative trade in commodities, Universalization of Public Distribution System as well as policies to address price hike and improve employment opportunities.

Effects of this strike:

• The strike hit banking, public transport and other services across India. The suspension of work in the banks could hamper banking transactions which are crucial for the conduct of business operations especially in areas which are serviced by branch banking operations.
• The financial impact of the disruption of essential services has lead to an estimated loss of over Rs 25,000 crore to the economy, thereby taking into account the numerous direct and indirect losses.
• This could also hit image of India as an attractive business destination.

Road Transport and Safety Bill:

It is a Bill which aims to provide a framework for safer, faster, cost effective and inclusive movement of passengers and freight in the country thus enabling the mission of ‘Make in India’.

Highlights of the Bill:

• 2 lakhs lives to be saved in first 5 years due to reduction in road traffic accident deaths
• 4% GDP improvement on account of increased efficiency and safety of road transport sector
• 10 lac Jobs to be created with increase in investment in the sector
• The new Bill makes significant departures from the 1988 Motor Vehicle Act as it includes safety in construction, design, maintenance and use of motor vehicles and roads as a major component.
• The Bill provides for more stringent penalties to offenders. A graded penalty point system would now act as a deterrent and improve traffic condition whereas electronic detection and centralized information of offences would facilitate to identify repeat-offenders.

New proposed Agencies and systems:

• The Bill proposes to introduce an independent agency called the National Road Safety Authority of India, which will be an independent, legally empowered and accountable expert lead agency. It shall be accountable to the Parliament and Central Government.
• The new Bill provides for the establishment of State Safety Authorities which shall act in accordance with the directions issued by the National Authority.
• The Bill seeks to establish a unified driver licensing system in India which will be transparent. Such a system shall facilitate any time anywhere licence application mechanism in the country and mitigate duplication of licences from various regional transport offices.
• According to the Provisions of the Bill there will be a unified vehicle registration system to enable electronic and online submission of applications for registration at any registering authority leading to real time interchange of data relating to such an activity.
• On the safety issues, the Bill envisages for enforcement of modern safety technologies.
• It also contains the provision for creation of a motor vehicle accident fund for immediate relief to the accident victim. It gives special emphasis on safety of school children and security of women.
• The Bill also includes the setting up of a Highway Traffic Regulation and Protection Force (HTRPF).

Why are some against this Bill?

• Due to some provisions in the proposed bill. They say that the proposed fines are too high.
• According to provisions of the Bill, the Motor Vehicle Act 1988 will be scrapped and State RTOs will close. Instead, a Central authority will be created and private entities will issue and renew licences. This move is not being welcomed.
• The provisions in the Bill are said to be against the principles of jurisprudence.
• Some state governments allege that the bill encroaches upon the financial, legislative and administrative powers of state governments.

Sources: The Hindu, NDTV, NIE.

Paper 2 and 3 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation and Investment models.

69 small oilfields on the block

The Union Cabinet has approved a new policy for the auction of 69 small and marginal oilfields to private and foreign companies that could unlock hydrocarbon reserves estimated at around Rs. 70,000 crore.

• This policy is based on sharing revenue instead of profits and giving out unified licences for all hydrocarbons in the field instead of a licence for each.

Changes/benefits in the new policy:

• The successful bidders of the fields on auction would be free to sell crude oil or natural gas at market-determined prices, without any government interference.
• Companies operating these new fields will be able to sell gas to any customer of their choice and not be bound by the government’s allocation policy.
• Companies will be able to exploit any and all hydrocarbons (oil, gas, shale oil, shale gas and so on) found in the field, unlike the current system which requires a separate licence for each.

Previous practice:

Until now, profit-sharing mechanism was followed. It encouraged investors to take higher exploration risks, and in the event of success, the costs could be recovered. This mechanism meant that the government had to scrutinise the various costs incurred by the private companies, which often led to delays and disputes.

Revenue sharing mechanism:

• The revenue-sharing and royalty-sharing mechanism will be benchmarked against the prevailing market price of oil. If the company sells at below this price, then the sharing will still have to be done at the market price. If the company manages to sell at a higher price than the market rate, then the sharing will be based on this higher price.
• The new model will replace the current practice of companies getting blocks by bidding maximum work programme and then recovering all of their investment before sharing profits with the government.

The model was criticised by CAG which said it encouraged companies to keep raising cost so as to postpone higher share of profits to the government.

Constitutional provision:

Article 297 provides that petroleum in its natural state in the territorial waters and the continental shelf of India is vested in the Union of India. The Oil Fields (Regulation and Development) Act, 1948 and the Petroleum and Natural Gas Rules, 1959 made thereunder make provisions for the regulation of petroleum operations.

Sources: The Hindu, PIB, FE.

Paper 3 Topic: Bio diversity and Environment.

ESA Demarcation Deadline may be Extended

With four states yet to submit reports demarcating ecologically sensitive areas (ESA) falling under Western Ghats, the Union Ministry for Environment and Forests (MoEF) may extend its September 9 deadline to issue final notification on demarcation of ESAs in six states.

• Kerala and Goa have submitted the reports while Gujarat, Tamil Nadu, Karnataka and Maharashtra are yet to do so despite repeated reminders from the ministry.

Background:

• The MoEF is bound to issue a final notification by September 9, about 18 months from the issuance of draft notification in March, 2014 but the ministry may extend the deadline so as to receive the feedback from all the states.
• Kerala had in July submitted the final report demarcating ESA falling in Western Ghats. The report prepared by a Committee headed by Kerala State Biodiversity Board chairman Oommen V Oommen had reduced the number of villages falling in ESAs from 123 to 119.
• Earlier, the MoEF had set April 15 as deadline for states to submit the ESAs but failed to hear from any and so had extended the deadline to June 15 before extending it to June 30.

What are Ecologically Sensitive Areas (ESAs)?

• ‘Ecologically Sensitive Areas’ are areas under human use, sometimes quite intense human use such as generation of thermal power.
• ESAs are areas where human activities will continue, but be prudently regulated under the Environment (Protection) Act, 1986.
• ESAs are not meant to stop development in ways that would hurt local people, but to ensure that development is environment friendly and people oriented, as well as serve to preserve the ecological heritage on a long-term basis.

Proposals by Kasturirangan panel:

• Kasturirangan panel had suggested that 90% of the natural forests left in the Western Ghats complex – adding upto 60,000 sq km and constituting 37% of the entire hilly belt — be conserved under the Ecologically Sensitive Area (ESA) provisions of the green law. The forest area falling within the ESA would also cover 4,156 villages across the six states.
• The Kasturirangan panel was set up to study the Gadgil committee report on the Western Ghats. The Gadgil panel report had faced unanimous opposition from state governments for recommending that almost three-fourth of the hills, including plantations, cultivated lands and large habitations, be turned into a restricted development zone with an over-arching authority to regulate the region superseding the elected authorities’ role.

Sources: The Hindu, Wiki, PIB.

Paper 2 Topic: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

India a worthy contender for APEC membership: Rudd

Former Australian Prime Minister Kevin Rudd, recently at a conference, said that India is a worthy contender for inclusion in the Asia-Pacific Economic Cooperation (APEC). APEC is throwing open its membership after decades.

• India with its $2 trillion economy is a growing market for economies in the region. Hence, India’s membership would add more weightage to the organization. India joining APEC would present significant geopolitical value and potential economic reward.
• India’s membership is also being considered important, as on a proposal made by China, there is likely to be a study of a much larger Asia Pacific Free Trade agreement, which will begin soon.

Major beneficiary:

Indian labour could be a big beneficiary of India joining the APEC. India’s large and growing labour supply can be an integral part of regional and global value chains and many APEC economies, which dominate global value chains, will face labour shortages in the coming years because of aging populations.

APEC:

The Asia-Pacific Economic Cooperation (APEC) is a regional economic forum established in 1989 to leverage the growing interdependence of the Asia-Pacific. APEC has 21 members.

Aim: to create greater prosperity for the people of the region by promoting balanced, inclusive, sustainable, innovative and secure growth and by accelerating regional economic integration.

Functions:

• APEC works to help all residents of the Asia-Pacific participate in the growing economy. APEC projects provide digital skills training for rural communities and help indigenous women export their products abroad.
• Recognizing the impacts of climate change, APEC members also implement initiatives to increase energy efficiency and promote sustainable management of forest and marine resources.
• The forum adapts to allow members to deal with important new challenges to the region’s economic well-being. This includes ensuring disaster resilience, planning for pandemics, and addressing terrorism.

Members:

• APEC’s 21 member economies are Australia; Brunei Darussalam; Canada; Chile; People’s Republic of China; Hong Kong, China; Indonesia; Japan; Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; The Philippines; The Russian Federation; Singapore; Chinese Taipei; Thailand; United States of America; Viet Nam.
• APEC Members account for approximately 40% of the world’s population, approximately 54% of the world’s gross domestic product and about 44% of world trade.

More details:

• APEC operates as a cooperative, multilateral economic and trade forum. Member economies participate on the basis of open dialogue and respect for views of all participants.
• In APEC, all economies have an equal say and decision-making is reached by consensus. There are no binding commitments or treaty obligations. Commitments are undertaken on a voluntary basis and capacity building projects help members implement APEC initiatives.
• APEC’s structure is based on both a “bottom-up” and “top-down” approach. Four core committees and their respective working groups provide strategic policy recommendations to APEC Leaders and Ministers who annually set the vision for overarching goals and initiatives.
• Members also take individual and collective actions to carry out APEC initiatives in their individual economies with the assistance of APEC capacity building projects.
• Capacity building projects play an important role in helping translate APEC’s goals into reality. By enhancing members’ capacity through skills training and technological know-how, APEC-funded projects strengthen members’ readiness to adopt new initiatives from electronic customs processing to regulatory reform.
• APEC projects also target specific policy areas from enhancing small and medium enterprise competitiveness to facilitating the adoption of renewable energy technologies in the region.
• The APEC process is supported by a permanent secretariat based in Singapore.

Sources: The Hindu, APEC, Wiki.

Paper 2 Topic: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes.

It’s 150 days of work in drought-hit taluks

With more than three-fourth of Karnataka reeling under severe drought, the Karnataka state government has increased the number of days of work from 100 to 150 days under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) in 135 drought-hit taluks in the state.

• The state government said the number of days of work a year had been increased for each rural household to prevent their migration. The beneficiary would get a daily wage of Rs. 204 under the job scheme. The State is expected to get Rs. 2,587.35 crore during 2015–16 for taking up various works under the scheme.
• Each gram panchayat (GP) has been asked to provide jobs from minimum 20 people to maximum 100 people a day and GPs across the State would take up 10,000 works related to roads, bridges, lakes, and playgrounds in the next few months.
• A sum of Rs. 369 crore had been released to GPs under the 14th Finance Commission.

MGNREGA:

The National Rural Employment Guarantee Act 2005, also known as the “Mahatma Gandhi National Rural Employment Guarantee Act” is an Indian labour law and social security measure.

Aims:

• To guarantee the ‘right to work’ and ensure livelihood security in rural areas.
• To create durable assets that would augment the basic resources available to the poor.
• To follow the Directive Principles of State Policy enunciated in Part IV of the Constitution of India and conforms to the Article 23 of the Universal Declaration of Human Rights that defines the right to work as a basic human right.

How? By providing at least 100 days of guaranteed wage employment in a financial year to every household whose adult members volunteer to do unskilled manual work.

More Details:

• The provisions of the law also adhere to the principles enunciated in the Constitution of India under Article 21 of the Constitution of India that guarantees the right to life with dignity to every citizen of India.
• This law guarantees the right to work to the people of India and hence is termed as a “People’s Act”.
• It is believed that targeting poverty through employment generation is the effective way to alleviate poverty.
• Employment under Mahatma Gandhi NREGA is a guaranteed legal right.
• The major responsibility of the implementation rests with Panchayati Raj institutions.
• Previous employment guarantee schemes (EGS) like ‘Sampoorna Grameen Rozgar Yojana’ (SGRY) Programme and National Food For Work Programme (NFFWP) were merged with MGNREGA to make it more effective.
• The Act sets a minimum limit to the wages, to be paid with gender equality. The states are required to evolve a set of norms for the measurement of works and schedule of rates. The unemployment allowance must be paid if the work is not provided within the statutory limit of 15 days.

Criticism:

• Activists say that the outlay for the scheme has remained nearly constant for the past three years, which, adjusting for inflation, amounts to a decrease.
• The release of funds to the States is being delayed and the amounts have been capped. As a result, there has been a 16% decline in employment from the 2013-14 figure.
• Compared with 147 lakh person days generated in December 2013, only 123 lakh person days were generated in December 2014, with the decline sharper in poor States such as Bihar and Chhattisgarh.
• Till December 2014 in the financial year 2014-15, 72% of the total wages disbursed were delayed. And delays in wage payments have actually increased over time.

However, Evidence from independent research studies have shown that the MGNREGA has successfully curbed distress migration, had large effects on consumption and poverty of Dalit and Adivasi households, increased nutritional standards of households, provided risk resilience to small and marginal farmers and vastly expanded the financial inclusion net in the country.

Sources: The Hindu, MGNREGA, Wiki.

Paper 2 Topic: Important aspects of governance, transparency and accountability.

Consider dedicated storage space for seized drugs: SC

The Supreme Court has asked the government to consider providing dedicated safe custody and storage space with round-the-clock surveillance in every State for seized drugs.

Why?

Due to the serious problem of disappearance and recirculation of seized contraband drugs.

Other problems:

• Heroin, hashish and ganja — are usually stored in the local police malkhanas , from where they have an uncanny tendency to disappear. Besides, no records are kept of their safe custody or destruction.
• Of the 60 lakh-kg contraband seized in the past decade, only 16 lakh kg had been found to be destroyed.
• Crores of illicit drugs seized during raids re-enter the market through low-level officers in the law enforcement agencies who take advantage of chinks in the storage and safe custody mechanism.

The court has asked the Solicitor-General to consult his officers and come out with details of a process through which drugs could be stored safely.

The narcotics and psychotropic substances seized have to be kept in safe custody for evidentiary purposes during trial. The trial, however, may prolong for years. Even results of drugs sent for analysis may take years. All this contributes to pilferage from the malkhanas .

Sources: The Hindu.

Paper 1 Topic: Important Geophysical phenomena and changes in critical geographical features (including water-bodies and ice-caps) and in flora and fauna and the effects of such changes.

Spring tide, swell waves caused tidal flooding

Scientists at the Indian National Centre for Ocean Information Services (INCOIS), Hyderabad, recently said that the tidal flooding and high wave activity reported from parts of the southern Kerala coast over the past few days were caused by the combined effect of a perigean spring tide and high swell waves originating in the southern Indian Ocean.

Background:

• Flooding since August 29 had triggered panic along the Alappuzha coast. The Vizhinjam coast in Thiruvananthapuram was battered by high waves, affecting fishing activities.
• INCOIS had issued a tidal flood alert on August 29, followed by a high wave warning for the coastal belt from Vizhinjam to Kasaragod in Kerala.

Spring Tides:

• Spring tides are especially strong high tides that occur during the full moon and new moon when the sun and moon are aligned with the earth, resulting in a collective gravitational pull on the earth’s water.
• A perigean spring tide, also known as King tide, occurs during a Supermoon when the moon is closest to the earth (less than 3,60,000 km) during its orbit. Supermoons during the year 2015 are January 20 (new moon), February 18 (new moon), March 20 (new moon), August 29 (full moon), September 28 (full moon) and October 27 (full moon).

What happens when spring tide coincides with high swell waves?

• When spring tide coincides with high swell waves, it results in coastal erosion and flooding. It is estimated that the tidal surge since August 29 is two metres high in some coastal parts of kerala.
• The perigean spring tide on August 29 had coincided with high swell waves that originated in the southern Indian Ocean near Australia.

The swells occur almost every year with varying intensity. Triggered by turbulent weather conditions, swells are known to propagate northward to the Arabian Sea and Bay of Bengal, causing freak flooding along the southern Indian coast.

Sources: The Hindu, Wiki.