Insights Daily Current Events, 02 November 2015
Paper 2 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
5-member panel mooted for deciding on monetary policy
Abandoning their original position on the proposed amendments to the RBI act, both RBI and Union Finance Ministry have arrived at a mid- way position.
The finance ministry has proposed a five-member Monetary Policy Committee which will have the responsibility of deciding India’s monetary policy, including the decision on interest rates.
Current scenario: At present, the Governor is advised by a technical committee but can veto decisions, being singularly responsible for monetary policy.
Composition of the newly proposed committee:
- The government will nominate two members.
- RBI will nominate one expert, besides two of its officials: the Deputy Governor and the executive director dealing with monetary policy.
Voting Powers of members:
Each of the five members would have one vote and the RBI Governor, chair of the committee, will have a casting vote in the event of a tie in situations such as the absence of a member.
- A draft of the Indian Financial Code that the Ministry had posted on its website in July proposed to strip the Governor of veto vote on the monetary policy. The draft proposed a six-member monetary policy committee, besides powers for the government to appoint four of the six members.
- The proposal had drawn sharp criticism, including from the former RBI Governors.
- RBI was also unhappy over the proposed amendments to the RBI Act that Finance Minister Arun Jaitley had announced in his Budget speech.
- Realising the RBI’s opposition, the Finance Minister had dropped the proposed amendments from the Finance Bill.
It should however be noted that the inflation target for the RBI in each financial year will be determined by the Government in consultation with the RBI itself.
sources: the hindu.
Paper 3 Topic: indigenization of technology and developing new technology.
BrahMos test-fired from new warship
India’s supersonic cruise missile BrahMos was recently test-fired from the country’s newest stealth-destroyer INS Kochi off the west coast.
- Launch of BrahMos was part of an acceptance testing-firing during a Naval drill being conducted on the west coast.
- INS Kochi is a 7,500-tonne indigenously developed warship which has new design concepts for survivability, stealth and manoeuvrability.
- It was inducted into the Navy in September 2015.
- It can carry 16 BrahMos missiles in two eight-cell vertical launch systems besides other modern weapons and sensors.
- It is a two stage missile, jointly developed by India and Russia.
- The missile can fly at a supersonic speed of 2.8 Mach and at a height of ten metres during the final stages of its flight.
- It carries conventional warheads.
- It can be launched from ships, land and submarines.
sources: the hindu, et.
Paper 2 Topic: Health.
Govt. forms committee to review drug pricing policy
The Union government has formed an inter-ministerial committee to review the Drug Price Control Order (DPCO) 2013, following the Supreme Court verdict in July this year that termed the drug pricing policy as irrational and unreasonable.
The committee will be composed of representatives from DIPP, Ministry of Health, National Pharmaceutical Pricing Authority (NPPA) and Department of Pharmaceuticals.
Functions of the committee:
- The committee will look into the drug pricing mechanism as there have been complaints that the companies are making significant profits which go up to few thousand per cent.
- The committee will also look into the pricing of medicines, and specifically in the market based pricing formula which is being used at present under DPCO 2013.
- In July this year, while hearing the petition of NGO All India Drug Action Network, the Supreme Court had observed that the Centre was fixing maximum price of a medicine above the retail price of the leading company.
- The NGO, in its plea, had also argued that MBP (Market Based Pricing) was never used for any price regulatory purposes and under the new policy, simple average ceiling prices were, in many cases, higher than the market leader price.
- The NGO had also sought inclusion of more life-saving medicines of diseases such as diabetes and tuberculosis in the list of drugs whose prices would be regulated by the government.
As stipulated under DPCO 2013, drug price regulator NPPA fixes the ceiling price of essential medicines of schedule-I. So far, the authority has fixed the ceiling price of 530 formulations from the list. And no one is authorised to sell any scheduled medicine to a consumer at a price higher than the one notified by NPPA under the order. While fixing the ceiling price, 16% margin is allowed for retailers.
sources: the hindu.
Paper 2 Topic: Statutory, regulatory and various quasi-judicial bodies.
NPPA caps price of 18 formulations packs
NPPA has capped prices of 18 formulations packs, including anti- diabetic Metformin HCl tablets, anti-bacterial Ceftriaxone Sodium injection packs and devices among others.
- The prices of the 18 formulation packs have been fixed/revised under Drug Price Control Order (DPCO), 2013.
- Drug firms such as Cipla, Alembic Pharma and Unichem Laboratories will be impacted by the government’s move for prices fixation and revision.
How the prices are fixed?
- At present, the government caps prices of essential drugs based on the simple average of all medicines in a particular therapeutic segment with sales of more than 1%.
- In case of non-scheduled formulations companies are allowed to hike prices of medicines by only up to 10% in a year.
The government had notified DPCO, 2013, which covers 680 formulations, effective May 15, 2014, replacing the 1995 order that regulated only 74 bulk drugs.
National Pharmaceutical Pricing Authority (NPPA)
NPPA was established, inter alia, to fix/ revise the prices of controlled bulk drugs and formulations and to enforce prices and availability of the medicines in the country, under the Drugs (Prices Control) Order, 1995.
- The organization is also entrusted with the task of recovering amounts overcharged by manufacturers for the controlled drugs from the consumers.
- It also monitors the prices of decontrolled drugs in order to keep them at reasonable levels.
Other important functions of National Pharmaceutical Pricing Authority:
- To deal with all legal matters arising out of the decisions of the Authority;
- To monitor the availability of drugs, identify shortages, if any, and to take remedial steps;
- To collect/ maintain data on production, exports and imports, market share of individual companies, profitability of companies etc, for bulk drugs and formulations;
- To render advice to the Central Government on changes/ revisions in the drug policy;
- To render assistance to the Central Government in the parliamentary matters relating to the drug pricing.
sources: the hindu, nppa.
Paper 3 Topic: infrastructure railways.
Railways launches ‘Vikalp’ for waitlisted passengers to get confirmed berth
Railways has launched a new scheme, called Vikalp, under which waitlisted passengers can get confirmed accommodation in next alternative train if they opt for the option while booking their tickets online.
- The scheme, also known as alternative train accommodation scheme, will take off in trains running on Delhi-Lucknow and Delhi-Jammu sectors from November 1, on a pilot basis.
- Initially, Vikalp scheme will be available only for the tickets booked through internet for six months and option will be limited to mail and express trains on the two selected routes.
- As per the scheme, waitlisted passengers of a train would be given option of getting confirmed accommodation in the next train running on the route.
- Passenger, if opts for the Vikalp scheme while booking tickets online, will get SMS alert on their mobile phone about getting confirmed accommodation in alternative train.
- As per the scheme, there would be no extra charges taken from the passenger or any refund provided for the difference of fare.
- The name of passenger who has been provided accommodation in the alternative train will not figure in the waitlisted charts of their original train. A separate list of passengers transferred in alternative train will be pasted along with the confirmed and waitlist charts.
Through this scheme Railway aims to achieve the twin objectives of providing confirmed accommodation to waitlisted passengers and ensure optimal utilisation of available accommodation.
sources: the hindu, pib.