9 PM Daily Current Affairs Brief – 3 February 2017

The Hindu

Context

State drafting legislation that will enable collection of genetic fingerprints to solve crime, track offenders

What has happened?

The Andhra Pradesh government plans to bring in legislation that will allow the State police and investigating agencies to collect and store DNA samples in a centralised database

Backdrop:-

 Draft bill on the issue by centre in 2012: Centre had first prepared a draft bill on the issue in 2012, but the legislation ran into severe opposition from activists on the ground that it violated privacy. It has since been on hold

• The Centre’s Human DNA Profiling Bill, 2015, was prepared by the Department of Biotechnology and the Hyderabad-based Centre for DNA-Fingerprinting and Diagnostics but is yet to be cleared by the Union Cabinet. Several organisations and individuals, however, raised concerns that the bill gave sweeping powers to government to mine the database and use it for purposes beyond just solving crime

DNA collection-kit launched

In August 2016, the Andhra Pradesh government, in an event attended by Chief Minister N. Chandrababu Naidu, launched a DNA collection-kit developed by IntegenX, Inc, a US company that enables DNA to be extracted from saliva and blood samples within a matter of two hours

Rationale behind the move

Tracking repeat offenders: The reasoning is that a centralised DNA database on convicts would help track repeat offenders in sexual assault and rape

Issues

• Database might be compromised

Counter: So far, about 70 million samples have been collected in 54 countries over 20 years, and there have been no instances of databases being compromised

• Database needs a supportive central legislation to be of any use
• Need to first train people in collecting DNA from crime scenes and storing them properly. A database can come later
  

  ---

The Hindu

Context

Nirupama Rao, a former ambassador to China, makes a case for Indo-China dialogue to promote connectivity, communication & betterment of bilateral relations b/w the two countries

Backdrop

Article takes the backdrop of recent suggestions made by Chinese ambassador for improvement of bilateral ties between China and India

 Issues that concern India vis-à-vis China

• China’s blocking of India’s entry to NSG
• Vetoing India’s efforts to get Masood Azhar listed under UNSC’s 1267 Committee
• Deployment of Chinese military and engineering assets in Pakistan-occupied Kashmir (PoK)
• The development of the China-Pakistan Economic Corridor (CPEC)

Suggestions made by ambassador

Chinese ambassador suggested a

• Friendship and cooperation treaty
• A free trade agreement (FTA) to boost bilateral relations
• Joining of hands on China’s One Belt, One Road (OBOR) initiative
• Resolution of Boundary disputes: Ambassador expressed that time is ripe for both countries to reap some ‘early harvest’ outcomes from unresolved boundary issues

• Early harvest: A term, in trade negotiations, for agreeing to accept and implement the results of a portion of the negotiations before the rest of the negotiations are completed
• In here, it indicates that both India & China need to build upon existing points of agreement while working to resolve the issue fully

 Significance: A policy shift within Chinese establishment vis-à-vis India!

That the Ambassador chose to make these remarks at the newly-established Ji Xianlin Centre for India-China Studies at the University of Mumbai campus could mean that

• There is an effort within Chinese establishment to review relations with neighbors like India

Who was Ji Xanlin?

Ji Xianlin was one of China’s foremost modern Indologists and a protagonist of friendship and civilizational understanding between India and China

 Why, such a shift might be taking place within Chinese establishment?

Author states that the recent suggestions by Chinese ambassador might indicate a shift in China’s policy towards India because of strategic uncertainties generated by the advent of Donald Trump’s administration in the U.S. and his open negativity towards China. Moreover, Mr Trump’s following actions have spurred concern in Beijing,

• His phone call with the Taiwanese President, Tsai Ing-wen, before he took office (It should be noted that as per People Republic of China’s (PRC) One China policy, Taiwan (or Republic Of China (ROC)) is its inalienable part while ROC considers itself a fully sovereign country)
• His proclaimed intention to impose punitive tariffs on Chinese goods
• The new U.S. Secretary of State, Rex Tillerson’s thinly disguised threats against China’s building of artificial islands in the disputed areas in the South China Sea

Dissecting the suggestions: –

 Treaty of friendship & Cooperation

Author states that the suggestion of a friendship & cooperation treaty made by Chinese ambassador recalls the 1954 “Panchsheel” Agreement which outlined the 5 principles of peaceful co-existence & were broken with impunity by China in 1962

• Previous agreements: The 1993 and 1996 agreements on peace and tranquility and confidence-building in the India-China border areas reiterated the five principles and also spoke of the non-use of force and the concept of mutual and equal security
• Mere symbolism: Given the difference in size & strength of both the nations, a treaty here would be only a symbolic gesture rather than having any transformative value

Free Trade Agreement

Author terms the suggestion of an FTA to be forward-looking idea

• Growth in Indo-China trade: Trade between India and China has grown to an annual volume of $70 billion (2015-16)
• India wants Chinese investment:India has made a strong pitch for Chinese investments under Make in India in infrastructure development, solar energy and smart cities
• Only a comprehensive FTA will help India: An FTA that is goods-centred will obviously not benefit India given the huge trade in goods imbalance that favours China. An FTA that is comprehensive, covering goods and services, cross-border investment, R&D, standards and dispute resolution would be worth exploring.

Connectivity: Joining OBOR
India’s reservations against OBOR are mainly due to the following reason,

• Chinese ambassador has suggested resolving boundary issues and joining of OBOR by India but it should be noted that China conveniently undermined Indian apprehensions and sensitivities over CPEC despite recognizing the disputed nature of the area under 1963 China-Pakistan Boundary Agreement
• Reviving connectivity b/w India & Tibet: Author states that India can consider reviving connectivity between Tibet and India, especially through the Sikkim sector into Bengal. The old route between Lhasa and Kolkata via Nathu La was the most easily traversed route — and may still be, despite the road networks constructed by the Chinese in Tibet — between Tibet and mainland China, via land and sea, up until the mid-20th century. This is a road that provided for the transport of goods and services between Tibet and the outside world through India

• Opening ties b/w India & Xinjiang region: An opening of ties between India and the Xinjiang region of China is also worth examining. Providing for air connectivity between Urumqi, the capital of Xinjiang province, and New Delhi as one of the OBOR linkages, for instance, would help the promotion of people-to-people ties and trade and commercial contact and could also help open a new chapter in counter-terrorism cooperation between India and China
  • Common challenges:Kashmir and Xinjiang, both contiguous neighbors, have similar challenges posed by terrorism and separatist movements

Way forward

Author states that the longstanding peace b/w two countries should be preserved and the suggestions made by Chinese ambassador, howsoever, modest they may be, are worth a consideration

• Competitive coexistence with a clear listing out of differences b/w two nations and how to manage them, the promotion of business and people-centered connectivity, and mutual confidence-building present a way forward
• The border problem will take time to resolve owing to its complexity
  

  ---

The Hindu

Context

Author states that the recent move proposed by Union Budget to reign in political financing is bound to fail. Why does he thinks so? Let us find out

What has been proposed?

• Limiting anonymous donations: In the Union Budget presented on 1^st Feb 2017, it was proposed that political parties would now have to mention details of anonymous donations above Rs 2000 unlike the previous limit of Rs 20000.
  • This announcement should be seen in the light of recent ADR report which cited that maximum portion of political funding is composed of such anonymous donations
• Allowing donors to purchase electoral bonds: Budget further proposed to allow donors to purchase electoral bonds from banks against cheque and digital payments to be given to registered political parties for redemption
• Filing Return within time limit: The Budget makes it mandatory for political parties to file returns within a time limit

Author’s contention

Proposal aredoomed to fail, not because they doesn’t go far enough but because they go in the wrong direction

Author’s reasons

• No disruption to the flow of illicit money: The proposal does not disrupt the flow of illicit political donations but only channels it differently, and will not reduce the proportion of cash from unverifiable sources in the total donations received
• Circumvention is easy: Author states that all that political parties would now have to do is to find more people to lend their names to these donations, or better still, find more names of unsuspecting people to be listed as cash donors
• Against transparency: The proposal to allow donors to purchase electoral bonds from banks against cheque and digital payments to be given to registered political parties for redemption, meant to cater to donors’ need to remain anonymous to rival political parties, hardly contributes to transparency
• Low compliance in absence of strict punitive measures: The Budget makes it mandatory for political parties to file returns within a time limit, but in the absence of extreme penal provisions compliance is likely to be low

 What should have been done?

• Limit the amount that can be received in cash as donations: Author states that instead of existing proposal budget should have placed a cap on the amount a party may receive in cash as a donation
• There should be no anonymity for donors: Donors should not enjoy any anonymity, before tax authorities or the general public. The absence of such anonymity, of course, will bring down the level of contributions from corporate houses and other entities to parties, not such a bad thing
  

  ---

The Hindu

Context

The pressing urgency of post-Brexit trade agreements is forcing the British government into a closer embrace of the Trump administration despite protests

The Hindu

Context

Article talks about proposals related to National Pension Scheme (NPS) in the recent Budget

Proposals

• Withdrawal limit increased: Subscribers are now allowed to withdraw up to 25% of their accumulated corpus before retirement without tax
• Investment ceiling increased for self-employed: Self-employed individuals have also been allowed to invest up to 20% of their income into the NPS as opposed to 10% earlier
• No tax on premature withdrawal if NPS allows: If the NPS Trust allows premature withdrawal after five or ten years as per its rules, there will be no tax on that
• Exemption on partial withdrawal: It has also been proposed to insert a new clause (12B) in the section 10 of the Income Tax Act, 1961 to provide exemption on partial withdrawal not exceeding 25% of the contribution made by an employee. This benefit will be effective on partial withdrawals made by the subscriber after April 1, 2017
• Contribution up to 20% of the gross income of the self-employed individual (individual other than salaried class) will be deductible from the taxable income under Section 80CCD (1) of the Income Tax Act, 1961, as against 10% earlier
  

  ---

The Hindu

Context

The budget presented yesterday marks a paradigm shift in multiple ways

Author delineates positives of the budget and juxtaposes reasons as to why it is a step in the right direction.

Read it once.

Note: Everything relevant about Union Budget vis-à-vis UPSC preparation

Indian Express

Context

Article juxtaposes the budget’s digital strategy to spur a less cash economy as envisaged by the present government in the aftermath of demonetization move

Two schemes

Author states that at the heart of Budget’s strategy to spur a digital ecosystem lies a push towards increased usage of BHIM app. Government has tried to achieve this through introduction of two incentive schemes,

• Referral Bonus scheme
• Cash back scheme for merchants who accept the payment system

Further steps taken

• A merchant version of the Aadhaar Pay system will be launched soon
• To stimulate adoption in different situations, the government plans to mandate digital payments at petrol stations, hospitals and universities
• Cash transactions over Rs 3 lakh have been banned altogether
• Removal of service charge: Indian Railways will no longer levy a service charge on train tickets booked online through the IRCTC website
• Boosting digital infrastructure:

1. Improving point of sale digital infrastructure: Government is going to remove duties on point-of-sale devices and fingerprint readers and there are plans for 10 lakh point-of-sale machines to be introduced by banks by March and another 20 lakh Aadhaar-based point-of-sale machines by September 2017
2. Broadband connectivity to 150000 gram panchayats by the end of 2017-18 under BharatNetalong with a DigiGaon initiative to be launched to provide tele-medicine, education and skills through digital technology. Overall, the government’s target is to achieve 25 billion digital transactions in 2017-18

• Payments Board: A Payments Regulatory Board has also been proposed under the Reserve Bank of India to supervise and regulate payment and settlement systems
• Bridging gender gap: Allocation of Rs 1.84 lakh crore for female skill development which will help to close the gender gap and will further help in closing other gaps likeboth socio-economic and digital

Why, government is right in incentivizing BHIM usage?

Because of the following features,

• Simple to use: It is relatively simple to use and based on the Unified Payments Interface (UPI) technology
• No concerns about interoperability: It allows for bank-to-bank and bank-to-e-wallet payments without concerns about inter-operability
• No need for internet connectivity: Currently, there are five payment options on the BHIM app; the Aadhaar number will be the sixth. There is no need for internet connectivity or a smartphone

How does this budget help wallet players like paytym?

Author states that although much of the focus has been around BHIM, a strategy that builds a trustworthy digital payments ecosystem and educates consumers could create benefits for all digital payment players

Point of worry

Author points out that

• Concern over cyber-attacks: With growing number of digital transactions the threat of cyber-attacks also increases. While the budget does provide for a Computer Emergency Response Team for the financial sector, which would work in close coordination with all financial sector regulators and other stakeholders, more scenarios could have been anticipated and more resources allocated to bolster cyber defences
• Current state of security of Aadhaar-based payment systems: The applications will use the biometric details registered in the Aadhaar card system. Even top-of-the-line fingerprint scanners can be fooled. Fingerprint data can be stolen. Technology against this is being developed but is far from being fool-proof

Way forward: A lot of ground to cover

Author states that despite obvious difficulties India still presents an attractive destination to build up the right digital ecosystem and environment

• Study of ‘digital trust’ by Fletcher school: In a first-of-its-kind study of “digital trust” around the world that we are currently conducting at The Fletcher School, in collaboration with MasterCard, we find that out of 40 countries studied,
  • A dismal rank: India ranks 36th in the quality of consumer experience and trustworthiness of the digital environment, as measured by security, accountability and privacy features
  • Ranked in the middle: In terms of how tolerant consumers are to all the frictions in the digital system, we find the Indian consumer in the middle of the pack — 24th out of 40 countries

What does above rankings imply?

• There is a lot of ground to cover in creating a trustworthy environment and enhancing consumer experience
• The Indian consumer is both patient and adaptable and is likely to give the government and the providers room to improve

Conclusion

The Budget is a step in the right direction as it incentivizes the people to move towards digital transactions unlike demonetization which forced them to do so.

Read More: BharatNet, All relevant points from Budget

Indian Express

Context

Budget makes some good moves on agriculture. But they don’t add up to reforms necessary to meet aspirations in rural India

Welcome initiatives

Author states that the Union budget has provided some welcome initiatives like

1. Boosting rural roads: Support for rural roads (Pradhan Mantri Gram Sadak Yojana) in the current as well as coming fiscal, at Rs 19,000 crore each, is more than double the Rs 8,885 crore and Rs 9,806 crore allocated in 2012-13 and 2013-14, respectively
2. Boosting rural housing: The budgeted expenditure of Rs 23,000 crore for rural housing (Pradhan Mantri Awas Yojana) in 2017-18 is, again, almost twice the Rs 12,982 crore that was spent in 2013-14
3. Helping Agri & farm sector:The creation of a Long-Term Irrigation Fund with a total corpus of Rs 40,000 crore, a new Pradhan Mantri FasalBima Yojana that is certainly an improvement over previous crop insurance schemes in terms of coverage and sums insured (though the subsidy provision of Rs 9,000 crore may prove inadequate)
4. Improving MGNREGS: Crediting of MGNREGA wages directly into the accounts of beneficiaries alongside efforts to link the programme with building of productive assets (farm ponds, dub wells, compost pits, etc.)

Author’s contention

The reforms are good but are inadequate wrt the necessary reforms to meet the rising aspirations in rural India. Government could have taken the lead for these bold reforms — replacing subsidies with direct benefit transfers and deregulating urea prices, among other things — in the first half of its tenure

Live Mint

Context

The budget has done some things right but there is a limit to what can be achieved through stroke-of-the-pen reforms

Let us take a look at meaning of the word ‘Structural reforms’

Structural Reforms

At its simplest, structural reforms imply changes to the way the government works. Structural reform is about the correction of government as it functions at the ground level, a process which calls for deep immersion and follow-through.

Read More: Please go through this article to have a thorough understanding as to what is actually meant by the word structural reform

Rest of the article is a brief commentary on steps taken in the budget

Read it once