9 PM Daily Current Affairs Brief – 31 March 2017

[1]. Bumpy ride

[2]. A time for electoral reform

---

Live Mint

---

[1]. Urgent next steps in banking sector reforms

---

Front Page / NATIONAL

---

[1]. LokSabha clears Finance Bill

 

The Hindu

 

Context

Five of Upper House’s amendments rejected

 

Give a light read. Nothing relevant here

 

[2]. Delhi to extend $5 billion credit to Dhaka

 

The Hindu

 

Context

India interested in railway projects and road transportation and maintenance

 

What has happened?

India has offered a new line of credit for $5 billion, its biggest yet in the neighborhood, to Bangladesh

• The credit would be open-ended and would follow the $1 billion offered in 2010, and the $2 billion in 2015

 

India’s interest

Areas of interest for India are,

• Railway projects
• Road transportation
• Road maintenance

 

Note: Bangladeshi PM Sheikh Hasina is set to visit New Delhi next week. All agreements and important announcements would be dealt in detail then

---

Editorial/OPINION

---

[1]. Next steps on GST

 

The Hindu

 

Context

The spirit of give and take must continue to operationalise the new indirect tax regime

 

What has happened?

LokSabha has duly given its assent to necessary Central legislation to operationalize the Goods and Services Tax

 

Issues that remain

• Too much leeway to government: While the highest GST rate has been pegged at 28%, the integrated GST law has set a ceiling of 40%. Though an enabling provision, it gives the government too much leeway to alter the rate structure in coming years without seeking Parliament’s nod
• Anti-profiteering clauses to curb ‘unjust enrichment’ of firms
• Separate registration of branch offices in each State
• Treating all transactions between related parties (including head office and branch offices) as taxable

 

[2]. A clean-up act: no compromise over air quality

The Hindu

 

Context

The Supreme Court has signaled there can be no compromise over air quality

 

What has happened?

SC has ordered a freeze on the registration and sale of BS-III fuel compliant vehicles by “any manufacturer or dealer” on and from April 1, when the next level and environmentally friendly BS-IV fuel emission standards are scheduled to kick in

Catalytic Converter

 

SC’s directions

• No selling: On and from April 1, 2017, such vehicles that are not BS-IV compliant shall not be sold in India by any manufacturer or dealer, that is to say that such vehicles, whether two-wheeler, three- wheeler, four-wheeler or commercial vehicles will not be sold
• No registration: All the vehicle registering authorities under the Motor Vehicles Act, 1988, are prohibited from registering such vehicles on and from April 1, 2017, that do not meet BS-IV emission standards, except on proof that such a vehicle has already been sold on or before March 31, 2017

 

Standard	Reference	Date
Bharat Stage II	Euro 2	1 April 2005
Bharat Stage III	Euro 3	1 April 2010
Bharat Stage IV	Euro 4	1 April 2017
Bharat Stage VI	Euro 6	April 2020 (proposed)

 

What are Bharat stage emission standards?

 

Bharat stage emission standards are emission standards instituted by the Government of India to normalize the productivity of air pollutants from internal combustion engine equipment

• The standards and the timeline for implementation are set by the Central Pollution Control Board under the Ministry of Environment & Forests and Climate Change. Bharat Stage norms are based on European regulations
• Each stage specifies a certain limit on the pollutants released, which is controlled by the type of fuel made by the oil companies and the upgradations and modifications made by the auto firms to their vehicles to control the pollutants released from the vehicle

 

Note: Please note that Bharat Stage V has been skipped and we will straightaway jump to Bharat Stage VI

 

Impact of the decision

A little over eight lakh BS-III vehicles will have to be either upgraded or sold abroad. As a total sum, this is a small fraction of the 19 Crore vehicles on Indian roads today

 

Why BS IV?

Less pollution: Particulate emissions from BS IV compliant trucks are 80 per cent less compared to those from trucks that adhere to BS III standards. BS IV compliant cars emit half the pollutants compared to cars made according to BS III specifications.

 

Observations

Author observes that,

• A clear message: It is unlikely that the court’s uncompromising approach will have a significant impact on reducing air pollution. But the message it sends out on air pollution is unmistakable that the manufacturers should prepare earnestly to shift to Bharat Stage VI norms on 1^st April 2020
• Centre should ensure that objective of the Supreme Court’s order is met, and the ‘one fuel, one country’ goal for BS-IV is fulfilled. This is crucial to ensure that the catalytic converters of newer vehicles are not affected by lower-grade fuels

 

Note:

• In 13 major cities, Bharat Stage IV emission norms have been in place since April 2010 and it’s enforced for whole country from April 2017
• The first emission norms in India were introduced in 1991 for petrol and the next year for diesel vehicles. In around 2005 and 2006, BS III was rolled out in NCR and several other cities in a bid to check on pollution. This was almost similar to European standards (Euro III) which was in place between 2000 and 2005 in most western nations

 

 

[3]. Is Aadhaar a breach of privacy?

 

The Hindu

 

Context

A simple debate centering on Aadhaar

 

Give it a go through. 

---

Economy

---

[1]. Centre picks airlines to connect 43 regional airports

The Hindu

 

Context

Adding 43 new destinations with the launch of RCS

 

What has happened?

The Centre has announced a list of routes awarded to five airlines which will operate flights under its regional connectivity scheme (RCS), named UDAN (UdeDeshkaAamNaagrik)

 

Low cost airlines

Low cost airline SpiceJet, Air India subsidiary Alliance Air, along with regional airlines Turbo Megha Airways, Air Deccan and Air Odisha Aviation won the rights to operate flights under the regional connectivity scheme under which half of the seats on the plane will be capped at ₹2,500 per hour’s flight

 

Connecting with nearest bigger airport

The regional airlines will connect these destinations with their nearest bigger airports such as Delhi, Bengaluru, Chennai, Bhubaneswar, Mumbai, Ahmedabad, and Jaipur, among others.

 

Regional Connectivity Scheme (RCS)

• Centre to subsidize losses: As per the scheme, the Centre will subsidize the losses incurred by airlines flying out of dormant airports to help airlines charge ₹2,500 for an hour’s flight
• 80% of the subsidy will be collected by charging a levy of up to ₹8,500 on each departing flight of domestic airlines and the rest 20% will come from the respective State governments
• The government will provide subsidy to airlines for first three years of operations when they will have exclusive flying rights on the selected routes
• Benefits: This scheme will stimulate growth in the regional aviation market and will connect underserved and unserved airports that really didn’t have flight services

 

[2]. Board moots EPF for unorganised sector

 

The Hindu

 

Context

 

The Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO) on Thursday recommended to the Centre to extend social security benefits to more than 61 lakh workers in the unorganised sector

 

News has already been covered in the brief dated 29^th Mar 17 under Economy section

---

Indian Express

---

[1]. Bumpy ride

 

Indian Express

 

Context

Changeover from BS III to BS IV car emission standards happened over seven years. There are lessons to be learnt

 

Why BS IV norms could not be implemented in entire country?

Although BS IV norms were put in place in 13 major cities in 2010, they could not be implemented throughout the country because Indian refineries lacked the capacity to cleanse fuel to BS IV standards.

• As late as January 2016, fuel stations in nearly 70 per cent cities in the country did not have this superior quality fuel, leading the auto-industry to argue that this shortage was preventing it from making a complete transition to BS IV compliant vehicles

 

Relevant points concerning Bharat Stage IV have already been covered under The Hindu editorial

 

[2]. A time for electoral reform

 

Indian Express

 

Context

A debate in RajyaSabha last week raised important questions. These, like the Election Commission’s proposals and recommendations, must no longer remain unaddressed

 

Article discusses various issues raised in the Rajya Saba, regarding electoral reforms.

 

EC’s reform proposals

The EC’s proposals could broadly be divided into three categories

• Reform to cleanse the electoral system (debarring criminally-tainted politicians from contesting, checking money power, empowering the EC to deregister defunct and dubious parties)

 

• Reforms to make the EC stronger and more independent (appointment of election commissioners through a collegium, their elevation to CEC on the criterion of seniority and their protection from removal only through impeachment as available to the CEC

 

• Reforms to make the electoral system more efficient (like the introduction of totaliser machines to prevent disclosure of polling patterns in a polling booth).

---

Live Mint

---

[1]. Urgent next steps in banking sector reforms

 

Live Mint

 

Context

We must accelerate recoveries from non-performing assets, recapitalize public sector banks, and introduce reforms that will increase the efficiency of these banks.

 

Author’s contention

Improving existing condition of banks requires action on three fronts. We must

• Accelerate recoveries from non-performing assets (NPAs),
• Recapitalize public sector banks to strengthen their ability to expand credit, and
• Introduce reforms that will increase the efficiency of these banks

 

This article explores how we might address these challenges

 

ACCELERATING RECOVERIES FROM NPAs

Author suggests that the best solution to address this problem is,

• Creation a new government institution—the so-called “bad bank”—to which the public sector banks transfer their large problem assets at a realistic price, leaving it to the new entity to handle recovery

 

Recapitalization of public sector banks

• Budgetary funds should be allocated in a manner which favors the better-performing banks. This approach will increase the overall efficiency of the public sector banking system as a whole, and incentivize the weak banks to improve their performance

 

Reforms in the banking sector

Improving Banking sector as a whole is very important in the coming years. Some steps that can be taken are,

• Reducing the government equity below 51%, and attracting some strategic investors, would be a very major step. It will not only reduce the pressure on the budget to provide funds for recapitalization, it will also set the stage for a more commercial orientation for public sector banks. This is critical if public sector banks are to compete more effectively with private sector banks
• If reducing government equity is not possible then we should think about the suggestions of PJ Nayak committeeas per which vesting the government’s shareholdings in public sector banks in a separate holding company, and limiting the finance ministry to deal only with the holding company on policy issues can help.

 

---