01 Feb 2019: UPSC Exam Comprehensive News Analysis

TABLE OF CONTENTS

A. GS1 Related
GEOGRAPHY
1. Polar Vortex 
B. GS2 Related
POLITY AND GOVERNANCE
1. SC to hear Sabarimala pleas on Feb. 6
C. GS3 Related 
ECONOMICS
1. Centre firm on FDI rules deadline
2. Govt. revises up GDP growth to 7.2%
3. Only an interim Budget, says PM
D. GS4 Related
E. Editorials
INTERNAL SECURITY (DEFENCE PREPAREDNESS)   
1. Heading towards strategic instability
SOCIAL JUSTICE  
1. Is there a case for reservation for the forward classes?
ETHICS AND INTEGRITY
1. Not kosher (ICICI Bank: Conflict of Interest Issues) 
F. Tidbits
1. Celestial billboards spark debate on who owns the sky
G. Prelims Facts
H. UPSC Prelims Practice Questions
I. UPSC Mains practice Questions

A. GS1 Related

Category: GEOGRAPHY

 

1. Polar Vortex

Context

  • Many parts of the northern United States are experiencing record cold temperatures this week, attributed to the polar vortex.
  • The polar vortex has broken into ‘two swirling blobs of cold air’, bringing the most frigid conditions in decades to the midwest.

What is the polar vortex?

  • As its name suggests, the polar vortex is found around the north pole. It’s a band of strong winds, high up in the atmosphere that keeps bitterly cold air locked around the Arctic region. This circulation isn’t considered a single storm, or even a weather pattern as such.
  • Occasionally, the vortex can become distorted and meander far further south than normal. The phenomenon became widely known to Americans during a particularly frigid spell in 2014, when the media first started using the term “polar vortex”. It was also a factor in the “bomb cyclone” that battered the US east coast last year.
  • Studies have pointed to a recent increase in instances where the polar vortex has bulged down into heavily populated areas. Scientists are gaining a better understanding of why this is happening, with many identifying climate change as an influence.
  • There’s some evidence that the jet stream, a meandering air current that flows over North America and Europe, is slowing and becoming wavier as the planet warms. The jet stream interacts with the polar vortex, helping bring numbing temperatures further south.
  • Scientists also point to a complex sequence of events involving sea ice, which is rapidly diminishing in the Arctic. As the ice retreats, summertime heat is absorbed by the dark ocean that lies underneath. This heat is released into the atmosphere during winter, spurring winds that can disrupt the polar vortex.

B. GS2 Related

Category: POLITY AND GOVERNANCE

 

1. SC to hear Sabarimala pleas on Feb. 6

Context

  • A five-judge Constitution Bench, led by Chief Justice of India Ranjan Gogoi, will hear the Sabarimala review petitions from February 6.

Review Petition

  • A binding decision of the Supreme Court/High Court can be reviewed in Review Petition.
  • The parties aggrieved on any order of the Supreme Court on any apparent error can file a review petition.
  • Article 137 of the Constitution provides that subject to provisions of any law and rule made under Article 145, the Supreme Court of India has the power to review any judgement pronounced (or order made) by it.
  • Under Supreme Court Rules, 1966 such a petition needs to be filed within 30 days from the date of judgement or order.
  • It is also recommended that the petition should be circulated without oral arguments to the same bench of judges that delivered the judgement (or order) sought to be reviewed.
  • Furthermore, even after dismissal of a review petition, the SC may consider a curative petition in order to prevent abuse of its process and to cure gross miscarriage of justice.

Curative petition

  • The concept of Curative petition was evolved by the Supreme Court of India in the matter of Rupa Ashok Hurra vs. Ashok Hurra and Anr (2002) where the question was whether an aggrieved person is entitled to any relief against the final judgement/order of the Supreme Court, after dismissal of a review petition.
  • The Supreme Court in the said case held that in order to prevent abuse of its process and to cure gross miscarriage of justice, it may reconsider its judgements in exercise of its inherent powers.
  • For this purpose the Court has devised what has been termed as a “curative” petition. In the Curative petition, the petitioner is required to aver specifically that the grounds mentioned therein had been taken in the review petition filed earlier and that it was dismissed by circulation.
  • This has to be certified by a senior advocate. The Curative petition is then circulated to the three senior most judges and the judges who delivered the impugned judgement, if available. No time limit is given for filing Curative petition.

Details of the issue

  • Justice Malhotra is part of the Constitution Bench hearing the Sabarimala petitions against the September 28 judgment of the Supreme Court revoking the bar on women of menstrual age from entering the Sabarimala temple for worship.
  • The Sabarimala review hearing, which was earlier scheduled for January 22, had to be postponed as Justice Malhotra was on medical leave. Responding to an oral mention by advocate Mathew Nedumpara to fix a date of hearing for the case, Justice Gogoi had conveyed the court’s decision to wait for Justice Malhotra’s return from leave.
  • Justice Malhotra had delivered the lone dissent in the majority judgment of the five-judge Constitution Bench on September 28.
  • Justice Malhotra, in her dissent, had declared the prohibition on women aged between 10 and 50 years to be an “essential practice”. The judge had held that imposing the court’s morality on religion would negate the freedom to practise religion according to one’s faith and beliefs.
  • Justice Malhotra’s judgment has since then become a rallying point for the review petitioners.
  • Review petitions were filed by a range of persons, from the Sabarimala temple’s chief priest to individuals and Ayyappa organisations, including women devotees’ groups. They urged the court that ‘reform’ does not mean rendering a religious practice out of existence on the basis of a PIL petition filed by “third parties” who do not believe in the Sabarimala deity.
  • The review petitioners have argued that the right to move the Supreme Court for violation of fundamental rights must be reserved for those whose personal rights to worship have been violated.

C. GS3 Related

Category: ECONOMICS

 

1. Centre firm on FDI rules deadline

Context

  • The government has recently said it would not be extending the deadline (February 1, 2019) for implementation of the new rules governing FDI in e-commerce.
  • Large e-commerce firms such as Amazon and Flipkart have repeatedly approached the Centre seeking either dilution of the rules or extension of the deadline.

New rules for e-commerce

  • Vendors that have any stake owned by an e-commerce company cannot sell their products on that e-commerce company’s portal.
  • Vendor who purchases 25% or more of its inventory from an e-commerce group company will be considered to be controlled by that e-commerce company, and thereby barred from selling on its portal.
  • This provision aims to ensure that vendors in which marketplaces, such as Amazon, have a stake do not sell the bulk of their items to a third-party vendor who then goes on to sell those items on the e-commerce marketplace.
  • In other words, the provision seeks to deny control by the marketplace entity over vendors. The third major provision says the e-commerce firm will not be allowed to influence the price of a product sold on its portal by giving incentives to particular vendors.

Some basics to understand the new rules

  • E-commerce companies can operate under two different models in India.
  • The first is the marketplace model where the e-commerce firm simply acts as a platform that connects buyers and sellers. FDI is allowed in e-commerce companies in this model.
  • The second model is inventory-based where the inventory of goods sold on the portal is owned or controlled by the e-commerce company. FDI is not allowed under this model.
  • What has been happening is that large e-commerce companies such as Amazon and Flipkart, while not owning inventory themselves, have been providing a platform for their group companies such as CloudTail and WS Retail respectively.
  • Some see this as skewing the playing field, especially if these vendors enjoyed special incentives from the e-commerce firm, over others. These controlled or owned vendors may then be able to offer discounts to customers that competitors may not be able to match.
 

2. Govt. revises up GDP growth to 7.2%

Context

  • The government had recently revised its GDP growth forecast for 2017-18 to 7.2% from the earlier estimate of 6.7%. It revised the actual growth rate in 2016-17 to 8.2% from 7.1%.

GDP Calculation – Recent changes

  • In 2015, the government adopted a new method for the calculation of the gross domestic product of the country, and also adopted the Gross Value Added measure to better estimate economic activity.
  • Further, the change involved a bringing forward of the base year used for calculations to 2011-12 from the previous 2004-05.
  • According to the Ministry of Statistics and Programme Implementation, the method for preparing the back series is largely the same as what is used to calculate the data using the new base, which is how all national accounts calculations will be made going forward.
  • While doing the exercise, the government adopted the recommendations of the United Nations System of National Accounts, which included measuring the GVA, Net Value Added (NVA), and the use of new data sources wherever available. One of these data sources is the Ministry of Corporate Affairs MCA-21 database, which became available since 2011-12.
  • One problem encountered was in finding matching data for the older series as what the MCA-21 database provided. The key difference between the two was that the old method measured volumes — actual physical output in the manufacturing sector, crop production, and employment for the services sector. The MCA-21 database allows for a more granular approach, looking at the balance sheet data of each company and aggregating the performance of the sector from that, after adjusting for inflation.
  • For most sectors, simply changing the price vectors from a 2004-05 to a 2011-12 base was enough, but others required splicing of new and old data in the relevant proportions to arrive at the closest approximation.
  • The new method is also statistically more robust as it tries to relate the estimates to more indicators such as consumption, employment, and the performance of enterprises, and also incorporates factors that are more responsive to current changes, unlike the old series that usually took 2-3 years to register an underlying change.
 

3. Only an interim Budget, says PM

Context

  • Prime Minister Narendra Modi had assured the Opposition that his government would be presenting an interim budget and not a full one

Interim Budget and Vote on Account

  • An Interim Budget is not the same as a ‘Vote on Account’. While a ‘Vote on Account’ deals only with the expenditure side of the government’s budget, an Interim Budget is a complete set of accounts, including both expenditure and receipts. An Interim Budget gives the complete financial statement, very similar to a full Budget.
  • Full Budget deals with both expenditure and revenue side but Vote-on-account deals only with the expenditure side of the government’s budget.
  • The vote-on-account is normally valid for two months but full budget is valid for 12 months (a financial year).
  • As a convention, a vote-on-account is treated as a formal matter and passed by Lok Sabha without discussion. But passing for budget happens only after discussions and voting on demand for grants.

D. GS4 Related

 Nothing here today!!!

E. Editorials

Category: INTERNAL SECURITY (DEFENCE PREPAREDNESS)

 

1. Heading towards strategic instability

Editorial Analysis:

  • In late 2018, the government decided to set up three new agencies — the Defence Cyber Agency, the Defence Space Agency and the Special Operations Division — in order to address the new age challenges to national security.
  • While this is indeed a useful step in the right direction, it is also important to note that the constitution of these agencies is a far cry from the crucial recommendations given by the Naresh Chandra Task Force and the Chiefs of Staff Committee, both of which had suggested the formation of three separate joint commands to deal with new challenges to India’s national security in the cyber, space and special operations domains.
  • Critics have opined that this rather lacklustre response to major ‘futuristic’ challenges to India’s national security raises a larger question: is India adequately prepared for the new age wars in general or is it still preparing for the last war it fought, and won?

High-tech innovations

  • There is a revolution in military affairs that seems to have attracted the attention of strategic analysts and policy planners across the world.
  • The current focus in military thinking across the world is increasingly moving away from traditional heavy-duty military hardware to high-tech innovations such as artificial intelligence (AI), big data analytics, satellite jammers, hypersonic strike technology, advanced cyber capabilities and spectrum denial and high-energy lasers.
  • In the light of the unprecedented capabilities that these systems offer, there is also an increased focus on developing suitable command and control as well as doctrinal concepts to accommodate and calibrate them.
  • The arrival of these technologies might deeply frustrate strategic stability as we know it given their disruptive nature.
  • Strategic stability in the contemporary international system, especially among the nuclear weapon states, depends on several age-old certainties, the most important being the issue of survivability of a state’s nuclear arsenal and its ability to carry out a second strike after a first attack.
  • Once accuracies get better, hypersonic glide vehicles replace conventional delivery systems, real-time tracking and surveillance make major strides, and AI-enabled systems take over, survivability of nuclear arsenal, which lies at the heart of great power stability, could take a severe beating. There was, for instance, an assumption that the naval leg of a nuclear triad is the most survivable part since it is hidden away in the depths of the ocean away from the adversary’s gaze.
  • However, the potential ability of deep-sea drones to detect ballistic-missiles, armed nuclear submarines or SSBNs may make this assurance a thing of the past, thereby frustrating traditional calculations.
  • Further, it is important that we add the arrival of these new technologies to the emerging strategic competition among great powers.
  • For instance, experts have opined that the U.S.’s withdrawal from the Intermediate-Range Nuclear Forces treaty is perhaps an indication of a potential arms race in the offing.
  • As a matter of fact, in a January 2018 article, the Economist put it succinctly: “Disruptive new technologies, worsening relations between Russia and America and a less cautious Russian leadership than in the cold war have raised fears that a new era of strategic instability may be approaching.”

Fears of a Possible Conflict:

  • There is an inherent paradox vis-à-vis high technology-enabled military systems. While on the one hand, it is imperative for states to redesign their systems in the light of these new technologies, especially the digital and cyber components, this also makes the cyber- and digital-enabled systems vulnerable to covert cyberattacks.
  • More so, given that such surreptitious attacks might take place in the early stages of a conflict, ensuing confusion and scare might lead to uncontrolled escalation with little time for assessment and judgement.
  • The biggest fear about these technologies, the implications of which we don’t fully understand yet, is their potential to increase the risks of intentional and inadvertent nuclear use. Such scenarios may be unlikely but not improbable.
  • Here’s what the Economist had to say on precisely such a scenario: “Both China and Russia fear that new American long-range non-nuclear strike capabilities could be used to deliver a disarming attack on a substantial part of their strategic forces or decapitate their nuclear command and control. Although they would still launch their surviving nuclear missiles, improved missile-defence systems of the U.S. would mop up most of the remainder before their warheads could do any damage.”
  • The fear of a bolt-from-the-blue attack against one’s command and control systems or a disabling strike against strategic arsenal using new technological solutions is likely to dominate the strategic mindspace of great powers in the days ahead, thereby further deepening mistrust and creating instability.
  • Therefore, the possibility of emerging military technologies prompting inadvertent escalation and conflict cannot and should not be ruled out.

Chinese capabilities:

  • China has emerged as a key actor in the field of emerging military technologies. This is something that will concern New Delhi in the days ahead. Some analysts believe that Beijing is in the lead position in emerging technologies with potential military applications such as quantum computing, 3D printing, hypersonic missiles and AI.
  • If indeed, Beijing continues to develop hypersonic systems, for instance, it could potentially target a range of targets in the U.S.
  • While the Chinese focus is evidently on U.S. capabilities, which China interprets as a potential threat, this is not without latent concerns for New Delhi. India might, in turn, consider developing some of these technologies which will create dilemmas for Islamabad. The cascading strategic competition then looks unavoidable at this point, and that is worrisome. And yet, it might be difficult to avoid some of these developments given their dual use.
  • However, there is a need to ask how survivable India’s naval platforms are given the feverish developments of advanced sensory capability in the neighbourhood.
  • Questions arise: Is it sufficiently prepared to face the new age wars? Has the urgency associated with these technological developments dawned on the security planners in New Delhi?
  • It is in this context that we must revisit the government’s decision to set up the agencies to address cyber and space challenges.
  • Clearly, this is a timely effort from the government to have finally decided to set them up — though they are not yet in place. It is unfortunate that unlike what was envisioned earlier, these agencies will be reduced in their powers and their standing in the pecking order of defence planning in the country.
  • Moreover, reports indicate that the Space Command will be headed by the Air Force, the Army will head the Special Operations Command, and the Navy will be given the responsibility of the Cyber Command. If indeed that happens, their effectiveness in terms of tri-service synergy will be much less than anticipated.
  • Even more so, given that the higher defence decision-making in the country is still civil services-dominated, despite the recent attempts to correct it, the effectiveness of these agencies will remain weak.

Category: SOCIAL JUSTICE

 

1. Is there a case for reservation for the forward classes?

Context:

This is an analysis-based article which presents different perspectives to the reader on whether or not there exists a case for reservation for the forward classes. UPSC aspirants would benefit from these points as they can use much of this content to present answers on the topic in case it is asked in the UPSC Mains Examination, be it as a part of the General Studies- II paper or the Essay paper.

Editorial Analysis:

Analysis- I:

The points mentioned here, take the view that social justice is not possible if we exclude the economically backward sections of our society.

  • Social justice is inclusive in nature. It means ensuring that no marker of backwardness is left untouched. Poverty is one such marker of backwardness, and a very strong one, which denies certain basic rights and equality in society to individuals affected by it.

  • The Preamble, which is the soul of the Constitution, promises to all citizens social, economic and political justice.

  • The economic status of citizens constitutes one of the three tests of backwardness.

  • Hence, the ends of social justice cannot be truly met if we exclude the economically backward sections of society from availing the fruits of development in an equal manner.

A move to help the poor

  • Poverty denies equality of opportunity to individuals in education and employment. It denies them the opportunity of a decent and sustainable livelihood.

  • Reservation, by the prevalent logic, ensures participation of the disadvantaged sections in employment through positive discrimination. Hence, there was a strong case for making a provision for reservation for the economically backward in the general category in education and employment to ensure that they also get reasonable opportunities to advance in life.

  • The present provision of 10% reservation for the economically backward in the general category is being referred to as reservation for the ‘savarnas’, or upper castes.

  • However, reservation under this category is not limited to upper caste Hindus; it is available to the poor in all general categories, who were not eligible for reservation under any other category hitherto. As for the upper caste Hindus, a significant proportion of the population live in the villages and in remote areas with limited economic opportunities.

  • They face disadvantages in the matter of getting access to education and employment. Hence, it was necessary to lend a helping hand to them as well.

The test of constitutionality:

  • To those who point to the Supreme Court’s capping of reservation at 50% in the famous Indira Sawhney case, some experts mention that this ceiling is applicable only for reservation for the socially and educationally backward category, i.e. to the Scheduled Castes/Scheduled Tribes (SCs/STs) and the Other Backward Classes (OBC) categories under Articles 15(4) and 16(4) of the Constitution.
  • It does not apply to the present case of reservation, which has been provided as a special provision through a Constitution amendment.
  • Further, to those who mistake the provision of reservation under the Constitution to be applicable only to the SCs/STs and OBCs, some experts make the point that the present quota, introduced through the 124th Constitution Amendment Bill, is provided through adequate amendments in Articles 15 and 16 of the Constitution, which allow for making “special provision for the advancement of any economically weaker sections of the citizens”. Hence, it can stand the test of constitutionality in the Supreme Court.

  • Social justice is a dynamic concept which has evolved over time in accordance with the changing needs and circumstances of our society. The concept has not been defined in our Constitution.

  • It has rightly been left to the wisdom of the lawmakers to increase its ambit from time to time, according to the needs of the time. A quota for poor citizens was a crying need of our times.

  • Some experts are of the view that the present government at the Centre realised this and, under the true spirit of ‘Sabka Saath Sabka Vikas’, made the dream of 10% reservation a reality. For other political parties, this had been nothing more than an electoral gambit all along.

Analysis- II:

The points mentioned here, take the view that when you allow reservation for the advanced classes, it changes the meaning of reservation.

  • During the Lok Sabha debate on the 124th Constitution Amendment Bill, to provide reservation in jobs and education for the economically weaker sections in the general category, an opinion was expressed that 50% of the States have to approve it. But that is not the case. Under Article 368(2), Parliament can amend the Constitution by passing the Bill in each House by a majority of the total membership of that House present and voting. Thereafter, the President shall give his assent to the Bill and the Constitution will stand amended.

  • But amendments which seek to make a change in certain specific provisions, including Articles 54, 55, 73, Chapter IV of Part V, Chapter V of Part VI or Chapter I of Part XI, or any of the Lists in the Seventh Schedule, or the representation of States in Parliament, shall require to be ratified by the Legislatures of not less than one-half of the States.

Providing the context

  • Article 15 guarantees the fundamental right of prohibition of discrimination on grounds of religion, race, caste, sex, or place of birth. Article 15(1) and (2) broadly state that the “State” shall not discriminate against “any citizen” on grounds only of religion, race, caste, sex, place of birth or any of them. Article 15(3) onwards, the Constitution lays down provisions relating to protective discrimination — the policy of granting special privileges to underprivileged sections. Articles 15(3) and 15(4) are the foundations for reservations in education and employment in the country.

  • Article 15(5) was introduced by the Constitution (93rd Amendment) Act, 2005. It is an enabling clause that empowers the State to make such provision for the advancement of SCs, STs and socially and educationally backward classes of citizens in relation to a specific subject, namely, admission to educational institutions including private educational institutions, whether aided or unaided by the state, notwithstanding the provisions of Article 19(1)(g). This was challenged in the court. In 2008, a five-judge Bench headed by the then Chief Justice of India, K.G. Balakrishnan, upheld the law providing 27% quota for OBCs in IITs, IIMs and other central educational institutions, but said it would not apply to the creamy layer. The Supreme Court upheld the validity of the Constitution (93rd Amendment) Act, 2005. It also held that the amendment does not violate the basic structure of the Constitution.

  • It is in this context that the reservation for the economically weaker sections is to be considered. A nine-judge Bench of the Supreme Court had ruled that reservation is a remedy for historical discrimination and its continuing ill-effects. The court had also said that reservation is not aimed at economic uplift or poverty alleviation. Economic weakness is on account of social backwardness. The economic criteria will lead, in effect, to the virtual deletion of Article 16(4) from the Constitution.

Is this the new poverty line?

  • Since the new amendment talks of economic criteria and addresses the grievances of Brahmins, Baniyas, Patels, Marathas, Gujjars, Thakurs and even Muslims and Christians for the first time, many think it will be broad-based. It is the responsibility of the state to uplift the poor.
  • Traditionally marginalised sections need affirmative action. But the current policy says those households earning less than Rs. 8 lakh annually or owning less than 5 acres of land can avail of the quota.
  • That is a salary of Rs. 66,000 a month. If so, is this the new poverty line of India? And if so, why are those earning more than Rs. 25,000 a month being taxed?
  • The moment you make reservation for the advanced classes, it changes the meaning of reservation altogether. Reservation is not an anti-poverty programme.

Analysis- III:

The points mentioned here, take the view that nothing stopped the government from providing jobs or scholarships to the poor.

  • Critics take the view that the 124th Constitution Amendment Bill, proposed and promulgated in just a few days, is a gross and wilful subversion of the principle of social justice, which the Supreme Court has held to be the part of the basic structure of the Constitution.

  • They further allege that it is hard to understand as to how the government, which has all the legal resources and counsel at its disposal, chose to characterise reservations mandated by the Constitution as a job guarantee or a poverty alleviation programme.

  • Reservations for students in public institutions of higher education and jobs in the public sector were envisioned to bring about adequate representation to those sections of society that are oppressed by caste discrimination.

  • Reservations along with legal protections against discrimination form the juridical structure for social upliftment of the backward classes of Indian society.

Constitutionally invalid

  • The Constituent Assembly amended Article 15 by inserting Clause (4), which states: “Nothing in this article or in Clause (2) of Article 29 shall prevent the State from making any special provision for the advancement of any socially and educationally backward classes of citizens or for the Scheduled Castes and the Scheduled Tribes.” The use of income or economic criteria for providing reservation for those not included in the backward classes, or for those belonging to the general sections, is thus constitutionally invalid.

  • Critics point out that if the present government wished to benefit the poorer sections of those not included in the backward classes, Scheduled Castes and Tribes, there was nothing that stopped it from creating jobs along the lines of the Mahatma Gandhi National Rural Employment Guarantee Act, which also created rural infrastructure. Nothing stopped it from instituting new universities and colleges and providing need-based scholarships for poor students.

  • Granting 10% reservation in government jobs and education institutions to households in the general category with an income of less than Rs. 8 lakh per annum will make little difference to their poverty levels as corporate-led jobless growth has increased income inequality exponentially.

Concluding Remarks:

  • In conclusion, critics take the view that the present government at the Centre chose not to increase the size of the pie, but to cut away another slice from the already shrinking pie of public sector institutions.

  • The promise of existing reservations is nowhere near to being fully realised.

  • Public spending for scholarships for students in the SC/ST/OBC categories (and minority students) has come to a near halt.

  • Critics further take the view that the move reverses the progress made in India over decades. It was perhaps put in place as the government was unable to provide any relief from the economic distress felt by small farmers, manufacturers, entrepreneurs, traders and the working class. In fact, this distress was worsened by the impact of the rash decision called demonetisation and the poor implementation of the Goods and Services Tax.

Category:ETHICS AND INTEGRITY

 

1. Not kosher (ICICI Bank: Conflict of Interest Issues)

Editorial Analysis:

  • The inquiry by former Supreme Court judge Justice B.N. Srikrishna into the allegations against former ICICI Bank CEO Chanda Kochhar has taken eight long months to confirm what seems apparent – that she did not conduct herself as she should have in relation to conflict-of-interest issues.
  • Recently, the Central Bureau of Investigation (CBI) filed an FIR against Ms. Kochhar, her husband Deepak Kochhar, head of the Videocon group Venugopal Dhoot and ICICI Bank executives for sanction of credit facilities in violation of rules, that caused a loss of Rs. 1,730 crore to the bank.
  • The investigating agency has a long way to go before it establishes whether the loans were given in return for financial favours, a charge that is at the heart of booking them for criminal conspiracy, cheating and corruption.

The crux of what happened:

  • Experts opine that clearly, Ms. Kochhar erred in not disclosing to the bank’s board her husband’s business connections with the Videocon group, which was a client of the bank.
  • Worse, she failed to display the correctness expected of her by sitting on committees that sanctioned credit facilities to Videocon when she ought to have recused herself.
  • As a matter of fact, just a day after a Rs. 300-crore loan was disbursed to Videocon International Electronics in 2009, Mr. Kochhar’s NuPower Renewables received Rs. 64 crore from the Videocon group.
  • Whether this was a quid pro quo for the loan, as the CBI suggests, needs to be proved. But there is no denying that it made for poor, even suspicious, optics.
  • The inquiry report holds her guilty of violation of the bank’s “code of conduct, its framework for dealing with conflict of interest and fiduciary duties, and in terms of applicable Indian laws, rules and regulations.”
  • The bank’s board has accepted the report and decided to treat her voluntary resignation from the bank in October 2018 as “termination for cause”, also deciding to claw back all bonuses paid to her since April 2009, hold back unpaid amounts and divest her of her stock option entitlements.

Concluding Remarks:

  • These are strong penalties, but the question is: how did the board give her a clean chit as recently as March last year (2018)?
  • It had then reposed its full confidence and faith in Ms. Kochhar and commended her and the management team for their “hard work and dedication”.
  • It is impossible to believe the board was not aware of the allegations against the CEO given that a whistle-blower had made them public in October 2016.
  • Questions arise: Was the board then influenced by Ms. Kochhar into giving her a good conduct certificate? These are uncomfortable questions that raise doubts over the standards of corporate governance at one of India’s largest banks.
  • In conclusion, the ICICI Bank episode is only one among several instances of governance lapses in corporate India in recent times.
  • Clearly, regulators need to up their game

 

F. Tidbits

 

1. Celestial billboards spark debate on who owns the sky

  • StartRocket, a Russian start-up aiming to put billboards in space; the firm plans to turn hundreds of tiny satellites into a massive display visible from the earth — something its CEO, Vlad Sitnikov, said would make him the first man to draw in space since the ancient Greeks grouped stars into constellations.
  • “New ages demand new gods,” the advertising expert said, adding that the world is no longer ruled by Greek deities but by brands and events.
  • Sitnikov said he came up with the space billboard idea last year after U.S.-New Zealand rocket propulsion company Rocket Lab launched a shiny disco ball called Humanity Star into orbit, where it remained visible to the human eye for months.
  • To work out technical details he teamed up with experts from Skoltech, a Moscow private university, he said. The team aims to put 200 tiny satellites, known as CubeSats, at an altitude of about 500 kilometres in the lower orbit by 2021.
  • The satellites, each equipped with a sun-reflecting sail, would fly close together to comprise the pixels of a giant screen that could be switched on and off to display short words or logos.
  • Production costs alone are expected to be more than $150 million, he said. The firm plans to charge about $200,000 for every eight hours of advertising.
  • The display would look roughly the size of a half moon and be visible for six minutes at a time, potentially from anywhere.
  • But to make ads worthwhile the firm intents to target mostly big cities — where light pollution is already high — at dusk or dawn, when people are out in the streets, Mr. Sitnikov said.
  • But since it was announced in January, the initiative has angered astronomers and raised questions about the need to better regulate who owns the skies — and what is in them.
 

G. Prelims Facts

  Nothing here today!!!

H. UPSC Prelims Practice Questions

Question 1.Consider the following statements
  1. An interim Budget is a complete set of accounts, including both expenditure and receipts.
  2. It made by the government just before the election.

Select the correct ones

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2

See

Answer

Question 2. Consider the following statements regarding India Water Impact Summit 2018
  1. It was organised jointly by the National Mission for Clean Ganga (NMCG) and the UNEP.
  2. The 2018 Summit introduced the inaugural Ganga Financing Forum that will bring a number of institutions to a common knowledge, information and partnership platform

Which of the above statement(s) is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2 only
  4. Neither 1 nor 2

See

Answer
Question 3. Recently, the species Sumatran, Amur (Siberian), Malayan, Amoy (South China) and 
Indochinese in news, belongs to the category of
  1. Subspecies of Tiger
  2. Migratory Bird
  3. Turtles
  4. Tribal groups in Indonesia island

See

Answer
Question 4. Consider the following statements regarding Namdapha National Park
  1. It is India’s only reserve to have four big cat species — the tiger, leopard and the severely endangered clouded and snow leopards
  2. Noa-Dihing River, a tributary of the Brahmaputra flows through Namdapha National Park.

Which of the above statement(s) is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2 only
  4. Neither 1 nor 2
See
Answer
 
 

I. UPSC Mains Practice Questions

  1. Many parts of the northern United States are experiencing record cold temperatures and it is attributed to the polar vortex. In this context discuss the concept of polar vortex (12.5 Marks; 200 words)
  2. India’s railway system has played a fundamental role in the country’s development, transporting people and goods throughout its vast territory, integrating markets and connecting communities. In this context discuss the “The Future of Rail Opportunities for energy” report and the efforts made by the government in recent years to modernize Indian railways (12.5 Marks; 200 words)

See previous CNA

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