Download the compilation of all summaries of all the news articles here


GS 2

Odisha to come up with single revenue code

News:

  1. Odisha government planning to bring single revenue code.

Important facts:

2. Existing law governing land and revenue are unable to meet the requirement.

3. There is no provision for settlement in case of encroachment if it is more than 30 years.

4. A committee to frame code consist of member of board of revenue as a chairmen and 12 other members.

5. Currently, there are 299 sections present divided into 7 acts, while the new code will have 107 sections.

6. The bill will be enacted by merging:

  • Odisha Survey and Settlement Act1958
  • The Odisha Special Survey and the Settlement Act 2012
  • The Odisha Government Land Settlement Act, 1962T
  • The Odisha Prevention of Land Encroachment Act, 1972
  • The Odisha Land Reforms Act, 1960
  • The Odisha Consolidation of Holdings and Prevention of Fragmentation of Land Act 1972
  • The Odisha Estates Abolition Act, 1951.

7. The bill has invited suggestions and objection from all section before it take final shape.

 

Council conundrum

News:

  1. Odisha calling for national policy on legislative council in states.

Important facts:

2. Currently, only 7 states have upper house (legislative council).

3. State cabinet of Odisha has passed the resolution to create 49 member legislative council.

4. Creation of state council involve tedious process.

5. Parliament may by law provide for the creation Council in a State, if the Legislative Assembly of the State passes a resolution by a majority of the total membership of the Assembly and by a majority of not less than two-thirds of the members of the Assembly present and voting.

6. Bill for creating council in Rajasthan and Assam still pending in RajyaSabha.

7. Even though State council provide forum for academician and intellectuals for healthy debate it is not favored by all.

8. Objections against the council:

  • Lack of educational intellectual in the council.
  • Provide platform to accommodate politician who fail to get elected.
  • Unnecessary burden on exchequer.
  • Declining educational standard may not guarantee graduate intellectual benefit.

8. Argument in Favor of council.

  • Enough number of doctors, teachers and doctors in political party can utilize their talent.
  • Will provide resistance force against legislative matters.

9. Odisha government proposal may give a large opportunity to center to bring common consensus.

 

Article 35A and the basic structure

Article

  1. SuhrithParthasarathy an advocate, has talked about connection between Article 35A and basic feature of Indian Constitution.

 Article 35A: Was added was added into the constitution through presidential order of 1954. Empowers the Jammu and Kashmir state’s legislature to define “permanent residents” of the state and provide special rights and privileges in respect to public employment, acquisition of immovable property in the State, settlement in different parts of the State, and access to scholarships.

Important Analysis:

2. According to author, struck down the article will damage the spirit of Indian Federalism.

3. High court bench to check the validity of Article 35A if it infringes on the Basic structure of Indian constitution.

4. HC believes present petition is meritless as the previous bench has already approved 1954 presidential order.

5. According to political scientist Louis Tillin, Article 370 has established Indian constitution is form of “asymmetric federalism”

6. Author’s Argument in favor of article 35A

 

  • Instrument of Accession gave India the power to make laws only on Defence, External Affairs, and Communications.
  • Other area could be legislated only through the president order with prior assent of state government.
  • Though, Article 368 deals with the ordinary power of Parliament applicable to other parts of India, article 35A makes it clear that the changes made under article 368 will not apply to J&K.
  • Any amendment require to be applicable for J&K needs to bring under Article 370 and needed prior state government assent.
  • President order to make any provision can be accepted only on the prior recommendation of state constituent assembly.
  • Article 370 is described as a tunnel because it seems to be the only way to take the Indian constitution in J&K.

7. Petitioner claims against Article 35A

  • Article 35A could not have been added outside the scope of Article 368.
  • It infringes the basic structure of constitution.

8. Argument against the claims:

  • Article 370 is also an integrated part of Indian constitution as Article 368.
  • Kashmir require special focus and attention.
  • Constituent assembly of state consent require for adding any scope in Instrument of Accession.

9. Constitutional validity of Article 370 further recognized by SC in PremNath and SampatNath Prakash case.

10. Constituent assembly was disbanded in 1956. Any presidential order made after 1956 without state approval will be considered null and void.

11. He has also pointed, any change in article 35A is not always against the basic structure of constitution.

12. Because, SC verdict in Keshwananda case doesn’t cover all the aspects of article 368 and logic doesn’t extend toArticle 370.

13. However the Supreme Court held in Waman Rao v. Union of India has cleared, amendment made prior to Keshwananda is not capable of challenging basic structure otherwise may cause more harm than expected.

 

GS 3

M.P. seeks revival of cheetah reintroduction project

News:

  1. The Madhya Pradesh forest department has written to the National Tiger Conservation Authority to revive the plan to reintroduce cheetahs in the State’s Nauradehi sanctuary.

Important facts:

2. The forest department would need finances from the Centre for the project.

3. The ambitious project was conceived in 2009.

4. The Cheetah was declared extinct in India in 1952

5. The country’s last spotted feline died in Chhattisgarh in 1947.

6. The Wildlife Institute of India at Dehradun had prepared cheetah reintroduction project six years ago.

7. The proposal was to put the felines in the enclosure with huge boundary walls before released in the wild.

8. Nauradeshi was found to be the most suitable area for the cheetahs as its forests are not very dense to restrict the fast movement of the spottec cat.

9. According to the earlier action plan, around 20 cheetahs were to be translocated to Nauradehi from Namibia in Africa.

10. The Namibia Cheetah Conservation Fund had then showed its willingness to donate the felines to India.

11. However, the State was not ready to finance the plan contending that it was the Centre’s project.

 

Until dams do us part

Article:

  1. Executive Director, Nityata River Otter Conservancy, highlighted that India’s policy on dams has to be urgently reviewed.

Important facts:

2. The tragedy in Kerala has highlighted the damages of excess water accumulation in dams.

3. The opening of the gates of the Idukki dam, caused the Periyar river to discharge excess water.

4. Dams store million of tonnes of fresh water in large reservoirs, submerging prime forests, villages, farms, and livelihoods.

5. Around 47,00 large dams built since 1947 have cumulatively displaced post-Partition.

6. Dams have displaced the poorest of India’s people in favour of richer farmers and urban residents, often with little or no compensation.

7. Kerala and Tamil Nadu have battled over the safety of the Mullaperiyar dam.

8. According to the India Water Portal, there are over 100 dams in India which are over a century old, and more than 500 large dams which are around 50-100 years old.

9. The reservoir-induced seismicity (RIS) from the weight of the reservoir has resulted in earthquake in various parts of the country:  of the 75 cases of RIS reported worldwide, 17 have been reported from India.

10. According to data provided by the Centre for Research on the Epidemiology of Disaster, the instances of extreme weather have gone up from 71 in the 1970s to about 224 in the 1990s and 350 in the first decade of the millennium.

11. In the second decade, Uttarakhand, Odisha, Chennai, and now Kerala and Kodagu district have all been hit.

12. Author provides the following suggestions:

  • Need to provide greater urgency to review India’s policy on dams and to act on decentralized alternatives that involve water recycling and reuse.
  • The immediate task is to critically review every dam in the country, stop building new ones and establish sound safety protocols.

 

New copters to enable tech transfer

News:

  1. The Defence Ministry will soon release project-specific implementation guidelines for the 111 naval utility helicopters to be procured under the Strategic Partnership (SP) model.

Important facts:

  1. According to some foreign companies, there is still some clarity required on crucial legal, liability and technology transfer issues like legal.
  2. Under the SP model, Indian private companies will get to tie up with global original equipment manufacturers (OEMs) and build major defence platforms in India under technology transfer.
  3. So far, it was defence public sector undertakings (DPSUs) which played the lead role.
  4. Apart from the helicopters, the projects to be processed under the SP model are fighter aircraft, P-75I submarines and armoured vehicles.
  5. All procurements under the SP model would be executed by specially constituted empowered project committees (EPC) to ensure timely execution.
  6. The liability issue was one of the major reasons the earlier medium multi-role combat aircraft(MMRCA) deal for 126 jets got derailed.
  7. Recently, Defence Acquisition Council (DAC) cleared project-specific implementation guidelines for the naval helicopters.
  8. These guidelines would lay emphasis on transfer of technology and high absorption of indigenous content.
  9. The guidelines and the qualification guidelines are yet to be communicated to the industry.
  10. Way ahead:
  • There is need for some clarity from the MoD on production transfer and technology transfer as well.
  • Large infrastructure present in the country with DPSUs must be utilized for the benefit of both the country as well as form a business sense.

 

Delays plague projects, despite RERA

News:

  1. The bulk of property locked in delayed projects across India, causing distress among homebuyers.

Important facts:

2. The bulk of this property is located in the National Capital Region(NCR) and the Mumbai Metropolitan Region(MMR).

3. As per findings by PropEquity, a real estate analytics company, most units in housing projects across India are running ‘significantly behind their delivery deadlines’ with construction delays.

4. The National Capital Region accounts for more than 70% of projects that have failed to meet completion deadlines.

5. The projects are on hold due to the following reasons :

  • Financial constraints
  • Execution challenges
  • Surplus supply due to over-ambitious launches by developers.
  • Environmental clearance and slowing sales
  • Funding is another issue.
  • RERA, a law brought in to enforce strict norms on developers, has not helped solve the issue as it had allowed developers to offer new completion dates without facing financial penalties.
  • Under RERA, the developer has given a new completion deadline.
  • Under RERA, one has to complete the project in time.
  • RERA has given an opportunity to developers to be transparent and deliver as per new deadline.
  • The forest land issue had stalled many projects in Mumbai and Thane.

6. Developers are now looking for JV partners who can bring capital to complete the struck projects.

7. One solution before REERA is to enforce original completion dates which will force developers to expedite these joint ventures.

 

What is share buyback?

News:

  1.  With prominent companies such as Infosys, TCS, and L&T having gone for a share buyback, there is low-down on the mechanism and the reason for firms taking such a step.

Important facts:

2. A buyback is a mechanism through which a listed company buys back shares from the market.

3. A buyback can be done either through open market purchases or through the tender offer route.

4. Under the open market mechanism, the company buys back the shares from the secondary market while under tender offer, shareholders can tender their shares during the buyback offer.

5. Most companies had preferred the open market route.

6. Buybacks are done when a company has a significant cash reserve and feels that the shares are not fairly valued at the current market price.

7. Promoters also use this mechanism to tighten their grip on the firm.

8. Benefits:

  • Buyback is usually done at a price higher than the then prevailing market price, shareholders get an attractive exit option, especially when the share are thinly traded.
  • It is also more tax-efficient than dividends as a way to reward shareholders.

9. A company execute a buyback in the following manner:

  • A company can use a maximum of 25% of the aggregate of its free reserves and paid-up capital for a buyback.
  • A special resolution needs to be passed at a general meeting.
  • However, it the company plans to use less than 10% of its reserves then only a board resolution is required.

10. A company cannot do a second buyback offer within one year from the date of the closure of the last buyback.

11. There are time-bound limitations on further share issuances like preferential allotment or bonus issue post a buyback.

12. These checks have been put in place so that companies do not misuse the buyback mechanism.

13. Recently, The Securities and Exchange Board of India (SEBI) has revised the buy back regulations that stipulate 15% reservation for retail shareholders in a buy back offer.

14. This gives retail investors a fair share in the offer, which otherwise could see large institutional investors tendering their shares leaving little or no room for small  investors.

 

Time for catastrophe bonds?

News:

  1. The recent floods in Kerala have set off a debate about the need for timely aid required to kickstart the relief process.

Important facts:

2. The idea that catastrophe risk could be securitised and that it could be dispersed among a wide number of investors was first mooted after hurricane ‘Andrew’ caused massive damages in the United States.

3. Catastrophe bonds are issued by insurance companies which have exposure to property and calamity insurance.

4. Under these bonds, the investors are compensated by a rate of return which is higher than that of normal government or corporate bonds.

5. The cost of issuing and managing catastrophe bonds is cheaper than the cost of reinsuring these risks and does the same function of transferring risk.

6. The instrument is a bond where the investor loses a part or whole of the capital based on certain pre-agreed conditions being triggered. These could be:

  • Indemnity on losses faced by the insurer;
  •  Modeled losses; or,
  • Losses indexed to the total loss faced by the industry.

7. The market for catastrophe bonds was initially pegged in the range of $1-2 billion dollars in the initial years of 1998-2001.

8. Today, the total size of the catastrophe bond market is more than $30 billion.

9. The outstanding bonds in the first quarter of 2018 amounted to $35 billion.

10. Advantages for investors:

  • Helps investors diversity risk. This is perhaps the only class of bonds that is not tied to economic performance parameters which would be the case in equity.
  • The investors are compensated by a rate of return which is higher than that of normal government or corporate bonds. This helps them get extra returns on investment which in turn helps them to meet liabilities.

11. Way ahead:

  • It is high time that such instruments are introduced in India so that relief and reconstruction work in areas affected by natural disasters goes on unimpeded and are no stalled for only want of capital.

 

Powell doctrine

News:

  1. US central bank chairmen in favor increasing interest rate gradually.

Important Facts:

2. According to recent data, the US economy is growing at a strong pace.

3. Unemployment figure touching 20 year low and inflation is close to target of 2 %.

4. Central Bank chief has supported the gradually increase in interest rate is appropriate.

5. President Trump raises concern over increasing interest rate which may have negative impact of economic growth.

6. Another perspective involve criticism that gradually increase in interest rate is too slow.

7. In response to this, Federal bank chief said raising interest rate either too fast or slow involve risk in an economy.

8. He has acknowledged issues with emerging market which could lead to federal policy change in future as well.

9. Federal tightening policy (increasing interest rate) has impacted on several emerging economies negatively.

10. For example, currency depreciation in Turkey and Brazil.

11. India too has raised interest rate twice to avoid currency depreciation.

12. It has been seen in past, The US central bank policy does not address the concern of emerging economies.

13. Change in the US federal policy can have a significant impact on rest of the world.

Print Friendly, PDF & Email

Did you like what you read?

Enter your email address below to get all our updates in your inbox the moment it is published. Once you enter your email address, you will be subscribed immediately.


We do not spam you, so you can easily unsubscribe anytime, by clicking on unsubscribe link in the email.