maggubhai

Arth Vol 28

Coverage ( September 2020)

1.RBI extends WMA limit relaxations for six months

  • The Reserve Bank of India (RBI) has decided to extend the interim relaxation in WMA (Ways and Means Advances) limits and OD (overdraft) regulations for States/ Union Territories (UTs) for another six months till March 31, 2021.
  • Both these relaxations, which are aimed at helping States/UTs overcome short-term liquidity mismatches, are currently available till September 30, 2020.
  • Under WMA, States/ UTs get short-term credit up to three months from the RBI to bridge temporary mismatches in cash flows.
  • The interest rate on WMA is the Repo rate (4 per cent).
  • For OD up to 100 per cent of WMA limit, the interest rate is 2 per cent above the Repo rate. For OD exceeding 100 per cent of the WMA limit, the interest rate is 5 per cent above the Repo rate.

WMA

  • ·         The Reserve Bank of India gives temporary loan facilities to the centre and state governments as a banker to government. 
  • ·         This temporary loan facility is called Ways and Means Advances (WMA).
  • ·         The WMA scheme was designed to meet temporary mismatches in the receipts and payments of the government.
  • ·         This facility can be availed by the government if it needs immediate cash from the RBI.
  • ·         The WMA is a loan facility from the RBI max for 90 days which implies that the government has to vacate the facility after 90 days.
  • ·         Interest rate for WMA is currently charged at the repo rate.
  • ·         The limits for WMA are mutually decided by the RBI and the Government of India.

 

2. India to receive Rs 3,500 crore loan from Japan’s donor agency JICA to boost COVID-19 fight

  • Japan’s donor agency JICA signed an agreement with the Indian government under which it will provide about Rs 3,500 crore in loan to boost the fight against the COVID-19 pandemic in India.
  • This loan will be disbursed to the Government of India for supporting anticipated financing requirement for the implementation of “Prime Minister Atmanirbhar Swasth Bharat Yojana (PM-ASBY)” governed by the Ministry of Health and Family Welfare as the Atmanirbhar Bharat Package for the health sector.
  • The objective of the project is to strengthen public healthcare system, by extending budget support to the Indian government in implementing emergency response programmes for the health sector as countermeasures against the COVID-19

3. Govt gives green signal to 27 cold-chain projects

  • The Inter-Ministerial Approval Committee (IMAC) chaired by Union Food Processing Minister Harsimrat Kaur Badal has approved 27 new projects under the scheme for integrated cold chain and value addition infrastructure of Pradhan Mantri Kisan SAMPADA Yojana (PMKSY).
  • These 27 new integrated cold chain projects worth ₹743 crore will be set up for creation of cold chain facilities for the food processing sector in the country.
  • Under the scheme, the Food Processing Ministry provides assistance in the form of grant-in-aid at the rate of 35 per cent for general areas and the rate of 50 per cent for North-Eastern States, Himalayan States, ITDP Areas, and Islands. The assistance at 50 per cent and 75 per cent respectively are also given for value addition and processing infrastructure subject to a maximum grant-in-aid of ₹10 crore per project.
  • As many as 85 cold chain projects have been considered for financial assistance throughout the country.

PMKSY

Implementation- 2019-20

  • PM Kisan SAMPADA Yojana is a comprehensive package aiming to create modern infrastructure with efficient supply chain management from farm gate to retail outlet.
  • The scheme boosts the growth of the food processing sector in the country and helps in providing better returns to farmers as well.
  • It is a big step towards creating huge employment opportunities in the rural areas, doubling the farmers’ income, increasing the processing level, reducing wastage of agricultural produce, and enhancing the export of processed foods.
  • It has an outlay of 6000 crores.

 

4. UN report flags changes in food system to boost climate action

  • According to the UNEP report ‘’Enhancing Nationally Determined Contributions (NDCs) for Food Systems’’, the world has missed out on significant opportunities to reduce greenhouse gas emissions, but it is not too late on strengthening food systems in the age of climate crisis stated.
  • Food loss and waste has been ignored widely, according to the report.
  • However, by simply adding these aspects to national climate plans, policymakers can improve their mitigation and adaptation contributions from food systems by as much as 25 per cent.
  • This will enhance the process of achieving the Sustainable Development (SDG) goals by 2030.
  • The report identified 16 ways to address the issue and put it forward in the public domain for policymakers to take action.
  • The report was put forward to help policymakers adopt food systems solutions and set more ambitious targets and measures to reduce greenhouse gas emissions and, in turn, improve biodiversity, food security, and public health.

5. NIDHI-EIR Brochure featuring Entrepreneurs in Residence launched

  • A brochure featuring Entrepreneurs in Residence (EIR) under the National Initiative for Developing and Harnessing Innovations (NIDHI) programme was launched by DST Secretary.
  • The NIDHI-EIR Program conceived to inspire the S&T qualified youth in India to take up entrepreneurship as a viable career and help shape India’s future and the economy.
  • The brochure brought out by Venture Center, details what the EIRs are working on and some highlights about them. It is also meant to be a directory of all EIRs. All contributing project execution partners are also featured in the brochure. The brochure also has a summary number of results and impact.
  • Entrepreneurs-in-Residence (EIR) Programme under National Initiative for Developing and Harnessing innovations (NIDHI) of Department of Science and Technology supports aspiring or budding entrepreneur of considerable potential for pursuing a promising technology business idea over a period up to 18 months with a subsistence grant up to Rs 30000 per month with a maximum cap for total support of Rs 3.6 lakh to each EIR over a maximum of 18 months.
  • The NIDHI-EIR programme provides tremendous opportunities for innovative entrepreneurs to expand their networks and get critical feedback on their ventures in order to promote their entrepreneurial career goals and aspirations. 
  • This program is important in that it creates a pipeline of startups with a focus on young budding entrepreneurs.

6. RBI revises priority sector lending guidelines

  • The Reserve Bank of India (RBI) said it has revised priority sector lending (PSL) guidelines to include entrepreneurship and renewable resources, in line with emerging national priorities.
  • Bank finance to start-ups (up to Rs 50 crore), loans to farmers for installation of solar power plants for solarisation of grid-connected agriculture pumps and loans for setting up Compressed BioGas plants have been included as fresh categories eligible for finance under priority sector.
  • The new guidelines are applicable to all commercial banks including regional rural banks, small finance banks, local area banks and primary (urban) co-operative banks other than salary earners’ banks.
  • PSL guidelines were last reviewed for commercial banks in April 2015 and for urban co-operative banks in May 2018.
  • RBIs said the new guidelines will address regional disparities in the flow of priority sector credit.
  • The targets prescribed for “small and marginal farmers” and “weaker sections” are being increased in a phased manner.
  • For this review, RBI took into account the recommendations made by the UK Sinha-led expert committee on Micro, Small and Medium Enterprises and the MK Jain led Internal Working Group to Review Agriculture Credit apart from discussions with all stakeholders.

7. Andhra Pradesh tops in ease of doing business rankings

  • According to the State Business Reform Action Plan 2020 (State BRAP) ranks, Andhra Pradesh has topped the country in the latest ease of doing business rankings.
  • Ease of Doing Business (EODB) is a joint initiative by the Department for Promotion of Industries and Internal Trade (DPIIT) and the World Bank to improve the overall business environment in the States.
  • The State has stood first in the overall ranking of the State business process reforms undertaken during 2019.
  • These rankings represent the ease of doing business in the State with increased transparency, efficiency and effectiveness of the government regulatory functions vis-a-vis the business enterprises.
  • The EODB initiatives to enable conducive business environment in the State ranged from reforms in development of online systems, enhancing transparency to regulating inspections covering entire life-cycle of business.
  • The Business Reform Action Plan 2019 released by DPIIT contains a list of 80 reforms (187 reform action points) to be implemented by 19 State departments and Andhra Pradesh had achieved 100% compliance.

8. NSO report shows stark digital divide affects education

  • A recent report on the latest National Statistical Organisation (NSO) survey shows just how stark is the digital divide across States, cities and villages, and income groups.
  • The survey on household social consumption related to education was part of the NSO’s 75th round, conducted from July 2017 to June 2018.
  • Across India, only one in ten households have a computer.
  • Most of these Internet-enabled homes are located in cities, where 42% have Internet access. In rural India, however, only 15% are connected to the internet.
  • The national capital has the highest Internet access, with 55% of homes having such facilities.
  • Himachal Pradesh and Kerala are the only other States where more than half of all households have Internet.
  • At the other end of the spectrum is Odisha, where only one in ten homes have Internet. There are ten other States with less than 20% Internet penetration, including States with software hubs such as Karnataka and Tamil Nadu.
  • The biggest divide is by economic status, which the NSO marks by dividing the population into five equal groups, or quintiles, based on their usual monthly per capita expenditure.
  • Even in Odisha, almost 63% of homes in the top urban quintile have Internet facilities. In the poorest quintile of rural Odisha, however, that figure drops to an abysmal 2.4%.
  • The NSO report shows that 20% of Indians above the age of 5 years had basic digital literacy, doubling to just 40% in the critical age group of 15 to 29 years, which includes all high school and college students as well as young parents responsible for teaching younger children.
  • A State-wise split of literacy rates also throws up some unexpected results. Andhra Pradesh has the country’s lowest literacy rate, at just 66.4%, significantly lower than less developed States such as Chhattisgarh (77.3%), Jharkhand (74.3%), Uttar Pradesh (73%), and Bihar (70.9%).
  •  Kerala remains at the top of the pile with 96.2% literacy, followed by three northern States: Delhi (88.7%), Uttarakhand (87.6%) and Himachal Pradesh (86.6%).

9. Kamath committee picks 26 sectors for loan restructuring-RBI

  • Finance Minister Nirmala Sitharaman asked banks and non-banking financial companies (NBFCs) to roll out a loan restructuring scheme for companies facing Covid-19-related stress, the Reserve Bank of India (RBI) announced the financial parameters for the resolution plans under the scheme.
  • The committee has made recommendations for 26 sectors that could be factored by lending institutions while finalizing loan resolution plans.
  • The committee said banks could adopt a graded approach based on the severity of the coronavirus pandemic in a sector.
  • The scheme was announced to bail out companies and organisations hit by the coronavirus and follow-up lockdowns.
  • The central bank’s announcement is based on the recommendations of the K V Kamath committee, which submitted its report last week.

10. Overall FDI rises 10% in FY20, but money coming in from Cayman Islands jumps 305%

  • Foreign direct investment into India rose 10 per cent to $42.69 billion in the year ended March 31, 2020 from $38.74 billion in the previous year despite the global slowdown, with the Cayman Islands showing the biggest jump in bringing cash in to India.
  • According to the Reserve Bank of India data, FDI from Cayman Islands jumped 305 per cent to $3.49 billion during 2019-20, as against $863 million in the previous year, thus becoming the fourth largest FDI contributor behind Singapore, Mauritius and the Netherlands.
  • The main activity in the British Overseas Territory is financial services. FDI from Cayman Islands, one of the most popular tax havens, in 2017-18 was $ 1.14 billion and $ 49 million in 2016-17.
  • Singapore and Mauritius remained the major source countries, accounting for about 50 per cent of total FDI flows in 2019-20, followed by the Netherlands, the Cayman Islands, the US and Japan.
  • While FDI from the US was $ 3.40 billion, Singapore topped the list with FDI of $ 12.61 billion.

11. Covid-19 pandemic pushes Union govt’s debt past Rs 100-trillion mark

  • For the first time, the outstanding debt of the central government crossed the Rs 100-trillion mark ($1.26 trn at current exchange rate), at the end of June.
  • A quarterly report by the finance ministry’s department of economic affairs (DEA) shows while debt was rising gradually, the sudden jump of Rs 7 trillion in the first quarter of this fiscal year (April-June 2020, or Q1) — accentuated by the Covid-19 pandemic — pushed it beyond the Rs 100 trillion mark.
  • This number is inclusive of the liabilities towards the public account, which comprises reserve funds and deposits, securities against special subsidies, among other liabilities.
  • Analysts have noted that sovereign debt could touch the level of 60 per cent of gross domestic product (GDP) at the end of FY21.
  • Currently, it stands at 43 per cent of GDP, according to the International Monetary Fund’s database (December 2019).

12. Samarth Scheme

  • As per the information provided by Union Minister of Textiles, under Samarth, 18 State Governments have been allocated a training target of 3.6 lakh beneficiaries for conducting training programme in traditional and organized sectors.

Samarth Scheme {Scheme for Capacity Building in Textile Sector (SCBTS)

  • Implemented by the Ministry of Textiles.
  • It seeks to Provide demand driven, placement oriented National Skills Qualifications Framework (NSQF) compliant skilling programmes.
  • To train 10.00 lakh persons (9 lakhs in organised & 1 lakh in traditional sector) excluding Spinning & Weaving in the organized Sector.
  • Key features of the scheme-
  • Training of Trainers (ToT).
  • Aadhar Enabled Biometric Attendance System (AEBAS).
  • CCTV recording of training programme.
  • Dedicated call centre with helpline number.

13. AICTE-SPICES to promote healthy co-curricular activity

  • Union Education Minister launched the AICTE-SPICES (Scheme for Promoting Interests, Creativity and Ethics among Students) to promote healthy co-curricular activity amongst the students for their all-round development.
  • Scheme provides financial support to institutions for developing students club for well-rounded development of students by promoting their interests, creativity and ethics.
  • This club should serve as a model for other clubs in the institution and also those in other institutions.
  • AICTE approved institutes with minimum 5 years of existence.
  • Only one proposal per institute for a club (with minimum student members 50) will be admissible. Institute may choose its best performing club for applying under the scheme for the grant.

14. NPAs under Mudra scheme rise to 5% for public sector banks

  • Non-performing assets for loans disbursed by state-owned banks under the Pradhan Mantri Mudra Yojana (PMMY) is on an upward trajectory.
  • Bad loans soared to around 5 per cent of the total disbursed amount in 2019-20.
  • NPAs of public sector banks (PSBs) under PMMY stood at 4.9 per cent in 2019-20 – a big jump from 3.8 per cent in 2018-19, and 3.4 per cent in 2017-18.

15. Parliament nod for Banking Regulation (Amendment) Bill 2020

  • Parliament approved the Banking Regulation (Amendment) Bill 2020 with the Rajya Sabha giving its nod for the Bill that seeks to protect depositors of cooperative banks and empower the Reserve Bank of India (RBI) to regulate banking activities of cooperative societies.
  • The Bill also empowers the RBI to effectively handle mishaps in private banks without any loss of public confidence or disruption to the financial system.
  • The central bank can go ahead with restructuring of the banking companies even without a moratorium being allowed.

16. Human Capital Index 2020: India ranks 116 in World Bank’s latest annual report

  • India has been ranked at the 116th position in the latest edition of the World Bank’s annual Human Capital Index that benchmarks key components of human capital across countries.
  • However, India’s score increased to 0.49 from 0.44 in 2018, as per the Human Capital Index report released by the World Bank.
  • The 2020 Human Capital Index update includes health and education data for 174 countries – covering 98% of the world’s population – up to March 2020, providing a pre-pandemic baseline on the health and education of children, with the biggest strides made in low-income countries.
  • The analysis shows that pre-pandemic, most countries had made steady progress in building human capital of children, with the biggest strides made in low-income countries.
  • Despite this progress, and even before the effects of the pandemic, a child born in a typical country could expect to achieve just 56% of their potential human capital, relative to a benchmark of complete education and full health.
  • Due to the pandemic’s impact, most children – more than 1 billion – have been out of school and could lose out, on average, half a year of schooling, adjusted for learning, translating into considerable monetary losses.
  • Data also shows significant disruptions to essential health services for women and children, with many children missing out on crucial vaccinations.
  • The World Bank estimates a 12% drop in employment.
  • There has been major decline in remittances and total income is going down by 11 or 12%.

17. Hardeep S Puri launches Climate Smart Cities Assessment Framework (CSCAF 2.0) and Streets for People Challenge

  • ​Shri Hardeep Singh Puri, Minister of State for Housing and Urban Affairs (I/C) has launched the Climate Smart Cities Assessment Framework (CSCAF) 2.0, along with the ‘Streets for People Challenge’.
  • The objective of CSCAF is to provide a clear roadmap for cities towards combating Climate Change while planning and implementing their actions, including investments.
  • CSCAF initiative intends to inculcate a climate-sensitive approach to urban planning and development in India.
  • ​This assessment framework was developed after review of existing frameworks and assessment approaches adopted throughout the world followed by series of extensive consultative process with more than 26 organizations and 60 experts from different thematic areas.
  • The framework has 28 indicators across five categories namely- (i) Energy and Green Buildings, (ii) Urban Planning, Green Cover & Biodiversity, (iii) Mobility and Air Quality, (iv) Water Management and (v) Waste Management.
  • The Climate Centre for Cities under National Institute of Urban Affairs (NIUA) is supporting MoHUA in implementation of CSCAF.

18. Karnataka tops DPIIT States’ Startup Ranking for the second consecutive year

  • Karnataka for the second consecutive year has been adjudged the top performer in the States’ Startup Ranking.
  • The state has been recognised for its several exemplary initiatives in developing: Futuristic policies to support new and disruptive technologies, Regulatory committee for reviewing the challenges faced by start-ups working in emerging technologies.

19.India slips 26 spots on Global Economic Freedom Index 2020

  • According to a report, ‘’The Economic Freedom of the World: 2020 Annual Report by Canada’s Fraser Institute’’, India has fallen 26 spots to the 105th position on the Global Economic Freedom Index 2020.
  • The country was at the 79th spot in last year’s rankings.  conjunction with New Delhi-based think tank Centre For Civil Society.
  • The report said prospects for increasing economic freedom in India depend on next generation reforms in factor markets and in greater openness to international trade.
  •  India reported marginal decrease in size of government (from 8.22 to 7.16), legal system and property rights (from 5.17 to 5.06), freedom to trade internationally (6.08 to 5.71) and regulation of credit, labour and business (6.63 to 6.53).
  • A score closer to 10 indicates a higher level of economic freedom.
  • According to the report, based on 2018 data, Hong Kong and Singapore once again topped the index, continuing their streak as first and second ranked, respectively.
  • India has been ranked higher than China, which stands at the 124th position.
  • New Zealand, Switzerland, US, Australia, Mauritius, Georgia, Canada and Ireland round out the top-10.
  • The report measures economic freedom (levels of personal choice, ability to enter markets, security of privately owned property, rule of law, among others) by analysing the policies and institutions of 162 countries and territories.

20.PM launches Rs 20,050-cr PMMSY to raise fisheries exports, farmer income

  • Prime Minister Narendra Modi  launched the Rs 20,050 crore from 2020-21 to 2024-25 as part of the Aatmanirbhar Bharat package Pradhan Mantri Matsya Sampada Yojana (PMMSY) in 21 states, including Bihar, that will help double fisheries exports, create more employment opportunities and boost income of farmers.
  • Prime Minister also launched the mobile app e-Gopala as well as several initiatives linked to studies and research in fisheries production, dairy, animal husbandry and agriculture in Bihar.
  • The PMMSY will ensure new infrastructure, modern equipment and access to new markets to fish producers and improve avenues for increasing income apart from farming.
  • It aims at enhancing fish production by an additional 70 lakh tonnes and increasing fisheries export earnings to Rs 1 lakh crore by 2024-25.
  • About the mobile app e-Gopala provides all the information related to cattle care, from productivity to its health and diet — will help farmers choose better quality livestock and get freedom from middlemen.
  • The e-Gopala app is being linked with animal Aadhaar and once that work is complete, then it will be easier for farmers to get all information about animals as well as help them in buying and selling animals.

21. ‘Levels and Trends in Child Mortality’ Report 2020

  • United Nations has released a report titled ‘Levels and Trends in Child Mortality’ for 2020.
  • The report is drafted by the United Nations Inter-Agency Group for Child Mortality Estimations (UN IGME). 
  • As per the report, India’s child mortality rate has reduced between 1990 and 2019. The child mortality rate in 1990 was 126 and now it has declined to 34 in 2019. 
  • As per the report, the child mortality rate globally under five has dropped from 12.5 million in 1990 to 5.2 million in 2019. 
  • The new mortality rates are released by UNICEF, WHO and Population Division of the United Nations, Department of Economic and Social Affairs and World Bank Group.
  • As per the report, 49% of under-five deaths occurred in Nigeria, India, Pakistan, Ethiopia and Congo for 2019. 
  • The sex-specific under-five mortality rate for India was 122 males and 131 females in 1990, which has now declined to 34 males and 35 males in 2019.
  • India has marked a 4.5% annual reduction rate in under-five mortality between 1990 and 2019.

22. Finance Minister unveils Doorstep Banking Services and declares EASE 2.0 Index Results

  • Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman inaugurated Doorstep Banking Services by PSBs and participated in the awards ceremony to felicitate best performing banks on EASE Banking Reforms Index.
  • As part of the EASE Reforms, Doorstep Banking Services is envisaged to provide convenience of banking services to the customers at their door step through the universal touch points of Call Centre, Web Portal or Mobile App
  • Customers can also track their service request through these channels.
  • The services shall be rendered by the Doorstep Banking Agents deployed by the selected Service Providers at 100 centres across the country. 

23. India Post launches Five Star Villages Scheme to ensure 100% rural coverage of postal schemes

  • The Department of Posts has launched a scheme called Five Star Villages, to ensure universal coverage of flagship postal schemes in rural areas of the country.
  • The scheme seeks to bridge the gaps in public awareness and reach of postal products and services, especially in interior villages.
  • All postal products and services will be made available and marketed and publicized at village level, under the Five Star Villages scheme.
  • Branch offices will function as one-stop shop to cater all post office – related needs of villagers.
  • The schemes covered under the Five Star scheme include:

 i)Savings Bank accounts, Recurrent Deposit Accounts, NSC / KVP certificates.

 ii) Sukanya Samridhi Accounts/ PPF Accounts

 iii) Funded Post Office Savings Account linked India Post Payments Bank Accounts

iv) Postal Life Insurance Policy/Rural Postal Life Insurance Policy

v) Pradhan Mantri Suraksha Bima Yojana Account / Pradhan Mantri Jeevan Jyoti Bima Yojana Account.

  • If a village attains universal coverage for four schemes from the above list, then that village gets four-star status; if a village completes three schemes, then that village get three-star status and so on.
  • Launching the scheme, the Union Minister of State for Communications that the scheme is being launched on pilot basis in Maharashtra.
  • It will be implemented nation-wide.
  • The scheme will be implemented by a team of five Gramin Dak Sevaks who will be assigned a village for marketing of all products, savings and insurance schemes of the Department of Posts.
  • This team will be headed by the Branch Post Master of the concerned Branch Office. Mail overseer will keep personal watch on progress of team on daily basis.
  • The teams will be led and monitored by concerned Divisional Head, Assistant Superintendents Posts and Inspector Posts.

24. Indian cities drop in Global Smart City Index, ‘not prepared’ for pandemic

  • The Institute for Management Development (IMD), in collaboration with Singapore University for Technology and Design (SUTD), has released the 2020 Smart City Index, with key findings on how technology is playing a role in the Covid-19 era.
  • In the 2020 Smart City Index, Hyderabad was placed at the 85th position (down from 67 in 2019), New Delhi at 86th rank (down from 68 in 2019), Mumbai was at 93rd place (in 2019 it was at 78) and Bengaluru at 95th (79 in 2019).
  • From 15 indicators that the respondents perceive as the priority areas for their city, all four cities highlighted air pollution as one of the key areas that they felt their city needed to prioritise on.
  • For cities like Bangalore and Mumbai, this was closely followed by road congestion while for Delhi and Hyderabad it was basic amenities.
  • The 2020 Smart City Index (SCI) was topped by Singapore, followed by Helsinki and Zurich in the second and the third place respectively.
  • In SCI’s context, ‘smart city’ describes an urban setting that apply technology to enhance the benefits and diminish the shortcomings of urbanization.
  • The second edition of the SCI ranked 109 cities worldwide by capturing perceptions of randomly chosen 120 residents in each city.

25. IFSCA Committee submits interim report on development of global retail business

  • An expert committee set up by the International Financial Services Authority (IFSCA) to suggest ways for the development of international retail business in International Financial Services Centres (IFSC) has submitted its interim report to the Chairperson of the Authority.
  • This report which focuses mainly on the banking vertical  suggests that the GIFT IFSC can aim at becoming a gateway to India growth story for international investors and business; serving domestic residents availing liberalised remittance scheme and providing Indian diaspora and individuals from Asia and Africa with a comprehensive range of financial services from the IFSC.
  • There is an immense immediate potential to promote international retail business in IFSC, and if done efficiently, it will meet three key objectives – boost job creation, generate additional revenue for India, and attract funds (especially from the Indian diaspora) for building India’s infrastructure.
  • The IFSC must aim to provide best in class jurisdictions and aim to build its competitiveness in terms of key factors like reputation, regulatory environment, taxation and ease of operations.
  • Going forward, this expert committee would cover other key business verticals — insurance, asset management and capital markets in subsequent reports.

26. Parliament passes Insolvency and Bankruptcy Code Amendment Bill

  • The parliament passed the Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020.
  • This bill will ensure that no fresh insolvency proceedings would be initiated against companies for defaults arising during six months from March 25.
  • Finance Minister Nirmala Sitharaman said that the provisions would, however, not impact proceedings already initiated before March 25.
  • The Centre might extend this six-month period to one year.
  • Changes in sections 7, 9, and 10 of the IBC that deal with initiation of corporate insolvency would ensure relief to companies that have been affected due to coronavirus pandemic.
  • It disables financial and operational creditors and corporate debtors from initiating insolvency proceedings for defaults within the six month time frame.

27. Led by renewables, non-fossils’ share in energy basket surges

  • The share of clean energy in India’s total power generation has risen rapidly to 30 per cent already this fiscal compared to 24.9 per cent in FY20.
  • The pace of growth has been such that the country, in the first five months of FY21, has added as much non-fossil energy capacity as it had managed cumulatively in the last four years.
  • The share of generation from thermal plants in the country has been coming down and that of non-fossil power (which includes renewables, hydro and nuclear) has been increasing gradually over the last five years due to a major policy thrust on the renewables sector.
  • The share of clean energy in overall generation in India increased from 19.6 per cent in 2015-16 to 24.9 per cent in 2019-20.
  • Three States — Karnataka (15,262 MW), Tamil Nadu (14,647 MW) and Gujarat (11,114 MW) — together account for about 46 per cent of India’s installed renewable capacity of 88,793 MW.

28. RBI releases document on UCBs’ cybersecurity

  • The Reserve Bank of India (RBI) has come out with a document to enhance cybersecurity of urban co-operative banks (UCBs).
  • The ‘Technology Vision for Cyber Security for Urban Co-operatve Banks (UCBs) 2020-2023’ has been formalised based on inputs from various stakeholders.
  • It plans to achieve its objective through a five-pillared strategic approach GUARD, viz. Governance Oversight, Utile Technology Investment, Appropriate Regulation and Supervision, Robust Collaboration and Developing necessary IT, cybersecurity skill sets.
  • With concerted efforts and involvement of all stake holders, the vision document, with its 12 specific action points, aspires to involve more board oversight over cybersecurity; enable UCBs to better manage and secure IT assets; implement an offsite supervisory mechanism framework for UCBs on cybersecurity-related controls; develop a forum for UCBs so that they can share best practices and discuss practical issues and challenges; and implement a framework for providing awareness/training for all UCBs.
  • The implementation of the approach outlined in this vision document will strengthen the cyber resilience of the Urban Co-operative Banks.

29.’Saubhagya’ scheme completes three years since its inception

  • Prime Minister Narendra Modi had launched this scheme on the 25th of September, 2017 to ensure electrification of all willing households in the country in rural as well as urban areas.
  • The scheme was launched with an  aim to achieve universal household electrification by providing last mile connectivity and electricity connections to all households in rural areas  and all poor households in urban areas across the country.

Saubhagya Scheme

Launch date- 2017

Features-

  • to provide electricity connections to over 40 million families in rural and urban areas by December 2018.
  • With no subsidy component for monthly electricity consumption, the Gram Panchayat and public institutions in the rural areas will be authorised to carry out billing and collection tasks which have been pain points for the discoms.
  • States have also been provided with an incentive of 50% of their loan being converted to grants, if the electrification targets are met by 31 December 2018.
  • To ensure on-the-spot registration, mobile applications will be used.
  • While free connections will be provided to below poverty line (BPL) households, even those not covered under this category can avail it by paying Rs500 in 10 instalments of Rs50 each along with their monthly bill.

30. Domestic Systemically Important Insurers (D-SIIs):

  • Three insurers- Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC) and New India Assurance Co. have been recognised as Domestic Systemically Important Insurers (D-SIIs) for 2020-21.
  • It was announced by Insurance Regulator and Development Authority of India (IRDAI).

D- SIIs

  • D-SIIs refer to insurers of such size, market importance and domestic and global inter-connectedness whose distress or failure would cause a significant dislocation in the domestic financial system.
  • D-SIIs are perceived as insurers that are ‘too big or too important to fail’ (TBTF).

31. AGRICULTURE BILLS

The following are the three bills implemented by the parliament :

The Essential Commodities (Amendment) Bill, 2020:

Removes cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. The amendment will do away with or deregulate  the production, storage, movement and distribution of these food commodities.

The central government is allowed regulation of supply during war, famine, extraordinary price rise and natural calamity, while providing exemptions for exporters and processors at such times as well.

The Farmers’ Produce Trade And Commerce (Promotion And Facilitation) Bill, 2020:

The Bill, gives freedom to the farmer to indulge in intra-state or inter-state trade in areas outside the APMC mandis.It also prohibits the collection of any market fee or cess under the state APMC Acts with respect to such trade outside the APMC market yards.

A key provision of the Bill is it finishes the over-rule of inconsistent provisions of the State APMC Acts. Also, the Central Government has been given powers to frame rules and regulations under the Act.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020:

It seeks to create a legal framework for contract farming in India.Provides framework on trade agreements for the sale and purchase of farm produce.

The mutually agreed remunerative price framework envisaged in the legislation is agreed to sell as one that would protect and empower farmers. The bill pays emphasis on the empowerment of farmers. To transfer the risk of market unpredictability from farmers to sponsors. 

Criticisms:

  • These bills are anti-farmer and will only result in reduced crop prices for farmers and undermine seed security even further.
  • Food security will be eroded as government intervention is eliminated.
  • These bills promote corporate control of the Indian food and farming systems.
  • They will also encourage black marketing, in addition to exploitation of farmers.
  • The bills also lack any assurance about Minimum Support Price(MSP).
  • What will happen to intermediaries and APMCs or mandis.

32. AGRICULTURE  BILLS (cont.)

The Parliament gave its nod to the two contentious agriculture Bills, despite the opposition. Two farm bills Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 and the Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020. And the Essential Commodities (Amendment) Bill , which was passed a week before two farmers bills are passed.

Bill on Agriculture Market: Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 :

The provisions of the bill are given below:-

  • To create and ecosystem where farmers and traders enjoy the freedom to sell and purchase farm produce outside registered “mandis” under state APMCs.
  • To promote barrier free inter-state and intra state trade of farmers produce.
  • To reduce marketing and transportation costs and help farmers in getting better prices.
  • To provide facilitative framework for electronic trading.

            The following are the reasons why bill is being opposed:-

  • States will lose revenue as they won’t be able to collect ‘mandi fees’ if farmers sell their produce outside registered mandis
  • What happens to ‘commission agents’ in states if entire farm move out of ‘mandis’?
  • It may eventually end the MSP – based procurement system.
  • Electronic trading like in e-NAM uses physical mandi structure. What will happen to e- NAM  if mandis are destroyed in absence of trading?

 Bill on Contract Farming: Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020:

The provisions of the bill are given below:-

  • Farmers can enter into a contract with agri-business firms, processors, wholesalers, exporters or large retailers for sale of future farming produce at a pre-agreed price.
  • Marginal and small farmers , with land less than five hectares , to gain via aggregation and contract ( Marginal and Small Farmers account for 86% of total farmers in India)
  • To transfer the risk of market unpredictability from farmers to sponsors.
  • To enable farmers to access modern tech and get better inputs.
  • To reduce cost of marketing and boost farmers income.
  • Farmers can engage in direct marketing by eliminating intermediaries for full price realisation.
  • Effective dispute resolution mechanism with redressal timelines.

The following are the reasons why bill is being opposed:-

  • Farmers in contract farming arrangements will be the weaker players in terms of their ability to negotiate what they need.
  • The sponsors may not like to deal with a multitude of small amd Marginal Farmers.
  • Being big private companies, exporters, wholesalers and processors, the sponsors will have edge in disputes.

 Bill Related to Commodities: Essential Commodities (Amendment) Bill,2020 :

           The provisions of the bill are given below:-

  • To remove commodities like cereals, pulses ,oilseeds , onion and potatoes from the list of essential commodities. It will do away with the imposition of stockholding limits on such items except under ‘extraordinary circumstances’ like war.
  • The provisions will attract private sector and FDI into farm sector as it will remove fears of private investors of excessive regulatory interference in business operations.
  • To bring investment for farm infrastructure like cold storages and modernising food supply chain.
  • To help both farmers and consumers while bringing in price stability.
  • To create competitive market environment and cut wastage of farm produce.

             The following are the reasons why bill is being opposed: –

  • Price limits set for “extraordinary circumstances” are so high that they are likely to be never triggered.
  • Big companies will have freedom to stock commodities – it means they will dictate terms to farmers, which may lead to less prices for the cultivators.
  • Recent decisions on export ban on onions creates doubt on its implementation.

Smart implementation of the new Farm Bills will lead to four significant changes. These are: An increase in farmer’s income, the rise of agri-entrepreneurs, massive private investments in agriculture, and a jump in farm product exports. Enabling farmers o get a better price for their produce will remain the most crucial factor in assessing implementation quality.

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