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Insights Daily Current Events, 29 December 2015

Insights Daily Current Events, 29 December 2015

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Paper 3 Topic: Indian economy, Issues related to direct and indirect farm subsidies.

LPG subsidy linked to income

In its first decisive move towards curbing the supply of subsidised cooking gas, the union government has announced that taxpayers with an annual income of more than Rs 10 lakh will not get subsidised LPG cylinders from the new year.

  • At present, all households are entitled to 12 cylinders of 14.2-kg each at subsidised rate of Rs 419.26, while the market price of each cylinder is Rs 608.
  • According to the Central Board of Direct Taxes data, in the assessment year 2014-15, a total of 20.26 lakh assesses were reported as having a taxable income above Rs 10 lakh.

Background:

  • In March this year, the government had asked “well-off people” to voluntarily give up using subsidised LPG and instead buy cooking fuel at market price.
  • So far, of the estimated 14.78 crore LPG consumers in the country, over 52 lakh are reported to have given up access to subsidised fuel voluntarily.
  • The number of LPG consumers in the country also fell from 16.35 crore to 14.78 crore after the start of Direct Benefit Transfer on LPG (DBTL) scheme that eliminated inactive customers and duplication in the rolls.

Total subsidy payout:

During fiscal 2014-15, the subsidy payout on LPG was estimated at Rs 40,551 crore. During April-September this fiscal, the subsidy outgo was Rs 8,814 crore. The total payout this fiscal is expected to be far lower than last year as oil prices have receded sharply.

Significance of this move:

  • The subsidy saved from the ‘Give it Up’ campaign will be used for providing new connections to the BPL families. This enables the allocation of LPG to poor households and ensures that they replace the use of fuels such as kerosene, coal, fuel wood.
  • As on December 7, a total of 52,58,841 consumers have given up or surrendered their subsidy. Taking into account the quota of 12 cylinders per consumer and the average LPG subsidy of Rs 184.93 per cylinder (in the Delhi market) for the period from April to September, 2015, the annual saving would be approximately Rs 1,167 crore.

sources: the hindu.

 

Topic: general awareness.

Ramakrishna Mission-UNESCO establish ‘official ties’

The United Nations Educational Scientific and Cultural Organisation (UNESCO) has established an ‘official relationship’ with the Ramakrishna Mission in the areas of inter-cultural dialogue, social cohesion and for promoting peace and non-violence.

  • The bonding between UNESCO and the over 100-year old Ramakrishna Mission started in 2002 with the former funding certain projects.
  • In 2012, the UNESCO set up a chair on Inclusive Adapted Physical Education and Yoga at the Coimbatore campus of Vivekananda University.
  • The UNESCO has found common features with the Ramakrishna Mission in many respects.

About UNESCO:

  • It is a specialized agency of the United Nations (UN).
  • Founded in 1945, the UNESCO’s mission is to contribute to building of peace, eradication of poverty, sustainable development and intercultural dialogue through education, the sciences, culture, communication and information.
  • It is the heir of the League of Nations’ International Committee on Intellectual Cooperation.
  • It has 195 member states and nine associate members.

sources: the hindu, wiki.

 

Paper 3 Topic: Awareness in the fields of IT.

Microsoft signs MoU with AP govt

The Andhra Pradesh state Government has signed a Memorandum of Understanding (MoU) with Microsoft India to improve access, deployment and use of information technology and communication (ICT) to offer better citizen services and drive digital inclusion.

  • The MoU was signed in the presence of Chief Minister of Andhra Pradesh N. Chandrababu Naidu and Microsoft India CEO Satya Nadella.

Highlights of the MoU:

  • According to the MoU, Microsoft India will provide technical knowledge to Andhra Pradesh Government.
  • It will support Andhra Pradesh Government in building three proof-of-concept (PoC) solutions in the fields of education, agriculture and eCitizen services with the use of methods such as Microsoft Azure Machine Learning and Advanced Visualization method.
  • It will use the lab method for data gathering, analysis, predictive analysis and policy planning in Andhra Pradesh.
  • It will also engage and train key IT executives of Andhra Pradesh Government on Microsoft technologies such as Cloud, Mobility and Microsoft Technology stack in the support of initiative taken by Andhra Pradesh Government for Cloud adoption and improve citizen services.

sources: the hindu, bs.

 

Paper 3 Topic: infrastructure.

Kelkar chalks out rules for PPP revival

An expert panel led by former Finance Secretary, Vijay Kelkar, has called for swift amendments to the anti-corruption law and an endorsement from the Parliament for a new policy for public private partnerships or PPPs that balances risk-sharing between private and public partners, in order to spur infrastructure building.

  • The report, which was released by the government recently, said rebooting PPPs is an urgent priority to take advantage of the ‘historical conjunction of the country’s infrastructure needs and the availability of long-term funding’.
  • The report also highlighted that it is critical for India to make the leap from a low-income country to a high-income one in two to three decades, else it risks falling into a ‘middle income’ trap.
  • The panel has also asked the government to actively ‘discourage’ the ‘Swiss Challenge’ for auctioning infrastructure projects, under which any bidder can offer to improve upon a project proposal submitted by another player. This model has been adopted by the government since July to redevelop 400 railway stations.

Highlights of the report:

  • The report notes that India’s success in deploying PPPs as an important instrument for creating infrastructure will depend on a change in attitude of all authorities dealing with PPPs-public agencies, government departments supervising and auditing and legislative institutions.
  • The panel has asked the Government to take early action to amend the Prevention of Corruption Act, 1988 which does not distinguish between genuine errors in decision-making and acts. This is necessary to make only malafide action by public servants punishable and not errors.
  • The report also underlines the need to further strengthen the three key pillars of PPP frameworks namely Governance, Institutions and Capacity, to build on the established foundation for the next wave of implementation.
  • The report asks for an independent regulatory with a unified mandate that encompasses activities in different infrastructure sub sectors to ensure harmonized performance by the regulators.
  • The panel has also asked the government to issue model concession agreements only when 80% of the land for a project has been acquired.
  • The panel is against adopting PPP structures for very small projects, since the benefits of delivering small PPP projects may not be commensurate with the resulting costs and the complexity of managing such partnerships over a long period.
  • The panel has recommended the government to notify comprehensive guidelines on the applicability and scope of access to, under RTI and Art 12 of the Constitution, and auditing of financial related matters in order to avoid any delays in public asset provision.
  • The report asks the government to encourage banks and financial institution to issue Deep Discount Bonds or Zero Coupon Bonds (ZCB) to mobilise long term capital at low cost.

The committee has also favoured disallowing statutory audit into the books of special purpose vehicle formed under the companies act.

sources: the hindu, pib.

 

Topic: general awareness.

Nagi Day Celebrated by the Army

The 44th Nagi Day was recently celebrated at Sriganganagar Military Station and Nagi (a small village located in Sri Karanpur close to International Boundary) in memory of gallant soldiers of the Indian Army who laid down their lives for the Nation during the famous Battle of Nagi on 27-28 Dec 1971.

  • The Battle of Nagi was fought ten days after announcement of the ceasefire of Indo-Pak war wherein brave action by Indian soldiers at Nagi thwarted the nefarious designs of Pakistan Army to capture Indian territory in Village Nagi of Karanpur Tehsil.

sources: pib.

 

Paper 3 Topic: Indian economy, Issues related to direct and indirect farm subsidies.

RBI panel for direct transfer of cash, abolishing farm subsidy

A Reserve Bank of India (RBI) committee on financial inclusion has suggested that the government should transfer cash directly to persons instead of giving subsidies, and should replace interest subvention on agriculture loans with affordable universal crop insurance scheme.

  • The committee on medium-term path on financial inclusion was headed by RBI executive director Deepak Mohanty. It was set up in mid-July after Prime Minister Narendra Modi told RBI in its 80th anniversary that a road map should be built to include 90% of India’s unbanked population in the financial fold.

Key recommendations:

  • Phase out of interest subvention scheme and ploughing the subsidy amount into a mandatory crop insurance scheme for small and marginal farmers
  • Suggests banks to open more accounts for females
  • Proposes a new welfare scheme for girl child — Sukanya Shiksha
  • Suggests stepping up financial inclusion in north-eastern, eastern and central states
  • Recommends Aadhaar to be linked with each individual credit account
  • Recommends use of low-cost solution based on mobile technology for ‘last mile’ delivery
  • Recommends ‘Gold KCC’ scheme for good borrowers
  • Recommends commercial banks to open specialised interest-free windows with simple products
  • Recommends RBI to take lead in creating a geographical information system to map banking access points
  • Recommends more bank credit to the MFI sector
  • Suggests more ATMs in rural centres

sources: the hindu, bs.