A brief of newspaper articles for the day bearing
relevance to Civil Services preparation
National
[1]. Money lending bill to be tabled in the parliament
What has happened?
AP government will table a money lending bill in the assembly. AP government also decided to issue a judicial probe into the call money racket
What is call money racket?
Call money is an instant loan available over a call through flexible process where the lender comes home with money, promissory note (a signed document containing a written promise to pay a stated sum to a specified person or the bearer at a specified date or on demand) and other documents which can fix borrowers.
Interest rate: The interest rate usually ranges from 120 per cent to 200 per cent.
Asked to pay back anytime– Another key ingredient in the process is that the lender can demand return of the money over a call anytime and anywhere.
In case of non-repayment: In case the borrower is unable to repay, vehicles, houses and other movable and immovable properties are demanded as a guarantee.
Racket prevalent in Vijayawada: Sources say the business of high interest rate is close to over Rs. 600 crore in Vijayawada . Hundreds of women were threatened, coerced and dragged into flesh trade if they were unable to repay on time.
The police busted the racket when a Vijayawada-based family lodged a complaint last week. In one of the cases, the victim paid about Rs. 6 lakh for Rs. 1.5 lakh loan she took. Police sources reveal these lending gangs have close links with political leaders and have a network spread across A.P. and Telangana
[2]. Maneka renews plea to amend Juvenile Justice Act
What has happened?
In the light of the intelligence reports of a Kashmiri militant radicalising the juvenile accused in the Delhi rape case, Union minister for Women and Child Development Maneka Gandhi said that law should treat as adults those aged 16-18 accused of heinous crimes.
Juvenile Justice Act
The Juvenile Justice (Care and Protection of Children) Act, 2000 is the primary legal framework for juvenile justice in India. The act provides for a special approach towards the prevention and treatment of juvenile delinquency and provides a framework for the protection, treatment and rehabilitation of children in the purview of the juvenile justice system. The act has been amended in 2006 and 2010.
In order to upgrade the Juvenile Justice Administration System, the Government of India launched the Integrated Child Protection Scheme (ICPS) in 2009-10 whereby financial allocations have been increased and various existing schemes have been merged under one scheme.
Why, was this law brought about?
This law, brought in compliance of the 1989 UN Convention on the Rights of the Child (UNCRC), repealed the earlier Juvenile Justice Act of 1986 after India signed and ratified the UNCRC in 1992.
What is UN convention on child rights?
The United Nations Convention on the Rights of the Child (commonly abbreviated as the CRC, CROC, or UNCRC) is a human rights treaty which sets out the civil, political, economic, social, health and cultural rights of children. The Convention defines a child as any human being under the age of eighteen, unless the age of majority is attained earlier under a state’s own domestic legislation
Why, a demand for review of the age of juvenile?
In the light of the Delhi Gang rape case of 2011, where one of the culprits was a juvenile, public perception changed dramatically. Seeing the brutality perpetrated by the juvenile in this case, there have been calls since then to reduce the age of juvenile from 18 to 16 years so that if a juvenile commits such a heinous crime he can be tried in a normal court and punished accordingly instead of a 3 year period correctional home stay.
[3]. Pichai pitches project loon for connectivity
What has happened?
In the wake of network problems faced by Chennai during floods, Google CEO Sundar Pichai has asserted that Project Loon can help in such scenarios.
What is project loon and how can it help?
Under Project loon, uses helium-filled balloons to provide data connectivity in remote areas. When a natural disaster hits, people often get no network coverage, as it happened in Chennai as well. Project Loon is focussed on providing connectivity in rural areas, and we can use software to position these balloons to areas where there’s no coverage or network capacity is less.
Connectivity range: Each balloon can provide connectivity to a ground area of about 40 km
[4]. ISRO launches 6 Singapore satellites
What has happened?
ISRO has launched 6 Singapore satellites and it also tested 4th stage of its PSLV C-29 rocket
The benefit of 4th stage restart
ISRO says that restarting the 4th stage will help them place multiple satellites in different orbits through a single rocket
50 years of Singapore’s Independence
The launch of 6 Singaporean satellites coincides with the 50 years of Singapore’s independence and 50 years of Indo-Singapore diplomatic ties
What has the launch earned India?
India has earned 26 Million Euros from the successful launch.
Satellites launched by ISRO
ISRO has launched 17 foreign and four Indian satellites this year
What are miniaturized satellites?
A miniaturized satellite is an earth-orbiting device having lower mass and smaller physical dimensions than a conventional satellite. Miniaturized satellites have become increasingly common in recent years.
Miniaturized satellites can be classified according to mass in kilograms (kg) or weight in pounds (lb).
Miniaturized satellites have several advantages over conventional satellites, such as:
- Lower cost of manufacture
- Ease of mass production
- Lower cost of launch
- Ability to be launched in groups or “piggyback” along with larger satellites
- Minimal financial loss in case of failure
Limitations
- Generally shorter working life
- Reduced hardware-carrying capacity
- Lower transmitter output power capability
- More rapid orbital decay
Microsatellite: A microsatellite (or microsat) weighs between 10 kg and 500 kg, a weight range of 22 pounds (lb) to 1100 lb.
Nano-satellite: A nano-satellite (or nanosat) masses between 1 kg and 10 kg (2.2 lb and 22 lb).
Pico-satellite: A pico-satellite (or picosat) masses less than 1 kg (2.2 lb).
[5]. $1.5Bn WB loan for Swachh Bharat
What has happened?
World Bank has approved a $1.5-billion loan for a support operation project of Swachh Bharat.
Why is WB doing so?
To help India ensure that all its citizens in rural areas have access to improved sanitation to end open defecation by 2019. This will support the Swachh Bharat- Gramin, the rural component of Swachh Bharat over 5 years.
Sanitation Stats
Total people worldwide who lack access to proper sanitation: 2.4 Billion
People in India who do not have access to proper sanitation: 750 Million
Out of those 750 million: 80% are in rural areas
- One in every 10 deaths in India is linked to poor sanitation
- This WB assistance project, aimed at strengthening the implementation of Swachh Bharat, will result in significant health benefits for the poor and vulnerable, especially those in rural areas
- The States and their implementing agencies will be given incentives for meeting performance standards: reducing open defecation, sustaining their open defecation-free status and improving solid and liquid waste management in rural areas.
- The World Bank will also provide a $25-million technical assistance for building the capacity of select State governments.
What is SBM?
To accelerate the efforts to achieve universal sanitation coverage and to put focus on sanitation, the Prime Minister of India launched the Swachh Bharat Mission on 2nd October, 2014.
The Mission Coordinator is the Secretary, Ministry of Drinking Water and Sanitation (MDWS) with two Sub-Missions, the Swachh Bharat Mission (Gramin) and the Swachh Bharat Mission (Urban), which aims to achieve Swachh Bharat by 2019, as a fitting tribute to the 150th Birth Anniversary of Mahatma Gandhi.
Rural Areas: In rural areas it shall mean improving the levels of cleanliness through Solid and Liquid Waste Management activities and making Gram Panchayats Open Defecation Free (ODF), clean and sanitised.
Objectives of SBM-Gramin
- Bring about an improvement in the general quality of life in the rural areas, by promoting cleanliness, hygiene and eliminating open defecation.
- Accelerate sanitation coverage in rural areas to achieve the vision of Swachh Bharat by 2nd October 2019.
- Motivate Communities and Panchayati Raj Institutions to adopt sustainable sanitation practices and facilities through awareness creation and health education.
- Encourage cost effective and appropriate technologies for ecologically safe and sustainable sanitation.
- Develop wherever required, Community managed sanitation systems focusing on scientific Solid & Liquid Waste Management systems for overall cleanliness in the rural areas
Business & Economy
[1]. India’s investment climate better: Cisco
What has happened?
The investment environment in the country has improved significantly in the past 18 months, enabling businesses to focus more on performance rather than worrying about factors such as an unpredictable tax regime and interest rates.
Businesses are now focused more on customer outcomes, partnerships and expanding operations.
The government is very focussed on making sure that over time, the right reforms are in place.
It is about tech and getting the process faster and efficient.
You need to know!
Co-innovation:-
Co-Innovation in government is about the public and private sector joining hands to create innovations that can help the government do its job better.
In software industries it is an enhanced partner and customer ecosystem through an integrated network of world-wide expertise, and best-in-class technologies and platforms.
[2]. History will judge WTO poorly if inequities persist
Context:-
The tenth WTO ministerial conference is being conducted in Nairobi, Kenya.
It was expected that some substantial consensus about the Doha development agenda will be arrived at.
Doha development agenda, negotiated from 2001, strived to provide a level playing field for both developed and developing countries in world trade.
Citing the slow progress of the ongoing Doha Round negotiations, developed countries want the Round to be either brought to an end during this ministerial conference, or to include ‘new’ issues of their interest.
Concerns for India:-
History will judge ministers from the World Trade Organization poorly if the ongoing Doha Round talks perpetuate inequities Commerce Minister, Nirmala Sitharaman, has said.
Hastiness:-
The manner and haste with which important negotiating meetings are being convened does not inspire confidence among the developing countries.
Agenda Overload:-
Nations must not overload the current agenda with “new issues” as there are still many outstanding matters such as protection of poor farmers’ interests and food security rights.
The new issues recommended by first world includes global value chains, e-commerce, labour, environment, competition policies, investment pacts and state-owned enterprises, on all of which the rich nations have much superior standards / rules than the developing and poor countries.
Developing and poor countries feel these standards rules might become non-tariff barriers, hurting their exports.
Ignoring crucial issues:-
India was concerned over the fact that the reduction in the massive subsidization of the farm sector in developed countries — which was the clear cut mandate of the Doha Round talks — is now not even a subject matter of discussion.
India seeks SSM:-
G-33 has strongly argued the case for an effective Special Safeguard Mechanism (SSM) for developing countries and for changing the rules relating to public stockholding for food security purposes
India wants rich countries to first drastically reduce their trade distorting farm subsidies and the developing countries are given an SSM, before the developing countries can be asked to make progress on their farm export subsidies.
What is G-33?
It is a coalition of 48 nations including India and China, which has been taking up the issue of developing countries getting considerable flexibility in limiting market opening of agriculture sector.
What is SSM?
It is a trade remedy mechanism that will allow developing countries to hike duties temporarily to counter the import surge and price falls in farm products.
Services sector:-
India is pressing for a special initiative on services sector .To achieve this, it is imperative to put in place a simple and transparent regulatory framework that encourages growth in the Services sectors.
[3]. Digital India pays off for PDS
Context:-
The article discusses how the difference between the allocation of food grains to states by FCI and the lifting of the same by states has reduced.
It is due to the end to end digitization in the Pubic delivery system that has helped in the above achievement.
How digitization has helped?
All states except Himachal Pradesh and West Bengal have put the beneficiaries list online to ensure transparency and eliminate duplicate cards.
The end-to-end computerization of TPDS operations was a prerequisite for rolling out the National Food Security Act (NFSA).
The states are now able to anticipate grains requirements for each month based on online data.
For more: – Pg 13 http://dfpd.nic.in/writereaddata/images/e-book.pdf:/
[4]. Costly Ignorance
Context:-
The article highlights financial illiteracy in the country which is a cause for concern in India’s endeavour towards financial inclusion.
What does the study say?
A study by S&P Ratings Services found 76% of Indian adults don’t understand concepts like compounding of interest, inflation and risk diversification.
India’s financial literacy is lower than the global average, and lower than many sub-Saharan nations.
It also shows that poor financial skills in the country is quite acute across the income spectrum (both rich and poor)
Concern:-
If financial literacy remains poor it will be difficult to penetrate deeper in Financial inclusion, than just account opening.
Initiatives:-
- Reserve Bank of India is spearheading a financial literacy drive—part of this involves funding and setting up Financial Inclusion and Literacy Centres across the country
- Using mobile telephony in the country to make financial literacy more commonplace, through easy-to-understand mobile learning.
You need to know!
Risk Diversification:-
It is the manner in which an investor invests in a variety of financial instruments like stocks, bonds etc and also in different sectors.
For example, an investor would not want to combine large investment positions in airlines,
trucking, and automobile manufacturing as each industry is significantly affected by oil prices.
It is based on the fact that not all asset classes or industries or individual companies move up and down in value at the same time or at the same rate thus mitigating risks.
Financial literacy centres:-
Guidelines on the Financial Literacy Centres (FLC), advises that FLCs and all the rural branches of scheduled commercial banks should scale up financial literacy efforts through conduct of outdoor Financial Literacy Camps at least once a month, to facilitate financial inclusion through provision of two essentials i.e. ‘Financial Literacy’ and easy ‘Financial Access’.
For more:-
https://www.rbi.org.in/scripts/NotificationUser.aspx?Id=7844&Mode=0
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=10074
[5]. Making municipal bonds work
Context:-
The municipal bonds market in India has not performed well since their introduction in 1997.
Given the widening gap between huge capital requirement by cities and their annual revenue revival of the municipal bonds can be a game changer.
Such bonds have been widely used in South Africa and Vietnam and have provided successful results.
What are Municipal bonds?
Say your city corporation wants to set up a new Metro rail network. It can issue municipal bonds to fund the project. Institutional investors as well as the public can buy these bonds. Revenues from the Metro will then be used to repay the interest and principal on these bonds.
For more:-
Why we need municipal bonds?
It will deepen the long-term infrastructure financing market in India as well as redirect retail investments (by city residents) away from real estate and gold.
By creating opportunities for citizens (as retail investors) to invest in tangible public causes in their cities, it can build strong bonds of trust between municipalities and citizens.
Right start
Smart Cities Mission envisages creation of special purpose vehicles in cities that would raise monies from the capital markets. SEBI has issued guidelines earlier this year for issuance of municipal bonds.
Need for policy reforms
- Financial Self sufficiency: A long-term roadmap to financial self-sufficiency of municipalities needs to be drawn up covering powers over revenues and borrowings, efficiency of revenue administration (both assessments and collections) and systematic measurement, reporting and review of revenue performance.
Though local self-government is a state subject, the Centre has a crucial role to play in addressing the infrastructure deficit in our cities
- Professional expertise: The revenue and finance departments of municipalities need to be urgently professional and made market-oriented.
- Making It attractive: Deliberately creating and positioning of the municipal bond brand to make it popular among citizens, and a slew of enabling measures to make them attractive.
- The missing links: The public good that municipal bonds can accomplish, and the personal connect that city residents have with individual projects they should be highlighted.
- Making all municipal bond issuances tax-free,
- Making investments in municipal bonds by banks part of their priority sector lending
- Actively encouraging pension funds and insurance companies to participate in municipal bond issuances need to be put into place by respective regulators.
Need of the hour
In the public policy discourse in India, “how will it get done” (implementation) and “who will do it” (ownership) are often more important than what needs to be done.
Who?
The Union finance ministry alone is capable of making municipal bonds work, because this requires serious domain expertise and leverage with states and regulatory institutions.
How?
Municipalities need to produce audited balance sheets each financial year and get themselves credit-rated so that they are able to access the municipal bond market in a credible and sustained manner.
Opinion & Editorial
[1]. The strange love for Nuclear energy
Context: In the light of recent joint statement of Japanese PM Shinzo Abe and PM Modi wherein both the sides welcomed the agreement for Cooperation in the Peaceful Uses of Nuclear Energy” and expressed the hope that “this Agreement will be signed after the technical details are finalised”.
Author says that India is venturing into an uncharted territory with the construction of untested and expensive reactors which will only benefit MNCs, adversely affecting Make in India.
Commercial interests of Japanese companies
As per author, the leading companies whose reactors government is planning to import are,
- GE Economic Simplified Boiling Water Reactor (ESBWR) for Kovvada, AP. The ESBWR was developed by GE in collaboration with Japan’s Hitachi
- Areva’s European Pressurised Reactors (EPRs) for Jaitapur (Maharashtra). Japan Steel Works supplies critical components to EPR.
- Westinghouse AP1000 reactors for Mithi Virdi (Gujarat). Japanese company Toshiba holds a controlling stake in Westinghouse
A global downturn in the nuclear industry after the Fukushima disaster (GE ESBWR was involved) in 2011 has left these companies with serious commercial difficulties. Nuclear deal is meant to clear the way for the Japanese companies to sell their wares in India.
No buyers inside Japan for Nuclear power
The Fukushima disaster of 2011 reminds Japanese of the dangers of the Nuclear power so there is no scope of sales of nuclear reactors in Japan. A commission established by the Japanese Parliament emphasised the role of poor safety practices in the Japanese nuclear industry and went so far as to state that “this was a disaster ‘Made in Japan’”. Despite a strong push by the Abe government, nuclear power finds little support in the country. So, the corporations have turned their interest towards India.
Why India should resist the offer?
- Prohibitive costs: The cost of electricity generated by domestic Nuclear reactors is already high and to implement designs such as ESBWR, AP100 and EPR which are not operational anywhere in the world the cost figures must rely on projections which only rise as the time passes. The huge cost is in part due to astronomical capital cost of the reactors.
For example: it was reported that the total costs of the two AP1000s being built in the U.S. state of Georgia might rise to $21 billion, significantly more than the initial projection of $14 billion. Likewise, the latest estimate, from September 2015, of the cost of the EPR being built at Flamanville (France) is €10.5 billion ($11.6 billion), up from €3.2 billion.
- Tariff: Author calculates that the tariff as per Indian scale for a nuclear reactor that costs $11billion in Europe would result in a cost of Rs.19 per unit for the first year. When we compare it to the recent winning bids of coal and solar power which have been in the range of 4.50rs to 5.50rs, one can clearly see the huge difference.
Indian govt says,
We will build key components in India thereby promoting Make-in India.
Author says that the in press briefing last year, Joint Secretary (East Asia) explained that India’s motivation in signing a nuclear deal with Japan is the inherent advantage involving Japanese industry wrt large-scale forgings.
So, author asserts that if key components are being built in Japan they can’t be built here in India simultaneously.
- Safety issues: The reactors under consideration are untested, and provide no empirical track record of safe operation. Although the industry produces some calculations, using a technique called probabilistic risk assessment to claim that these reactors are safe, these techniques are unreliable both on theoretical and empirical grounds. Companies themselves are aware of the risks associated which can be gauged from their constant efforts to alet India’s Liability Law.
Lessons from Japan
GE’s CEO, Jeffrey Immelt, explicitly stated earlier this year that he would not invest in India without legal indemnity.
Author says that India should not give into such threats and learn lessons from Fukushima accident. More than 50 years ago, Japan succumbed to pressure from nuclear suppliers and instituted a law to indemnify them. Consequently, when the GE reactors at Fukushima suffered an accident, in part due to a design defect that had been pointed out decades earlier, GE was protected from any claims by victims. The cost of the clean-up, estimated at about $200 billion, has been borne almost entirely by Japanese taxpayers. Of course, multinational suppliers would like to institute the same outrageous arrangement in India, but there is no reason that the government should oblige them
Opposition to Nuclear deal in Japan and India
Recently, 13 villages near Jaitapur passed a joint resolution against that nuclear plant. Large protests have also taken place at Kovvada and Mithi Virdi. Before Mr. Abe’s visit, the mayors of Hiroshima and Nagasaki took the unusual step of jointly writing to their Prime Minister asking him to reconsider the deal with India. It is revealing that the leaders of “Asia’s largest democracies” have entirely ignored these voices on the ground, and instead moved to bail out the multinational nuclear industry.
[2]. Warning for Beijing
Context: In the wake of recent visit of Japanese PM Shinzo Abe and signing of key pacts, author singles out the agreement on bullet train link between Ahmedabad and Mumbai as the most important one.
Author says,
- A blow to China’s high speed rail diplomacy: China and Japan are both engaged in a fierce competition to export its high-speed rail technology. China recently bagged such contract in Indonesia. Indonesia opted for China as it was offering a high concessional loan with no guarantee from Indonesian government. Japan learned from it and has offered India a $12 Billion loan with 0.1% interest rate re-payable over 50 years.
- Delhi-Mumbai: China won the contract for the feasibility study of high-speed train link between Delhi-Mumbai. So, China can still get to export its high-speed rail system to India
- Maritime Silk Road: China has eagerly promoted its Maritime Silk road initiative and has invited India to join it. India has still not cleared its stand. Although a map released by China shows Kolkata as a part of the Maritime Silk Road. If India refuses, the routes would have to be redrawn bypassing Indian ports.
- Indo-Japan co-operation: Together with finance and technology from Japan, India can challenge the growing challenge of China in South Asia and the Indian Ocean
- Building up the presence: The mentioning of South China Sea dispute in the joint statement with Japan and with US earlier this year states the fact that India is again trying to build up its presence in the South Asian region.
Conclusion
Author concludes by saying that India can twist the insecurity of China over the increasing co-operation between India and Japan to make it shell out some attractive packages like the one Tokyo did.
By: ForumIAS Editorial Team
Leave a Reply