9 PM Daily Brief – 5th September 2016

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National

 

[1]. My fight is for transparency, says Justice Chelameswar

The Hindu

Context:- Justice Chelameswar had informed CJI TS Thakur that he won’t be attending the collegium meetings any further until judiciary ushers in transparency on its part.

  • Judicial crisis: The development comes at the time a of judicial crisis in the form of burgeoning judicial vacancies in High court (The latest report issued by the Ministry of Law and Justice shows that vacancies in the High Courts have reached almost 45 per cent of the sanctioned strength of judges)

 Who is Justice Chelameswar?

  • He is currently the 5th senior most judge in SC hierarchy
  • He was the lone dissenting judge on the five-judge Constitution Bench led by Justice J.S. Khehar, which scrapped the National Judicial Appointments Commission (NJAC) law passed by Parliament and upheld the collegium system of judicial appointments in a majority judgment on October 16, 2015

 Justice Chelameswar’s views,

  • He criticized the collegium system for the lack of accountability by terming it opaque and inaccessible to both public and judges of the SC itself
  • He said that there is a need for transparency in the judicial appointments
  • Primacy of judiciary and exclusion of the government from judicial process were some of the reasons given as the basis of the October Judgement which scrapped NJAC. Justice Chelameswar said he found these arguments illogical

 

Secrecy strengthens Chelameswar’s argument

The Centre has sent its draft MoP, but it appears the collegium is reluctant to approve some of the clauses. The fact that the exact nature of the differences between them is not known only strengthens Mr. Chelameswar’s point about opacity.

  • The revision process should not be kept under wraps. Public interest, especially the principle of judicial independence, will be better served if the procedure under preparation is thrown open to a debate.

Impact of this recent development

Delay: It has brought the focus again on the manner in which the judiciary functions on its administrative side. It may further delay the finalization of the collegium’s view on the Memorandum of Procedure (MoP) for appointment and transfer of judges 

Bound by Principle: It raises the question whether Justice Chelameswar is not bound to be part of the collegium system as long as it is in force.

A brief review of NJAC vs collegium matter

What is the NJAC?

The National Judicial Appointments Commission (NJAC) is a constitutional body proposed to replace the present Collegium system of appointing judges. 

What is the Collegium system?

The Collegium system is one where the Chief Justice of India and a forum of four senior-most judges of the Supreme Court recommend appointments and transfers of judges. However, it has no place in the Indian Constitution. The system was evolved through Supreme Court judgments in the Three Judges Cases (October 28, 1998) 

Why is Collegium system being criticized?

The Central government has criticized it saying it has created an imperium in imperio (empire within an empire) within the Supreme Court.

The Supreme Court Bar Association has blamed it for creating a “give-and-take” culture, creating a rift between the haves and have-nots. “While politicians and actors get instant relief from courts, the common man struggles for years for justice.”

 

[2].The not-so-swachh life of the Railways’ cleaners 

The Hindu

Context:- Safaikarmacharis who keeps the railway tracks clean are a neglected lot. Their condition is miserable as they have to face a lot of problems while working at railway stations.

Problems faced

  • They still have to resort to manual scavenging
  • Due to poor quality of protective gear like boots and gloves, they have to brave diseases & infections on a routine level. Jaundice is a common and recurring ailment
  • Wages are extremely low
  • Social stigma attached with a job of garbage man makes them prone to added mental trauma
  • Working hours are long. Some workers who reside in outskirts of the cities do not get an adequate family life leading to unhappiness and depression in general.

What does railway ministry has to say about this?

It denies their existence because apparently the fact that it has outsourced the work to private contractors, absolves it of its responsibility to have a humane policy framework for these workers.

Even after the passage of Prohibition of Employment as Manual Scavengers and their Rehabilitation Act, 2013, manual scavenging is common for these safaikarmacharis. 

Judiciary takes notice

Delhi High Court bench, headed by Justice B.D. Ahmed, directed both the AAP government and Centre to file an affidavit indicating the steps taken under the law, particularly under Section 36 of the Act.

Section 36The appropriate Government shall, by notification, make rules for carrying out the provisions of this Act, within a period not exceeding three months from the date of commencement of this Act

UN Sustainable Goals pertinent to the discussion

Listed under Goal 8: Promote inclusive and sustainable economic growth, employment and decent work for all

  • promote safe and secure working environments for all workers

Related info

Swachh Bharat Mission was launched on the birth anniversary of Mahatma Gandhi on 2nd October 2014.

There are 2 subparts of this mission,

  1. Swachh Bharat Urban – The Ministry of Urban Development
  2. Swachh Bharat Gramin – The Drinking Water and Sanitation Ministry

Prohibition of Employment as Manual Scavengers and their Rehabilitation Act 2013

  • It came into force on 6 December 2013 across India except Jammu and Kashmir.
  • The law prohibits the employment of manual scavengers, the manual cleaning of sewers and septic tanks without protective equipment and the construction of insanitary latrines.
  • The law also provides rehabilitation of manual scavengers and alternative employment to them within the time bound manner.

National Commission for SafaiKaramcharis (NCSK)

The NCSK was established in 1993 as per the provisions of the NCSK Act 1993 initially for the period up to 1997

  • Later the validity of the Act was initially extended up to 2002 and thereafter up to 2004
  • The NCSK Act ceased to have effect from 2004. After that the tenure of the NCSK has been extended as a non-statutory body from time to time. The tenure of the present Commission is up to 2016
  • It has been further extended for 3 years

Functions

The NCSK has been giving its recommendations to the Government regarding

  • specific programmes for welfare of safaikaramcharis,
  • study and evaluate the existing welfare programmes for safaikaramcharis,
  • grievance redressal
  • As per the provisions of the Prohibition of Employment as Manual Scavengers and their Rehabilitation Act, the NCSK has been assigned the work to
    • monitor the implementation of the Act,
    • tender advice for its effective implementation to the Centre and State Governments
    • enquire into complaints regarding contravention/non-implementation of the provisions of the Act

 

International

[1].Hong Kong holds biggest polls since 2014 protests

The Hindu

Context:- During the Legislative council elections held on 4th Sept 16 in Hong kong the Young Hong Kong independence activists also stood for the elections.

What if they win?

It is being feared that winning of seats by the Young Hong Kong activists would weaken the prodemocracy camp. Pro democracy camp doesn’t wants full independence while the activists support a much radical notion

Background

Hong Kong witnessed mass protests in 2014 termed popularly as Umbrella movement.

Why the protests happened?

  • On June 10 2014, the Standing Committee of the National People’s Congress (NPCSC) practically claimed full autonomy over Hong Kong by declaring “comprehensive jurisdiction” over the former British colony in a white paper.
  • The NPCSC also ruled on Aug. 31 that the region’s top political leader in 2017 will be elected from two or three candidates chosen by a committee that Beijing controls.
  • The Aug. 31 NPCSC decision sparked a huge outcry from Hongkongers, who saw it as the Chinese regime going back on its plan to introduce fuller democracy in the city. Beijing had said in Dec. 2007 that Hongkongers “may” be able to choose their own top leader via universal suffrage in 2017 and their legislature by 2020. 

What do Hongkongers want?

Universal suffrage: Hongkongers had always hoped to get universal suffrage, since the Basic Law, Hong Kong’s mini-constitution, states that universal suffrage for the Chief Executive elections is the “ultimate aim.”

In simple terms, the right to choose their own leader.

Why the movement was termed Umbrella movement?

  • On Sept. 28 2014, the Hong Kong police fired tear gas and used pepper spray on students and citizens gathered outside the government headquarters in Admiralty as part of a civil disobedience movement.
  • The protesters brought umbrellas for shade against the scorching mid-day sun, but ended up using them as personal tear gas shields instead.
  • Since then, the umbrella has become both the name and the symbol of the movement

 

[2].PM balances ties by praising Obama after talks with Xi

The Hindu

Context:- G20 summit is being held at Hangzhou China from 4th – 5th September 2016

  • Our PM had met with Chinese premier in the morning to reboot ties with China

Balancing both

Diplomatic exigencies made our PM to praise U.S. President Barack Obama too for his leadership of the G-20 and asserted that the grouping in the future would succeed if it pursued a “collective, coordinated and target-oriented” approach

We can’t let our foreign policy shift unnecessarily towards either US or China. So, a balancing act was necessary after Indian PM met with Xi Jinping.

Earlier,

Mr. Obama had also praised our PM for success of passing of GST Bill in the parliament

New Delhi & Riyadh

PM also met with Saudi prince and pushed for joint collaboration on following issues

  • maritime trade,
  • infrastructure and low-cost housing

 

EDITORIAL/OPINION

[1]. Realizing energy sector targets 

The Hindu

Context:- India has set ambitious targets on many fronts like

  • 175GW of renewable energy by 2022
  • Increasing domestic coal production to 1,500 million tonnes (MT) by 2020

Article mainly speaks on two fronts,

  • Are these targets for coal and renewable energy consistent?
  • How are we to achieve 175 GW of renewable capacity by 2022? If 175 GW of renewable capacity comes on line, do we need 1,500 MT of coal? 

Why the target for coal production is a reasonable one?

Coal production target will be achieved in following manner,

  • 1,000 MT by Coal India Limited
  • 100 MT by Singareni Collieries Company Limited
  • 400 MT by captive and private producers

175 GW of renewable capacity, if achieved by 2022, will reduce coal demand by 210 MT of coal.

Coal demand through years

In 2011 – 10: 622MT

In 2014 – 15: 924MT

In 2020: 1675MT

If by 2020, we are on track to achieve 175GW renewable energy, then by 2020 we should have around 140GW of renewable energy capacity in place.

This translates to 170MT of coal demand being fulfilled through renewable energy.

It further means that we shall need around 1500MT of domestic coal production by 2020, if we want to eliminate imports by then

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Can we eliminate all imports?

No because we need to import coking coal for steel production. If we provide for some 66 MT of coking coal import, we will still need domestic production of around 1,400 MT of coal.

Thus the target of 1,500 MT of coal production is a reasonable one.

Now let us switch our attention to,

Renewable energy

The question that needs answering is that,

Whether we can have 175GW of renewable energy by 2022?

We have used three measures to encourage renewable power:

  1. Feed-in tariff (FIT)
  2. Renewable portfolio obligation (RPO)
  3. Accelerated depreciation allowance

Feed-in tariff (FIT)

A fixed tariff is guaranteed to the power producer for a certain number of years. For him or her, this is desirable as it ensures assured income that eliminates market risk and he or she is able to raise finance easily

Renewable Portfolio Obligation (RPO)

An electricity distribution company (DISCOM) is required to purchase a certain percentage of its total distributed electricity from renewable sources. The price that a renewable power producer will receive is determined by the market. Thus there is also incentive to supply electricity at completive rates.

Uncertainty through RPO & eliminating it: RPO creates uncertainty of revenue for the power producers, and banks are reluctant to finance them. The way out is to guarantee a certain minimum price to be paid to a renewable power producer.

Effective enforcement: RPO if not effectively enforced is useless. To ensure proper enforcement, a DISCOM that does not meet its RPO obligation is made to pay a sufficiently high fine for the extent of the shortfall

Advantages of RPO

  • Surety of a market: RPO will ensure that the renewable electricity generated will have a market and will be paid for
  • Neutral to technology: Another advantage of RPO is that it can be neutral to technology. One does not have to prescribe whether it is solar or wind or biomass. Competitive market forces will select the most economical option. Thus there is no need to prescribe separate levels of RPO for wind, solar, small hydro, and so on

Accelerated depreciation allowance

It provides incentive to set up the plant but not to maintain it or generate electricity.

New RPO guidelines

The Ministry of New and Renewable Energy (MNRE) has recently announced consultation guidelines for long-term RPO trajectory 

What do the new guidelines mandate?

The guidelines stipulate separate RPO for solar and non-solar electricity.

  • The guidelines prescribe that 2.75 per cent, 4.75 per cent and 6.75 per cent has to be solar energy for 2016-17, 2017-18 and 2018-19, respectively
  • The shares of non-solar energy such as wind, biomass, and small hydro for these years are to be 8.75 per cent, 9.50 per cent, and 10.25 per cent, respectively

Why states are not happy with new RPO guidelines?

Higher financial burden: While the Central government has issued these guidelines, electricity is a State subject and some States are not happy with the guidelines. States which do not have renewable potential feel that they would have to bear a higher burden for the renewable target. If West Bengal has to import renewable electricity from Tamil Nadu or Rajasthan, it will have to bear a higher burden or transmission charges.

Solution:The Centre has said that no transmission charge would be levied on renewable power.

Incentivizing states to implement RPO effectively

Centre could provide money from the coal cess revenue to States depending on the extent to which they meet the RPO targets.

 

[2]. Merely a logistics pact?

The Hindu

Context:- On August 29 2016, India and Carter signed a Logistics Exchange Memorandum of Agreement (LEMOA), an agreement that the U.S. has meticulously pursued since 2002 and which India had, till now, resolutely refused to endorse

What LEMOA is and what is isn’t?

It is not a military pact: The agreement does not mention the setting up of “permanent bases” in either country. According to the signatories, LEMOA only facilitates establishing “mutual basing facilities” on a case by case basis 

Intention:  LEMOA is intended to help speed up humanitarian relief operations as also emergency evacuation from conflict-prone regions

Above is the official version, which we all know is seldom the truth

What strategic experts from the West have to say about LEMOA?

  • LEMOA is a critical link in the U.S.’s plans for a larger pivot towards Asia.
  • It is intended to meet the threat from an increasingly assertive China

Indo US relationship trajectory

Since past century Indo US relations are on the upwing. Starting with PM Vajpayee who visited US and hinted that it was time to move from the shadows of the past, to Manmohan Singh to our current PM, all have demonstrated that they are willing to go extra mile to cement this relationship.

Similar reciprocation by US presidents, both GW Bush & Obama have been quite visible in the past few years.

The strategic build-up between the two countries commenced during the first term of Mr. Bush, when the Next Steps in Strategic Partnership heralded a sea change in U.S.-India relations. It led to the conclusion of Indo US civil nuclear deal

The relationship derived its strength from a mutual desire to strengthen cooperation between the world’s two largest democracies. Containment of China was not the primary objective at this point.

Signing of 1st Defence Cooperation Agreement: It was in 2005 that India and the U.S. signed their first Defence Cooperation Agreement. This agreement was renewed and expanded in 2010 and 2015, leading to a loosening of strict controls that existed regarding the transfer of excluded categories of technologies. 

Around 2007-2008, the U.S. made initial moves to get India to sign three foundational agreements viz.,

  • The Logistics Support Agreement (LSA)
  • The Communications Interoperability and Security Memorandum of Agreement (CISMOA)
  • The Basic Exchange and Cooperation Agreement (BECA) for Geo-spatial Cooperation.

While India welcomed the idea of relaxation of technology norms, it resisted signing the foundational agreements on the ground that it undermined India’s strategic autonomy

June 2016: A defining month in Indo US relations

A joint statement was issued on the occasion of our PM’s visit to US wherein U.S. recognized India as a major defence partner

LEMOA’s impact

It will intensify pressure on India to sign other two foundational agreements. If India signs them, then it could convey an impression that India has transformed from a major defence partner to a significant non-NATO ally

Why India should be wary of US?

Author says that US is a true practitioner of the art of realpolitik. Changes in policy are constantly effected to suit its global requirements.

 Examples:

In Europe: the U.S. seems to be preparing to throw away its long-standing “special relationship” with the U.K.

In West Asia: As U.S.-Iran relations improve, Saudi Arabia is now the new villain.

Indo Russia ties: The U.S. had always been suspicious of India’s relations with Russia that go back to the period of non-alignment. And today, as U.S.-Russia relations are at their nadir (rock bottom) since the fall of the Berlin Wall, the U.S. can be expected to try and further weaken India-Russia relations that are lately facing some strain.

Pakistan: Furthermore, given Pakistan’s location, it would be a mistake to believe that the U.S. would completely detach itself from Pakistan

How the Indo Russia ties are being affected as India moves closer to US?

As India moves closer to the U.S., Russia is seen to be coming closer to China.

Russia & China: At one level, Russia is strengthening its links with China economically and strategically, and coordinating more closely with the latter on the issue of the South China Sea.

  • At another level, Russia is engaging with China to oppose U.S. attempts to install its Missile Defence System in Asia 

Russia & ASEAN: Russia is simultaneously seeking to reinforce its long-standing strategic ties with Southeast Asian countries such as Vietnam.

  • Russia and the Association of Southeast Asian Nations (ASEAN) appear to have come closer. At the Russia-ASEAN Summit earlier this year, there was even talk of a “strategic partnership for mutual benefit”. 

Russia & Eurasia: In Eurasia, Russia is currently carving out a zone of influence for itself

India figures nowhere in all of this 

So, should India move closer to US while neglecting the current scenario shaping up in Asia?

India can’t ignore that these are the times of multilateral cooperation. It will be a foolish mistake to side with one power. US’s power is waning globally and to side only with US will be an error of judgement.

  • In Asia too, China and Russia are trying to restrict the US influence, labelling it as Non-Asian power.
  • On issues such as the South China Sea, even many of the countries directly involved, especially the Philippines, are willing to make their peace with China.

The U.S.’s role in the region is thus becoming restricted, leaving it with few alternatives

Our take: India should align itself strategically as per the global geopolitical situation. It can neither choose to ignore China by siding completely with US nor can it sideline its partnership with US to focus solely on Asia. It needs to strike a balance between the two. Middle path, as always is the key here.

 

[3]. The gap between rich and poor states

The Hindu

Context:- Article talks about the increasing economic disparity between the Indian states. Authors surmise that a Delhi-based one-size-fits-all policy regime for all of India is entirely unsuitable as per current times.

Research conducted

Authors’ research of per capita net domestic product from 1960 to 2014 of India’s 12 largest States that accounted for 85 per cent of the total population shows that economic disparity within India’s States is among the largest in the world.

Results of the research

Earnings per annum

In 1960,

  • the average person in West Bengal earned Rs.390 per annum;
  • the average person in Tamil Nadu earned Rs.330.

In 2014,

  • The average Bengali earned Rs.80,000
  • the average Tamilian earned Rs.1,36,000

The southern States of Kerala, Tamil Nadu and Karnataka have climbed up rapidly while West Bengal and Rajasthan have dropped down the order of the richest large States

Gap between the top & Bottom states

  • The richest (per capita GDP) State in 1960, Maharashtra, was twice as rich as the then poorest State, Bihar.
  • In 2014, the richest state, Kerala, was four times richer than the still poorest state of Bihar.

This gap of four times between the richest and the poorest large State in India is among the highest in the world

Global situation

A similar ratio in other federal polities such as the U.S., European Union and China is between two and three times

Gap is widening

Economic disparity among States is only widening and not narrowing. India is the only large country in the world today that is experiencing an economic divergence among its States and not convergence

Groundbreaking year: 1990

Pre-1990 and post-1990 look like almost two different eras in India’s history of economic diversity among States. Why?

In the period between 1960 and 1990, the economic disparity among India’s twelve largest States remained more or less constant.

  • In 1990, the top three States were twice as rich as the bottom three, nearly the same ratio as in 1960.
  • However, in the subsequent 25-year period from 1990 to 2015, the disparity between the richest and the poorest State doubled

Why these trends are against the economic theory?

Economic theory would suggest that the poorer regions grow faster to catch up with the richer States to cause an eventual convergence, as is happening globally.

Contrary to global experiences of narrowing disparity,both across and within nations, India actually shows trends of an increasing divergence among its large States

Why this divergence?

At best, it can be attributed to a complex interplay of politics, leadership, policies, human capital, and some luck

Conclusion

Besides cultural and political diversity, India now also needs to recognize the economic diversity. A one size fits all policy is not going to work seeing these trends. India should take a lesson from the recently held BREXIT vote. It clearly reflected the helplessness of a centralized EU in balancing the common market policies for diverse nations

 

[4]. Rights for abducted children

The Hindu

Context:- Author talks about the children who are caught between migration of parents from one country to another. He questions that,

When one parent goes to another country, taking the child along, but without the permission of the other parent. What happens to the child who has been abducted? What are his or her rights?

Issues confronting transnational inter spousal child removal

No codified family laws or specific child custody laws under which these children can be returned to their homes in a foreign jurisdiction.

  • An aggrieved parent with a foreign court order requiring return of the child finds no takers in the Indian legal system

Legal recourse in India

  • India legal system provides relief through invoking of writ of Habeas Corpus
  • Custody battles requiring conventional evidence to be established fall under the outdated Guardians and Wards Act, 1890

Worsening situation

The situation has degraded much more, as now cases have come to light where children from India are being abducted abroad and they cannot be traced there or legally directed to be returned.

 Hague convention on Civil aspects of International Child abduction

  • 94 states are party to this convention
  • Aim: to protect children internationally from the harmful effects of their wrongful removal or retention and to establish procedures to ensure their prompt return to the State of their habitual residence, as well as to secure protection for rights of access
  • India has not joined it 

India & the Civil Aspects of International Child Abduction Bill

  • The question of India’s accession to the Convention first came about in 2007, but, the Civil Aspects of International Child Abduction Bill, 2007, to secure the prompt return of wrongly removed or returned children, lapsed before reaching Parliament
  • On June 22, 2016, the Ministry of Women and Child Development (MWCD) uploaded on its website a proposal to enact a draft of the Civil Aspects of International Child Abduction Bill, 2016

Key features of the proposed bill

  • Wrongful retention or removal: It considers the removal to or the retention of a child in India to be wrongful if it is in breach of rights of custody attributed to a person, an institution, or any other body, either jointly or alone, at a place where the child was habitually resident immediately before the removal or retention. It further stipulates that the removal to or the retention in India of a child is to be considered wrongful where at the time of removal or retention those rights were actually exercised, either jointly or alone, by a person, an institution or any other body, or would have been so exercised, but for the removal or retention.

Why the draft bill was prepared?

Bill was prepared following a reference made by the Punjab and Haryana HC to Law commission of India to consider whether recommendations should be made for enacting a suitable law and for signing the Hague Convention.

Why the HC made a reference?

The High Court had made this reference when a minor child remained untraceable after she was removed from the officialcustody of the court and taken abroad by misusing an interim order of 2006.

Surya Vadanan vs State of Tamil Nadu, 2015

The judgement helped in framing a consistent approach towards multi-jurisdictional child custody disputes. Court ruled that:

  1. the principle of Comity of Courts and nations must be respected and the best interest of the child should apply
  2. The principle of “first strike”, namely, whichever court is seized of the matter first, ought to have prerogative of jurisdiction in adjudicating the welfare of the child;
  3. the rule of Comity of Courts should not be jettisoned except for compelling special reasons to be recorded in writing by a domestic court
  4. interlocutory orders of foreign courts of competent jurisdiction regarding child custody must be respected by domestic courts
  5. an elaborate or summary enquiry by local courts when there is a pre-existing order of a competent foreign court must be based on reasons and not ordered as routine when a local court is seized of a child custody litigation
  6. The nature and effect of a foreign court order, reasons for repatriation, moral, physical, social, cultural or psychological harm to the child, harm to the parent in the foreign country, and alacrity in moving a concerned foreign court must be considered before ordering return of a child to a foreign court

Despite of the above judgment we still need a codified law on this subject

How can Hague convention help India resolve the problem on this matter?

  • India’s accession to the Hague Convention would resolve the issue since it is based on the principle of reverting the situation to status quo ante (reverting back to original condition).
  • It is also based on the principle that the removed child ought to be promptly returned to his or her country of habitual residence to enable a court of that country to examine the merits of the custody dispute and thereupon award care and control in the child’s best interest. This is because the courts of the country where the child had permanent or habitual residence are considered to best determine the child’s interest.

 

ECONOMY 

[1]. GST may shutdown local intellectual property firms

The Hindu

Context:- GST Bill was passed by RS recently after being passed by LS in 2015 setting the stage for the biggest tax reform India has seen since independence. Heaps of praise has been showered upon the goodies GST has in store but its impact on Intellectual Property domain has not been discussed much. This article tries to do that.

What is Intellectual Property?

As per World Intellectual Property Organization (WIPO),

“Intellectual property (IP) refers to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce”

IP is protected in law by, for example, patents, copyright and trademarks, which enable people to earn recognition or financial benefit from what they invent or create. By striking the right balance between the interests of innovators and the wider public interest, the IP system aims to foster an environment in which creativity and innovation can flourish.

Why GST should foster the IP?

In absence of any enabling environment, India’s fragile IP ecosystem will perish. In absence of IP, India will become just a market and a cheap labor destination

If India’s dependence on the foreign technology has to be reduced in critical sectors then a fostering atmosphere for IP needs to be inculcated through GST

How will current GST regime impact IP?

The proposed GST regime will shut down indigenous IP companies as the licensing cost will increase manifold

What can be done?

Following provisions should be included in the GST framework to help foster IP companies,

  • Exemption of GST on both purchase of tools or computers as well as on sale of IP by indigenous entities.
  • Equipment or license purchased by a company recognized by the Department of Science and Industrial Research (DSIR) as a research company as per the Income Tax Act Section 80-IB (8A) and which are designed for use, and are used exclusively in research, education, instruction or investigation, and repair to be exempted from GST.
  • Technology transfer or licensing of technology from universities, institutes and DSIR-recognized pure research firms, needs exemption.

Countries on international front

Most countries that have GST have retained full exemption for IP-generating entities as in the case of Malaysia or have kept GST very low e.g. 6% in certain cases.

 


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