23 Jul 2018: UPSC Exam Comprehensive News Analysis

TABLE OF CONTENTS

A. GS1 Related
B. GS2 Related
SOCIAL ISSUES
1. WCD to move proposal to amend POCSO Act
C. GS3 Related
ECONOMY
1. An index to determine the value of coal blocks
2. What is the GDP deflator?
3. IBC: UN model eyed for cross-border norms
D. GS4 Related
E. Editorials
GOVERNANCE
1. Amendments that weaken the RTI Act
F. Tidbits
G. Prelims Fact
H. UPSC Prelims Practice Questions
I. UPSC Mains Practice Questions 

A. GS1 Related

Nothing here for today!!!

B. GS2 Related

Category: SOCIAL ISSUES

1. WCD to move proposal to amend POCSO Act

 

  • The Women and Child Development (WCD) Ministry is set to move a proposal before the Cabinet this week for enhanced punishment in cases of sexual assault of male children.
  • The Law Ministry has cleared the proposal to amend the Protection of Children from Sexual Offences (POCSO) Act, 2012, for enhancing punishment in cases of sexual assault against young boys, officials said.
  • Amendments to the POCSO Act for enhanced punishment for sexual assaults of young boys have been approved by the Law Ministry.
  • Sources said the Ministry was working on the proposal to amend the Act to award death penalty to those convicted of raping children below 12 years.
  • The move is being seen as an effort to bring in a gender-neutral law while dealing with cases of sexual assaults.
  • Boys who are sexually abused as children spend a lifetime in silence.

C. GS3 Related

Category: ECONOMY

1. An index to determine the value of coal blocks

 

  • Major changes in the coal block auction system have been suggested by the high-powered committee set up last year to review the current process.
  • The recommendations rest on four tenets — ensuring transparency and fairness, equity, early development of coal blocks and simplicity of implementation of the recommendations.
  • These suggestions coincide with the opening up of the coal sector for commercial mining.
  • The proposed changes aim at introducing flexibility in the number of bidders, penalties for defaulting on milestones and revoking bank guarantees, project execution, and relaxation to captive miners to sell some of the coal in the market.
  • The panel has recommended developing a Coal Index for determining the value of blocks and a revenue-sharing model with the States. Currently, the valuation is on the basis of the notified price of Coal India Ltd.
  • The committee has suggested scrapping the current practice of cancelling an auction if the number of bidders drop below three, saying that a single-bid should be accepted if biddings failed to find eligible bidders, provided the offered price was benchmarked to the reserve price.
  • In the previous auctions, majority of the blocks could not be allocated as the number of eligible bidders was less than three.
  • The number of milestones are now eight versus 20 earlier, with the panel suggesting that only a default in achieving critical milestones should attract penalty against the earlier penalty for each default.
  • If accepted, the changes would mark a major shift in the current system which was put in place after the cancellation of 204 coal-block allocations and introducing a system of auctioning the mineral blocks.
  • Triggering euphoria and intense competition since their introduction, the e-auctions failed to sustain interest after several blocks were taken at high prices. Even companies which bought the blocks found it cheaper to import coal to meet their requirements rather than developing the mines.
  • There were no takers for subsequent blocks, forcing the Centre to do a rethink.
  • The Expert Committee to ‘report on the challenges faced by the current auction system and recommend changes’ was headed by Pratyush Sinha with bureaucrats, ex-bureaucrats and one ex-chairperson each from the SBI and the Union Bank.
  • Production from the captive mines which were auctioned had remained lower than their pre-auction output.
  • Aggressive bids by some of the bidders during auctions, subsequent decline in coal prices in international markets as well as in e-auctions, and weak financial health of some of the coal-block winning companies are other reasons for slower ramp-up of production from these mines.
  • Absence of end-use condition in the guidelines is a significant positive for commercial miners, who were not eligible to participate in the coal-mine auctions conducted in 2015.
  • However, given the issues related to land acquisition and regulatory clearances, production levels from private commercial miners are not expected to rise significantly in the short- to medium term.

2. What is the GDP deflator?

 

  • The GDP deflator, also called implicit price deflator, is a measure of inflation. It is the ratio of the value of goods and services an economy produces in a particular year at current prices to that of prices that prevailed during the base year.
  • This ratio helps show the extent to which the increase in gross domestic product has happened on account of higher prices rather than increase in output.
  • Since the deflator covers the entire range of goods and services produced in the economy — as against the limited commodity baskets for the wholesale or consumer price indices — it is seen as a more comprehensive measure of inflation.
  • GDP GDP price deflator measures the difference between real GDP and nominal GDP. Nominal GDP differs from real GDP as the former doesn’t include inflation, while the latter does.
  • As a result, nominal GDP will most often be higher than real GDP in an expanding economy.
  • The formula to find the GDP price deflator:
  • GDP price deflator = (nominal GDP ÷ real GDP) x 100
  • A consumer price index (CPI) measures changes over time in the general level of prices of goods and services that households acquire for the purpose of consumption.
  • However, since CPI is based only a basket of select goods and is calculated on prices included in it, it does not capture inflation across the economy as a whole.
  • The wholesale price index basket has no representation of the services sector and all the constituents are only goods whose prices are captured at the wholesale/producer level.
  • Changes in consumption patterns or introduction of goods and services are automatically reflected in the GDP deflator.
  • This allows the GDP deflator to absorb changes to an economy’s consumption or investment patterns. Often, the trends of the GDP deflator will be similar to that of the CPI.
  • Specifically, for the GDP deflator, the ‘basket’ in each year is the set of all goods that were produced domestically, weighted by the market value of the total consumption of each good.
  • Therefore, new expenditure patterns are allowed to show up in the deflator as people respond to changing prices. The theory behind this approach is that the GDP deflator reflects up-to-date expenditure patterns.
  • GDP deflator is available only on a quarterly basis along with GDP estimates, whereas CPI and WPI data are released every month.

3. IBC: UN model eyed for cross-border norms

 

  • The government is looking at the possibility of adopting a United Nations legal model for cross-border insolvency cases as it works on strengthening the insolvency resolution framework.
  • The Insolvency and Bankruptcy Code (IBC) has sections pertaining to cross-border insolvency matters but are yet to be made operational.
  • The Insolvency Law Committee, headed by Corporate Affairs Secretary Injeti Srinivas, is studying the feasibility of introducing cross-border insolvency provisions.
  • The committee is looking at the adoption of the United Nations Commission on International Trade Law model on dealing with cross border insolvency.
  • The existing Code provides for two sections — 234 and 235 — relating to cross-border insolvency, which allows the Centre to enter into an agreement with a foreign country for enforcing the provisions of the Code, which is considered insufficient and time-taking.
  • In case the UN model is adopted for cross-border insolvency matters, then sections 234 and 235 could be dropped from the Code as they pertain to only bilateral pacts.

D. GS4 Related

Nothing here for today!!!

E. Editorials

Category: GOVERNANCE

1. Amendments that weaken the RTI Act

 

  • The government is trying to amend the Right to Information (RTI) Act 2005, but RTI activists in the country have raised concerns that the proposed amendments would weaken the legislation, which has empowered millions of people to hold public authorities accountable.
  • On 25 May, the National Campaign for Peoples’ Right to Information (NCPRI) wrote to Prime Minister Narendra Modi expressing anguish and concern regarding the regressive amendments to the RTI Act 2005 being proposed by the government.
  • Among the most worrisome proposed amendments was the proposal that the central government and state governments would decide the salaries of information commissioners through rules — a move that is likely to compromise the independence and autonomy in the functioning of the commissioners.
  • The information commissions (ICs), set up under the RTI Act are critical to citizens exercising the Right to Information, which allows citizens to question and seek information from public authorities.
  • The ICs are the final authorities to adjudicate on claims of access to information which is a deemed fundamental right under Article 19(1) of the Constitution.
  • The RTI law currently pegs the salaries, allowances and other terms of service of the Chief of all information commissions and the information commissioners of the Central Information Commissions at the level of a judge of the Supreme Court, while those of the state information commissioners are pegged at the level of the Chief Secretary of the state.
  • The status conferred on commissioners under the RTI Act is to empower them to carry out their functions autonomously and require even the highest offices to comply with the provisions of the law.
  • Empowering the central and state governments to decide salaries of information commissioners would seriously undermine the independence of information commissions.
  • As it is, the information commissions in the country are in a mess, with the posts of commissioners, including that of the chief information commissioner, lying vacant in several state ICs.
  • The draft rules in the amendment bill, issued by the Department of Personnel and Training (DoPT) of the Government of India, has reportedly been approved by the Cabinet.
  • There are also several other issues, raised earlier by the RTI activists, with the proposed amendments that will complicate the process of seeking information from the government.
  • But the text of the amendment bill has not been made public, and no comments and suggestions from the public has been sought yet.
  • This undermines people’s democratic right to know and participate in the legislative process and prevents public scrutiny of the provisions of a proposed bill.

Pre-legislative Consultation Policy

  • The RTI activists have demanded that the Modi government make the amendment bill public in keeping with the pre-legislative consultation policy of the government of India.
  • In 2014, a Pre-legislative Consultation Policy was adopted by the Government of India which mandates that all draft legislations (including subordinate legislation) be placed in the public domain for 30 days for inviting public comments and a summary of comments be made available on the concerned ministry’s website prior to being sent for Cabinet approval.
  • The necessity and significance of public consultation in the process of law-making is widely recognised by democratic governments across the world.
  • More than six million RTI applications are filed every year, and the RTI Act is the most extensively used transparency legislation globally. The law has been used by people to fight corruption and wrongdoing in the system.
  • The importance of the Right to Information, and the threat that it poses to public authorities by holding them answerable, can be gauged by the rising number of attacks and murders of RTI activists in the country.
  • Though the criticism of the changes to the RTI Act that the Centre wants to bring need nuance, the underlying concern of those protesting the changes is merited.
  • The amendments will indeed weaken the transparency law and RTI as a lever to ensure government accountability.
  • The changes relate to fixing the tenure of information commissioners (including the chief information commissioner) at both the central and the state level, and the rationalisation of their salaries and service conditions.
  • While the Centre may be well within its rights to tweak the salaries for the commissioners of the Central Information Commission, all other interventions it has in mind make the commissions vulnerable to political pressure and erode the commission(s) authority, and will also be a violation of the federal spirit.
  • The existing law states that the tenure of the information commissioners will be of five years, with an age cap of 65—the Centre now proposes that the term may be prescribed by the central government.
  • If the tenure is subject to the Centre’s whim, chances are information commissions will be sacked for passing inconvenient orders.
  • While three of the 10 positions at the Central Information Commission are lying vacant, the Centre is intent upon vesting itself with more termination powers.
  • What’s worse is the manner in which the amendments have been presented.
  • The Pre-Legislative Consultation Policy of 2014 makes it mandatory for the government to seek public feedback on draft legislations, but the Centre has zealously guarded the changes, as per many activists involved in shaping the original Act.
  • The present government, as well as its predecessor, have moved in the past to weaken the Act—while the UPA took the RTI yoke off political parties, the present government wanted to introduce changes that would have jeopardised the safety of RTI applicants and made using RTI forbidding, before public outcry forced it to withdraw the proposals.
  • This would make the opaqueness with which the amendments have been presented seem deliberate.
  • As a law that empowers the citizen, the Right to Information Act, 2005 quickly struck root in a country saddled with the colonial legacy of secretive government.
  • The move by the NDA government to amend the far-sighted law aims at eroding the independence of the Information Commissions at the national level and in the States.
  • The proposed amendments show that the Central government seeks control over the tenure, salary and allowances of the Chief Information Commissioner and Information Commissioners at the Centre, and the State Chief Information Commissioners.
  • Such a change would eliminate the parity they currently have with the Chief Election Commissioner and Election Commissioners and, therefore, equivalence with a judge of the Supreme Court in matters of pay, allowances and conditions of service. The Centre will also fix the terms for State Information Commissioners.
  • If at all, the law needs to be amended only to bring about full compliance by government departments and agencies that receive substantial funding from the exchequer, and to extend its scope to more institutions that have an influence on official policy.
  • The Supreme Court has held the right to information as being integral to the right to free expression under Article 19(1)(a); weakening the transparency law would negate that guarantee.
  • In its rationale for the amendments, the Centre has maintained that unlike the EC, Information Commissions are not constitutional bodies but mere statutory creations under the law.
  • This is a narrow view, betraying an anxiety to tighten the hold of the administration on the Commissions, which even now get little official support to fill vacancies and improve efficiency.
  • A recent public interest petition filed in the Supreme Court by the National Campaign for People’s Right to Information pointed out that the Central Information Commission has over 23,500 pending appeals and complaints, and sought the filling up of vacancies in the body.
  • In many States, the Commissions are either moribund or working at low capacity owing to vacancies, resulting in a pile-up of appeals.
  • The challenges to the working of the law are also increasing, with many State departments ignoring the requirement under Section 4 of the Act to publish information suo motu .
  • The law envisaged that voluntary disclosure would reduce the need to file an application. Since fines are rarely imposed, officers give incomplete, vague or unconnected information to applicants with impunity.
  • Proposals to make it easier to pay the application fee, and develop a reliable online system to apply for information, are missing.
  • These are the serious lacunae. Attempts were made by the UPA government also to weaken the law, including to remove political parties from its purview. Any move to enfeeble the RTI Act will deal a blow to transparency.

F. Tidbits

Nothing here for today!!!

G. Prelims Fact

Nothing here for today!!!

H. Practice Questions for UPSC Prelims Exam

Question 1. Which of the following statement/s is/are correct with respect
to GDP Deflator?
  1. It is the ratio of the value of goods and services an economy produces in a particular year at current prices to that of prices that prevailed during the base year.
  2. The GDP deflator is a measure of inflation.

Options:

  1. i only
  2. ii only
  3. Both i and ii
  4. None of the above

 

See

Answer
Question 2. Consider the following statements about CPI-Consumer 
Price Index:?
  1. A consumer price index (CPI) measures changes over time in the general level of prices of goods and services meant for the purpose of consumption.
  2. CPI is based on a comprehensive list of  goods that covers the entire economy.

Which of the above statements are correct?

  1. 1 only.
  2. 2 only.
  3. Both 1 and 2.
  4. None of the above

 

See

Answer
Question 3. Consider the following statements :
  1. The Insolvency Law Committee is headed by Corporate Affairs Secretary Injeti Srinivas and it is studying the feasibility of introducing cross-border insolvency provisions.
  2. The existing Insolvency and Bankruptcy Code (IBC) has no provisions pertaining to cross-border insolvency matters..

Choose the incorrect option:

  1. I only
  2. II only
  3. Both I and II
  4. None of the above

 

See

Answer

 

Question 4. Consider the following statements :
  1. The Expert Committee to ‘report on the challenges faced by the current auction system and recommend changes’ was headed by Pratyush Sinha.
  2. The panel has recommended developing a Coal Index for determining the value of blocks and a revenue-sharing model with the States.

Choose the correct option:

  1. I only
  2. II only
  3. Both I and II
  4. None of the above

 

See

Answer

 

I. UPSC Mains Practice Questions

  1. Critically analyse the changes proposed in the RTI Act by the Government. Discuss the challenges in the current RTI framework.

  2. The Coal Sector is in dire need of reforms in multiple aspects ranging from allocation to financial health of companies.Comment.
Also, check previous Daily News Analysis

 

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