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[1].GST Council undecided over authority for tax assessment
Context: 4th round of meetings of GST council was inconclusive regarding the key issue of how to divide the authority to assess tax between the Centre and the States.
Next meeting
The next GST Council meeting has been postponed from November 9-10 to November 24-25 and the Ministers will meet for an informal session on November 20 to discuss the tax assessment issue further
Draft bills
The preparation of the drafts of the Central GST, State GST, Inter-state GST, and Compensation Law will be completed by November 14-15. The draft laws will then be sent to the States, which will have one week to respond with any recommendations
Horizontal division
Government said that one option is to divide assessees horizontally, where those with a turnover of less than Rs. 1.5 crore a year will be assessed by the States and those with more than that will be shared by the States and the Centre
[2].Legal tangle hits Ecuador Dhruv deal
Context: HAL moves court after the South American nation terminated chopper pact following four crashes.
Backdrop
In a clear indication of its ambition to emerge as a key player in the global defence market, India began exports of its indigenous Dhruv helicopters in 2009 to Ecuador with much fanfare. Almost seven years later, however, the expectations have been severely contradicted as Ecuador is planning to sell off three remaining helicopters, after four crashed; the Hindustan Aeronautics Limited (HAL) has now moved a local court.
Source: the Hindu
Procurement and subsequent crashes
Ecuador had procured the seven Dhruv Advanced Light Helicopters (ALH) in two batches — five in 2009 and two in 2011 — in a deal worth $ 45.2 million. But following the four crashes, Ecuador unilaterally terminated the contract with HAL in October 2015.
• Reasons for crash: Of the four helicopters that crashed, two had been attributed to pilot error, one was due to a mechanical failure while the reason for the fourth crash is not clear.
Help offered
After the termination, HAL had offered free maintenance beyond the contractual obligations but “they wanted more.” “Considering the unreasonable demands, it was decided to take the matter to court in Ecuador.
• HAL was responsible for the maintenance of the choppers for 24 months after which Ecuadorean personnel, who had been trained by HAL, were expected to take over.
Reasons given for contract termination
• Lack of spares & maintenance
HAL’s stance: HAL officials rejected the charges and said enough spares were supplied and stocked in the country during the contract period
About Dhruva
The Dhruv, indigenously designed and developed by HAL, is powered by a Shakti engine, jointly developed by HAL and Turbomeca of France. Over 200 of these choppers are currently in service in India.
[3]. ‘Make enforcement stricter’
Context: CPCB had issued a 42-point guideline to the States to tackle air pollution. There were short-, medium- and long-term measures.
Source: The Hindu
News
Union Environment Secretary Ajay Narayan Jha on Friday called for special attention to the enforcement of orders issued by the Central Pollution Control Board (CPCB)
He further said that,
• Last December, the CPCB had issued a 42-point guideline to the States to tackle air pollution. There were short-, medium- and long-term measures. There are areas where much more needs to be done
• Because the enforcement mechanism is still weak, the States have been asked to make enforcement stricter and take steps that need to be taken
[4]. Panel seeks views on judicial vacancies
Context
The Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice has sought views from the public on the delay in filling vacancies in the Supreme Court and the High Courts. There is an ongoing tussle between the Union government and the judiciary on the draft Memorandum of Procedure (MoP) for judicial appointments.
Backdrop
The note inviting public suggestions is a follow-up to the interactions the committee had with senior jurists like senior advocate and a former Solicitor General Mohan Parasaran and Indira Jaisingh on October 25 and the Bar Association representatives on November 2 on the subject.
Press release by Committee secretariat noted that,
Around 42 per cent of sanctioned posts in the higher judiciary are lying vacant for quite some time now. Such a large number of vacancies is alarming in nature and has direct bearing upon the access to justice for common people.
• The Committee intends to address systemic short-comings in judicial appointments and suggest improvements to streamline the existing procedure and process for appointment in higher judiciary
Confidential
The suggestions could be sent via email to rs-cpers@sansad.nic.in, or via post to the Director Rajya Sabha Secretariat at Room No. 145, First Floor, Parliament House Annexe, New Delhi. Maintaining that oral evidence is allowed, the press note said that all the material submitted to the Committee shall be treated as ‘confidential’.
Editorial/OPINION
[1].Still unwieldy but just in time
Context
Tax structure under GST has been finalised by the GST council but author argues that it is still too complicated to meet the objective of simplifying tax compliance.
Finalised tax structure
• Multiple rates: The Goods and Services Tax (GST) will be levied at multiple rates ranging from 0 per cent to 28 per cent.
• Cess on ultra-luxury, sin and demerit goods: Ultra-luxuries, demerit and sin goods, will attract a cess for a period of five years on top of the 28 per cent GST
• On nearly half of the consumer inflation basket, including food grains, the GST will be at 0 per cent
• Lowest slab: The lowest slab of 5 per cent will be for items of common consumption
• Standard rates for bulk of foods and services: There would be two standard rates of 12 per cent and 18 per cent, which would fall on the bulk of the goods and services. This includes fast-moving consumer goods
• Services to become costly: Most services are expected to become costlier as the ones being taxed currently at the rate of 15 per cent are likely to be put in the 18-per cent slab
• Highest slab: The highest slab of 28 per cent will include white goods and all those items on which the current rate of incidence varies from 30-31 per cent
Meeting the concerns
Concerns of States that levy Value Added Tax at 5 per cent on items of mass consumption were met by lowering the threshold GST rate.
A surprise
Author states that raising the highest tax slab to 28 per cent to balance the fiscal books is a surprise, especially since it would be levied on items such as consumer durables and cars that are now taxed at 30-31 per cent.
• Not good: Even if producers do pass on this rate differential to customers, this is hardly likely to generate the kind of consumption that could drive more manufacturing investment, create jobs and consolidate economic growth.
Multiple tax slabs: A problem
Multiple slabs lead to complications on compliance and issues on classification
Undesirable cess
Author alleges that the cess that has been levied on sin, ultra-luxury and demerit goods is neither efficient nor desirable
Dovetailing (joining) multiple tax rates
Government has said that it will do away with the cess in the coming four to five years. Author
says a similar target should be given to join multiple tax rates into two or three
Conclusion
Author concludes that GST tax structure finalised is still too complex and a far cry from the objective of simplifying tax structure with which it set out at the onset.
[2].Piecing together an encounter
Context: For nation’s security, we need to strengthen the lowest rungs of the national security architecture, namely, the police stations and prisons
Author, in first few paragraphs has given an account of what actually happened on the fateful Diwali night in Bhopal central jail, how the prison guard was killed, how the under-trials allegedly escaped unseen and then their encounter thereafter later in the day.
Author then goes on to state that this whole incident and the debate that it has elicited has ramifications for our nation’s internal security policy.
Working at the grass-roots
• There is a need to strengthen the lowest rungs of the national security architecture, namely, the police stations and prisons. Strengthening does not necessarily mean giving more powerful arms to policemen and prison guards, but ensuring that security measures put in place are enforced properly
• Appointing persons of high caliber as superintendent of prisons who can ensure that standard operating procedure is scrupulously followed.
Can police fire in unarmed under-trials?
Yes. As per Section 46 (2) and (3) of the Criminal Procedure Code if and when a person forcibly resists the endeavor to arrest him, or attempts to evade the arrest, such police officer or other person may use all means necessary to effect the arrest, including causing the death of a person if he is accused of an offence punishable with death or imprisonment for life.
Inquiry is a pity
Author regrets that police will now be facing an inquiry regarding the whole operation, not because it is not right in this case, but because those who conduct an inquiry are rarely familiar with the pressures under which police officers in the field function
Tough situation
There are certain occasions when passions run high, especially when one of your own has been killed. In a war situation, a nation’s army avenging a colleague’s death is perfectly permissible. In an internal security situation, you have to abide by the law of the land, which limits the extent or the scope of your reaction.
• Passions run high: There are certain occasions when passions run high, especially when one of your own has been killed. In a war situation, a nation’s army avenging a colleague’s death is perfectly permissible. In an internal security situation, you have to abide by the law of the land, which limits the extent or the scope of your reaction
• Maintaining restraint or ensuring compliance under immense pressure situations is a difficult task and those entrusted with conducting an inquiry are unable to grasp the gravity of such a situation
Hence in most inquiries the police officer finds it immensely difficult to answer questions regarding following rules in such conditions
Backed by legislation
Author points out that if government wants police to take strong action against them then it must also back its officers with strong legislation so that they are not left to fight their battles in court
Need to capture alive
Author stresses the need to capture terrorists alive because by capturing them alive we can extract useful information from them, which would be far more useful than their dead cold bodies.
Conclusion
Author concludes by saying that there is a need to inspire young officers away from the misplaced sense of valor and explain it to them that there is no gallantry involved in shooting at people who cannot shoot back, either because their hands are already tied behind their back, or because they are already dead.
Indian Express
[1]. Engaging with the enemy
Context
Author details steps as to how India can normalize relations with Pakistan
Author begins by stating that India being economically larger and militarily stronger state out of the two, the responsibility of normalizing the relations lies with it.
Aggressive tactics a success?
Author then questions as to whether the recently aggressive stance of India towards Pakistan has borne any fruit.
• It should be noted here that India has termed Pakistan an Ivy League of terrorism during General Assembly meeting in UN recently
Unintended outcomes
Author states that the tactics followed by both countries have,
• Resulted in development of ill-feelings between citizenry of both the nations
• Fueled fears of an imminent nuclear war between India and Pakistan
Neutralising Pakistan:
• Policy of Peace: Author stresses that India should show courage in following a policy of peace with Pakistan, which runs counter to the current national discourse that will settle nothing short of a full blown war
• Widen the rift: Another policy line that India can adopt is to show through its actions and words that it does not harbor feelings of animosity and aversion towards Pakistan’s marginalised minorities, endangered liberals, fearless rights defenders and impoverished masses, thereby widening the split between the civilian and military leaderships
• Adopt a modern policy: India should adopt a 21st century policy of proportionate response, military de-escalation and diplomatic engagement towards Pakistan
• Examining the protest: India needs to devote more resources to examining objectively the disorder in Kashmir rather than blaming Pakistan for everything
• Welcoming Pakistani artists: India should continue to make Pakistani musicians and actors feel welcome, and use their presence to maximise positive publicity. The present response of some political parties hounding Pakistani actors have only created a backlash towards beneficial business of screening Bollywood films in Pakistan
• Expanding the list: The government should consider expanding the informal list of persona grata (after proper vetting) to include Pakistani businessmen interested in tapping India’s vast market, and citizens of Pakistani ancestry who wish to travel to India as tourists, for medical consultation or to visit relatives.
• Taking Pakistan away from China: The ongoing China Pakistan Economic Corridor project (CPEC) is nothing but a proof of India’s unintended success in pushing Pakistan deep into China’s embrace. It may not be too late to try to convince Pakistanis that India’s long record of religious tolerance and abiding by WTO rules is a more reliable basis for permanent friendship.
i) Opening for India: As the CPEC’s hidden costs come to light and Baluch nationalist groups give warnings, there may be an opening for India to wean Pakistan away from China with a generous, long-term partnership offer, whose starting point could be the Most Favored Nation (MFN) status accorded to Pakistan in 1996.
Conclusion
Author concludes by saying that it is time that we should give peace a chance.
INTERNATIONAL
[1]. India, China discuss steps to improve ties
Context: National Security Adviser Ajit Doval and his Chinese counterpart met in Hyderabad for a day-long discussion on improving bilateral ties, especially on the issue of India’s entry into the NSG (Nuclear Suppliers Group) and U.N. ban on terrorist Masood Azhar.
Backdrop
Meeting is part of efforts to improve high-level interaction to deal with issues of mutual interest and concern.
Ties facing challenges
Bilateral ties between the two sides have been facing challenges, ranging from China’s blocking of India’s entry into the NSG to the recent boycott in India against Chinese goods
China’s stance on India’s entry to NSG
Despite India’s efforts, China is yet to relent on its opposition to New Delhi’s entry into the 48-member NSG.
• China has opposed the entry, saying India has not signed the Nuclear Non-Proliferation Treaty, while suggesting that the NSG should have a common criteria for entry of non-NSG members, putting India and Pakistan at the same level
[2]. President reaches out to Madhesis
Context
President of India is on the Nepal visit which is first by an Indian head of state in 18 years
What Indian president said?
• India’s development plans would help achieve shared prosperity for both countries
• Speaking at a civic reception in Janakpur, he said that the city was part of the Ramayana and Buddhhist circuits and would benefit from greater connectivity and tourism between India and Nepal
• Develop consensus: India has urged Nepal’s diverse population to build a Constitution through “broad consensus.
Importance of the visit to Janakpur and Janakimata temple
It allowed India to address the citizens of the Madhesh region directly after a major blockade organised by the Madhesis in 2015 led to the closure of the economic supply lines of Nepal and hurt India-Nepal ties.
Backdrop: Madhesi leaders repeatedly complained about being denied of rights by Kathmandu. They have been protesting against the newly floated constitution of Nepal
ECONOMY
[1]. Turkey wants India to start free trade pact talks soon
Context
Turkey wants India to start talks on a proposed Free Trade Agreement (FTA) soon and said the ongoing political turmoil will not impact foreign investment flows.
Joint study group report
Though there is an India-Turkey Joint Study Group report on “the feasibility and possibility of concluding a Comprehensive Economic Partnership Agreement” (CEPA or, in other words, a FTA), no dates have been fixed for starting FTA negotiations.
Making India a gateway for improving business
Turkish companies want to make India a gateway for improving business ties in South Asia. Indian companies can use Turkey as a hub to expand operations in the European Union (with which Turkey has a Customs Union agreement), the Middle East and Africa.
Shrinking trade
In FY’16, India-Turkey trade had shrunk nearly 28 per cent year-on-year to $4.91 billion of which India’s exports to Turkey were $4.14 billion (contraction of 22.7 per cent) while Turkey’s exports to India fell 47 per cent to $776 million.
What is a Free Trade Agreement (FTA)?
FTA between two or more countries is an agreement to establish a free trade area where commerce in goods and services can be conducted across their common borders, without tariffs or hindrances but (in contrast to a common market) capital or labor may not move freely. Member countries usually impose a uniform tariff (called common external tariff) on trade with non-member countries.
[2]. GDP advance estimates by January
The Hindu
Context
The Central Statistical Organisation will provide its advance estimates of GDP growth by the first week of January to facilitate the presentation of the Union Budget earlier than February 28
Earlier position
As of now the GDP estimates come around first week of February
Higher growth expected
The economy will clock higher growth this year than the 7.6 per cent GDP growth in 2015-16 on the back of improved farm sector output.
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