‘Paddy-Frog’IASToppers-2019
Current Affair Analysis

13th June 2019 Current Affairs Analysis -IASToppers

‘Paddy frog’; 33rd Feria Internacional del Libro de Guadalajara; National Rural Drinking Water Programme (NRDWP); Kailash Manasarovar Yatra; World Day Against Child Labour; Leader of Rajya Sabha; Article 356; International Arbitration Centre (NDIAC) Bill, 2019; Institutionalised Arbitration; What are Kelps? Bimal Jalan committee on economic capital framework; Multilateral Convention to Implement Tax Treaty Related Measures; Base erosion and profit shifting (BEPS); Bureau of Police Research and Development (BPRD); etc.
By IT's Current Affairs Analysis Team
June 13, 2019

Contents

Polity & Governance

  • Thawarchand Gehlot appointed Leader of Rajya Sabha
  • Cabinet approves extension of President’s Rule in J&K for six months with effect from 3rd July, 2019
  • J&K Constitution provides for Governor’s rule unlike other states

Government Schemes & Policies

  • Piped water coverage to increase from 18 to 100% by 2024
  • Cabinet approves International Arbitration Centre Bill

Issues related to Health & Education

  • World Day Against Child Labour: An overview of the current situation in India

Economy

  • Consensus eludes RBI-appointed Jalan panel on economic capital framework
  • Ratification of the Multilateral Convention to Implement Tax Treaty Related Measures

Environment, Ecology & Disaster Management

  • DU scientists discover frog in Assam, name it after Northeast
  • Underwater forests in the Arctic are expanding with climate change

Art & Culture

  • Kailash Manasarovar Yatra

Key Facts for Prelims

  • 33rd Feria Internacional del Libro de Guadalajara
  • Bureau of Police Research and Development (BPRD)

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Polity & Governance

Thawarchand Gehlot appointed Leader of Rajya Sabha

Union Minister Thawarchand Gehlot was appointed the Leader of the Rajya Sabha, a position occupied in the previous government who has had health issues and is currently recovering.

Leader of Rajya Sabha Current Affairs Analysis

Leader of the House (Rajya Sabha)

Leader of Rajya Sabha1

  • The term Leader of the House has been defined in Rules of Procedure of the Lok Sabha and the Rajya Sabha.
  • The Leader of the upper House is a Rajya Sabha member who is either a cabinet minister or another nominated minister.
  • The Leader of the House is an important parliamentary functionary and exercises direct influence on the course of parliamentary business.
  • The Leader of the House in Rajya Sabha is normally the Prime Minister, if he is its member or any Minister who is a member of the House and is nominated by him to so function.
  • He occupies the first seat in the Chamber in first row at right the side of the Chair so that he is easily available to the Presiding Officer for consultation.

Functions:

  • His primary responsibility is to maintain coordination amongst all sections of the House for a harmonious and meaningful debate in the House.
  • For this purpose, he remains in close contact not only with the Government but also with the Opposition, individual ministers and the Presiding Officer.
  • The Leader of the House is an important parliamentary functionary and exercises direct influence on the course of parliamentary business.
  • The whole policy of the Government especially in so far as it is expressed in the inner life of the House and in measures dealing with the course of its business, is concentrated in his person.
  • The arrangement of Government business is the ultimate responsibility of the Leader of the House, though the details are settled, subject to his approval, by the Chief Whip.
  • The Leader of the House makes proposals for the dates of summoning and prorogation of the House for the approval of the Chair.
  • He has to draw up the programme of official business to be transacted in the Session of Parliament, namely, Bills, motions, discussions on general or specific subjects like five-year plans, foreign policy, economic or industrial policy and other important State activities.
  • He fixes inter se priorities for various items of business to ensure their smooth passage.
  • Under the rules, the Leader of the House is consulted by the Chairman in regard to the arrangement of Government business in the House, allotment of days or allocation of time for discussion on the President’s Address, Private Members’ business on any day other than Friday, discussion on No Day-Yet-Named Motions, Short Duration Discussions and consideration and return of a Money Bill.
  • He is also consulted by the Chairman in the matter of adjournment or otherwise of the House for the day in case of death of an outstanding personality, national leader or international dignitary.
  • He works as the spokesperson of the House in expressing sense of the House and represents it on ceremonial or formal occasions.
  • After settling tentative programme for the whole session, he maps out weekly and daily programme depending upon the state of progress of work and announces the programme to the members in advances every week. 

Business Advisory Committee:

  • The Business Advisory Committee determines the allocation of time for Government Bills and otter business on the basis of suggestions made by or received from him from time to time.
  • The Leader of the Lok Sabha. viz., Prime Minister, never sits in the Business advisory Committee; he or she is represented by the Minister for Parliamentary Affairs in the Business Advisory Committee.
  • The Leader of the House in the Rajya Sabha is generally a member of the Business Advisory Committee (BAC). In the event, he is not a member of the BAC, he is invited to attend its meetings.

 [Ref: Economic Times]

 

Cabinet approves extension of President’s Rule in J&K for six months with effect from 3rd July, 2019

The Union Cabinet has approved the extension of President’s Rule in Jammu and Kashmir for a further period of six months from 3rd July, 2019, under article 356(4) of the Constitution of India.

PTI6_12_2019_000203B

Implications:

  • The present term of President’s Rule is expiring on 2nd July, 2019 and the Governor has recommended that the President Rule in the State may be extended for a further period of six months with effect from 3rd July, 2019.

Background:

  • The Governor of Jammu & Kashmir issued a proclamation in June 2018 under Section 92 of the Constitution of Jammu and Kashmir with the concurrence of the President of India, thereby assuming to himself the functions of the Government and Legislature of the State.
  • The State Assembly was dissolved by the Governor in November 2018.
  • Under Section 92 of the Constitution of Jammu and Kashmir, there is no provision for further continuation of such Proclamation after six months.
  • Hence, on the recommendation of Governor and having regard to the prevailing situation in the State, President issued a proclamation promulgating President’s Rule in J&K under article 356 of the Constitution of India.
[Ref: PIB]

 

J&K Constitution provides for Governor’s rule unlike other states

Under the provision of Section 92 of the Jammu and Kashmir Constitution, Governor’s rule is imposed for six months, but only after the consent of the President of India.j&k

What is President’s Rule in the Indian context?

  • The imposition of Article 356 of the Constitution on a State following the failure of constitutional machinery is called President’s Rule in India. Once the President’s Rule has been imposed on a state, the elected state government will be temporarily dissolved, and the Governor, who is appointed by the government at the Centre, will replace the Chief Minister as the chief executive of the State.
  • The state will fall under the direct control of the Union government.
  • Article 356 is inspired by sections 93 of the Government of India Act, 1935, which provided that if a Governor of a province was satisfied that a situation had arisen in which the government of the province cannot be carried on in accordance with the provisions of the said Act, he could assume to himself all or any of the powers of the government and discharge those functions in his discretion.
  • The imposition of the President’s rule requires the sanction of both the houses of Parliament. If approved, it can go on for a period of six months. However, the imposition cannot be extended for more than three years, and needs to be brought before the two houses every six months for approval.

When can President’s Rule be imposed on a state?

  • State Legislature is unable to elect a leader as Chief Minister
  • Collapse of a Coalition due to disagreements, parting ways within the members
  • Serious breakdown law and order
  • Elections postponed due to ineludible reasons
  • Loss of majority in the state assembly
  • Shoot up of insurgency or rebellion

Critic on Article 356:

  • Article 356 has been widely criticised for giving provisions for the party/coalition in the Centre to misuse democratic powers for political gains. Dr BR Ambedkar called it ‘the death letter of Indian Constitution’.
  • The rival parties running governments in various states were dissolved by those at the Centre by making use of the Article.
  • The dismissal of the Communist government in Kerala by Jawaharlal Nehru in July 1959, and the 21 instances during the period 1975-1979 are often considered as examples of the misuse of the President’s Rule.

How Governor’s rule and President’s rule set J&K apart from other states?

J&K President’s rule

  • The Constitution of India grants special status to Jammu and Kashmir among Indian states, and it is the only state in India to have a separate Constitution and regulations specific to it.
  • In other states, the president’s rule is imposed under the Article 356 of Constitution of India. In J&K, governor’s rule is mentioned under Article 370 section 92 – ‘Provisions in case of failure of constitutional machinery in the State.’
  • Article 370 states that the Union Government jurisdiction extends over limited matters with respect to State of Jammu and Kashmir, and in all other matters not specifically vested in federal governments, actions have to be supported by state legislature.
  • Under the provision of Section 92 of the Jammu and Kashmir Constitution, Governor’s rule is imposed for six months, but only after the consent of the President of India.
  • Under the Governor’s rule, the State Assembly is either kept in suspended animation or dissolved. If it is not possible to restore the state machinery before the expiry of the six-month period, the provision is extended.
  • The Governor’s rule was imposed on the state for the first time in March 1977, when the Congress withdrew support to National Conference (NC) government led by the late Sheikh Abdullah.
  • Among notable differences with other states, till 1965, the head of state in Jammu and Kashmir was called Sadr-e-Riyasat, whereas in other state, the title was Governor, and head of government was called Prime Minister in place of Chief Minister in other states.
  • The Government of India can declare emergency in Jammu and Kashmir and impose Governor’s rule in certain conditions. Matters related to defence, foreign relations, communication and finance of Jammu and Kashmir are under jurisdiction of the Constitution of India.

Provisions for Governor’s rule as per Article 370 section 92:

  • In case of failure of constitutional machinery in the State,
  • If at any time, the Governor is satisfied that a situation has arisen in which the Government of the State cannot be carried on in accordance with the provisions of this Constitution, the Governor may by Proclamation-

(a) Assume to himself all or any of the functions of the Government of the State.

  1. b) Make such incidental provisions as appear to the Governor to be necessary for giving effect to the objects of the Proclamation,

Provided that nothing in this section shall authorise the Governor to assume to himself any of the powers vested in or exercisable by the High Court –

  • Any such Proclamation may be revoked or varied by a subsequent Proclamation.
  • Any such Proclamation whether varied under subsection (2) or not, shall except where it is a Proclamation revoking a previous Proclamation, cease to operate on the expiration of six months from the date on which it was first issued.
  • If the Government or by a Proclamation under his section assumes, to himself any, of the powers of the Legislature to make his laws, any law made by him in the exercise of that power shall, subject to, the terms there of continue to have effect until two years have elapsed from the date on which the proclamation ceases to have effect, unless sooner
  • No Proclamation under this section shall, except where it is a Proclamation revoking a previous Proclamation, be laid before each House of the Legislature as soon as it is convened.

Key Facts:

  • Uttar Pradesh is the Indian state upon which the President’s Rule has been imposed for the most number of times.
  • Indira Gandhi imposed the most number of President’s rule upon states of India.
  • In 1994, the Supreme Court delivered a landmark judgement in the SR Bommai vs Union of India case, introducing certain guidelines to check the unwarranted intrusion of the central government and the imposition of Article 356 for political gains.
[Ref: Economic Times, Financial Express]

 

Government Schemes & Policies

Piped water coverage to increase from 18 to 100% by 2024

The Central government has decided to increase coverage of piped water to households from the current 18 per cent to 100 per cent by 2024.

Clean drinking water to all by 2024 4

About the Piped water coverage:

  • The minister of Jal Shakti stated that the Formulation of a plan under ‘Nal Se Jal’ (water from tap) mission to provide tap water to 14 crore households is underway.Clean drinking water to all by 2024 2

National Rural Drinking Water Programme (NRDWP)

jal-shakti

  • It is a centrally sponsored scheme, launched in 2009, which aims to provide safe and adequate water for drinking, cooking and other domestic needs to every rural person on a sustainable basis.
  • The scheme provides financial and technical assistance to state governments to install rural drinking water connections.
  • However, the NRDWP has been restructured in 2018 towards improving efficiency by approving nearly 23,000 crore for the programme till 2020.

Performance of NRDP:

  • The programme’s target was to provide 35% of rural households with water connections and 40 lt–about two buckets–of water per person per day. However, due to poor execution and weak contract management, less than half that target was achieved.
  • National Rural Drinking Water Programme, despite spending 90% of Rs 89,956 crore budget over five years to 2017, has “failed” its targets, according to an August 2018 report from the government’s auditor.
  • About 78% of 1.7 million rural Indian habitations have access to the minimum required quantity of water, 40 litre per person per day, but that does not mean they actually get this water, experts said. Nearly 18% of rural habitations get less than 40 litre per person per day under the National Rural Drinking Water Programme.

Key Facts:

  • Sikkim had 99 per cent coverage of piped water to households, while some states such as Uttar Pradesh, Bihar, Odisha, Chhattisgarh, and Jharkhand had below five per cent.
  • The per capita water availability was over 5,000 litre cube in 1950 but it has now reduced to 1,434 litre cube.
  • Punjab and Haryana consume water that is double the amount they actually store and harvest.
  • Nearly 163 million people lack access to clean water close to their homes in India–which is more than two-and-a-half times the number in Ethiopia, second in the list of countries with people without access to safe water.
  • Water falls under the State List of the Constitution.
  • India’s estimated per capita availability of water in 2025 will be 1,341 cubic metre (cu.m). This may further fall to 1,140 cu.m in 2050, bringing it closer to becoming water-scarce.

 [Ref: The Hindu, Business standard]

 

Cabinet approves International Arbitration Centre Bill

Cabinet-approves-International-Arbitration-Centre-Bill

The Cabinet has approved the International Arbitration Centre (NDIAC) Bill, 2019, to promote ease of doing business in India.

About the International Arbitration Centre (NDIAC) Bill, 2019

  • The Bill provides for setting up an independent an autonomous body for institutional arbitration and to acquire and transfer the undertakings of International Centre for Alternative Dispute Resolution (ICADR) to New Delhi International Arbitration Centre (NDIAC).
  • The Bill will replace the New Delhi International Arbitration Centre Ordinance, 2019, promulgated by President in March, 2019 while saving all the actions done or taken under the Ordinance which will be deemed to have been done or taken under the provisions of this Bill.

Objective of the NDAIC:

Objective of the NDAIC

  • Bring targeted reforms to develop itself as a flagship institution for conducting international and domestic arbitration
  • Provide facilities and administrative assistance for conciliation, mediation and arbitral proceedings
  • Maintain panels of accredited arbitrators, conciliators and mediators both at national and international level or specialists such as surveyors and investigators
  • Facilitate conducting of international and domestic arbitrations and conciliation in the most professional manner
  • Provide cost effective and timely services for the conduct of arbitrations and conciliations at Domestic and International level
  • Promote studies in the field of alternative dispute resolution and related matters, and to promote reforms in the system of settlement of disputes
  • Co-operate with other societies, institutions and organisations, national or international for promoting alternative dispute resolution

Composition of NDIAC:

  • The New Delhi International Arbitration Centre (NDIAC) will be headed by a Chairperson, who has been a Judge of the Supreme Court or a Judge of a High Court or an eminent person, having special knowledge and experience in the conduct or administration of arbitration, law or management, to be appointed by the Central Government in consultation with the Chief Justice of India.
  • Besides, it will also have two Full-time or Part-time Members from amongst eminent persons having substantial knowledge and experience in institutional arbitration in both domestic and international.
  • In addition, one representative of a recognized body of commerce and industry shall be nominated on rotational basis as a Part-time Member.
  • The Secretary, Department of Legal Affairs, Ministry of Law & Justice, Financial Adviser nominated by Department of Expenditure, Ministry of Finance and Chief Executive Officer, NDIAC will be ex-officio Members.

Significance:

  • Institutionalized arbitration will attract quality experts in India, and as a consequence, it will substantially reduce the cost incurred in the process of arbitration, especially at various international forum.
  • It will facilitate India becoming a hub for institutional arbitration.

Background:

  • A High-Level Committee (HLC), headed by Mr. Justice B.N. Srikrishna, was constituted in the year 2017 which recommended that the Government may take over the International Centre for Alternative Dispute Resolution (ICADR), using the public funds and develop it as an Institution of National Importance.
  • Taking into consideration the HLC’s recommendations and in the view of the provisions of the Article 107 (5) and 123 (2) of the Constitution, a Bill, namely the New Delhi International Arbitration Centre (NDIAC) Bill 2018 was approved.
  • The President, in view of the importance of the matter and urgency to make India a hub of institutionalized arbitration and promote ‘Ease of Doing Business’ in India, promulgated an Ordinance namely “The New Delhi International Arbitration Centre Ordinance, 2019” on 2nd March, 2019.

What is Arbitration?

  • Arbitration may be defined as the process by which a dispute or difference between two or more parties as to their mutual legal rights and liabilities is referred to and determined judicially by one or more persons (the arbitral tribunal) instead of by a court of law.
  • The objective of arbitration is to provide fair and impartial resolution of disputes without causing unnecessary delay or expense.
  • Some common institutions are the London Court of International Arbitration (LCIA), the International Chamber of Commerce (ICC), the Dubai International Finance Centre (DIFC) etc.
  • There are two forms of arbitration namely, ad hoc arbitration and institutional arbitration.

What is Institutionalised Arbitration?

  • An institutional arbitration is one in which a specialised institution intervenes and takes on the role of administering the arbitration process.
  • Each institution has its own set of rules which provide a framework for the arbitration, and its own form of administration to assist in the process.

Advantages of institutional arbitration:

  • Availability of pre-established rules and procedures which ensure the arbitration proceedings begin in a timely manner
  • Administrative assistance from the institution, which will provide a secretariat or court of arbitration
  • A list of qualified arbitrators to choose from
  • Assistance in encouraging reluctant parties to proceed with arbitration
  • An established format with a proven record

What is Ad-hoc arbitration?

  • An ad hoc arbitration is one which is not administered by an institution and therefore, the parties are required to determine all aspects of the arbitration like the number of arbitrators, manner of their appointment, procedure for conducting the arbitration, etc.

Advantages of Ad-hoc arbitration:

  • A properly structured ad hoc arbitration should be more cost effective, and therefore better suited to smaller claims and less wealthy parties.
  • A primary advantage of the ad hoc process is its flexibility, enabling the parties to decide the dispute resolution procedure themselves.
[Ref: PIB, Business standard, Livemint]

 

Issues related to Health & Education

World Day Against Child Labour: An overview of the current situation in India

World_Day_against_Child_Labour_2019

Each year on 12 June, the World Day Against Child Labour brings together governments, employers and workers organizations to highlight the plight of child labourers.

About the World Day against child Labour:

About-the-World-Day-against-child-Labour

  • The International Labour Organization (ILO) launched the World Day Against Child Labour in 2002 to focus attention on the global extent of child labour and the action and efforts needed to eliminate it.
  • The theme of the 2019 World Day Against Child Labour was “Children shouldn’t work in fields, but on dreams!”.

What is Child Labour?

  • The term ‘child labour’ is often defined as work that deprives children of their childhood, their potential and their dignity, and is harmful to their physical and mental development.
  • In India, “Child” as defined by the child labour (prohibition and regulation) Act 1986 is a person who has not completed the age of 14 years. 

It refers to work that:

  • is mentally, physically, socially or morally dangerous and harmful to children.
  • interferes with their schooling by depriving them of the opportunity to attend school; obliging them to leave school prematurely; or requiring them to attempt to combine school attendance with excessively long and heavy work.

Forms of child labour:

  • All forms of slavery or practices similar to slavery, such as the sale and trafficking of children, debt bondage and forced or compulsory labour, including forced or compulsory recruitment of children for use in armed conflict.
  • The use, procuring or offering of a child for prostitution, for the production of pornography or for pornographic performances.
  • The use, procuring or offering of a child for illicit activities, in particular for the production and trafficking of drugs as defined in the relevant international treaties.
  • Work which, by its nature or the circumstances in which it is carried out, is likely to harm the health, safety or morals of children.

Child labour in India:

Child-labour-in-India

  • One in three child labourers in the 7-14 age group are illiterate who work for more than six months in a year.
  • While 45 percent of child labourers in Bihar are illiterate, in Rajasthan and Jharkhand, the figure stands at 40 percent.
  • Madhya Pradesh and Andhra Pradesh also have about 38 percent child labourers as illiterate.

Initiatives taken by the government to prevent child labour

  1. In 1979, the central government formed the first statutory committee led by Gurupadswamy to analyse on the issue of child labour in India.
  • Taking into account the findings and recommendations of the Gurupadswamy committee, the union government enacted the child labour (Prohibition and & Regulation) Act in 1986.
  • The act prohibited children from being employed in specified hazardous occupations and at the same time regulated their working condition in other non-hazardous occupations and processes.
  1. India ratified International Labour Organizations Convention (ILO) no 138 (minimum age for employment) and convention no 182 (worst forms of child labour), to symbolise its commitment for the eradication of child labour and attainment of Sustainable Development Goal 8.7 related with curbing of child labour.
  • India is the 170th ILO Member State to ratify a convention (181) which requires states to set a minimum age under which no one shall be admitted to employment or work in any occupation, except for light work and artistic performances.
  • Similarly, for convention no 182, India is the 181st  member state to ratify and reaffirm its commitment for the prohibition and elimination of worst forms of child labour, including slavery, forced labour and trafficking; the use of children in armed conflict; use of children for prostitution, pornography and in illicit activities (drug trafficking); and hazardous work.
  1. A landmark step in the endeavour to have a child labour free society was the enactment of the Child labour (Prohibition and Prevention) Amendment Act, 2016 in August 2016.
  • It provides for a complete prohibition on the employment of children below 14 years in all occupations and prohibits the employment of adolescents (14-18 years) in hazardous occupations and processes.
  • The age of admission to employment has been linked to the age of compulsory education under the Right to Education Act (RTE), 2009.
  1. British Asian Trust, the leading South Asian diaspora development organisation announced a major new partnership with leading Jaipur-based Indian Premier League (IPL) cricket team the Rajasthan Royals.
  • The partnership, backed by the Children’s Investment Fund Foundation (CIFF), will launch a media-driven mass awareness campaign to combat child-trafficking in India.
  • It is aimed to raise the funds to scale up the British Asian Trust’s anti-trafficking programme in India and develop a mass awareness campaign to combat child trafficking.

Key Facts:

  • There are 10.13 million Child labourers between 5-14 years in India (2011 census data).
  • There are 22.87 million working children in India between 15-18 years.
  • Child labour in 2011 has decreased by around 20 percent from 2001 census figures.
  • As per 2011 census, one in 11 children are working in India (5-18 years).
  • 80 percent of the child labour in India is concentrated in rural areas.
  • ILO 2016 data indicates that there are 152 million working children in the world between 5-17 years, of which 23.8 million children are in India.
  • So, 16 percent of the working children (or every 6th working child) in this age group is in India.
[Ref: Indian Today]

 

Economy

Consensus eludes RBI-appointed Jalan panel on economic capital framework

RBI Panel on Economic Capital Framework1

The Reserve Bank of India (RBI)-appointed committee to review the economic capital framework of the central bank failed to arrive at a consensus during a meeting leading to a delay in finalising its report.

Background:

  • RBI had constituted a panel on economic capital framework. It was headed by Ex-RBI governor Bimal Jalan.
  • The committee, formed in December 2018, was supposed to submit its report by April 2019, but it was later given a three-month extension.
  • The expert panel on RBI’s economic capital framework was formed to address the issue of RBI reserves—one of the sticking points between the central bank and the government.

Mandate of Bimal Jalan committee:

  • To review status, need and justification of various reserves and buffers maintained by RBI
  • Review global best practices followed by central banks in making provisions for risks
  • Suggest adequate level of risk provisioning that RBI needs to maintain
  • Determine whether RBI is holding provisions, reserves and buffers in surplus or deficit
  • Propose suitable profits distribution policy

Delay in Finalizing the Report:

  • The main difference of opinion has arisen between the panel members and the government’s representative on the panel over the transfer of the RBI’s ‘excess’ capital reserves.
  • While most panel members were in favour of a phased transfer of the RBI’s capital reserves to the government over the years, some believe in a one-time transfer.

What’s the issue?

  • The government has been insisting that the central bank hand over its surplus reserves amid a shortfall in revenue collections.
  • Access to the funds will allow the government to meet deficit targets, infuse capital into weak banks to boost lending and fund welfare programmes.

What is economic capital framework?

  • Economic capital framework refers to the risk capital required by the central bank while taking into account different risks.
  • The economic capital framework reflects the capital that an institution requires or needs to hold as a counter against unforeseen risks or events or losses in the future.

Why it needs a fix?

  • Existing economic capital framework which governs the RBI’s capital requirements and terms for the transfer of its surplus to the government is based on a conservative assessment of risk by the central bank and that a review of the framework would result in excess capital being freed, which the RBI can then share with the government.
  • The government believes that RBI is sitting on much higher reserves than it actually needs to tide over financial emergencies that India may face.
  • Some central banks around the world (like US and UK) keep 13% to 14% of their assets as a reserve compared to RBI’s 27% and some (like Russia) more than that.
  • Economists in the past have argued for RBI releasing ‘extra’ capital that can be put to productive use by the government. The Malegam Committee estimated the excess (in 2013) at Rs 1.49 lakh crore.

Nature of the arrangement between the government and RBI on the transfer of surplus or profits:

rbi

  • Although RBI was promoted as a private shareholders’ bank in 1935 with a paid up capital of Rs 5 crore, the government nationalised RBI in January 1949, making the sovereign its “owner”. What the central bank does, therefore, is transfer the “surplus” — that is, the excess of income over expenditure — to the government, in accordance with Section 47 (Allocation of Surplus Profits) of the Reserve Bank of India Act, 1934.

Does the RBI pay tax on these earnings or profits?

  • Its statute provides exemption from paying income-tax or any other tax, including wealth tax.

Why RBI needs excess reserves?

  • The RBI needs adequate capital reserves for monetary policy operations, currency fluctuations, possible fall in value of bonds, sterilisation costs related to open-market operations, credit risks arising from the lender of last resort function and other risks from unexpected increase in its expenditure.
  • The RBI has maintained the view that it needs to have a stronger balance sheet to deal with a possible crisis and external shocks.
[Ref: The Hindu, Business standard]

 

Ratification of the Multilateral Convention to Implement Tax Treaty Related Measures

Union Cabinet has approved the ratification of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI).

  • India has already ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting.

About the Multilateral Convention:

About-the-Multilateral-Convention

  • The Multilateral Convention is an outcome of the Organisation for Economic Co-operation and Development (OECD) / G20 Project to tackle Base Erosion and Profit Shifting (the BEPS Project).
  • India was part of the Ad Hoc Group which finalized the text of the Multilateral Convention, which was adopted in 2016.
  • The Convention implements two minimum standards relating to prevention of treaty abuse and dispute resolution through Mutual Agreement Procedure.
  • The Convention will operate to modify tax treaties between two or more Parties to the Convention. It will not function in the same way as an amending protocol to a single existing treaty, which would directly amend the text of the Covered Tax Agreement.
  • Instead, it will be applied alongside existing tax treaties, modifying their application in order to implement the BEPS measures.
  • The Convention will modify India’s treaties in order to curb revenue loss through treaty abuse and base erosion and profit shifting strategies.
  • A list of Covered Tax Agreements as well as a list of reservations and options chosen by a country are required to be made at the time of signature or when depositing the instrument of ratification.

Significance

Significance:

  • The Convention will modify India’s treaties in order to curb revenue loss through treaty abuse and base erosion and profit shifting strategies by ensuring that profits are taxed where substantive economic activities generating the profits are carried out and where value is created.
  • The Convention enables to implement the tax treaty related changes to achieve anti-abuse BEPS outcomes through the multilateral route without the need to bilaterally re-negotiate each such agreement which is burdensome and time consuming.

What is Base erosion and profit shifting (BEPS)?

  • BEPS refers to tax planning strategies used by multinational companies, that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where there is little or no economic activity, resulting in little or no overall corporate tax being paid.

BEPS Project:

  • The project headed by the Organization for Economic Cooperation and Development (OECD) was initiated by the G20 in 2012.
  • The OECD/G20 Inclusive Framework on BEPS has a global membership, including about 70% of non-OECD and non-G20 countries from all geographic regions.
  • Developing countries have been engaged since the beginning of the BEPS Project.
  • The Final BEPS Project identified 15 actions to address BEPS in a comprehensive manner.
  • There are over 125 members and 14 observer organisations in this project. More than 85 countries and jurisdictions have signed the Multilateral Instrument on BEPS.
[Ref: PIB, OECD]

 

Environment, Ecology & Disaster Management

DU scientists discover frog in Assam, name it after Northeast

A team of scientists from Delhi University and the Wildlife Institute of India, in collaboration with researchers from Indonesia and the US, have discovered a new species of ‘paddy frog’ from Northeast India, primarily Assam.

About the new frog species:

About-the-new-frog-species

  • The frog belongs to the microhylid genus Micryletta, a group of narrow-mouthed frogs that is primarily and widely distributed in Southeast Asia, more commonly known as paddy frogs.
  • The new species has been named ‘aishani’, derived from the Sanskrit word ‘aishani’ or aisani meaning Northeast.
  • The new species is likely to be more widely distributed in Northeast India, particularly the Indo-Burma biodiversity hotspot region that lies south of River Brahmaputra.
  • Micryletta aishani is currently endemic to Northeast India but it could very well be present in neighbouring regions of Bangladesh and Myanmar.

Characteristics:

  • This new species strikingly differs from other narrow-mouthed paddy frogs by characteristics such as reddish-brown colouration on back, prominent dark streaks and ash-grey mottling on the lateral sides, shape of the snout, and absence of web on its feet.

Background:

  • The first known species of this genus was originally described from Sumatra in Indonesia.
  • As of now, there are only four recognised species in this group, and Micryletta aishani becomes the fifth.
[Ref: Indian Express]

 

Underwater forests in the Arctic are expanding with climate change

Proliferation of kelps in the Arctic3

Lush underwater forests of large brown seaweeds (kelps) are particularly striking in the Arctic, especially in contrast to the land where harsh climates leave the ground barren with little vegetation.

What are Kelps?

Proliferation of kelps in the Arctic1

  • Kelp are large brown algae that live in cool, relatively shallow waters close to the shore.
  • They grow in dense groupings much like a forest on land. These underwater towers of kelp provide food and shelter for thousands of fish, invertebrates, and marine mammal species.
  • Kelp doesn’t have roots. Instead, it uses something called holdfasts to attach itself to solid structures such as rocks.
  • Kelps currently occur on rocky coasts throughout the Arctic. The longest kelp recorded in the Arctic in Canada was 15 metres, and the deepest was found at 60-metre depth (Disko Bay, Greenland).
  • Kelps have adapted to the severe conditions. These cool water species have special strategies to survive freezing temperatures and long periods of darkness, and even grow under sea ice.
  • They can attain some of the highest rates of primary production of any natural ecosystem on Earth.
  • Kelps function underwater in the same way trees do on land. They create habitat and modify the physical environment by shading light and softening waves.
  • In Western Australia, eastern Canada, southern Europe, northern California and eastern United States, kelps are disappearing due to warming temperatures.

Effect of changing climatic condition on kelps:

  • Researchers predict a northern shift of kelp forests as ice retreats due to global warming.
  • Genetic evidence reveals that most kelps reinvaded the Arctic from the Atlantic Ocean quite recently (approximately 8,000 years ago, following the last Ice Age). As a result, most kelps in the Arctic are living in waters colder than their optimal temperature.
  • Ocean warming will also move conditions closer to temperatures of maximum growth, and could increase the productivity of these habitats.
  • However, a number of researchers in Canada have partnered with northern communities to study kelp in the Arctic. The five-year ArcticKelp Project, for example, explores future changes these ecosystems could provide.
  • At the same time new technology (underwater lasers) is being developed in collaboration with Inuit fishers to map kelp forests in the Arctic.
  • Other changes are happening in the Arctic that complicate this picture. In Canada, Alaska, Greenland, Norway and Siberia, permafrost soils that have been frozen for thousands of years are receding by half a metre per year. Thawing permafrost and crumbling Arctic coasts are dumping sediments into coastal waters at alarming rates, which blocks light and could limit plant growth.
  • The run-off from melting glaciers will also lower salinity and increase turbidity, which impacts young kelp.

Significance:

  • Kelp forests throughout the world play an important role in coastal economies, supporting a broad range of tourism, recreational and commercial activities.
  • Kelp aquaculture industry is growing at a rate of seven per cent per year for the last 20 years globally (kelp is a coveted food source in many countries, full of potassium, iron, calcium, fibre and iodine).
  • In the Arctic, Inuit peoples traditionally use kelp as food and wild harvest numerous species.
  • Arctic kelp forests provide a key example of the diverse responses to climate change.
  • Kelp absorbs CO2 from seawater, helping fight climate change while also making nearby water less acidic.

Key Facts:

  • Kelp forests can be damaged by destructive fishing practices, coastal pollution and accidental damage caused by boat entanglement.
[Ref: Times of India, Scroll]

 

Art & Culture

Kailash Manasarovar Yatra

Kailash Manasarovar Yatra

Kailash Manasarovar Yatra (KMY), known for its religious value and cultural significance, is undertaken by hundreds of people every year.

More about KMY:

  • The Yatra is organized by the government of India in close cooperation with the Government of the People’s Republic of China. State Governments of Uttarakhand, Sikkim and Delhi, and Indo-Tibetan Border Police (ITBP) and Kumaon Mandal Vikas Nigam Limited (KMVN) are other major Indian partners of the Ministry in organizing the Yatra.
  • This Yatra takes pilgrims to Mount Kailash and Lake Manasarovar, which, located at an altitude of 4556 ft above sea level is the world’s highest fresh water lake.
  • Mount Kailash is considered the sacred abode of Lord Shiva as per Hindu theology and drinking water from the lake, it is believed, cleanses all the sins of the past hundred lives.
  • This annual pilgrimage holds religious significance to not only to Hindus but also Jains and Buddhists.
  • Mansarovar Lake is located at an altitude of 14,950 ft (4,558 m) is said to be the highest freshwater lake in the world. It is located in the Tibet Autonomous Region, China, 940 kilometres from Lhasa. To the west of it is Lake Rakshastal and to the north is Mount Kailash.
  • Nathu La is a mountain pass in the Himalayas. It connects the Indian state of Sikkim with China’s Tibet Autonomous Region. It is also one of the four officially agreed BPM (Border Personnel Meeting) points between the Indian Army and People’s Liberation Army of China for regular consultations and interactions between the two armies, which helps in defusing stand-offs.

The route

  • It has a specific surface route that starts and ends in New Delhi and takes about 27 days to cover the whole Yatra proper.
  • The route which takes yatris from India to Tibet through the Lipulekh pass involves nearly 200km of trek in addition to travelling on all kinds of transportation.

Eligibility:

  • It is open to all Indian citizens between 18-70 years.
  • However, every applicant has to qualify special tests at the Delhi Heart and Lung Institute and the ITBP Base hospital in New Delhi before the journey begins due to extremely arduous nature of the Yatra.
[Ref: The Hindu, Ministry of External Affairs]

 

Key Facts for Prelims 

33rd Feria Internacional del Libro de Guadalajara

33rd-Feria-Internacional-del-Libro-de-Guadalajara

  • India has been designated as the Guest of Honour at the 33rd Feria Internacional del Libro de Guadalajara (Guadalajara International Book Fair), in Mexico.
  • The book fair, to be organised from November 30 – December 8, will be “the largest book fair in the Spanish speaking world”
  • The book fair was created in 1986 by University of Guadalajara, Mexico.
  • It is the most important publishing gathering in Ibero-America.

Bureau of Police Research and Development (BPRD)

Bureau of Police Research and Development (BPRD

  • The BPRD was established in 1970 as the national police organisation to study, research and develop on subjects and issues related to policing.
  • It functions under the aegis of Union Home Ministry.

Background:

  • In 2017, Union government merged Bureau of Police Research and Development (BPRD) with National Crime Records Bureau (NCRB) for improving administrative efficiency and optimally utilising resources related to policing.
  • Now, BPR&D will oversee all the data collection related to Crime in India, Suicides and Accidental Deaths, Prison Statistics and Fingerprints which was earlier done by NCRB.
  • The BPRD Director General (DG) will be the head of the merged new entity, where the NCRB Director, an Additional DG rank post will report to the former.

 

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