Insights Daily Current Affairs + PIB: 06 July 2019
Relevant articles from PIB:
What to study?
For prelims and mains: key features and significance of the scheme.
Context: Estimated savings/benefits of Rs. 59,599 crore upto March, 2019 under ‘PAHAL’ scheme.
Pratyaksh Hanstantrit Labh (PaHaL) scheme:
- Aims to reduce diversion and eliminate duplicate or bogus LPG connections.
- Under PaHaL, LPG cylinders are sold at market rates and entitled consumers get the subsidy directly into their bank accounts.
Relevant articles from various news sources:
GS Paper 2:
Issues related to Education.
What to study?
For prelims and mains: key highlights of the report, concerns and measures needed for upliftment.
Context: The 2019 “State of the Education Report for India: Children with Disabilities” has been released by the UNESCO.
The report highlights accomplishments and challenges with regards to the right to education of children with disabilities (CWDs).
Key highlights of the report:
- There are 78,64,636 children with disability in India constituting 1.7% of the total child population.
- Three-fourths of the children with disabilities at the age of five years and one-fourth between 5-19 years do not go to any educational institution.
- The number of children enrolled in school drops significantly with each successive level of schooling.
- There are fewer girls with disabilities in schools than boys with disabilities in schools.
- A large number of children with disabilities do not go to regular schools but are enrolled at the National Institute of Open Schooling (NIOS).
- The percentage of children attending schools is the lowest among those with multiple disabilities, mental illnesses and mental retardation.
- Significant gaps remain, even though successive government schemes and programs have brought large numbers of children with disabilities into schools.
- Only 61 percent of CWDs aged between 5 and 19 were attending an educational institution compared to the overall figure of 71 percent when all children are considered.
- Around 12 percent of CWDs dropped out of school, which is comparable with the overall percentage of dropouts among all children. 27 percent of CWDs never attended any educational institution, as opposed to the overall figure of 17 percent when the entire child population is taken into account.
- A review of enrolment figures at NIOS shows a decline for most categories of disabilities between 2009 and 2015.
Why the attitude of parents and teachers toward mainstream education important?
To accomplish the goal of inclusive education besides accessibility to physical infrastructure, processes in the school, assistive and ICT technology and devices being essential resources.
The report has made certain recommendations to improve the state of education for CWDs:
- Amend the RTE Act to better align with the RPWD Act by including specific concerns of education of such children.
- Establish a coordinating mechanism under HRD Ministry for effective convergence of all education programmes of children with disabilities.
- Ensure specific and adequate financial allocation in education budgets to meet the learning needs of children with disabilities.
- Strengthening data systems to make them robust and reliable and useful for planning.
- Massively expand the use of information technology for the education of children with disabilities.
- Give a chance to every child and leave no child with disability behind.
- Transform teaching practices to aid the inclusion of diverse learners.
- Overcome stereotypes and build positive dispositions towards children with disabilities, both in the classroom and beyond.
Inclusive education is complex to implement and requires a fine understanding of diverse needs of children and their families across different contexts. India has made considerable progress in terms of putting in place a robust legal framework and a range of programmes and schemes that have improved enrolment rates of children with disabilities in schools.
However, further measures are needed to ensure quality education for every child to achieve the goals and targets of agenda 2030 and more specifically Sustainable Development Goal 4.
Sources: the Hindu.
Mains Question: We still have much to do to ensure an inclusive, barrier-free and rights-based society for persons with disabilities through empowering them. Discuss the steps taken by government in this regard and examine how far have we been successful in empowering the differently abled?
GS Paper 3:
- Infrastructure- Energy.
What to study?
For Prelims: What is National Grid? UTs out of it, capacity and cross border transmissions.
For Mains: Significance and the need for National Grid, India’s energy demands and the role of National Grid in fulfilling these demands.
Context: The FM has promised a blueprint this year for developing “water grids” on the line of power grids in the country to push the government’s ‘One Nation, One Grid’ concept.
What is National Grid?
It is the high-voltage electric power transmission network in mainland India, connecting power stations and major substations and ensuring that electricity generated anywhere in mainland India can be used to satisfy demand elsewhere.
Benefits of a National Grid:
- Better availability resulting in lesser power cuts.
- More stability in power.
Sources: the Hindu.
GS Paper 2:
- Schemes for the vulnerable sections of the society.
What to study?
For prelims and mains: Key features of the new code, need, significance, need for uniform wage across the country.
Context: The Union Cabinet has cleared the new version of Code on Wages Bill, which seeks to define the norms for fixing minimum wages that will be applicable to workers of organised and unorganised sectors, except government employees and MGNREGA workers.
The Code on Wages will amalgamate the Payment of Wages Act, 1936, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976.
The code on wages is one of the four codes that would subsume 44 labour laws with certain certain amendments to improve the ease of doing business and attract investment for spurring growth.
The four codes will deal with wages, social security, industrial safety and welfare, and industrial relations.
What are the determining factors?
As per the Bill, minimum wages will be linked only to factors such as skills and geographical regions.
Present status: At present, minimum wages are fixed on the basis of categories such as skilled, unskilled, semi-skilled, high skilled, geographical regions, and nature of work such as mining and are applicable for 45 scheduled employments in the central sphere and 1709 scheduled employments in states.
As per the new Bill, the minimum wages across the country would be only linked to factors of skills and geographical regions, while the rest of the factors have been removed.
A National Floor Level Minimum Wage will be set by the Centre to be revised every five years, while states will fix minimum wages for their regions, which cannot be lower than the floor wage. The current floor wage, which was fixed in 2017, is at Rs 176 a day, but some states have minimum wages lower than it such as Andhra Pradesh (Rs 69) and Telangana (Rs 69).
This is expected to effectively reduce the number of minimum wage rates across the country to 300 from about 2,500 minimum wage rates at present.
Key Issues and Analysis:
- Central government may set a national minimum wage. Further, it may set separate national minimum wages for different states or regions. In this context, two questions arise: (i) the rationale for a national minimum wage, and (ii) whether the central government should set one or multiple national minimum wages.
- States have to ensure that minimum wages set by them are not lower than the national minimum wage. If existing minimum wages set by states are higher than the national minimum wage, they cannot reduce the minimum wages. This may affect the ability of states to reduce their minimum wages if the national minimum wage is lowered.
- The time period for revising minimum wages will be set at five years. Currently, state governments have flexibility in revising minimum wages, as long as it is not more than five years. It is unclear why this flexibility has been removed, and five years has been set for revision.
- The Equal Remuneration Act, 1976, prohibits employers from discriminating in wage payments as well as recruitment of employees based on gender. While the Code prohibits gender discrimination on wage-related matters, it does not include provisions regarding discrimination during recruitment.
Need for a national minimum wage:
One argument for a national minimum wage is to ensure a uniform standard of living across the country. At present, there are differences in minimum wages across states and regions. Such differences are attributed to the fact that both the central and state governments set, revise and enforce minimum wages for the employments covered by them. The introduction of a national minimum wage may help reduce these differences and provide a basic standard of living for all employees across the country.
Sources: the Hindu.
GS Paper 2:
- Separation of powers between various organs dispute redressal mechanisms and institutions.
What to study?
For prelims and mains: Key issues, need for enhanced powers and what needs to be done?
Context: The government is actively considering a proposal from the Reserve Bank of India (RBI) seeking more powers to improve its regulatory and supervisory mechanism for Non-Banking Financial Companies (NBFCs).
Why is this being proposed?
Recent defaults and delays in loan repayments by a section of NBFCs have shaken the confidence in the financial markets, leading to fears that potential solvency risks at certain companies can be contagious.
Liquidity for NBFCs with default ratings has completely dried up, creating broader challenges for policymakers.
What changes are being sought by RBI?
In the light of recent developments, there is a case for having a fresh look at their regulation and supervision. Need of the hour is to have an optimal level of regulation and supervision so that the NBFC sector is financially resilient and robust.
More powers will enable RBI to close regulatory gaps between banks (which are tightly regulated) and NBFCs. The RBI has already reduced the periodicity of the NBFC supervision to 12 months from 18 months earlier.
What is the scale of the challenge?
NBFCs were the largest net borrowers of funds from the financial system with gross payables of around Rs 8.44 lakh crore and gross receivables of around Rs 7.23 lakh crore as on end-March 2019.
These companies depend largely on public funds such as bank borrowings, debentures and commercial papers, which account for 70 per cent of the total liabilities of the sector.
When banks and mutual funds stop fresh loans to NBFCs facing default possibility, it can potentially lead to contagion in the financial markets.
Sources: Indian Express.
GS Paper 2:
- Important International institutions, agencies and fora, their structure, mandate.
What to study?
For Prelims and Mains: All about ICJ and comparison with ICC, Jadhav’s case and what can India do now in this case?
Context: International Court of Justice likely to deliver verdict in Kulbhushan Jadhav case this month.
What is it?
The International Court of Justice (ICJ) is the principal judicial body of the UN. Established in 1946 to replace the Permanent Court of International Justice, the ICJ mainly operates under the statute of its predecessor, which is included in the UN Charter.
It has two primary functions: to settle legal disputes submitted by States in accordance with established international laws, and to act as an advisory board on issues submitted to it by authorized international organizations.
Members of the Court:
The International Court of Justice is composed of 15 judges elected to nine-year terms of office by the United Nations General Assembly and the Security Council. These organs vote simultaneously but separately. In order to be elected, a candidate must receive an absolute majority of the votes in both bodies. In order to ensure a measure of continuity, one third of the Court is elected every three years. Judges are eligible for re-election.
Who nominates the candidates?
Every state government, party to the Charter, designates a group who propose candidates for the office of ICJ judges. This group includes four members/jurists of the Permanent Court of Arbitration (machinery which enables arbitral tribunals to be set up as desired and facilitates their work) also picked by the State. Countries not part of the statute follow the same procedure where a group nominates the candidates.
Each group is limited to nominate four candidates, two of whom could be of their nationality. Within a fixed duration set by the Secretary-General, the names of the candidates have to be sent to him/her.
What are the qualifications of ICJ judges?
- A judge should have a high moral character.
- A judge should fit to the qualifications of appointment of highest judicial officers as prescribed by their respective states or.
- A judge should be a juriconsult of recognized competence in international law.
The 15 judges of the Court are distributed as per the regions:
- Three from Africa.
- Two from Latin America and Caribbean.
- Three from Asia.
- Five from Western Europe and other states.
- Two from Eastern Europe.
Independence of the Judges:
Once elected, a Member of the Court is a delegate neither of the government of his own country nor of that of any other State. Unlike most other organs of international organizations, the Court is not composed of representatives of governments. Members of the Court are independent judges whose first task, before taking up their duties, is to make a solemn declaration in open court that they will exercise their powers impartially and conscientiously.
In order to guarantee his or her independence, no Member of the Court can be dismissed unless, in the unanimous opinion of the other Members, he/she no longer fulfils the required conditions. This has in fact never happened.
Sources: the hindu.
Facts for prelims:
Longest electrified tunnel in Indian Railways:
Context: South Central Railway (SCR) has commissioned the longest electrified tunnel in Indian Railways.
How long is it? 6.6 kilometres.
Where? It is situated between Cherlopalli and Rapuru Railway stations in Nellore district, Andhra Pradesh.
Kerala Champions Boat League:
The Champions Boat League (CBL) has been conceived by tourism officials in Kerala on the model of the Indian Premier League (IPL) to transform the state’s legendary and historically-significant ‘vallamkali’ (snake boat races) into a world-class sporting event.
The snake boat, or ‘chundam vallam’ is essentially a long canoe that can seat up to 100 rowers and can have a length between 100 and 138 feet in length. While the front portion of the boat tapers with a pointy end, the rear end can rise up to a height of 20 feet — the entire wooden structure resembling a snake with its raised hood, hence the name.
Background: Snake boat races owe their origins as far back as the 13th century when princely kingdoms, located in present-day Alappuzha along the backwaters, would have raging battles in the water. These battles used to be fought on the snake boats especially constructed for the purpose. In fact, the construction mechanisms of such boats are even said to be recorded in the Vedas.
Highlights of the Union Budget 2019-20:
10-point Vision for the decade:
- Building Team India with Jan Bhagidari: Minimum Government Maximum Governance.
- Achieving green Mother Earth and Blue Skiesthrough a pollution-free India.
- Making Digital India reach every sector of the economy.
- Launching Gaganyan, Chandrayan, other Space and Satellite programmes.
- Building physical and social infrastructure.
- Water, water management, clean rivers.
- Blue Economy.
- Self-sufficiency and export of food-grains, pulses, oilseeds, fruits and vegetables.
- Achieving a healthy society via Ayushman Bharat, well-nourished women & children, safety of citizens.
- Emphasis on MSMEs, Start-ups, defence manufacturing, automobiles, electronics, fabs and batteries, and medical devices under Make in India.
Achievements during 2014-19:
- 1 trillion dollar added to Indian economy over last 5 years (compared to over 55 years taken to reach the first trillion dollar).
- India is now the 6th largest economy in the world, compared to 11th largest five years ago.
- Indian economy is globally the 3rd largest in Purchasing Power Parity (PPP)
- Strident commitment to fiscal discipline and a rejuvenated Centre-State dynamic provided during 2014-19.
- Structural reforms in indirect taxation, bankruptcy and real estate carried out.
- Average amount spent on food security per year almost doubled during 2014-19 compared to 2009-14.
- Patents issued more than trebled in 2017-18 as against the number in 2014.
Towards a 5 Trillion Dollar Economy:
Indian economy to become a 3 trillion-dollar economy in the current year.
What needs to be done to make India a 5 trillion dollar economy? What has the government proposed?
- To promote digital economy:
TDS of 2% on cash withdrawal exceeding Rs. 1 crore in a year from a bank account.
Business establishments with annual turnover more than Rs. 50 crore shall offer low cost digital modes of payment to their customers and no charges or Merchant Discount Rate shall be imposed on customers as well as merchants.
- Banking and Financial Sector:
- NPAs of commercial banks reduced by over Rs. 1 lakh crore over the last year.
- Record recovery of over Rs. 4 lakh crore effected over the last four years.
- Provision coverage ratio at its highest in seven years.
- Domestic credit growth increased to 13.8%.
PSBs: Rs. 70,000 crore proposed to be provided to PSBs to boost credit; Steps to be initiated to empower accountholders to have control over deposit of cash by others in their accounts.
NBFCs: Proposals for strengthening the regulatory authority of RBI over NBFCs to be placed in the Finance Bill; Requirement of creating a Debenture Redemption Reserve will be done away with to allow NBFCs to raise funds in public issues; Steps to allow all NBFCs to directly participate on the TReDS platform; Return of regulatory authority from NHB to RBI proposed, over the housing finance sector; Steps to be taken to separate the NPS Trust from PFRDA; Reduction in Net Owned Fund requirement from Rs. 5,000 crore to Rs. 1,000 crore proposed.
CPSEs: Target of Rs. 1, 05,000 crore of disinvestment receipts set for the FY 2019-20. Government to offer an investment option in ETFs on the lines of Equity Linked Savings Scheme (ELSS).
- women empowerment:
Approach shift from women-centric-policy making to women-led initiatives and movements.
Women SHG interest subvention program proposed to be expanded to all districts; Overdraft of Rs. 5,000 to be allowed for every verified women SHG member having a Jan Dhan Bank Account; One woman per SHG to be eligible for a loan up to Rs. 1 lakh under MUDRA Scheme.
New National Education Policy to be brought.
National Research Foundation (NRF) proposed.
Rs. 400 crore provided for “World Class Institutions”, for FY 2019-20, more than three times the revised estimates for the previous year.
‘Study in India’ proposed to bring foreign students to study in Indian higher educational institutions.
Draft legislation to set up Higher Education Commission of India (HECI), to be presented.
Khelo India Scheme to be expanded with all necessary financial support.
National Sports Education Board for development of sportspersons to be set up under Khelo India, to popularize sports at all levels.
Stand-Up India Scheme to be continued for the period of 2020-25. The Banks to provide financial assistance for demand based businesses.
- Rural India:
Electricity and clean cooking facility to all willing rural families by 2022.
A robust fisheries management framework through Pradhan Mantri Matsya Sampada Yojana (PMMSY) to be established by the Department of Fisheries.
Target of connecting the eligible and feasible habitations advanced from 2022 to 2019 with 97% of such habitations already being provided with all weather connectivity.
1,25,000 kilometers of road length to be upgraded over the next five years under PMGSY III.
Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship’ (ASPIRE) consolidated.
10,000 new Farmer Producer Organizations to be formed, to ensure economies of scale for farmers.
Zero Budget Farming in which few states’ farmers are already being trained to be replicated in other states.
Jal Jeevan Mission to achieve Har Ghar Jal (piped water supply) to all rural households by 2024.
Compensatory Afforestation Fund Management and Planning Authority (CAMPA) fund can be used Jal Shakti Abhiyan.
Universal Obligation Fund under a PPP arrangement to be utilized for speeding up Bharat-Net.
Proposal to consider issuing Aadhaar Card for NRIs with Indian Passports on their arrival without waiting for 180 days.
Revamp of Indian Development Assistance Scheme (IDEAS) proposed.
Direct tax incentives proposed for an International Financial Services Centre (IFSC).
Securities Transaction Tax (STT) restricted only to the difference between settlement and strike price in case of exercise of options.
Capital gains exemptions from sale of residential house for investment in start-ups extended till FY21.
‘Angel tax’ issue resolved- start-ups and investors filing requisite declarations and providing information in their returns not to be subjected to any kind of scrutiny in respect of valuations of share premiums.
Funds raised by start-ups to not require scrutiny from Income Tax Department.
Tax rate reduced to 25% for companies with annual turnover up to Rs. 400 crore.
Surcharge increased on individuals having taxable income from Rs. 2 crore to Rs. 5 crore and Rs. 5 crore and above.
Government to organize an annual Global Investors Meet in India, using National Infrastructure Investment Fund (NIIF) as an anchor to get all three sets of global players (pension, insurance and sovereign wealth funds).
Statutory limit for FPI investment in a company is proposed to be increased from 24% to sectoral foreign investment limit. FPIs to be permitted to subscribe to listed debt securities issued by ReITs and InvITs.
NRI-Portfolio Investment Scheme Route is proposed to be merged with the Foreign Portfolio Investment Route.
Credit Guarantee Enhancement Corporation to be set up in 2019-2020.
Tax rates for individuals having taxable income from Rs. 2 cr – 5 cr and Rs. 5 cr & above to be increased by around 3 % and 7 % respectively.
Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI) aims to set up more Common Facility Centres for generating sustained employment opportunities.
- New Space India Limited (NSIL):
It is a Public Sector Enterprise incorporated as a new commercial arm of Department of Space to tap the benefits of the Research & Development carried out by ISRO.
Functions: The Company will spearhead commercialization of various space products including production of launch vehicles, transfer to technologies and marketing of space products.
In a nutshell, India needs:
- Simplification of procedures.
- Incentivizing performance.
- Red-tape reduction.
- Making the best use of technology.
- Accelerating mega programmes and services initiated and delivered so far.
What is Budget?
The Annual Financial Statement or the Statement of the Estimated Receipts and Expenditure of the Government of India in respect of each financial year is popularly known as the Budget.
Presentation of the budget:
The Budget is presented to Lok Sabha on such day as the President may direct. Immediately after the presentation of the Budget, the following three statements under the Fiscal Responsibility and Budget Management Act, 2003 are also laid on the Table of Lok Sabha:
- The Medium Term Fiscal Policy Statement.
- The Fiscal Policy Strategy Statement.
- The Macro Economic Framework Statement.
General Discussion on the Budget:
No discussion on Budget takes place on the day it is presented to the House.
Budgets are discussed in two stages—the General Discussion followed by detailed discussion and voting on the demands for grants.
Consideration of the Demands for Grants by Departmentally Related Standing Committees of Parliament:
With the creation of Departmentally Related Standing Committees of Parliament in 1993, the Demands for Grants of all the Ministries/Departments are required to be considered by these Committees. After the General Discussion on the Budget is over, the House is adjourned for a fixed period. During this period, the Demands for Grants of the Ministries/ Departments are considered by the Committees. These Committees are required to make their reports to the House within specified period without asking for more time and make separate report on the Demands for Grants of each Ministry.
Discussion on Demands for Grants:
The demands for grants are presented to Lok Sabha along with the Annual Financial Statement. These are not generally moved in the House by the Minister concerned. The demands are assumed to have been moved and are proposed from the Chair to save the time of the House. After the reports of the Standing Committees are presented to the House, the House proceeds to the discussion and voting on Demands for Grants, Ministry-wise. The scope of discussion at this stage is confined to a matter which is under the administrative control of the Ministry and to each head of the demand as is put to the vote of the House. It is open to members to disapprove a policy pursued by a particular Ministry or to suggest measure for economy in the administration of that Ministry or to focus attention of the Ministry to specific local grievances. At this stage, cut motions can be moved to reduce any demand for grant but no amendments to a motion seeking to reduce any demand is permissible.
The motions to reduce the amounts of demands for grants are called ‘Cut Motions’. The object of a cut motion is to draw the attention of the House to the matter specified therein.
Cut Motions can be classified into three categories:
- Disapproval of Policy Cut.
- Economy Cut.
- Token Cut.
The Speaker decides whether a cut motion is or is not admissible and may disallow any cut motion when in his opinion it is an abuse of the right of moving cut motions or is calculated to obstruct or prejudicially affect the procedure of the House or is in contravention of the Rules of Procedure of the House.
On the last of the allotted days for the discussion and voting on demands for grants, at the appointed time the Speaker puts every question necessary to dispose of all the outstanding matters in connection with the demands for grants. This is known as guillotine. The guillotine concludes the discussion on demands for grants.
After the demands for grants have been passed by the House, a Bill to provide for the appropriation out of the Consolidated Fund of India of all moneys required to meet the grants and the expenditure charged on the Consolidated Fund of India is introduced, considered and passed. The introduction of such Bill cannot be opposed. The scope of discussion is limited to matters of public importance or administrative policy implied in the grants covered by the Bill and which have not already been raised during the discussion on demands for grants.
The Speaker may require members desiring to take part in the discussion to give advance intimation of the specific points they intend to raise and may withhold permission for raising such of the points as in his opinion appear to be repetition of the matters discussed on a demand for grant.
No amendment can be proposed to an Appropriation Bill which will have the effect of varying the amount or altering the destination of any grant so made or of varying the amount of any expenditure charged on the Consolidated Fund of India, and the decision of the Speaker as to whether such an amendment is admissible is final. An amendment to an Appropriation Bill for omission of a demand voted by the House is out of order.
In other respects, the procedure in respect of an Appropriation Bill is the same as in respect of other Money Bills.
“Finance Bill” means a Bill ordinarily introduced every year to give effect to the financial proposals of the Government of India for the next following financial year and includes a Bill to give effect to supplementary financial proposals for any period.
The Finance Bill is introduced immediately after the presentation of the Budget. The introduction of the Bill cannot be opposed. The Appropriation Bills and Finance Bills may be introduced without prior circulation of copies to members.
The Finance Bill usually contains a declaration under the Provisional Collection of Taxes Act, 1931, by which the declared provisions of the Bill relating to imposition or increase in duties of customs or excise come into force immediately on the expiry of the day on which the Bill is introduced. In view of such provisions and the provision of Act of 1931, the Finance Bill has to be passed by Parliament and assented to by the President before the expiry of the seventy-fifth day after the day on which it was introduced.
As the Finance Bill contains taxation proposals, it is considered and passed by the Lok Sabha only after the Demands for Grants have been voted and the total expenditure is known. The scope of discussion on the Finance Bill is vast and members can discuss any action of the Government of India. The whole administration comes under review.
The procedure in respect of Finance Bill is the same as in the case of other Money Bills.