TABLE OF CONTENTS
A. GS1 Related GEOGRAPHY 1. Earthquake in Indonesia B. GS2 Related POLITY 1. Bill for death in rape cases cleared 2. SC notifies norms for ‘senior advocate’ status 3. Amendment in LS to make adoption easier HEALTH 1. Three northeastern States emerge as new HIV hotspots C. GS3 Related ECONOMY 1. RBI must resume issuing LoUs, LoCs 2. One-third of PSBs remain headless D. GS4 Related E. Editorials ECONOMY 1. Economics of Tax Havens EDUCATION 1. Status of Industrial Training Institutes in India F. Tidbits 1. NGT forms panel to monitor rejuvenation project of Ganga G. Prelims Fact 1. Jatayu Earth Center H. UPSC Prelims Practice Questions I. UPSC Mains Practice Questions
A. GS1 Related
1. Earthquake in Indonesia
Indonesia was hit by a 6.9 magnitude Earthquake on the 5th of August 2018
- The epicenter of the quake was in northern Lombok, a more residential, less developed part of the island.
- Indonesia is one of the world’s most disaster-prone nations, it straddles the so-called Pacific ‘Ring of Fire’.
Ring of Fire:
- Pacific Ring of Fire is a geologically and volcanically active region that stretches from one side of the Pacific to the other.
- In a 40,000 km (25,000 mi) horseshoe shape, it is associated with a nearly continuous series of oceanic trenches, volcanic arcs, and volcanic belts and/or plate movements.
- It has 452 volcanoes (more than 75% of the world’s active and dormant volcanoes).
- The Ring of Fire is sometimes called the circum-Pacific belt.
- About 90%of the world’s earthquakes and 81% of the world’s largest earthquakes occur along the Ring of Fire.
- The next most seismically active region (5–6% of earthquakes and 17% of the world’s largest earthquakes) is the Alpide belt, which extends from Java to the northern Atlantic Ocean via the Himalayas and southern Europe.
B. GS2 Related
1. Bill for death in rape cases cleared
A Bill awarding a maximum sentence of death to those convicted for raping girls below 12 years of age was passed by both the houses of the Parliament.
- It replaces the Criminal Law (Amendment) Ordinance that was promulgated on April 21, following a public outrage over the rape and murder of a minor girl in Jammu and Kashmir’s Kathua and the rape of a minor from Unnao in Uttar Pradesh.
- The amendments have been made to the Indian Penal Code, the Criminal Procedure Code, Evidence Act and the Protection of Children from Sexual Offences Act.
Provisions in the bill:
- The minimum sentence in cases of rape of women has been increased from seven to 10 years of rigorous imprisonment.
- In cases involving girls below 16 years, the minimum punishment has gone up from 10 to 20 years, which is extendable to life imprisonment.
- The law also for speedy investigations and trial. The probe has to be completed within two months.
- The deadline for completion of trial in all rape cases will also be two months, while a six-month limit has been set for disposal of appeals.
- There will be no provision for anticipatory bail for a person accused of rape or gang-rape of an under-16 girl.
- It has provision for maintaining national database and profile of sexual offenders by National Crime Records Bureau (NCRB). This data will be regularly shared with States/UTs for monitoring, tracking and investigation including verification of antecedents by police.
Madhya Pradesh, Haryana, Rajasthan and Arunachal Pradesh have already passed Laws for Capital Punishment to those raping girls below 12 years of age.
2. SC notifies norms for ‘senior advocate’ status
The Supreme Court has notified guidelines for according ‘senior advocate’ designation to lawyers.
- It is a major effort to streamline and bring in transparency into the process of designating advocates as “seniors”.
- The finalised guidelines are titled “Supreme Court Guidelines to regulate Conferment of Designation of Senior Advocates, 2018.”
- A five-member permanent committee headed by the Chief Justice of India has been constituted to shortlist candidates.
- The secretariat would invite applications annually.
- The names will then be sent to the Full Court, comprising all apex court judges, for a decision, where the voting will be conducted following the secret ballot system.
- The candidates can apply or the committee can suo motu recommend a candidate to the Full Court.
The five member Committee:
- This committee shall comprise of the Chief Justice of India as its Chairperson, two senior-most Supreme Court judges, Attorney general for India, and a member of the Bar as nominated by the Chairperson.
- The committee would meet twice a year in January and July.
- It would have a permanent secretariat to facilitate the collating of details of the probable candidates. The composition of which would be decided by the CJI in consultation with other members of the Committee.
Who are eligible for ‘Senior Advocate’ status?
- An Advocate shall be eligible for designation as Senior Advocate only if he has 10 years combined standing as an advocate or a District Judge, or as a Judicial Member of any Tribunal whose qualification for eligibility isn’t less than that prescribed for a District judge.
- Retired Chief Justices or judges of the High Courts are also eligible for the distinction.
3. Amendment in LS to make adoption easier
- The government introduced an amendment to the Juvenile Justice (JJ) Act, 2015, in the Lok Sabha to empower District Magistrates with the authority to grant adoption orders.
- The Juvenile Justice (Care and Protection of Children) Amendment Bill, 2018, revises the provisions governing adoptions in the JJ Act by making changes to Section 56,58, 59, 60, 61, 63, 64 and 65, where the word “court” has been replaced by “District Magistrate.”
- The changes are applicable for both domestic and international applications.
- The bill also proposes the transfer of all adoption cases in various courts to the District Magistrates concerned.
Why was the amendment proposed?
- The heavy workload of the courts had been resulting in “inordinate delay” in issuing adoption orders. as many as 629 cases relating to the passing of orders for adoption were pending in various courts across the country as on July 20, 2018
- The amendment was proposed with the objective of avoiding pendency of cases.
- The bill seeks to empower the district magistrates to issue orders for adoption in order to avert inordinate delay by the courts in doing the same.
- It will make the adoption procedure faster for prospective parents, by avoiding delays in courts.
Juvenile Justice Act 2015:
The Act came into effect from January 15, 2016, with comprehensive provisions for the children allegedly found to be in conflict with law as well as those in need of care and protection.
Know more: Juvenile Justice Act https://youtu.be/ORgG2M6f3dI
1. Three northeastern States emerge as new HIV hotspots
Three North Eastern States, Meghalaya, Mizoram and Tripura emerge as new HIV hotspots.
- The Health Ministry attributed the rise of incidence to: injecting drug users and unsafe sexual practices
- The good news is that there has been a steady decline in the number of HIV cases in India.
- In four sites in Mizoram and one in Tripura, HIV prevalence was higher among IDUs, which for the rest of the country is 6.3%. At least in three places at Aizwal, Champhai and Kolasib, the prevalence of HIV in IDUs was 37.44%, 33.06% and 38.14% respectively.
- In the case of pregnant women visiting ante-natal clinics (ANC), six centres in Mizoram, two in Meghalaya and one in Tripura recorded HIV prevalence of more than 1%, compared with HIV prevalence of 0.28% among pregnant women visiting ANCs in other places in India surveyed in December 2017.
- HIV prevalence among female sex workers was higher at four sites — two in Tripura and one each in Mizoram and Meghlaya. At one site of Mizoram’s Aizwal district, the prevalence of HIV was as high as 24.68%, compared with 1.6% for other sites in the country.
HIV Sentinel Surveillance:
- The HIV Sentinel Surveillance (HSS), a biennial study conducted by the National AIDS Control Organisation (NACO), is one of the largest regular studies in the world dealing with HIV in high risk groups of the population.
- The HSS had referred that HIV prevalence in the context of ANCs in the North Eastern States of Mizoram (1.19%), Nagaland (0.82%), Meghalaya (0.73%), Tripura (0.56%) and Manipur (0.47%) were among the highest.
- Anti-Retroviral Treatment (ART) leads to effectively suppressing the virus and reducing the transmission of HIV from the infected person, Dr. Panda said.
- In terms of PLHIV who are on ART, Maharashtra has the highest number (with 2.03 lakh persons) followed by A.P.(1.78 lakh ) and Karnataka (1.58 lakh persons).
- The discussion on HIV prevalence has to be taken to the districts.
- Prevention and intervention strategies for the most-at-risk population in the pockets in the districts with good coverage are necessary.
- Anti-Retroviral Treatment (ART), must be made easily accessible.
C. GS3 Related
1. RBI must resume issuing LoUs, LoCs
- Discontinuation of the facility has resulted in 2-2.5% increase in cost of credit: Parliamentary panel
The Reserve Bank of India decided to discontinue the issuance of Letters of Undertaking (LoU) and Letters of Credit (LoC) for trade credit as a reaction to the Punjab National Bank fraud case. The Parliamentary Standing Committee on Commerce has now tabled a report stating that the facility should be restored at the earliest.
Why should RBI resume issuing LoUs and LoCs?
- It was noted by the Committee that all the stakeholders it consulted, representing trade and industry, unanimously said that the discontinuation of the LoU and LoC facility had resulted in a 2-2.5% increase in the cost of credit.
- The committee believes that the decision of RBI was a Knee Jerk Reaction and that the RBI got unnerved with the PNB fraud and it hastened the decision to ban LoU/LoC without much thought and consideration. And that RBI should have engaged in more consultations with stakeholders on the matter
- The panel noted that all the stakeholders, including banks, were of the opinion that LoUs and LoCs were accepted globally and their efficacy as a source of cost-effective short term credit of foreign currency for importers was “unmatched”.
- The ban had affected the cost competiveness of the country’s trade and industry, having a cascading effect on jobs. The loss of jobs is something that India can ill-afford.
- The ban as a response to the fraud had set off a knock-on effect of conservatism in the banking sector.
- Post the discontinuation, the banks had become very stringent in their operation and credit exposures. And the caution has inadvertently made banks becoming inaccessible to the MSME sector. The Committee was concerned that such an approach has the dangers of making banking services elitist and subservient to a few large corporates leaving out the vast majority of MSME units.
The Committee is of the considered opinion that LoU/LoC should be restored at the earliest albeit with proper safeguards. Its restoration assumes more significance in the face of the fact that the content of imports is over 20% of India’s total exports.
2. One-third of PSBs remain headless
The public sector banks (PSBs) stare at a leadership vacuum. The PM-led panel yet to make appoints.
- The chief executive officer post at three PSBs remain vacant for more than seven months.
- There are 21 public sector lenders in the country. 7 posts remain vacant as of July 31, 2018.
- Dena Bank, Punjab & Sind Bank and Andhra Bank do not have a CEO since January this year.
- In May, Allahabad Bank MD and CEO Usha Ananthasubramanian was divested of her responsibilities after the CBI charge-sheeted her in the Nirav Modi scam.
- In June, R. Marathe, MD & CEO, Bank of Maharashtra too was divested of his portfolio after he was arrested (later obtained bail) for allegedly violating norms while extending loans to a real estate developer.
- Rakesh Sharma of Canara Bank and Rajeev Rishi of Central Bank of India — hung up their boots, taking the total number of such vacancies to seven. There are 21 public sector lenders in the country.
- The Banks’ Board Bureau (BBB) too had recommended names of 14 candidates to the Union government by June end. These candidates were to be appointed for vacancies arising in the current financial year.
- According to bankers, the decision-making process at banks gets affected in the absence of leadership, particularly when the festive season, during which credit demand picks up, is about to kick in.
- The BBB, makes its recommendations for the vacancies of MD and CEO in PSBs.
- The Appointment Committee of Cabinet (ACC), headed by the Prime Minister, makes the appointments.
D. GS4 Related
Nothing here for today!!!
1. Economics of Tax Havens
- A tax haven is a country that offers foreign individuals and businesses little or no tax liability in a politically and economically static environment.
- Tax havens also share limited or no financial information with foreign tax authorities.
- Tax havens do not require residency or business presence for individuals and businesses to benefit from their tax policies.
- Due to the globalization of business operations, an increasing number of U.S. corporations, including Microsoft, Apple and Alphabet, are keeping cash in offshore tax havens to minimize corporate taxes.
- Tax haven status benefits the host country as well as the companies and individuals maintaining accounts in them.
- Tax haven countries benefit by drawing capital to their banks and financial institutions, which can form the foundation of a thriving financial sector.
- Individuals and corporations benefit through tax savings resulting from tax rates ranging from zero to the low single digits versus relatively high taxes in their countries of citizenship or domicile.
- The list of tax haven countries includes Andorra, the Bahamas, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, the Channel Islands, the Cook Islands, Hong Kong, The Isle of Man, Mauritius, Lichtenstein, Monaco, Panama, and St. Kitts, and Nevis.
- The Tax Cuts and Jobs Act, which passed in December 2017 set the effective corporate rate of U.S. taxes at 21%.
- Rather than repatriating revenues and earnings from offshore operations, companies including Apple, Microsoft, Alphabet, Cisco, and Oracle maintain billions of dollars in foreign tax haven accounts with tax rates in the low single digits.
- The circumstances of this paradigm make it less expensive for U.S.-based companies to borrow funds for share buy-backs, special dividends, and acquisitions than to repatriate and utilize the cash on their balance sheets.
- For example, rather than use its $100 billion in cash holdings and pay $9 billion in corporate taxes for repatriation, Microsoft opted for debt financing to fund its all-cash acquisition of LinkedIn for $26.2 billion in June 2016.
- To maximize their tax receipts, foreign governments maintain relatively constant pressure on tax havens to release information regarding their citizens’ offshore accounts.
- For the efforts to succeed, however, countries trying to get tax havens to change their ways usually need financial leverage in some form as the advantages of capital inflows seeking tax relief typically outweigh the benefits that might be received due to tax compliance.
- Tax havens help rich corporations and businessmen avoid paying high taxes on their income.
- They have been vilified for supporting the illegal accumulation of wealth.
- Organisations like Oxfam have often characterised tax havens as anti-poor since they help the rich avoid paying taxes to governments.
- Several governments have also come together to crack down on tax havens, for only a collective effort can help.
Why are Tax Havens important?
- The existence of tax havens allowed corporations to invest in the U.S. despite the country’s high tax rates because tax havens helped to lower the effective U.S. tax rate.
- But with the crackdown on tax havens, corporations could no longer serve U.S. consumers.
- Despite the crackdown on tax havens, the practice of shifting profits to avoid paying higher taxes continues unabated.
- About 40% of the profits earned by multinationals each year continue to be shifted to tax havens.
- The authors argue that such profit shifting persists because tax authorities in high-tax countries have been unable to eliminate the influence of tax havens that compete against them for revenues.
- So these tax authorities have instead resorted to competing against other high-tax countries by allowing corporations to shift profits to their jurisdictions.
- In fact, according to the authors, such competition between tax authorities has caused the average global corporate tax rate to fall by more than half between 1985 and 2018.
1. Status of Industrial Training Institutes in India
Industrial Training Institutes and Industrial Training Centers are post-secondary schools in India constituted under Directorate General of Employment & Training (DGET), Ministry of Skill Development and Entrepreneurship, Union Government to provide training in various trades.
- The report of the Standing Committee on Labour (2017-18) headed by Bharatiya Janata Party MP Kirit Somaiya, on the “Industrial Training Institutes (ITIs) and Skill Development Initiative Scheme” of the Ministry of Skill Development and Entrepreneurship (MSDE) was submitted to Parliament few months ago.
- The ITIs were initiated in the 1950s. In a span of 60 years, until 2007, around 1,896 public and 2,000 private ITIs were set up.
- However, in a 10-year period from 2007, more than 9,000 additional private ITIs were accredited.
- What explains this huge private sector scale-up?
- The committee says that it is not efficiency but a disregard for norms and standards.
- The National Skill Development Corporation (NSDC) today has more than 6,000 private training centres.
- Since it has short-term courses and its centres open and close frequently, it is all the more prone to a dilution of standards.
- Private training partners have mushroomed at the rate of five a day (mostly with government support) and it is clear that the government has been unable to regulate private institutions for quality.
- Private sector engagement in skill development has been taken up by standalone private training partners and not employers. The latter could have made the system demand-driven.
- Meanwhile, the lack of a regulator for skill development, with teeth, has led to poor quality affiliation, assessment and certification.
- The Somaiya committee report is scathing in its tone and specific in details.
- It outlines instances of responsibility outsourcing, no oversight, connivance and an ownership tussle between the Central and State governments.
- Private-ITI accreditation troubles started when the Quality Council of India (QCI), a private body, was hired due to “high workload of affiliation and shortage of [government] staff”.
- The QCI did not follow accreditation norms created by the National Council for Vocational Training (NCVT) and it appears that neither scale nor standard was achieved, but only speed.
- ‘Speed’ now risks the future of 13.8 lakh students (on an average, 206 students per ITI) studying in these substandard ITIs, which can be closed any time.
- The ITIs have a unique functioning set-up. While they were formed under the government’s Craftsman Training Scheme scheme, their day-to-day administration, finances and admissions are with State governments. The NCVT performs an advisory role.
- The ITIs often run into issues with no one to take ownership.
- A case in point is the examination process — the question paper is prepared by the NCVT, but administered and evaluated by instructors of the State Councils for VT.
- The NCVT is just a stamp with no role in actually assessing quality. How can quality outcomes be expected without quality assessments?The parliamentary committee has shed light on the ITIs.
- If the same exercise were extended to other skill development schemes, the picture would be grimmer.
- There are 183 cases pending in High Courts on non-compliance of norms by the ITIs.However, the short-term training programmes of the Ministry evade any scrutiny and action.
- For example, the Standard Training Assessment and Reward scheme spent Rs. 850 crore in 2013-14 with no norms for quality. There were no Aadhaar checks, attendance requirements and batch size limitations.
- Private training operators have made a profit with no court cases. The report also reinforces disturbing findings of a national survey by the research institute (NILERD) of the Planning Commission in 2011 about private ITIs: they offered training in less than five trades (in government ITIs it is less than 10); had fewer classrooms and workshops for practice; and their teachers were very poorly paid.
Way Forward: Sharda Prasad Committee recommendations.
- We need better oversight, with a national board for all skill development programmes. The core work (accreditation, assessment, certification and course standards) cannot be outsourced.
- Like every other education board (such as the CBSE), a board is required in vocational training that is accountable.Since we have the NCVT as a legacy, it should be used as a kernel to constitute the board.
- We should also have a mandatory rating system for the ITIs that is published periodically.
- A ranking of the ITIs on several parameters such as the one done by the National Assessment and Accreditation Council in tertiary education can be replicated.
- There should be one system, with one law and one national vocational education and training system. The silos in which vocational training happens in India is unfortunate.
- We need to create a unified national vocational system where the ITIs, NSDC private vocational trainers and vocational education in schools, and the other Central ministries conducting training gel seamlessly and can learn from, and work with each other.
- A unified legal framework can facilitate such a unification. The absence of a law has only weakened regulation and monitoring.
- What we need is a national vocational act that replaces all scattered regulations — recommended in the 12th Five Year Plan.
- The ITIs have many internal issues such as staffing and salaries that need attention, as the NILERD nationwide survey in 2011 had found.
- There is also a critical need to reskill ITI teachers and maintain the student-teacher ratio.
- Since technology obsolescence is a continuous challenge, financial support envisaged through the NSDC should be extended to the ITIs.
- The primary reason for hiring the QCI and the mess that followed was this: “huge workload of affiliation and shortage of staff”.
- This is true even today. It is unlikely that without fixing this, the QCI mistake will not be repeated.
- There has been a tremendous push by the government for private sector talent in government; perhaps it is worth considering talent from the open market to fill up higher posts in skill development.
- Institutional reforms such as moving the office of the Directorate General of Employment (the arm that has all data on employment) from the Ministry of Labour to the MSDE would help.
- It would also complement the Directorate General of Training already under MSDE.
Employers and financing
- This is the last but perennial challenge. Given the scale of our demographic challenge, a belief that financing from corporate social responsibility, multilateral organisations such as the World Bank, and the government will meet the financial needs for skill development is wishful thinking.
- The only way to mobilise adequate resources the right way is to do skills training, and have equipment and tools that keep pace with changing needs and ensure that employers have skin in the game.
- This is possible through a reimbursable industry contribution (RIC) — a 1-2% payroll tax that will be reimbursed when employers train using public/private infrastructure and provide data.
- RIC, which is implemented in 62 other countries, was recommended in the 12th Plan and is an idea whose time has come.
- Finally, while there is so much talk of skills for the future and the impact of artificial intelligence and automation, data show that 13.8 lakh students in the ITIs are suffering due to poor institutional accreditation.
- Placement in NSDC training has been less than 15%. Maybe if we take care of the present, we will be better prepared for the future.
- The National Green Tribunal constituted a committee, to be headed by a former Allahabad High Court judge, for monitoring the rejuvenation project of Ganga from Haridwar to Unnao in Uttar Pradesh.
- The National Mission for Clean Ganga (NMCG) would be the nodal agency to coordinate with the committee
- The green panel, in a detailed judgment, had passed directions to rejuvenate the Ganga, declaring as ‘No Development Zone’, an area of 100 metres from the edge of the river, between Haridwar and Unnao.
G. Prelims Fact
1. Jatayu Earth Center
- The Jatayu sculpture at the Jatayu Earth Center in Kollam, Kerala, is said to be world’s largest bird sculpture.
- It is built on a massive rock called Jatayupara.
H. Practice Questions for UPSC Prelims Exam
Question 1. Consider the following statements regarding National Mission for Clean Ganga:
- It is the implementation wing of the National Ganga Council.
- It is a statutory body.
Which of the statement/s is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
Question 2. Consider the following statements:
- All natural Earthquakes take place in the lithosphere
- Tectonic Earthquakes occur due to the sliding of the rocks along the fault line.
Which of the statement/s is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
Question 3. Consider the following statements:
- S-Waves are the first waves to arrive at the surface at the time of an Earthquake.
- P-Waves arrive after some time after the happening of Earthquake.
Which of the statement/s is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
Question 4. Consider the following statements:
- Richter scale is used to measure the intensity of earthquake
- The energy released during a quake is expressed in absolute numbers of 0-10
Which of the statement/s is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
I. UPSC Mains Practice Questions
- “It is not the severity of the punishment but the certainty and uniformity of it which will reduce crime”. Critically analyze this statement in the context of recent Criminal Law Amendment Bill.
- The good news is that there has been a steady decline in the number of HIV cases in India. The bad news is that Meghalaya, Mizoram and Tripura have emerged as the new hotspots for HIV. In this context evaluate our country’s efforts in dealing with HIV AIDS.
Also, check previous Daily News Analysis
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