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UPSC CURRENT AFFAIRS – 3 January 2024

InstaLinks :  help you think beyond the issue but relevant to the issue from UPSC prelims and Mains exam point of view. These linkages provided in this ‘hint’ format help you frame possible questions ina your mind that might arise(or an examiner might imagine) from each current event. InstaLinks also connect every issue to their static or theoretical background. This helps you study a topic holistically and add new dimensions to every current event to help you think analytically

Table of Contents:

GS Paper 2:

  1. Performance of Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

 

Content for Mains Enrichment:

  1. IAS officer Sushant Gaurav

 

Facts for Prelims (FFP) 

  1. Sukanya Samriddhi Yojana (SSY) scheme
  2. Virtual Digital Asset Service Providers (VDA SPs)
  3. Green Funds/Deposit
  4. Marine Energy Conversion Systems Sectional Committee (MECSSC)
  5. United Liberation Front of Asom (ULFA)

 


 

Performance of Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

GS Paper 2

Syllabus: Government Programme and Policies

 

Source: The Wire, TH

 

Context: The Centre has mandated the payment of all wages under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) through an Aadhaar-based payment system (ABPS), starting from Jan 1st, 20024.

  • Exceptions: The government may consider exemptions for Gram Panchayats facing technical or Aadhaar-related issues.
  • Aim of the move: The move aims to curb corruption, ensure prompt payments, and reduce rejections, affecting more than 1100 government schemes and programs.

 

What is MGNREGA?

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is a rural employment program in India that aims to provide guaranteed wage employment to rural households. The scheme has been implemented in India since 2005 and has been credited with providing a safety net for rural households, particularly during times of economic hardship.

 

What is ABPS?

Aadhaar-based payment system (ABPS) (it has been in use since 2017). ABPS utilizes the worker’s 12-digit Aadhaar number as their financial address, requiring linkage to job cards, bank accounts, and the National Payments Corporation of India (NCPI) database. Some notable programs where ABPS is mandatory include Pradhan Mantri Ujjwala Yojana, Pradhan Mantri Awas Yojna, Pradhan Mantri Fasal Bima Yojana, and Atal Pension Yojana.

 

The situation of stagnant growth in Rural India:

Stagnant rural wage growth has posed a challenge to the recovery because it has been the result of unemployment among the rural population resulting in significant demand reduction in the rural area.

Fig- Rural wage growth and economic recovery

 

Performance of MGNREGA IN ALLEVIATING RURAL POVERTY

  • Providing a safety net for rural households: providing 100 days of guaranteed work, has ensured a minimum level of income for rural households, particularly during periods of hardship.
    • Ex- COVID- wages earned under the Act helped compensate somewhere between 20% and 80% of the income loss incurred because of the lockdown- study by Ajim Premji Institute.
  • Improving rural livelihoods: The program has helped provide a source of additional income. This has helped to increase the overall standard of living in rural areas.
  • Creating employment opportunities: MGNREGA has helped reduce unemployment and underemployment in rural areas. 7 million households were employed under MGNREGS, while a total of 2.89 billion person-days of employment were generated in 2022- Ministry of Rural Development.
  • Development of agriculture Activities such as the construction of bunds, terracing, and the improvement of irrigation systems have helped increase agricultural income.
  • Improving rural infrastructure: MGNREGA has been used to finance a wide range of public works activities, including the creation of rural roads, water bodies, and rural housing.
  • Supporting rural health systems: MGNREGA has led to the construction of health facilities and sanitation systems in rural areas. Ex- construction of toilets.
  • Providing food security: MGNREGA was used for the construction of community kitchens and food storage facilities in rural areas. This helped to ensure that rural households had access to food during the pandemic.
  • Reducing migration: MGNREGA has helped to reduce migration from rural to urban areas by providing employment opportunities in rural areas. This has helped to keep families together.

 

According to the National Council of Applied Economic Research (NCAER), MGNREGA has played a vital role in reducing poverty among the poor as well as the socially weaker sections such as Dalits, tribals and marginal farmers.

 

Issues with MGNREGA: 

  1. Limited Coverage (not in the urban areas)
  2. Lack of adequate funding, bureaucratic delays, corruption
  3. Low Wages
  4. Lack of Skilled Jobs
  5. Limited Impact on Poverty Reduction Workers not receiving timely payment and the quality of work is subpar.
  6. Despite multiple deadline extensions, over 34% of registered job card holders and over 12% of active workers remain ineligible for ABPS as of December 27 (2023).
  7. The push for ABPS eligibility has led to the deletion of over 7 crore job cards in the past 21 months, causing concerns about denial of the right to work.
  8. Activists call for the revocation of mandatory ABPS implementation and the reinstatement of deleted workers with due compensation. The government argues that ABPS will enhance efficiency and reduce payment rejections.

 

Measures needed to improve the performance of MGNREGA

  • Increased allocation of funds: To fully realize the potential of MGNREGA, it is important to allocate sufficient funds to the scheme. In the 2023-24 budget, Rs.60,000 was allocated towards MGNREGA, which after payment of existing liabilities can provide only 17 days of work-study by PAEG.
  • Better targeting of beneficiaries: The current targeting mechanism for MGNREGA beneficiaries needs to be improved to ensure that the benefits of the scheme reach the most vulnerable and marginalized groups in society, including women, Dalits, and Adivasis.
  • Improved monitoring and evaluation: through Social audits to enforce greater accountability.
  • Increase MGNREGA wage rates– to at least the state minimum wage or ₹375 per day as recommended by the Anoop Satpathy Committee and index with CPI‑R.
  • Strengthening the role of gram panchayats: they should be provided with adequate resources (advanced funds), powers, and responsibilities to sanction works, provide work on demand, and authorise wage payments to ensure there are no delays in payments.
  • Increased participation of women: The participation of women in MGNREGA needs to be increased to ensure that the scheme provides equal opportunities for both men and women and that women are able to access the benefits of the scheme.
  • Linking with other development programs: to ensure that the scheme contributes to the overall development of rural areas. Ex-National Bamboo Mission, Rashtriya Krishi Vikas Yojana.
  • Awareness generation– displaying a ​‘Know Your Rights (KYR) concerning MGNREGA in public places, usage of ombudsman app for grievance redressal.

 

Conclusion 

MGNREGA was regarded as a stellar example of rural development by the World Development Report of 2014. While the MNREGA has noble goals and has provided some employment opportunities to rural workers, it has faced several limitations that have prevented it from achieving its full potential as a poverty reduction program.

 

Insta Links:

IAS officer Sushant Gaurav

Content for Mains Enrichment:

 

Source: Money Control

 Context: IAS officer Sushant Gaurav, the Deputy Commissioner of Gumla in Jharkhand, has been credited for transforming the poverty-stricken district into the ‘Ragi Capital of India.

Gaurav’s innovative approach shifted locals from water-intensive paddy cultivation to a more sustainable model of ragi cultivation. The district, once plagued by extreme poverty and Naxalite insurgency, underwent a remarkable turnaround under Gaurav’s leadership. For his efforts, he received the Prime Minister’s Award for Excellence in Public Administration. The shift to ragi cultivation brought nutritional benefits to the predominantly Adivasi population in Gumla.

Usage: The example can be used to show the ethical values of Leadership, Innovation, Empathy, Social Responsibility, and Public Service Excellence.

Sukanya Samriddhi Yojana (SSY) scheme

Facts for Prelims (FFP)

 

Source: LM

 

Context: The government has increased the interest rate on the Sukanya Samriddhi Yojana (SSY) scheme by 20 basis points for the January-March quarter ahead of the 2024 Lok Sabha polls. The new interest rate is 8.2%, up from the previous 8%.

 

About the scheme:

ObjectiveAims to ensure equitable share to a girl child in resources and savings of a family.
SchemeSmall deposit scheme for a girl child launched under the “Beti Bachao, Beti Padhao” initiative. Offers a higher interest rate than PPF, exclusive to girls below 10 years with a longer lock-in period.
Start Date2015
Investment TypeSmall deposit account. The scheme offers income tax benefits under Section 80C. Interest earned through the Sukanya Samriddhi Account is tax-free. Withdrawals can be made after the account holder turns 18, with a maximum annual withdrawal limit of 50% of the balance.
WherePost office and selected banks
Max Number of Accounts1 account per girl, Maximum of 2 girl children
Age EligibilityFrom birth to 10 years of the girl’s child
Min. DepositRs. 250 per year (Previously Rs. 1000), further multiples of Rs. 100
Max. DepositRs. 1.5 lakh per year
Interest Ratesubject to annual changes
Partial Withdrawal50% allowed at the age of 18 years of the girl
Maturity21 years from the date of account opening or marriage, whichever is earlier

Virtual Digital Asset Service Providers (VDA SPs)

Facts for Prelims (FFP)

 

Source: TH

 Context: The Financial Intelligence Unit India (FIU IND) issued show-cause notices to 9 offshore virtual digital asset service providers (VDA SPs), including Binance and Huobi, for operating illegally without complying with anti-money laundering regulations (under the Prevention of Money Laundering Act (PMLA), 2002)

 

What are VDA SPs?

VDA SPs (Virtual Digital Asset Service Providers) are entities (operating within or outside India) that offer digital asset services, such as cryptocurrency exchanges.

 

Regulations in place for VDA SPs:

In March 2023, India mandated VDA SPs to adhere to the Prevention of Money Laundering Act under the Anti Anti-Money Laundering/Counter Financing of Terrorism (AML-CFT) framework. They also have to verify client identities and record financial transactions. Non-compliance led to notices and a request to block URLs. They are required to be registered with FIU IND as Reporting Entity. Currently, 31 VDA SPs have registered with FIU IND

 

Concerns of Money Laundering Due to VDAs:

  1. Predicate crime: Raising funds through illegal activities by selling illegal goods or services in return for virtual assets.
  2. Placement: Converting ill-gotten virtual assets into fiat currencies within a traditional financial system.
  3. Layering: Converting fiat assets into virtual assets, exchanging virtual assets, and vice-versa.
  4. Integration: Forming an online company that accepts crypto payments to legitimize income and clean dirty crypto.
  5. Hiding: Using anonymizing services like mixers and tumblers to break the links between crypto transactions.

 

Global Regulations:

Global regulations vary, with Dubai’s VARA having a licensing framework, the EU’s MiCA focusing on market rules, and the U.S. lacking a comprehensive framework. The Bureau for International Settlements (BIS) suggests considering an outright ban, containment, or regulation, emphasizing the need to balance benefits and costs, especially for emerging market economies.

 

About Financial Intelligence Unit – India

It is an organisation (HQ: New Delhi; formed: 2004) under the Department of Revenue, Government of India which collects financial intelligence about offences under the Prevention of Money Laundering Act, 2002. It is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by Finance Minister.

Green Funds/Deposit

Facts for Prelims (FFP)

 

Source: RBI

 Context: The Reserve Bank of India clarified that banks and NBFCs are not obligated to raise green funds.

 

What are Green Funds/Deposits?

Green funds refer to financial resources (interest-bearing deposit) specifically earmarked for environmentally sustainable projects and activities. These funds are designed to support initiatives that contribute to ecological well-being, such as renewable energy, green transport, and eco-friendly construction.

 

What are REs?

Regulated Entities (REs) are financial institutions and organizations operating in the financial sector that fall under the regulatory purview of a central authority, such as the Reserve Bank of India (RBI).

 

REs under the Framework for acceptance of Green Deposits include:

  1. Scheduled Commercial Banks including Small Finance Banks (excluding Regional Rural Banks, Local Area Banks, and Payments Banks)
  2. All Deposit-taking NBFCs registered with the RBI
  3. Housing Finance Companies (HFCs)

 

Other aspects of Green Deposits are:

  • Green deposits in India must be in Indian rupees. The framework aims to encourage green financing and address concerns, supporting the flow of credit to eco-friendly projects.
  • Sectors included are Renewable Energy, Energy Efficiency, Clean Transportation, Climate Change Adaptation, Sustainable Water and Waste Management, Green Buildings, etc.
  • Exclusions (don’t come under Green Deposit framework): Projects involving new or existing extraction, production and distribution of fossil fuels; Nuclear power generation; Direct waste incineration; Landfill projects; Hydropower plants larger than 25 MW, etc.
  • Monitoring: Green deposit funds are subject to independent third-party verificationon an annual basis.

Marine Energy Conversion Systems Sectional Committee (MECSSC)

Facts for Prelims (FFP)

 

Source: PIB

 Context: The Bureau of Indian Standards (BIS) has taken a significant step in promoting standardization in the field of Marine Energy Conversion Systems by establishing the Marine Energy Conversion Systems Sectional Committee under ETD 54.

 

It will establish comprehensive standards and guidelines for various aspects of Marine Energy Conversion Systems (MECS). Promote collaboration, innovation, and knowledge exchange within the MECS domain.

 

What are Marine Energy Conservation System?

Marine Energy Conversion Systems refer to technologies that harness energy from the ocean, converting it into electricity or other usable forms. Examples include:

  • Tidal Energy: Utilizing the rise and fall of tides to generate electricity through tidal turbines or barrages.
  • Wave Energy: Capturing the kinetic energy of ocean waves to generate power through devices like wave energy converters.
  • Ocean Thermal Energy Conversion (OTEC): Leveraging temperature differences between the warm surface water and cold deep water to produce electricity.
  • Salinity Gradient Power: Generating energy from the difference in salt concentration between freshwater and seawater.

 

About BIS:

The Bureau of Indian Standards (BIS) (HQ: New Delhi) is the National Standards Body of India under the Ministry of Consumer Affairs, Food & Public Distribution. Established by the Bureau of Indian Standards Act, 2016, effective from October 12, 2017, it replaced the Indian Standards Institution (ISI). The BIS Act, 2016, designates the Minister in charge of the relevant Ministry as the ex-officio President. It also serves as India’s WTO-TBT (Agreement on Technical Barriers to Trade) enquiry point.

 

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