Polity & Governance
- 15th finance commission report
- What are Gram Nyayalayas
- Facial recognition app in Telangana municipal polls
Government Schemes & Policies
- Pradhan Mantri Matru Vandana Yojana (PMMVY) awards
- SATHI Initiative
- Taxing investor on dividends will hurt REIT, InvIT funding
Environment, Ecology & Disaster Management
- Menace of locusts
- Ujh Multipurpose (National) Project
- Prolonged monsoon revives waterholes in Bandipur Tiger Reserve
- Haryana’s Harappan site to create jobs
Science & Technology
- Study on bats and bat hunters in Nagaland to be probed
Also in News
- Great leap for India’s Think Tank
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Polity & Governance
15th finance commission report
The report of the Fifteenth Finance Commission, along with an Action Taken Report, was tabled in Parliament on February 1.
Fifteenth Finance Commission:
- The Fifteenth Finance Commission is an Indian Finance Commission constituted in November 2017 under the chairmanship of N K Singh.
- The Commission had submitted its Report to the President in December 2019.
- The recommendations of Fifteenth Finance Commission will cover the five-year period commencing from 1st April, 2020.
What is the Finance Commission?
- The Finance Commission is appointed by the President under Article 280 of the Constitution, mainly to give its recommendations on distribution of tax revenues between the Union and the States and amongst the States themselves.
- Article 280 (1) requires the President to constitute a Finance Commission within two years from the commencement of this Constitution and thereafter at the expiration of every fifth year or at such earlier time as the President considers necessary, which shall consist of a Chairman and four other members.
- Two distinctive features of the Commission’s work involve:
- redressing the vertical imbalances between the taxation powers and expenditure responsibilities of the centre and the States respectively,
- equalization of all public services across the States.
- The Commission determines a formula for tax-sharing between the states, which is a weighted sum of the states’ population, area, forest cover, tax capacity, tax effort and demographic performance, with the weights expressed in percentages.
- This crucial role of the Commission makes it instrumental in the implementation of fiscal federalism.
Measures taken by the finance panel:
- The Commission has reduced the vertical devolutione. the share of tax revenues that the Centre shares with the states — from 42% to 41%. It has used the criterion of ‘demographic effort’ to offset the population parameter.
- The 1% decrease in the vertical devolution is roughly equal to the share of the erstwhile state of Jammu and Kashmir, which would have been 0.85% as per the formula described by the Commission.
- The Commission has considered the 2011 population along with forest cover, tax effort, area of the state, and “demographic performance” to arrive at the states’ share in the divisible pool of taxes.
- As had been widely anticipated, shares of the southern states, except Tamil Nadu, have fallen — with Karnataka losing the most.
- Non-lapsable fund for defence expenditure: The Commission intends to set up an expert group to initiate a non-lapsable fund for defence expenditure considering the Centre’s demand for funds for defence and national security. It may do so by creating a separate fund from the gross tax revenue before computing the divisible pool — which means that states would get a smaller share of the taxes.
The population parameter:
- The population parameter used by the Commission has been criticised by the governments of the southern states. The previous FC used both the 1971 and the 2011 populations to calculate the states’ shares, giving greater weight to the 1971 population (17.5%) as compared to the 2011 population (10%).
Reasoning: The Fifteenth FC has reasoned that the terms of reference leave it with no choice but to use the 2011 population; it has also argued that in the interest of fiscal equalisation, it is necessary to use the latest Census figures.
- The use of 2011 population figures has resulted in states with larger populations like Uttar Pradesh and Bihar getting larger shares, while smaller states with lower fertility rates (the number of children born to a woman in her life) have lost out.
- The combined population of the Hindi-speaking northern states (Bihar, Uttar Pradesh, Madhya Pradesh, Rajasthan and Jharkhand) is 47.8 crore. This is over 39.48% of India’s total population, and is spread over 32.4% of the country’s area, as per the 2011 Census. They also get a slightly more than the proportional share of the divisible pool of taxes (45.17%).
- The southern states of Tamil Nadu, Kerala, Karnataka and undivided Andhra Pradesh are home to only 20.75% of the population living in 19.34% of the area, with a 13.89% share of the taxes.
The demographic effort:
- In order to reward population control efforts by states, the Commission developed a criterion for demographic effort — which is essentially the ratio of the state’s population in 1971 to its fertility rate in 2011 — with a weight of 12.5%.
- States such as Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, and Telangana have fertility rates below the replacement rate, or the number of children that have to be born to a woman of reproductive age in order for the population to maintain itself at the current level without migration.
- However, the effect of the demographic effort in increasing states’ devolution is not clear. Shares of states like Maharashtra, Himachal Pradesh and Punjab, along with Tamil Nadu, all of which have fertility rates below the replacement level, have increased slightly. On the other hand, Andhra Pradesh, Kerala, Karnataka, and West Bengal’s shares have fallen, even though their fertility rates are also low.
- Incidentally, Karnataka, the biggest loser in this exercise, also had the highest tax-GSDP ratio in 2017-18, as per an RBI report on state finances. Tax effort was also used by the Commission to decide the states’ shares, with a weight of 2.5%.
Income distance criterion:
- The total area of states, area under forest cover, and income distance were also used by the FC to arrive at the tax-sharing formula.
- Income distance is calculated as the difference between the per capita gross state domestic product (GSDP) of the state from that of the state with the highest per capita GSDP, with states with less income getting a higher share in order to allow them to provide services comparable to those provided by the richer ones.
- The Commission used the per capita GSDP of Haryana as the reference for calculating the income distance, and gave it a weight of 45%, down from the 50% assigned by the 14th FC. The weight assigned to state area was unchanged at 15%, and that of forest cover was increased from 7.5% to 10%.
The Supreme Court has directed the states, which have not come out with notifications for establishing Gram Nyayalayas, to do so within four weeks. The apex court also asked the high courts to expedite the process of consultation with state governments on this issue.
What are Gram Nyayalayas?
- The Gram Nyayalayas Act passed by Parliament in 2008 provided for setting up of ‘Gram Nyayalayas’ at the grass roots level for providing inexpensive justice to people in rural areas at their doorsteps.
- The act envisages to ensure that opportunities for securing justice are not denied to anyone by reason of social, economic or other disabilities.
- They are mobile village courts in India established under Gram Nyayalayas Act, 2008 for speedy and easy access to justice system in the rural areas of India.
- The Act came into force on October 2, 2009.
Gram Nyayalayas Act, 2008:
- Sections 5 and 6 of the 2008 Act provide that state government in consultation with the high court will appoint a ‘Nyayadhikari’ for each ‘Gram Nyayalaya’, who will be a person eligible to be appointed as a Judicial Magistrate of the First Class.
- The Gram Nyayalayas are guided by the principles of natural justice and subject to any rule made by the High Court.
- These courts have both civil and criminal jurisdictions over the offences and nature of suits specified in the schedule I, II and III of the Act.
- Several states have issued notifications for establishing Gram Nyayalayas but all of them were not functioning except in Kerala, Maharashtra and Rajasthan.
- The bench noted that states like Gujarat, Haryana, Telangana, West Bengal, Uttarakhand, Chhattisgarh and Odisha have not yet filed their affidavits on this issue despite the apex court’s last year direction.
Facial recognition app in Telangana municipal polls
In the upcoming Telangana urban local bodies polls, the state election commission will use a facial recognition app for verification and real-time authentication of voters at polling stations.
- Telangana State Election Commission (TSEC) said that it will use the technology in select 10 polling stations of the Kompally Municipality of Medchal Malkajgiri district.
- The process of identification and authentication of the voter by applying the latest technologies of Artificial Intelligence, deep learning, etc.
- The technology is completely driven by the system with full digital trail that can help reduce impersonation cases significantly.
- The facial recognition is proposed as an additional tool to validate the identity of the voter in addition to the existing procedures prescribed including use of photo electoral rolls, the insistence of photo ID proof in addition to the personal scrutiny by the polling agents appointed by the contesting candidates.
What is the procedure?
- The additional polling officer-in-charge of the mobile phone will take the voter’s photo using Face Recognition App to compare the same with the photographs of all the voters of the concerned polling station.
- The App displays the result of the verification based on the match established with any one of the voters.
- It is the process of either encrypting or removing personally-identifying information from data sets so that the people whom the data describe remain anonymous.
Government Schemes & Policies
Pradhan Mantri Matru Vandana Yojana (PMMVY) awards
Union Minister of Women & Child Development (WCD) and Textiles, Smriti Zubin Irani gave away the Pradhan Mantri Matru Vandana Yojana (PMMVY) awards to States, Union Territories and Districts for best performance in New Delhi recently.
- States/ UTs having population of more than 1 crore:
- Best performance since inception of the Scheme to States/ UTs having population of more than 1 crore the first position was awarded to the State of Madhya Pradesh, followed by Andhra Pradesh and Haryana was in the third position.
- States/ UTs having population less than 1 crore:
- Among States/ UTs having population of less than 1 crore Dadra & Nagar Haveli is in the first position, Himachal stood second and Chandigarh is at the third position.
- District level awards for States/ UTs with population of more than 1 crore the first position went to Indore in Madhya Pradesh. Kurnool in Andhra Pradesh is in second position and South Salmara Mankachar in Assam was third.
- Among the districts of States/ UTs having population of less than 1 crore the first position went to Serchhip in Mizoram, second position to Unain Himachal Pradesh and Puducherry was in the third position.
Matru Vandana Saptah (MVS):
MVS was held from 2nd to 8th December 2019.
Objective: To increase the implementation of the Scheme and create a healthy competition amongst States/ UTs.
Theme: Towards building a healthy nation – Surakshit Janani, Viksit Dharini.
Pradhan Mantri Matru Vandana Yojana (PMMVY):
- The PMMVY is a maternity benefit programme being implemented in all districts of the country from 01.01.2017.
- Under PMMVY a cash incentive of Rs. 5000 is provided directly to the bank/ post office account of Pregnant Women and Lactating Mothers (PW&LM) for the first living child of the family subject to fulfilling specific conditions relating to maternal and child health.
- PMMVY is implemented using the platform of Anganwadi Services Scheme of Umbrella ICDS under the WCD Ministry in respect of States/ UTs implementing scheme through Women and Child Development Department/ Social Welfare Department and through health system in respect of States/ UTs where scheme is implemented by Health and Family Welfare Department.
For detailed information on Pradhan Mantri Matru Vandana Yojana, please visit the link:
Department of Science (DST) has recently launched a SATHI Initiative for building shared, professionally managed strong Science and technology infrastructure.
- Sophisticated Analytical & Technical Help Institutes (SATHI) is a unique scheme of Department of science, to address the need for building shared, professionally managed and strong Science and Technology infrastructure in the country which is readily accessible to academia, start-ups, manufacturing, industry and R&D labs.
- These Centres are expected to house major analytical instruments to provide common services of high-end analytical testing, thus avoiding duplication and reduced dependency on foreign sources. These would be operated with a transparent, open access policy.
- A digital platform is proposed to be created to facilitate seamless application and capture Intellectual Property Rights (IPR) and a centre will be established that will work in the field of intellectual property.
- Knowledge translation clusters will be set up across different technology sectors including in new and emerging sectors for designing, fabrication and proof of concept and further scaling up technology clusters harbouring such testbeds and small scale manufacturing facilities would be established.
- DST has already set up three such centres in the country, one each at IIT Kharagpur, IIT Delhi and BHU at a total cost of Rs 375 Cores. It is planned to set up five SATHI Centres every year for the next four years.
- Besides SATHI initiative, support to 100 top-performing departments in universities and IITs etc. will be provided this year with an investment of Rs. 500 crores for augmentation of their research facilities to global benchmarks. The research profile of the supported Departments will align with the national priorities of excellence in manufacturing, waste processing, clean energy and water, and Start-up India, etc.
- SATHI will address the problems of accessibility, maintenance, redundancy and duplication of expensive equipment in our Institutions, while reaching out to the less endowed organizations in need, e.g., industry, MSMEs, start-ups and State Universities.
- This will also foster a strong culture of collaboration between institutions and across disciplines to take advantage of developments, innovations and expertise in diverse areas.
Taxing investor on dividends will hurt REIT, InvIT funding
As per the real estate and infrastructure industry officials and analysts, the proposal in the Union Budget to tax dividend in the hands of unit holders/ investors would hurt future InvITs and REITs.
What is the issue?
- Till this Budget, business trusts in India had a single level of tax at source, or the corporate tax paid by the special purpose vehicles (SPVs) that owned the assets. The SPVs paid tax only on their annuity income.
- Under the provisions of the Income Tax Act, no dividend distribution tax (DDT) is now chargeable on any amount declared, distributed or paid by a 100% SPV by way of dividends (whether interim or otherwise) to a business trust out of current income.
- After the Budget announcement, resident unitholders may be liable to tax in such income at rates that could go up to 43% while non-resident investors may be liable at rates that could go up to 20%.
- This tax was levied on the income of the asset-owning SPV; after-tax profit, distributed by the SPV to the REIT / InvIT and by the REIT / InvIT to the investors were tax exempt. This was achieved by exempting dividend distributions by the SPV from DDT and by further exempting the REIT / InvIT and the investors from tax in such income distributions from the SPV.
- The 2020-21, Budget seeks to replace DDT with the more conventional method of taxing dividends. As a result, DDT has been abolished; instead, shareholders are now taxable on dividend income that they receive at applicable rates.
- This taxing framework is also proposed to be applied to REITS / InvITs, such that dividends distributed by the SPV will not attract DDT; the REIT / InvIT would be exempt from tax on such income but the unitholders would be liable to tax on such income distributed by the REIT.
What are REITs and InvITs?
- Real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) are innovative vehicles that allow developers to monetise revenue-generating real estate and infrastructure assets, while enabling investors or unit holders to invest in these assets without actually owning them.
- They are regulated by the SEBI (Infrastructure Investment Trusts) Regulations, 2014.
Real Estate Investment Trusts (REIT):
- REIT gives investors, big or small, the opportunity to hold shares of the real estate investment trust by investing in it thereby benefitting them through good returns on the investment.
- It provides the advantage of portfolio diversification and long-term capital appreciation.
- REIT’s are a legitimate way of investing in the real estate sector as they have the provision of getting enlisted in the known stock exchanges.
Infrastructure Investment Trusts (InvIT):
- It is a collective Investment scheme similar to a mutual fund, which enables direct investment of money from individual and institutional investors in infrastructure projects to earn a small portion of the income as return.
- The investors can invest into the eligible infrastructure projects either directly or via special purpose vehicles (SPVs).
- InvITs can be treated as the modified version of REITs designed to suit the specific circumstances of the infrastructure sector.
Environment, Ecology & Disaster Management
Menace of Locusts
Pakistan and Somalia have declared locust emergencies recently. During the past few weeks, major locust attacks have been observed in several countries in Western and Southern Asia and in Eastern Africa.
- In India, locusts’ attacks emanating from the desert area in Pakistan have struck parts of Rajasthan and Gujarat, causing heavy damage to standing crop.
Global Locust Emergency:
- The Food and Agriculture Organisation (FAO) of the United Nations has currently identified three hotspots of threatening locust activity, where the situation has been called “extremely alarming” — the Horn of Africa, the Red Sea area, and Southwest Asia.
- The Horn of Africa has been called the worst-affected area, where the FAO has said there is an unprecedented threat to food security and livelihoods.
- Locust swarms from Ethiopia and Somalia have travelled South to Kenya and 14 other countries in the continent.
- The outbreak is the worst to strike Ethiopia and Somalia in 25 years, and the worst infestation in Kenya in the past 70 years. Without international help, the FAO has said that locust numbers across the region could grow 500 times by June.
- In locusts have also struck in Saudi Arabia, Oman, and Yemen, Iran, Pakistan and India.
What are locusts, and how do they inflict damage?
- Locusts are a group of short-horned grasshoppers that multiply in numbers as they migrate long distances in destructive swarms (up to 150km in one day).
- The swarms devour leaves, flowers, fruits, seeds, bark and growing points, and also destroy plants by their sheer weight as they descend on them in massive numbers.
- The desert locust is regarded as the most destructive pest in India as well as internationally, with a small swarm covering one square kilometre being able to consume the same amount of food in one day as 35,000 people.
- Four species of locusts are found in India:
Desert locust, Migratory locust, Bombay Locust and Tree locust.
[Ref: Indian Express]
Ujh Multipurpose (National) Project
Recently, a meeting was chaired to fast-track the implementation of Ujh Multipurpose (National) Project, Jammu & Kashmir.
About the project:
- As per Government’s commitment to fast track utilization of India’s rights under Indus Waters Treaty, the project is planned to be constructed in Kathua District of J&K on the River Ujh which is a major tributary of River Ravi.
- This project will store around 781 Million Cubic meter of waters of river Ujh (a tributary of river Ravi).
- After construction of the project, utilization of waters of Eastern Rivers allotted to India as per the Indus Water Treaty would be enhanced by utilizing of the flow that presently goes across border unutilized.
- The Ujh river is a tributary of the Ravi River that flows through the Kathua district in the Indian union territory of Jammu and Kashmir.
- It originates in Kailash mountains (part of the Pir Panjal Range) and flows a distance of nearly 100 kilometres, some of it in Pakistani Punjab, before joining Ravi near Chak Ram Sahai in Indian Punjab.
What is Indus Water Treaty, 1960?
- The Indus Waters Treaty (IWT) is a water-distribution treaty between India and Pakistan, mediated by the World Bank to use the water available in the Indus System of Rivers.
- IWT was signed in Karachi on September 19, 1960 by the first Prime Minister of India Pandit Jawaharlal Nehru and then President of Pakistan Ayub Khan.
- The agreement awarded control over the water flowing in three eastern rivers of India, i.e. the Beas, the Ravi and the Sutlej was given to India, while control over the water flowing in three western rivers of India i.e. the Indus, the Chenab and the Jhelum was given to Pakistan.
- India has unrestricted usage rights over the eastern rivers, and India should allow unrestricted flow of the western rivers into Pakistan.
- India can use 20% of Indus water for irrigation, transport and power generation since it originates in India and Chenab and Jhelum for consumption purposes.
- After the Pulwama attacks in Feb. 2019, the Indian government is planning to review the treaty, and contain all excess water flowing from India’s share of eastern rivers into Pakistan at present, and divert it to Haryana, Punjab and Rajasthan for different uses.
Prolonged monsoon revives waterholes in Bandipur Tiger Reserve
This is expected to help wild animals beat water stress and tide over the greater part of the scorching summer.
Bandipur Tiger Reserve:
- Bandipur Tiger Reserve formerly known as the Bandipur National Park.
- Bandipur National Park is located in Karnataka.
- It is one of the oldest tiger reserves in India and was brought under Project Tiger in 1973.
- It is part of interconnected forests that include:
- Mudumalai Wildlife Sanctuary (Tamil Nadu)
- Wayanad Wildlife Sanctuary (Kerala)
- Nagarhole National Park (Karnataka)
- It was once a hunting reserve for the Maharaja of Mysore.
- It has a variety of biomes including dry deciduous forests, moist deciduous forests and shrublands.
- It is flanked by the Kabini river in the north and Moyar river in the south while the Nugu river runs through the park.
Haryana’s Harappan site to create jobs
The residents of Rakhigharhi welcomed the announcement to develop the Harappan site at Hisar’s Rakhigarhi village, as an iconic site and set up a national museum, in the Union Budget of 2020.
- Rakhigarhi is a village in Hisar District in Haryana.
- It is located in the Ghaggar-Hakra river plain.
- It is the largest city of Harappan civilisation in the Indian sub-continent.
- Five interconnected mounds spread in a huge area form the Rakhigarhi’s unique site.
- This site was excavated by Shri Amarendra Nath of Archeological Survey of India.
- Objectives behind the excavation were to trace its beginnings and to study its gradual evolution from 6000 BCE to 2500 BCE.
- In May 2012, the Global Heritage Fund declared Rakhigarhi one of the 10 most endangered heritage sites in Asia.
- Besides Rakhigarhi, Hastinapur in Uttar Pradesh, Shivsagar in Assam, Dholavira in Gujarat and Adichanallur in Tamil Nadu will also be developed as iconic sites with national museums.
Science & Technology
Study on bats and bat hunters in Nagaland to be probed
The government has ordered an inquiry into a study conducted in Nagaland by researchers from the U.S., China and India on bats and humans carrying antibodies to deadly viruses like Ebola.
- The inquiry comes as the spread of coronavirus from Wuhan (China) to 20 countries that has resulted in over 300 deaths.
- The study came under probe as two of the 12 researchers belonged to the Wuhan Institute of Virology’s Department.
- The study is being investigated for how the scientists were allowed to access live samples of bats and bat hunters (humans) without due permissions.
- The Nagaland study suggests bats in South Asia act as a reservoir host of a diverse range of filoviruses, and filovirus spillover occurs through human exposure to bats.
- The presence of filovirus reactive antibodies in both human and bat populations in Northeast India with no historical record of Ebola virus disease.
- Filovirus is an any virus belonging to the family Filoviridae.
- Filoviridae consists of three genera, Marburgvirus, Ebolavirus and Cuevavirus.
- Filoviruses have enveloped virions (virus particles) appearing as variably elongated filaments.
- The filovirus genome is made up of a single strand of negative-sense RNA (ribonucleic acid) and an endogenous RNA polymerase.
- Bats often carry ebola, rabies, marburg and the coronavirus.
- Many high-profile epidemics have been traced to bats.
- According to the World Health Organization, Ebola and Marburg viruses are known to cause severe hemorrhagic fevers, which affect many organs and damage the blood vessels.
Also in News
Great leap for India’s Think Tank
India’s Observer Research Foundation (ORF) has jumped more than 90 places to 27th position among 176 global think tanks, according to the 2019 Global Go to Think Tank Index Report.
What is a think tank?
- The report defined ”think tanks” as public-policy research analysis and engagement organisations that generate policy-oriented research, analysis, and advice on domestic and international issues, thereby enabling policymakers and the public to make informed decisions about public policy.
Highlights of the report:
- The 2019 Global Go to Think Tank Index Report, by the Think Tanks and Civil Societies Program (TTCSP) of the Lauder Institute at the University of Pennsylvania, ranked ORF among top 30 think tanks globally.
- ORF moved up from the 118th position in the 2018 ranking and got featured at the ninth position on the “Think Tank to Watch in 2019” list.
- Moreover, ORF curated Raisina Dialogue has been ranked 7th best conference in the report, moving up from 12th position.
- The list was topped by Carnegie Endowment for International Peace of US, followed by Belgium’s Bruegel and French Institute of International Relations.
- India has the second-largest number of think tanks at 509. The US has the highest number at 1,871.
- ORF remained the most featured Indian think tank, being ranked in 26 categories and the highest-ranked in India in 14 categories.
- Among non-US think tanks globally, ORF was ranked 15th- moving up from the 24th place last year. It ranked 3rd among the Think Tanks in the region – China, India, Japan and South Korea (ORF was ranked 4th last year).
- The 2019 GGTTI Nomination and Ranking Criteria included think tank’s leadership, staff reputation, quality and reputation of the research and analysis produced, ability to recruit and retain elite scholars, analysts, academic performance, reputation, the impact of a think tank’s research and programs on policymakers and reputation with policymakers.