Comprehensive News Analysis - 11 August 2016

A. GS1 Related

B. GS2 Related

Topic: Gender Issues

Category: Society

Key points:

• Women employees who have complained of sexual harassment can get three months’ leave during the pendency of inquiry, Union Minister Jitendra Singh told the Lok Sabha
• The Union Cabinet on Wednesday approved amendments to the Maternity Benefit Act of 1961 to increase paid leave for expectant mothers from three months to six and a half months
• In a first, women adopting a newborn and those having babies through surrogacy will also be entitled for maternity leave for three months
• The Maternity Benefit (Amendment) Bill of 2016 will be introduced in the Rajya Sabha
• The government says these amendments, which are applicable to factories with at least 10 workers, will help around 18 lakh women workers in the organised sector
• The proposed amendment also “facilitates work from home” and “mandatory provision for crèche” for factories with at least 50 workers

Topic: Judiciary

Category: Polity

Key points:

• The Supreme Court directed the Law Commission of India to file a report within a year on whether it is permissible to stop the filing of all appeals which are not of national and public importance
• It also wanted the Commission to consider the “desirability” of laws that allow parties, including the government, to file appeals against tribunal orders in the Supreme Court bypassing the High Courts
• It ordered the Centre to file an Action Taken Report on the Law Commission’s recommendations and said a three-judge Bench would hear the Centre in November 2017
• The court observed that the apex court was being prevented from fulfilling its constitutional objectives
• A certificate of the High Court is required to appeal to the Supreme Court. Only in exceptional circumstances would the Supreme Court admit a case without the High Court’s certificate. The exception has become the rule now. The result is more and more unsuccessful people are encouraged to have another go at it by approaching the Supreme Court

Topic: Nuclear Power

Category: Governance

Key points:

• Nearly 28 years after Russia and India signed the agreement to set up the nuclear plant at Kudankulam, Prime Minister Narendra Modi, Russian President Vladimir Putin and Tamil Nadu Chief Minister Jayalalithaa on Wednesday did the dedicated it to the nation through a video conference organised from Moscow, Delhi, Chennai, and Kudankulam
• The 1,000-MWe KNPP-1 is the largest single unit of electrical power in India. “At Kudankulam alone, five more units of 1,000 MWe each are planned,” Mr. Modi said
• Putin said the two countries hoped to sign the General Framework Agreement for setting up units 5 and 6 by year-end. Work commenced on units 3 and 4 in February this year

Topic: Citizenship

Category: Polity

Key points:

• The Opposition parties want the Citizenship (Amendment) Bill, 2016, which was introduced in the Lok Sabha by the Union Home Minister in July, sent to a Standing Committee of Parliament. They say the amendments seek to give the granting of citizenship a religious twist
• The original Act, passed in 1955, lists the ways to acquire citizenship, denying it to undocumented migrants. The amendments now seek to allow citizenship to undocumented migrants of all faiths barring Islam from Afghanistan, Pakistan and Bangladesh
• Now members of every major religious community barring Islam coming into India without legal passports or staying on without valid papers will be entitled to Indian citizenship after six years of residence in India
• However, defending the amendments, a senior Minister said, “The principle is victimhood. How can a Muslim claim he has been victimised in these countries?” But what if a Muslim is victimised? The answer is, “He can always seek asylum in India.”

C. GS3 Related

Topic: Indo-Pak Border

Category: Security

Key points:

• A day after India handed over a strong demarche to Pakistan over its continued support to cross-border terrorism, the National Investigation Agency (NIA) on Wednesday said it has evidence to prove that Lashkar-e-Taiba is sending its cadres, with the help of Pakistani security forces, to fuel large-scale agitation in Kashmir
• The NIA probe has revealed that a high-power radio communications centre codenamed Alpha-3 has been set up in PoK, in coordination with Pakistani forces, to remain in contact with the LeT cadres operating in Kashmir

Topic: Finance Institutions

Category: Economy

Key points:

• The Cabinet approved a proposal to amend rules for foreign investment in non-banking finance companies (NBFCs)
• “The amendment in the existing Foreign Exchange Management regulations on non- banking finance companies (NBFCs) will enable inflow of foreign investment in ‘other financial services’ on automatic route provided such services are regulated by any financial sector regulators (RBI, SEBI, PFRDA etc.)/government agencies,” according to an official statement
• Foreign investment in ‘other financial services’ that are not regulated by any regulators or by a government agency can be made via the approval route, according to the statement
• The Cabinet Committee on Economic Affairs approved a one-time grant of Rs.900 crores spread over three years for an R&D project for the development of Advanced Ultra Super Critical (AUSC) technology for thermal power plants. The estimated cost of the project is Rs.1,554 crore, according to the government
• The Rs.900 crore, commencing from 2017-18, is to be provided as plan gross budgetary support to Bharat Heavy Electricals (BHEL) for the implementation of the R&D project
• The other decisions taken by the Cabinet include approval for the signing and ratification of an agreement between India and Croatia on economic cooperation.
• India and Croatia had earlier signed an agreement on trade and economic cooperation in September 1994 with an aim to promote and develop bilateral trade and economic relations. “Signing of the new agreement between India and Croatia would be a step in continuity as the existing agreement expired in November 2009,” the government said

D. GS4 Related

E. Important Editorials: A Quick Glance

1. Regulating India’s regressive health insurance
   

Topic: Health

Category: Governance

Key points:

• The Union Health Minister said in May 2016, that only about 24 per cent of the population has some form of medical insurance. That includes private and public sector insurance, and the Central scheme for weaker sections, theRashtriyaSwasthyaBimaYojana
• India primarily relies on commercial health insurance
• Rather than pool financial resources across social groupings for risk protection, and move towards tax-funded health care, government policy has created fragments with low insurance. Can the base of these pools be widened and merged to mitigate classic insurance failures?
• Commercial health insurance in India is seriously deficient. It almost entirely covers only catastrophic expenditure, such as the cost of highly restricted hospital treatments, which are offered without cost and quality regulation and external audits. Outpatient treatment and prescription medicines are not covered
• The WHO estimates out-of-pocket spending as a percentage of total health spending to be 62.42 per cent in India in 2014
• Commercial health insurance has traditionally experienced two problems. First, adverse selection: Only those who currently need care are more likely to insure themselves, rather than everyone. This reduces the risk pool size. The insurer responds by screening beneficiaries to reduce exposure and protect returns, defeating the insurance objective. Second, moral hazard: patients and care providers like hospitals build up claims without cost concerns. If there is any attempt to regulate providers, they respond with cost-cutting measures that harm patients

From case study:
Gaping holes in the safety net

• Many insurance policies do not cover genetic disorders such as Thalassemia and Haemophilia.People with disabilities, especially intellectual and psychosocial disabilities, also generally fall through the gaps of mainstream insurance coverage
• Insurance does not usually cover the costs of travel from a village, the loss of wages of the patient and attendants, costs of staying in the city, food and other expenses
• The biggest issue when it comes to insurance however remains awareness

Topic: political consciousness

Category: polity

Key points:

• The fresh turns in Ms. Sharmila’s story — the ending of the fast, her desire to join the political process and her peculiar isolation — set a mirror to the state and society
• As long as she was on fast, she was in a comfortable zone for both. For the state, the Gandhian non-violence implicit in her method allowed a comparison with the violence of others, positioning her as the good protester, as it were
• And in fact it was the unflinching protest by Manipuri women at Imphal’sKangla fort in 2004 that forced New Delhi to withdraw AFSPA from parts of the State
• For others, Ms. Sharmila became the representative of a popular desire to hold the highest moral ground, even as they went on with their lives, though all in the face of the kind of government apathy in Manipur that must shame this country
• The breaking of the fast is a highly political act. It demands that we respond to the cause she has given her adult life to. For herself, she has chosen to place faith in the electoral process for reform, a far more messy and risky option than the high pedestal of unyielding non-cooperation she had secured

Topic: Nepal

Category: India’s Neighbourhood

Key points:

• On August 4, Pushpa Kamal Dahal ‘Prachanda’, leader of the Communist Party of Nepal (Maoist-Centre), was sworn in for the second time as Prime Minister of Nepal, becoming the ninth Prime Minister in the country’s eight-year-long history as a republic and the only communist leader to have managed to stage a political comeback

Challenges before him:]

• He would like to get the Madhesi groups and Janajatis on board but the SanghiyaGathabandhan want to first see what kind of pronouncements are made about making the new Constitution truly federal and inclusive
• To strengthen his leadership within his party, Mr. Prachanda would like to bring the pending legal cases against the Maoist cadre going back to the decade-long insurgency (1996-2005) to a closure, which could lead to strains with the Nepali Congress(NC)
• Easier perhaps are simple steps to get the post-earthquake reconstruction efforts going. The international community had generously pledged $4.4 billion for the reconstruction effort at an international conference held in Kathmandu last year
• On the foreign policy front, Mr. Prachanda needs to repair the damage done by his predecessor Mr. Oli to relations with India

Topic: Post colonial era

Category: Society

Key points:

• The war on colonial hegemonies and injustices by the best anti-colonial and postcolonial minds often left other hegemonies largely unscathed. Though the colonial Western hegemony was the dominant one, it was by no means the only. There were various others: some global, like the various versions of patriarchy cutting across societies, and some regional, like the Brahminised-Hindu hegemonies of India, and the Islamic hegemonies of Muslim societies. There were local ones too
• The problem was that all these hegemonies operated in order to maintain structurally unequal and institutionally unfair societies, and hence what was good from the perspective of some was also exploitative for many others. The White man’s burden was mostly borne by the Yellow, Brown and, most heavily of all, the Black man (and woman)
• Much has been done to expose the lies and atrocities of European colonisation in the past, especially by scholars in or from postcolonial societies.
• But because our attention has been focussed on Western hegemonies, we have often failed to engage with equivalent rigour with our own regional and local hegemonies, unless it was to trace their imbrication with European colonisation or American imperialism. The rise of both Hindutva and Islamism is a consequence of that
• That Hindutva is less virulent in India than Islamism is in many Muslim nations might have much to do with the fact that, at least in India, some of our leading anti-colonial leaders also aimed their criticism inwards at Hindu society: Gandhiji did so from a caste-based reformist position, Jawaharlal Nehru from a universalist-socialist one, B.R. Ambedkar from a more located and hence angrier anti-caste Dalit perspective
• Their anti-colonialism did not totally blind them to the hegemonies within, though again all of them were more careful in criticising religious Muslim sentiments as they were not Muslim
• The self-analysis of such Indian leaders and intellectuals was seldom the case in most Muslim countries, and when it half-happened, it did so, as in Turkey, from a position of authoritarian elitism, or, as in Iran, from that of an undemocratic monarchy
• Today we are reaping the harvest of this partial blindness — perhaps inevitable historically, but not so any more. It is time to turn the searchlight inwards more often than we tend to do
• If greed is the cardinal sin of the aberrant power of colonialism, resentment is that of the lagging self-assertion of postcolonialism. To blame the coloniser (or the media or the other) and not to blame oneself is often just an expression of resentment. It offers no solution

1. After the celebrations

Topic: Taxation

Category: Economy

Key points:

• Without question, the coming together of all parties was a commendable effort and the Indian GST will be the largest tax reform to be implemented anywhere in the world
• But the constitutional amendment is just the first step and does nothing more than enable the Centre and the states to implement a new method of taxation — GST. The herculean task that lies ahead is the implementation of this gigantic tax reform which will require the successful tackling of several issues
• We will have 31 GST enactments (for 29 states and the union territories of Puducherry and Delhi). Therefore, “one nation, one tax” will really be “one state-one GST”. This is apart from separate enactments of Central GST (CGST) and Intra-State GST (IGST). Besides GST, the states will continue to have the power to levy sales tax/VAT on petrol, diesel, aviation fuel and potable alcohol. The Centre can continue to levy excise duty on all these products as well as on tobacco and tobacco products. Whatever the merits of the Indian GST, simplicity is not one of them
• It is critical that all states follow one model enactment; the greater the deviation, the greater the headache for industry. The present constitutional amendment gives only recommendatory powers to the GST council. Nothing curbs a state that decides to strike a deviant path
• The heart of any GST system is a single rate of tax applicable to all commodities and services. It is better to have one lower rate for all commodities than to have multiple rates for different products. We have opted for the latter and multiple rates are expected: zero rate for essential commodities, 2-4 per cent for gold jewellery, 12 per cent for “merit items”, 18 per cent or more as the standard rate and 40 percent for luxury products. Under Article 279A(4), the GST council can also recommend limits for granting exemptions, “floor rates with bands of GST”, special rate for specified periods to meet natural calamities/disasters, and special provisions for the north-eastern states, Jammu & Kashmir, Himachal Pradesh and Uttarakhand
• These multiple rates will get further complicated if different states start granting different exemptions. And with each state having plenary power under Article 246A, what happens if some states begin to levy an additional tax or a surcharge? Indeed, even if the GST council recommends a rate of 18 per cent, there is nothing to prevent a state from increasing it to 22 per cent or even reducing it to 12 per cent. If other states are affected by such an increase or decrease, do they approach the GST council? Is any state’s right to approach the supreme court under Article 131 taken away? To what extent is the decision of the GST council binding? These are just some of the questions that require serious contemplation
• Another dangerous consequence of the GST regime is that imports will be cheaper as the IGST on imports will be entitled to a set-off against the final selling price. This is not permissible under the existing regime, as the table indicates. Thus, imported goods will now be cheaper because the IGST at Rs 22 can be off-set by the importer when he sells the goods in the domestic market. The net cost to him will be Rs110 as against Rs128.85 in the earlier regime. Undoubtedly, the GST regime will bring down manufacturing costs by reducing the cascading effect of indirect taxes and through improvement of supply-chain efficiencies. But these benefits must be mathematically greater than the benefit that will accrue to direct imports. With highly cumbersome labour, tax and regulatory laws in most states, manufacturing is hardly a happy activity. If imports become even cheaper, the Make in India campaign will be adversely affected
• There is considerable uncertainty over the actual manner of implementation of the GST regime. With the overlapping of taxes, how will the multiple laws be administered? Since the GST is a separate concurrent levy by the Centre and the states, how will the disputes be resolved? Will each state have its own GST tribunal?
• The model law is unduly harsh in several respects. For example, GST credit will be available only if the buyer of goods furnishes proof that the vendor has paid GST to the government account. Therefore, a lawyer or businessman cannot claim GST credit on the GST paid on his laptop unless he can prove that the seller has paid GST to the government
• Extremely serious issues need to be resolved on e-commerce transactions, dual taxation and restricted credit
• Each State will not only have its own GST but each act will have multiple rules. With CGST and IGST, there are bound to be separate credit pools for SGST, CGST and IGST. Preliminary studies show that there will be a substantial increase in paperwork and compliance costs
• With these multiple problems likely to arise in the immediate future, it is best that the GST is implemented in stages. It is best to implement GST on a trial basis in a few manufacturing, trading and service sectors. This will reveal possible hurdles that require attention and will also help in perfecting the IT infrastructure that is so critical to a successful GST. Above all, GST will require states to eschew short-term thinking. With several states indulging in disastrous populist schemes, this will require statesmanship of a very high order. As Henry Ford put it: “Coming together is a beginning; Keeping together is progress.”

To Read:RBI to banks and back: The journey of currency under cover, protection

Government has notified the Scheme for Technology Acquisition and Development Fund (TADF) under the National Manufacturing Policy (NMP) to provide funding support to SMEs for the acquisition and development of clean and green technology. The Scheme is applicable to all existing and new Micro, Small and Medium Enterprises (MSMEs) including those in the National Investment and Manufacturing Zones (NIMZs) in respect of their investments made after notification of the Scheme.

The fund provides subsidy of upto 10% of capital expenditure incurred on new plant and machinery (on procuring plant and machinery) for manufacturing units for controlling pollution, reducing energy consumption and for water conservation, subject to a maximum of Rs. 50 lakhs.

Government of India proposes to form a National Industrial Corridor Development Authority (NICDA). The proposed NICDA would facilitate integrated development of Industrial Corridors across the country. It will channelize central as well as institutional funds while ensuring that the various corridors are properly planned and implemented keeping in view the broad national perspectives regarding industrial and city development.

The Department of Commerce is negotiating a Free Trade Agreement (FTA) with  Israel. The eighth round was held in Israel from 24-26 November, 2013 wherein discussions took place on market access in goods, rules of origin, custom procedures and trade in services. In the subsequent inter-sessional consultations, the focus has been on a balanced outcome in both goods and services. Although India is negotiating the India-European Union Broad-based Bilateral Trade and Investment Agreement (India-EU BTIA) which includes Austria, there are no bilateral negotiations. The EU BTIA negotiations began in 2007 with sixteen rounds of negotiations concluded. Moreover, three rounds of stocktaking meetings have been held recently on 18^th January, 2016, 22^nd February, 2016 and 15^th July, 2016. A Joint Study Group (JSG) has been set up for considering the feasibility of entering into an FTA between India and Eurasian Economic Union (EaEU) comprising of 5 countries namely Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. The first meeting of the JSG with EaEU was held on 31^st July, 2015. A Free Trade Agreement is also being negotiated with the Gulf Cooperation Council (GCC) which comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates. The second round of negotiations was held on 9-10 September, 2008 in Riyadh, with the GCC now reviewing all their economic engagements

14 such cities in Karnataka; 5 in Punjab 

25 cities have prepared Comprehensive Mobility Plans (CMP) based on origin and destination flow of traffic , identifying major traffic corridors and feeder corridors, land use etc which in turn would assist in proper urban planning. CMPs are subsequently made part of City Master Plans.

As per the Travel & Tourism Competitiveness Index (TTCI) 2015, of the World Economic Forum, India ranks 35th in Air Transport Infrastructure and 50th in Ground & Port Infrastructure from 141 countries of the world. India ranks 136th in terms of airport density and 76th in terms of quality of roads according to TTCI Report 2015, while according to the 2013 Report, India ranked 136th in terms of airport density and 85th in terms of quality of roads.

The overall TTCI ranking of India has improved to 52nd in 2015 as compared to 65th in 2013.

Topic: India and WTO

Category: Economy

Key points:

• India lost two high-profile trade disputes at the World Trade Organisation recently — both to the US. These could be good case studies on how not to handle such matters
• In both the poultry dispute and the fight over domestic sourcing clause in the country’s solar power programme, it was a case of too many cooks spoiling the broth
• The bigger of the two botch-ups is, without doubt, the handling of the solar dispute. Two years ago in September, India gave up the opportunity of imposing anti-dumping duties on cheap solar panels imported from the US and China, despite the Directorate General of Anti-Dumping (DGAD) recommending such duties
• The finance ministry refused to notify the duties as the ministries of new and renewable energy (MNRE) and road transport and highways rallied against the move, arguing there wasn’t enough domestic manufacturing capability
• One might have imagined the US would, in turn, drop its case at the WTO against India’s domestic content norms in its national solar power generation programme (that it lodged in 2013 and again the next year) — but that did not happen
• It is difficult to understand as to why did India not use the proposed anti-dumping duties to strike a deal with the US on domestic sourcing?
• Levying anti-dumping duties following processes laid down by the WTO and after duly establishing dumping and injury to domestic industry is considered legitimate by the multilateral trade body. Therefore, deciding not to impose the anti-dumping duties without making the US give anything in return seems to defy common sense
• Arguments that the mandatory local sourcing of components was limited in scope, was part of government procurement and a small move to encourage the nascent domestic solar industry fell flat both with the US and the WTO

• India decided to file a number of cases against the US’ domestic sourcing policy
• While retaliatory cases would have certainly helped in sending the US the message that it should not play dirty with India, unfortunately, New Delhi is again dragging its feet. It is yet to make its move
• It is quite obvious, though, that India will not be able to continue with its domestic sourcing clause in the present form in the third phase of the ambitious Jawaharlal Nehru National Solar Mission (which seeks to generate 100 gigawatts of electricity annually from solar power by 2022)
• The WTO’s verdict on India’s appeal is unlikely to be favourable in the absence of any fresh arguments. New Delhi has none but itself to blame for its predicament
• The second case that India lost recently at the WTO is the one related to the ban on import of US poultry
• The WTO ruled last year that India’s ban based on the risk of low-pathogenic (low intensity) avian influenza was unscientific and went against global norms. It was obvious to the commerce ministry that more genuine and convincing reasons would have to be found to continue with the ban
• New Delhi had one year to come up with newer justifications, as the WTO gave it a year’s time to weed out the older restrictions considered as unscientific
• Since the Department of Animal Husbandry officially notifies import restrictions on animal products, it became the nodal ministry to examine the validity of alternative reasons to stop imports, such as use of genetically modified feed by US farmers or the practice of deep freezing meat for months
• Unable to come up with anything new, the Animal Husbandry Department decided to lie low and continue with the ban even after the WTO deadline had lapsed
• The US, however, was not sleeping, and threatened India with economic sanctions after waiting for a few weeks. Just a day later, New Delhi, came up with a new notification removing the older restrictions, and not surprisingly it was not ready with any new barriers

The Confederation of All India Traders (CAIT), the apex body of traders in the country, said it has filed a complaint with the Department of Industrial Policy and Promotion (DIPP) against some leading e-commerce players alleging that they are flouting the Foreign Direct Investment (FDI) norms. FDI guidelines on e-commerce state that ‘e-commerce entities providing marketplace will not directly or indirectly influence the sale prices of goods or services and shall maintain a level playing field.The complaint comes in the backdrop of the government’s decision to set up a panel headed by NITI Aayog CEO to study all e-commerce-related issues and suggest measures to boost the sector.

The Union Shipping Minister will lay the foundation stone for a multi-modal terminal at Varanasi and flag off the trial run of two vessels as a part of National Waterway-1 development. The terminal will have road and rail connectivity with proposed links on NH-7 and Jeonathpur railway station respectively.The cargo handling capacity of the multi-modal terminal is estimated to be 1.2 million metric tonnes per annum and it will handle cement and food grains among others.

The U.S. is in favour of India providing greater security assistance to Afghanistan, General John William Nicholson, Commander of the U.S. Forces in Afghanistan, said on Wednesday.“The tremendous cooperation India has made in the human capital of Afghan security forces is the one contribution that is going to be enduring,” he said referring to the training provided by India to Afghan forces.

Pro-government forces in Libya said they seized control of the Islamic State group’s headquarters in Sirte on Wednesday as they push to oust the jihadists from the coastal city

The United States has approved the possible sale to Saudi Arabia of up to 153 tanks, hundreds of machine guns and other military gear in a deal worth $1.15 billion, the Pentagon said on Tuesday.

The announcement coincided with news that Saudi-led coalition warplanes had resumed air strikes on Yemen’s capital for the first time in three months, killing 14 people and shutting the airport after UN-brokered talks were suspended.

Even as obstacles have been lifted for Australia’s export of uranium to fuel India’s nuclear power plants, South Australia has said a huge business opportunity awaits Indian firms that can help it set up nuclear waste disposal facilities. South Australia, a state in south central Australia, houses over a quarter of the world’s uranium resources and about 70 per cent of Australia’s reserves of the heavy metal.

Nearly three years after it launched a world record making MOM (Mars Orbiter Mission) the Indian Space Research Organisation has invited Indian planetary scientists from the academia and research bodies to suggest which aspects of Mars should now be studied, along with the instruments they can provide for MOM-2.

Although a second Martian venture has been in the air, the latest `Announcement of opportunity’ or AO is the first formal whiff of it.

Why a second Martian mission? Scientists believe that the atmosphere, land and minerals on Mars, which has similarities with Earth, may answer questions on how planets evolved, whether there is life elsewhere in the solar system and perhaps suggest the future of Earth itself.Methane study [that MOM carries] still is important, and also a study of the Martian dust and its ionosphere.

The MOM-2 spacecraft should ideally have an orbit of 200 km x 2,000 km. It should take better experiments with sharper instruments along and use the bigger GSLV rocket to propel it. Last time, ISRO used the light-lift PSLV.

NASA has selected six US companies to help develop prototypes and concepts of deep space habitats for manned missions to Mars.

”Habitation systems provide a safe place for humans to live as we move beyond Earth on our journey to Mars,” NASA said.

F. Concepts-in-News: Related Concepts to Revise/Learn:

• GST
• NIMZ
• Eurasian Economic Union
• MOM-2
• KNPP-1

G. Fun with Practice Questions 🙂

Question 1: Which of the following statements is/are correct about Kudankulam Nuclear Power Plant?

Question 2: Which of the following countries are members of the Eurasian Economic Union?

Question 3: Which of the following statements is/are correct?

Question 4: Which of the followingis/are advantages of Advanced Ultra Super Critical Technology for thermal power plants?

Question 5: Which of the following statements is/are correct about Rashtriya Swasthya Bima yojana?

H. Archives:

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