Insights Daily Current Affairs + PIB: 05 July 2019
Relevant articles from pib:
GS Paper 2:
- Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
What to study?
For prelims: key features of the bill.
For mains: need for regulation, concerns and issues associated with surrogacy.
Context: The Cabinet has approved the introduction of Surrogacy (Regulation) Bill, 2019 that aims to prohibit commercial surrogacy in India.
Key features of the bill:
- The Bill proposes to regulate surrogacy in India by establishing a National Surrogacy Board at the central level and state surrogacy boards and appropriate authorities in the state and Union Territories.
- The purpose of the Bill is to ensure effective regulation of surrogacy, prohibit commercial surrogacy, and allow ethical surrogacy.
- While commercial surrogacy will be prohibited, including sale and purchase of human embryos and gametes, ethical surrogacy for needy couples will be allowed on fulfilment of stipulated conditions.
- It will also prevent exploitation of surrogate mothers and children born through surrogacy.
- There will not be any financial implications, except for the meetings of the National and State Surrogacy Boards and appropriate authorities, which will be met out of the administrative budgets of respective departments.
Need for regulation:
India has emerged as a surrogacy hub for couples from other countries and there have been reports concerning unethical practices, exploitation of surrogate mothers, abandonment of children born out of surrogacy, and rackets involving intermediaries importing human embryos and gametes. The 228th report of the Law Commission of India has recommended prohibiting commercial surrogacy and allowing altruistic surrogacy by enacting suitable legislation.
What is an altruistic surrogacy arrangement?
The Bill includes contracting a ‘close relative’ as a surrogate by a heterosexual married couple who have been childless for five years of their marriage.
Mains Question: Analyse the ethical and economic implications of latest surrogacy bill.
GS Paper 2 and 3:
- Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes.
- Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing.
What to study?
For Prelims: MSP- crops covered, how is it decided.
For Mains: MSP- need, significance, concerns and rectifying measures.
Context: Union Cabinet has announced a Minimum Support Price (MSP) of 14 Kharif crops.
What is it?
In theory, an MSP is the minimum price set by the Government at which farmers can expect to sell their produce for the season. When market prices fall below the announced MSPs, procurement agencies step in to procure the crop and ‘support’ the prices.
The Cabinet Committee of Economic Affairs announces MSP for various crops at the beginning of each sowing season based on the recommendations of the Commission for Agricultural Costs and Prices (CACP). The CACP takes into account demand and supply, the cost of production and price trends in the market among other things when fixing MSPs.
Why is it important?
Price volatility makes life difficult for farmers. Though prices of agri commodities may soar while in short supply, during years of bumper production, prices of the very same commodities plummet. MSPs ensure that farmers get a minimum price for their produce in adverse markets. MSPs have also been used as a tool by the Government to incentivise farmers to grow crops that are in short supply.
Relevant articles from various news sources:
GS Paper 3:
Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
What to study?
For prelims and mains: CICs- significance, challenges and their regulation.
Context: The Reserve Bank has constituted a working group that will review the regulatory and supervisory framework for core investment companies.
- The six-member working group is to be headed by Tapan Ray, non-executive chairman, Central Bank of India and former secretary, Ministry of Corporate Affairs.
- The terms of reference of the working group include examination of the current regulatory framework for CICs in terms of adequacy, efficacy and effectiveness of every component thereof and suggest changes therein.
In August 2010, RBI had introduced a separate framework for the regulation of systemically important core investment companies (CICs), recognising the difference in the business model of a holding company relative to other non-banking financial companies.
What are Core Investment Companies (CICs)?
CICs are non-banking financial companies with asset size of ₹100 crore and above which carry on the business of acquisition of shares and securities, subject to certain conditions.
CICs, which are allowed to accept public funds, hold not less than 90% of their net assets in the form of investment in equity shares, preference shares, bonds, debentures, debt or loans in group companies.
Investments of CIC in the equity shares (including instruments compulsorily convertible into equity shares within a period not exceeding 10 years from the date of issue) in group companies constitutes not less than 60% of its net assets as mentioned in clause.
Exemption: CICs having asset size of below Rs 100 crore are exempted from registration and regulation from the RBI, except if they wish to make overseas investments in the financial sector.
What do the term public funds include? Is it the same as public deposits?
Public funds are not the same as public deposits. Public funds include public deposits, inter-corporate deposits, bank finance and all funds received whether directly or indirectly from outside sources such as funds raised by issue of Commercial Papers, debentures etc. However, even though public funds include public deposits in the general course, it may be noted that CICs/CICs-ND-SI cannot accept public deposits.
This Concept was originated in order to safeguard NBFCs which are formed for group investments from stringent RBI procedures.
Sources: the Hindu.
GS Paper 2:
- Parliament and State Legislatures – structure, functioning, conduct of business, powers & privileges and issues arising out of these.
What to study?
For Prelims and Mains: All about Privilege motion and privilege committee.
Context: Trinamool MP Mahua Moitra has moved a breach of privilege motion in the Lok Sabha against a private Hindi news channel and its Editor for reporting that her first speech in Parliament was plagiarised.
What is a privilege motion?
Parliamentary privileges are certain rights and immunities enjoyed by members of Parliament, individually and collectively, so that they can “effectively discharge their functions”. When any of these rights and immunities are disregarded, the offence is called a breach of privilege and is punishable under law of Parliament.
Who can move it? How?
A notice is moved in the form of a motion by any member of either House against those being held guilty of breach of privilege. Each House also claims the right to punish as contempt actions which, while not breach of any specific privilege, are offences against its authority and dignity.
What are the rules governing privilege?
Rule No 222 in Chapter 20 of the Lok Sabha Rule Book and correspondingly Rule 187 in Chapter 16 of the Rajya Sabha rulebook governs privilege. It says that a member may, with the consent of the Speaker or the Chairperson, raise a question involving a breach of privilege either of a member or of the House or of a committee thereof. The rules however mandate that any notice should be relating to an incident of recent occurrence and should need the intervention of the House. Notices have to be given before 10 am to the Speaker or the Chairperson.
What is the role of the Speaker/Rajya Sabha Chair?
The Speaker/RS chairperson is the first level of scrutiny of a privilege motion. The Speaker/Chair can decide on the privilege motion himself or herself or refer it to the privileges committee of Parliament. If the Speaker/Chair gives consent under Rule 222, the member concerned is given an opportunity to make a short statement.
What is the privileges committee?
In the Lok Sabha, the Speaker nominates a committee of privileges consisting of 15 members as per respective party strengths. A report is then presented to the House for its consideration. The Speaker may permit a half-hour debate while considering the report. The Speaker may then pass final orders or direct that the report be tabled before the House.
A resolution may then be moved relating to the breach of privilege that has to be unanimously passed. In the Rajya Sabha, the deputy chairperson heads the committee of privileges, that consists of 10 members.
Sources: the Hindu.
GS Paper 2:
Important aspects of governance, transparency and accountability, e-governance- applications, models, successes, limitations, and potential; citizens charters, transparency & accountability and institutional and other measures.
What to study?
For prelims and mains: Need for database, significance, challenges in the absence of data and measures to improve data accuracy.
Context: Economic Survey moots central welfare database of citizens.
About the Proposed Central Welfare Database of citizens:
It will be created by merging different data maintained by separate Ministries and departments — which can be tapped for enhancing ease of living for citizens, particularly the poor.
Governments can create data as a public good within the legal framework of data privacy. Care must also be taken not to impose the “elite’s preference of privacy on the poor, who care for a better quality of living the most.”
Private sector may be granted access to select database for a fee.
The datasets talked about include administrative data such as birth and death records, pensions, tax records, marriage records; survey data such as census data, national sample survey data; transactions data such as e-national agriculture market data, UPI data, institutional data and public hospital data on patients.
The governments already has a rich repository of administrative, survey, institutional and transactions data about citizens, but these data were scattered across numerous government bodies. Merging these distinct datasets would generate multiple benefits with the applications being limitless.
The government could utilise the information embedded in these distinct datasets to enhance ease of living for citizens, enable truly evidence-based policy, improve targeting in welfare schemes, uncover unmet needs, integrate fragmented markets, bring greater accountability in public services and generate greater citizen participation in governance, etc.
GS Paper 3:
Conservation related issues.
What to study?
For prelims and mains: coral bleaching- causes, effect and various ways to restore.
Why in News? The National Centre for Coastal Research’s (NCCR) proposal of dropping ‘melted plastic rocks or slabs’ on the seabed for growing coral reefs and address the problem of disposal of plastic waste has drawn criticism from the Gulf of Mannar (GoM) Marine National Park, which has been implementing coral rehabilitation programme since 2002.
What’s the issue?
- The NCCR suggested that plastic waste materials could simply be wound around as hard substrates as a way of disposing of them and help build coral colonies.
- Therefore, researchers have expressed apprehensions that the NCCR’s ‘innovative idea’ for the growth of marine organisms like algae for coral reefs building would destroy the existing coral reef colonies.
- Corals in the GoM were already stressed and bleached under climate change and the NCCR’s idea would turn the reefs into graveyards.
About the Coral Rehabilitation Programme:
- The GoM Marine National Park has been implementing the corral rehabilitation programme since 2002.
- It has so far covered eight sq km areas in GoM region, where coral reefs suffered bleaching and degradation due to climate change and high temperature.
- The program employs ‘concrete frame slabs’ method.
- Corals would start growing in 60 days using the concrete frames as sub-state. The acropora coral species grow by 10 to 12 cm per year on these slabs.
Sources: the Hindu.
Facts for prelims:
Centre and IBM to jointly study on using AI in Agriculture:
Context: Union Ministry of Agriculture and Farmers Welfare has signed a Statement of Intent (SoI) with IBM India Private Limited for undertaking a pilot study to utilise Artificial Intelligence (AI) and weather technology solutions in agriculture in selected pilot districts.
The pilot study will be undertaken in 3 districts of Bhopal, Rajkot and Nanded in Madhya Pradesh, Gujarat and Maharashtra respectively.
Context: According to the World Bank, India’s turnover ratio at 58 in 2018 was a 43 per cent drop from 101 recorded in 2004.
What is it? A turnover ratio represents the amount of assets or liabilities that a company replaces in relation to its sales. The concept is useful for determining the efficiency with which a business utilizes its assets.
In most cases, a high asset turnover ratio is considered good, since it implies that receivables are collected quickly, fixed assets are heavily utilized, and little excess inventory is kept on hand. This implies a minimal need for invested funds, and therefore a high return on investment.
Conversely, a low liability turnover ratio (usually in relation to accounts payable) is considered good, since it implies that a company is taking the longest possible amount of time in which to pay its suppliers, and so has use of its cash for a longer period of time.
About Export Credit Guarantee Corporation:
ECGC is a premier export credit agency of the Government of India to provide Export Credit Insurance Services to facilitate exports from the country.
The ECGC offers credit insurance schemes to exporters to protect them against losses due to non-payment of export dues by overseas buyers due to political and / or commercial risks.
It functions under the administrative control of Ministry of Commerce & Industry, and is managed by a Board of Directors comprising representatives of the Government, Reserve Bank of India, banking, and insurance and exporting community.
It is an auspicious day for farming communities in North India especially Gujarat, Uttar Pradesh and some other places. This festival is celebrated mainly to predict the monsoon.
Key Highlights of Economic Survey 2018-19:
- Private Investment as the Key Driver of Growth, Jobs, Exports and Demand:
Target: Sustained real GDP growth rate of 8% needed for a $5 trillion economy by 2024-25.
Need of the hour: “Virtuous Cycle” of savings, investment and exports catalyzed and supported by a favorable demographic phase required for sustainable growth.
Private investment– key driverfor demand, capacity, labor productivity, new technology, creative destruction and job creation.
Key ingredients for a self-sustaining virtuous cycle:
- Presenting data as a public good.
- Emphasizing legal reforms.
- Ensuring policy consistency.
- Encouraging behavior change using principles of behavioral economics.
- Nourishing MSMEs to create more jobs and become more productive.
- Reducing the cost of capital.
- Rationalizing the risk-return trade-off for investments.
- Using insights from behavioural economics to create an aspirational agenda for social change:
From ‘Beti Baco Beti Padhao’ to ‘BADLAV’ (Beti Aapki Dhan Lakshmi Aur Vijay Lakshmi).
From ‘Swachh Bharat’ to ‘Sundar Bharat’.
From ‘Give it up” for the LPG subsidy to ‘Think about the Subsidy’.
From ‘Tax evasion’ to ‘Tax compliance’.
- Nourishing Dwarfs to become Giants: Reorienting policies for MSME Growth:
Focus on enabling MSMEs to grow for achieving greater profits, job creation and enhanced productivity.
Concerns: Dwarfs (firms with less than 100 workers) despite being more than 10 years old, account for more than 50% of all organized firms in manufacturing by number. Contribution of dwarfs to employment is only 14% and to productivity is a mere 8%. Large firms (more than 100 employees) account for 75% employment and close to90% of productivity despite accounting for about 15% by number.
What needs to be done?
Unshackling MSMEs and enabling them to grow by way of:
- A sunset clause of less than 10 years, with necessary grand-fathering, for all size-based incentives.
- Deregulating labor law restrictions to create significantly more jobs, as evident from Rajasthan.
- Re-calibrating Priority Sector Lending (PSL) guidelines for direct credit flow to young firms in high employment elastic sectors.
- Focus on service sectors such as tourism, with high spillover effects on other sectors such as hotel & catering, transport, real estate, entertainment etc., for job creation.
- Data as public good:
As data of societal interest is generated by the people, data can be created as a public good within the legal framework of data privacy.
Need of hour: Government must intervene in creating data as a public good, especially of the poor and in social sectors.
Merging the distinct datasets held by the Government already would generate multiple benefits.
- How to Ramp up Capacity in the Lower Judiciary?
Challenges: Delays in contract enforcement and disposal resolution are arguably now the single biggest hurdle to the ease of doing business and higher GDP growth in India. Around 87.5 per cent of pending cases are in the District and Subordinate courts.
What needs to be done? 100 per cent clearance rate can be achieved by filling out merely 2279 vacancies in the lower courts and 93 in High Courts.
States of Uttar Pradesh, Bihar, Odisha and West Bengal need special attention.
Productivity improvements of 25 percent in lower courts, 4 percent in High Courts and 18 percent in Supreme Court can clear backlog.
- India’s Demography at 2040: Planning Public Good Provision for the 21st Century:
- Sharp slowdown in population growth expected in next 2 decades.
- Most of India to enjoy demographic dividend while some states will transition to ageing societies by 2030s.
- National Total Fertility Rate expected to be below replacement rate by 2021.
- Working age population to grow by roughly 9.7mn per year during 2021-31 and 4.2mn per year during 2031-41.
- Significant decline to be witnessed in elementary school-going children (5-14 age group) over next two decades.
What needs to be done? States need to consolidate/merge schools to make them viable rather than build new ones.
Policy makers need to prepare for ageing by investing in health care and by increasing the retirement age in a phased manner.
- Enabling Inclusive Growth through Affordable, Reliable and Sustainable Energy:
- 5 times increase in per capita energy consumption needed for India to increase its real per capita GDP by $5000 at 2010 prices, and enter the upper-middle income group.
- 4 times increase in per capita energy consumption needed for India to achieve 0.8 Human Development Index score.
- Market share of electric cars only 0.06% in India while it is 2% in China and 39% in Norway.
India now stands at 4th in wind power, 5th in solar power and 5th in renewable power installed capacity.
Savings: Rs 50,000 crore saved and 108.28 million tonnes of CO2 emissions reduced by energy efficiency programmes in India.
Share of renewable (excluding hydro above 25 MW) in total electricity generation increased from 6% in 2014-15 to 10% in 2018-19. Thermal power still plays a dominant role at 60% share.
Access to fast battery charging facilities needed to increase the market share of electric vehicles.
- A well-designed minimum wage system as a potent tool for protecting workers and alleviating poverty.
Present minimum wage system in India has 1,915 minimum wages for various scheduled job categories across states.
1 in every 3 wage workers in India not protected by the minimum wage law.
Need of the hour:
- Rationalize minimum wages as proposed under the Code on Wages Bill.
- Minimum wages to all employments/workers proposed by the Survey.
- ‘National Floor Minimum Wage’ should be notified by the Central Government, varying across five geographical regions.
- Minimum wages by states should be fixed at levels not lower than the ‘floor wage’.
- Minimum wages can be notified based either on the skills or on geographical region or on both grounds.
- ‘National level dashboard’ under the Ministry of Labour & Employment for regular notifications on minimum wages.
- Toll-free number to register grievance on non-payment of the statutory minimum wages.
- State of the Economy in 2018-19: A Macro View:
- India still the fastest growing major economy in 2018-19.
- Growth of GDP moderated to 6.8 per cent in 2018-19 from 7.2 per cent in 2017-18.
- Inflation contained at 3.4 per cent in 2018-19.
- Non-Performing Assets as percentage of Gross Advances reduced to 10.1 per cent at end December 2018 from 11.5 per cent at end March 2018.
- Investment growth recovering.
- Fiscal deficit of Central Government declined from 3.5 percent of GDP in 2017-18 to 3.4 percent in 2018-19.
- Prospects of pickup in growth in 2019-20 on the back of further increase in private investment and acceleration in consumption.
- Sustainable Development and Climate Change:
India’s SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs: Kerala and Himachal Pradesh are the front runners with a score of 69 amongst states. Chandigarh and Puducherry are the front runners with a score of 68 and 65 respectively among the UTs.
Need of the hour:
- For mainstreaming Resource Efficiency approach in the development pathway for achieving SDGs, a national policy on Resource Efficiency should be devised.
- Prevention, control and abatement of air pollution
- Augmenting the air quality monitoring network across the country.
- Scale and size of investments required to implement India’s NDC requires mobilizing international public finance and private sector resources along with domestic public budgets.
- Agriculture and Food Management:
Agriculture sector in India typically goes through cyclical movement in terms of its growth.
Gross Value Added (GVA) in agriculture decelerated to 2.9 per cent in 2018-19.
Gross Capital Formation (GCF) in agriculture as percentage of GVA marginally declined to 15.2 per cent in 2017-18 as compared to 15.6 per cent in 2016-17.
The public sector GCF in agriculture as a percentage of GVA increased to 2.7 per cent in 2016-17 from 2.1 per cent in 2013-14.
Women’s participation in agriculture increased to 13.9 per cent in 2015-16 from 11.7 per cent in 2005-06 and their concentration is highest (28 per cent) among small and marginal farmers.
A shift is seen in the number of operational land holdings and area operated by operational land holdings towards small and marginal farmers.
What needs to be done?
- 89% of groundwater extracted is used for irrigation. Hence, focus should shift from land productivity to ‘irrigation water productivity’.
- Thrust should be on micro-irrigation to improve water use efficiency.
- Organic and natural farming techniques including Zero Budget Natural Farming (ZBNF) can improve both water use efficiency and soil fertility.
- Adopting appropriate technologies through Custom Hiring Centers and implementation of ICT are critical to improve resource-use efficiency among small and marginal farmers.
- Diversification of livelihoods is critical for inclusive and sustainable development in agriculture and allied sectors.
- Policies should focus on
- Dairying as India is the largest producer of milk. Livestock rearing particularly of small ruminants.
- Social Infrastructure, Employment and Human Development:
The public investments in social infrastructure like education, health, housing and connectivity is critical for inclusive development.
Encouraging Skill Development by:
- Introduction of the skill vouchers as a financing instrument to enable youth obtain training from any accredited training institutes.
- Involving industry in setting up of training institutes in PPP mode; in curriculum development; provision of equipment; training of trainers etc.
- Personnel of Railways and para-military could be roped in for imparting training in difficult terrains.
- Create a database of Instructors, skill mapping of rural youth by involving local bodies to assess the demand-supply gaps are some of the other initiatives proposed.