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GS 2

Cut regulatory levies

News

  1. For restoring telecom companies’ health, GOI has released the draft of National Digital Communication Policy (NDCP), 2018.

Important facts

  1. Telecom sector has been facing challenges with the debt of 7.64 lakh crore in last few years
  2. The sectors’ employment is at all time low due to decreasing profit margins, causing merger of companies.
  3. To recover Telecom sector problems GOI has announced NDCP, 2018
  4. NDCP draft
  • It proposes Rationalization of multiple taxes and levies, such as license fees, spectrum usage charges, universal obligation fund, GST.
  • The target is attracting an investment worth $ 100 billion in the digital communication sector.
  • Telecom firms would be allowed to issue tax-free telecom bonds.
  • Tax holidays and low interest on debt repay to the government would also be considered.
  • There is also urgency of rationalization of Universal Service Obligation (USO) Fund, especially in rural sector.Nb
  • Draft proposes spectrum as a natural resources.
  • In India nominal fee can be charged for the administrative cost, spectrum usage charges would also be reduced to 1% of Adjusted Gross Revenue (AGR)

Challenges

  • Telecom sector pays 30% of their revenues in the form of taxes and levies, while rest of the global companies pay around 10%.
  • It is estimated that the sector has to spend as much as 2 lakh crore over 3 to 5 years, to install mobile towers, optical fibers and other infrastructure for the new technologies.
  • Generation of capital requires two things
  • Sector should make sufficient profits that can be invested back in other businesses.
  • Make the business attractive enough to attract funding from other sources.
  • To get rid of the funding route problem, one option can be setting up of Telecom Finance Corporation (TFC).

 

Criminal cases against Law makers

News

Supreme Court asked 19 states to furnish information about criminal cases pending against MP and MLAs.

The  petition was filed in  Supreme Court, for speedy trial and life time ban on convicted politician in criminal cases.

Important facts

Objective is to decriminalize politics.

Law on criminal politicians

Certain provisions of the Representation of People (RP) Act, bar convicted politicians from contesting elections for six years after serving jail term

Special court

According to center affidavit 11 states, and union territory of Delhi have designated special court to prosecute elected politicians in criminal case

Pending cases

The Centre informed the Supreme Court that 1097 criminal cases are pending before 12 special courts against members of parliament and members of State legislatures in 11 states and a Union Territory

Take of Election commission and law commission

Election Commission of India (ECI) and the Law Commission favoring lifetime disqualification of politicians convicted in criminal cases

 

Mediterranean Black Carbon may be polluting Himalayas

News

  1. Wadia Institute of Himalayan Geology (WIHG) has studied the impact of black carbon on Himalayas recently.

Important facts

  1. The study revealed that black carbon coming from Mediterranean countries during the western disturbance may be one of the factors in diminishing snowfall in the region.
  2. Black Carbon
  • It is formed through the incomplete combustion of fossil fuels, Bio-fuel etc.
  • It has an adverse effect on human health and decreases the Earth’s ability to reflect the warming rays of the Sun
  1. Western disturbance

It is an extra tropical storm originating from the Mediterranean region that brings sudden winter rain to the northwestern parts of the Indian subcontinent.

  1. Study
  • Data of carbon concentration between January to December 2016 has been taken from Gangotri glacier valley shows high even in winter months.
  • In the month of January and February, there are no human intervention and absence of local factor in this region due to cold, but the study shows, during this time, data of carbon concentration is 4th and 5th highest in 12 months.
  • This shows that black carbon aerosols were being transported during Western Disturbances and wind projections.
  1. Effects in region
  • Aerosols like black carbon have been recognized as the second most important anthropogenic agent for climate change.
  • The primary factor for adverse health effects is air pollution
  • Decreased snow covers area in the region, resulting in lowered albedo which enhances warming in the region. Decreased snow has also led to disappearance of valuable medical herbs in the region.

 

GS 3

Cabinet clears new procurement policy

News:

  1. Recently, the Union Cabinet approved a new umbrella Scheme “Pradhan Mantri AnnadataAaySanrakshanAbhiyan’ (PM-AASHA) to guarantee MSP to the farmers.

Important Facts:

  1. Minimum Support Price (MSP):
  • Minimum Support Price is the price at which government purchases crops from the farmers, to safeguard their interests.
  • Every year, under the MSP policy the government fixes the rates for 23 crops grown in Kharif and Rabi season. In 2018, the rates were set at 50% higher than the farmer’s production costs, including that of labour
  • The minimum support price (MSP) for agricultural produce is decided by the Commission for Agricultural Costs and Prices (CACP)
  1. Background: The decision to launch a new mechanism comes against the backdrop of the Union Budget 2018 where it was assured that the farmers would benefit from MSPs
  2. Key Features of PM-AASHA:

The scheme comprises of three sub-schemes viz.

Price Support Scheme (PSS):

  • Physical procurement of pulses, oilseeds and Copra will be done by Central Nodal Agencies in collaboration with state governments
  • Both National Agricultural Cooperative Marketing Federation of India (NAFED) and Food Cooperation of India (FCI) will take up PSS operations in states.
  • As per norms, the central government will bear the procurement expenditure and losses due to procurement.

Price Deficiency Payment Scheme (PDPS):

  • Announcement of the scheme follows the recommendations of NITI Aayog where it suggested “Price Deficiency Payment” for implementation of MSP in crops where procurement is poor.
  • The scheme will cover all oilseeds for which MSP is notified.
  • Direct payment of the difference between the MSP and the selling price will be made to pre-registered farmers selling their produce in the notified market yard and thus it does not involve any physical procurement.
  • All payments will be done directly into registered bank accounts of the farmers.

Note: The scheme has been framed on the lines of BhavantarBhugtan Yojana, Madhya Pradesh government’s scheme to protect the interests of oilseed farmers in the state.

Pilot of Private Procurement &Stockist Scheme (PPPS):

  • Under this scheme, participation of private sector in procurement operations will be piloted.
  • States have the option to roll out the scheme on pilot basis in selected districts/APMCs involving private stockists
  1. Significance:
  • It is an important step towards achieving the ambitious target of doubling farmers’ income by 2022
  • The provision of crop-wise procurement is expected to benefit both farmers and states
  • The policy will help in stabilising commodity markets and will also benefit the farmers by providing options to the state governments to compensate farmers when the market prices fall below MSP.
  • The involvement of private sector in procurement will help improve the process and infrastructure of procurement in the country.
  1. Concerns:
  • The NITI Aayog in its 2016 evaluation report highlighted that the procurement infrastructure in India is inadequate. However, recent initiatives have not focused on improving the procurement infrastructure.
  • Another important concern is lack of an efficient distribution system. For example, NAFED has a stock of 4 million tonnes of pulses and oil seeds because of previous 2 years procurement. However, their distribution policy is still non-existent.
  • Critics have also raised concerns over price manipulation by traders
  1. Way Forward:
  • Efficient implementation will be the key to the success of PM-AASHA. The government should ensure hassle-free and easy registration of farmers.
  • The scheme should target small and marginal farmers so as to improve their economic condition
  • The government should effectively check price manipulation by traders.

 

Health Ministry bans 328 fixed dose combination drugs

News:

  1. The Ministry of Health and Family Welfare (MoHFW) has prohibited the manufacture, sale or distribution of 328 fixed dose combinations (FDCs) for human use with immediate effect.

FDCs : A drug which contains two or more active ingredients in a fixed dosage ratio.

The FDC formulation may have up to 5 or even more ingredients with or without rationality of their presence and in the quantity.

Important Facts:

  1. The prohibition is done under the Section 26 A of the Drugs and Cosmetics Act, 1940 .
  2. The ban on FDCs will  include painkillers, anti-diabetic, respiratory and gastrointestinal medicines, covering 6,000 brands.
  3. The ban notifications do not include 15 FDCs that were manufactured since before 1988.
  4. The MoHFW earlier in 2016, had banned 349 FDCs but Supreme Court(SC) stayed it after drug manufacturers petitioned .
  5. SC also directed to form an expert panel by the DTAB to review the matter.
  6. Findings of the Expert Panel formed under Chairmanship of NilimaKshirsagar:
  • These FDCs were “irrational” and have  lack of therapeutic justification.
  • Many FDCs were formulated without due diligence, with dosing mismatches that could result in toxicity.
  • FDCs may raise safety issues for human beings.
  1. Central Government considered the recommendations of the Expert Committee and concluded that it was expedient in public interest to prohibit these 328 FDCs.
  2. General issues with FDCs:
  • Pharmacodynamic mismatch between two FDC components i.e., having opposite effects leading to reduced efficacy or enhanced toxicity,
  • Pharmacokinetic mismatch between components with peak efficacy at different times.
  • Chemical non-compatibility leading to decreased shelf life.
  1. Impact of the FDCs ban:
  • Ban will shave off over Rs1,500 crore from India’s Rs1.18-lakh crore pharmaceutical industry.
  • It would also  impact medicine brands across several therapy areas.
  • However the impact of this ban is expected to be limited as most of these brands are “very small” and  ban may have a “marginal” impact.
  •  Moreover the drug makers with FDCs banned between 2016 and 2017 have either changed the compositions of their combinations or discontinued production of some brands that fell into the ‘banned’ category.
  • Companies can  launch variants to FDCs that would be compliant with regulations.

 

37% of women dying of suicide are Indians

News:

  1. A series of studies published in The Lancet reported that India has had witnessed an alarming rise in the occurrence of heart disease, stroke, diabetes, cancers and suicides over the past 25 years.

Important Facts:

  1. The report titled “India State-level Disease Burden Initiative” has analysed several major Non Communicable Diseases (NCDs) and suicide cases for every state in India.
  2. According to estimates, the prevalence of cardiovascular diseases, diabetes, chronic respiratory diseases, cancer, and suicide increased in all Indian states between 1990 and 2016

Non-Communicable Diseases:

  1. Cardiovascular Diseases:

Prevalence of ischemic heart disease and stroke has increased by over 50% from 1990 to 2016 and contributed to 28% of total deaths (leading cause) in 2016

  1. Chronic respiratory disease:
  • Chronic respiratory diseases is the second leading factor for disease burden in India and were responsible for 10.9% of total death in 2016.
  • The cases of COPD in India increased from 28 million to 55 million between 1990 and 2016. Further, the death rate among these cases is significantly higher in the less developed states than the more developed states.
  • According to the study, contribution of air pollution to COPD was found to be higher than smoking. Air pollution has also been found to raise risk of cancer, cardiovascular diseases and diabetes prevalence.
  1. Diabetes:
  • Cases of diabetes rose by 29.7% between 1990 and 2016. It contributed to 3.1% of total deaths in 2016
  • The prevalence of diabetes has been observed to be highest in the more developed states such as Tamil Nadu and Kerala and in New Delhi.
  1. Cancer:
  • The proportional contribution of cancers to the total health loss in India doubled from 1990 to 2016. However, the incidence of different types of cancers has been observed to vary widely across states.
  • Cancers of the cervix, stomach and oesophagus reported a decline while breast and liver cancers have increased significantly
  1. Suicides:
  • According to the study, suicide is the leading cause of death in the age group 15-39 and there has been a 40% increase in the number of suicide deaths between 1990 and 2016
  • India contributes 37% total global suicide deaths among women and the suicide rate among women in India is 2.1 times higher than the global average
  • Suicide death rate among the elderly has also increased
  • There are regional variations in suicide rates and Karnataka, Tamil Nadu; Andhra Pradesh recorded high suicide rates for both men and women.

Concerns:

  • A major concern is very high rate of increase in the burden of cardiovascular diseases and diabetes in less developed states which already have a high burden from chronic obstructive lung disease and from a range of infectious and childhood diseases.
  • Insufficient healthcare services and infrastructure in India makes it more difficult to combat the menace of rising disease burden in India

Way Forward:

  • High suicide rates in India highlights the need for a national suicide prevention strategy which is data driven, gender specific and takes state variations into account
  • There is an urgent need to address the double disease burden in less developed states with concerted efforts towards improving healthcare system, nutrition and public awareness.

 

An education that is in sync

Article:

  1. R.B. Grover and HomiBhabha has discussed the importance of “general and specialized education in India.

Important Analysis:

  1. All India Survey on Higher Education reports says, the Gross Enrollment Ratio (GER) in higher education has increased to 25.8 % in 2017-18 compared to 10 % in 2004-05.
  2. About Gross Enrollment Ratio:

Gross Enrolment Ratio determines the number of students enrolled in school/college at several different grade levels.

It is the ratio of students enrolled in a given level of education regardless of age to the population of the age group which officially corresponds to the given level of education.

In India, for higher education it is calculated for age group of 18-23.

  1. According to survey, in India, GER in higher education is 30 % which is quite impressive but still less than the developed nations.
  2. According to Author, debate on higher education should be focused on content of Higher Education rather than autonomy and governance.
  3. Recommendations of Radhakrishnan Commission Report (RCR) published in 1949-50 on Indian University Education which is still relevant in present scenario.

General and Professional education – advocated that general education (Arts and Humanity) and specialised/professional education should proceed together.

Education of language should be given equal importance to enhance communication skills.

  1. Similarly, the National Academic Press (NAP) of U.S in its report “Branches of the same Tree” has talked about the purpose of Higher Education which should include:

The integration of Humanities and Arts with Sciences, Engineering and Medicine in Higher Education.

Acquisition of knowledge, skills, written and oral communication skill, ability to work as a team, ethical decision making and critical thinking which helps graduate to make balance between work and life.

  1. NAP has also acknowledged few challenges such as

Interdisciplinary Specialization (Academic) has resulted in many developments but problem arising are multi-disciplinary. Such as balancing demand of energy on a large scale with continue supply of energy in an environmental friendly approach.

Due to advancement in technology, professional must study the impact of innovation influencing everyday life such as privacy and technology-driven social changes.

  1. Study has revealed, integration of Humanity and Arts with Science has resulted graduates with increased critical thinking ability, deeper learning, higher creativity and improved communication skills.
  2. Reality existing in India:

Higher education in India is not yet prepared for integration of general education with Science.

Missing General education plan from most university affiliated Science colleges.

Single stream institutions (Focused on single subjects) further eliminate the possibility of integrated study.

  1. Primarily the focus of undergraduate education should be on general education and specialized education can be introduced at postgraduate level.

 

Sage advice

News:

  1. Former RBI Governor Raghuram raised concern over high Non Performing Assets (NPA) of the banks.

Important News:

  1. According to Raghuram, Government is not taking serious steps to tackle the issue of NPA.

Factors contributing to high NPA and issues with them:

  1. MUDRA CREDIT: – Small loans provided to Micro and Small Medium Enterprises.

Under Pradhan Mantri Mudra Yojana loan of ₹6.37 lakh crore, which is over 7% of the total outstanding bank credit disbursed to the sector mostly belong to informal sector.

Though, these are small loans up to Rs.10 Lakh to each, it builds into large credit over a period of time.

Since borrowers mostly belong to informal sector, bank needs to monitor them closely.

Rising concern is if Banks have enough manpower to chase and recover the granted loan.

  1. Kisan Credit Card: Provide adequate and timely short-term credit needs of farmers during the cropping season.

Credit provided under Kisan Credit Card also goes to informal sector and hard to recover.

Loan waiver scheme further discourages small farmers to pay their loan leading to less recovery by banks.

  1. Credit Guarantee Scheme for MSMEs: In which small loan is given to MSMEs and it is run by Small Industrial Development Bank, having the same issues of loan recovery.
  2. As per RBI recommendation, recognition of bad loan should be the first step in an effort to clean-up NPA.
  3. And once the Banks are clean, they can further make fresh loans.
  4. Other Recommendations provided by RaghuramRajan

Professionalising bank boards with appointments done by an independent Banks Board Bureau.

Bring talent from outside banks.

Revising compensation structures to attract the best talent.

Ensuring that banks are not left without a leader at the top.

  1. Finally, he has raised concerns over political parties for their un-justified policies such as Loan waiving schemes.

 

Petrol and diesel price continue to rise.

Important News:

  1. Crude oil price rises to almost at $80 a barrel and raising concern.
  2. Why Fuel price continue to rise:

Pricing Approach: – Oil marketing companies have switched to dynamic pricing approach. This was done to adopt market driven approach to adjust exchange rate and crude oil rate fluctuation.

Tax and Duties: – Beside the cost of crude oil rate and exchange, Excise Duty and VAT (charged by the respective state) does not seem to be favorable.

Commission: – High commission which oil companies pay to fuel pump owner.

Dynamic Pricing: Also referred to as surge pricing, demand pricing, or time-based pricing is a pricing strategy in which businesses set flexible prices for products or service based on current market demands.In dynamic fuel pricing, retail selling prices of petrol and diesel will be revised daily.

  1. So far only two states Rajasthan and Andhra Pradesh have cut fuel taxes to control fuel price.
  2. Consequences of Fuel Price hike:

Impact on retail inflation affecting end consumers.

Curtailing Non-Essential consumption expenditure.

Softening of economic growth due to reduced consumer expenditure.

  1. What government can do to tackle situation:

Trimming excise duty and VAT

The Centre must direct oil marketing companies to change their pricing mechanism from trade parity price (TPP) to one based on market realities.

  1. The TPP is based on product prices in the international market, assuming that 80 percent of the petrol and diesel is imported and 20 per cent is exported.
  2. It is high time for oil marketing companies to start pricing their products independently and transparently based on market principles.
  3. So far Government/State has failed to take concrete steps against the fuel price hike because:

Fiscal Risk: –  Risk of higher Fiscal deficit at a time when current account deficit is already soaring high.

Revenue Loss: –  Petroleum products contributed 24 per cent of the Centre’s revenue receipts and 8 percent of the States’ revenue receipts.

Uncertainty over GST revenue.

  1. Future recommendations:

Centre must work with States to bring petrol and diesel under GST.

Lower costs and the benefit of input tax credit under GST could help oil companies reduce fuel prices in future.

 

The high cost of man-animal conflict

Article

  • AathiraPerinchery talks about several inconsistencies in compensation awarded for man-human wildlife conflict between states.
  1. Important facts

According to 2010 to 2015 data by Bengaluru Centre for wildlife studies on man-human conflict shows

  • Majority of the States awarded compensation for loss of livestock, human injury and death, due to man-animal conflict. However, only 18 states provided compensation for property damage.
  • 22 states provide for compensation for crop loss by man-animal conflict, however still states like Gujarat and Rajasthan do not provide compensation for crop loss.
  • There exist numerous inconsistencies in eligibility, application, assessment, implementation and payment procedures across States in giving compensation.
  • There are discrepancies in eligibility procedure for filling compensation for loss due to man- animal conflict.
  1. Suggestion
  • Policies must be standardized across State lines in a manner that are equitable to both citizens and wildlife.

 

EU Parliament OKs copyright rules that could be ‘catastrophic’ for Net .

News:

  1. The EU parliament has approved new copyright rules which include stringent new automated checks for content before being posted on online platforms.

Important Facts:

  1.  EU parliament bought controversial rules, known as Articles 11 and 13.
  2.  Article 11 introduces a “link tax” which means that companies like Google and Facebook may have to pay news organisations to use their headlines on their sites.
  3.  Articles 13  provides for filtering the public posts on technology platforms and check for copyright infringement.
  4. The new directives exempts the smallest tech companies.
  5. Wikipedia and open source software platforms would not be affected.
  6.   Positive implications of new rules:
  • It will  better protect the rights of the authors and creators.
  • Automated filters could identify copyrighted material.
  • Media companies and publishers say the changes would help them get paid for their work.
  •  New rules would force internet giants like Google and Facebook to share more revenues with European media, publishers and other content creators.
  1. 8. Negative implications of new rules:
  • The legitimate content will be removed from websites accidently by automated filters.
  • Perfectly legal content like parodies and memes based on existing songs or movies  can also be banned.
  • Some musicians have argued that new rules could actually hurt their industry,  by stifling the ability to collaborate with young artists.
  • Rules are too hard to put into effect and might lead to greater control over internet.
  •  It would undermine free expression online and access to information.
  • The cost and reliability of automated filters is also doubtful.

 

 

Tax break to unlock oil, gas worth Rs 50 lakh crore; boost for ONGC, Cairn

News:

  1. The cabinet approved fiscal incentives to unlock oil and gas by attracting investments and technology to raise the output of ageing oil fields.

Important Facts:

  1.  Fiscal incentives worth Rs 50 lakh crore over the next 20 years will be provided by government to enhance oil and gas recovery.
  2. Incentives will include lowering cess by half and 75% discount on royalty.
  3. Enhanced oil and gas recovery will be obtained from ageing fields as well as new sources such as shale, hydrates and heavy oil.
  4. Under the new policy, every field will be assessed for its potential for enhanced recovery, the technology required and the fiscal incentives needed to make it viable.
  5. The policy will benefit both the state firms and private parties.
  6. Policy also provides mandatory screening of fields through designated institutions, to be notified by government.
  7. Pilot studies will also be conducted before actual implementation of enhanced recovery project on commercial level.
  8. Implications of the move:
  • The move can raise the production of oil by 120 million tonnes and gas by 52 billion cubic metres over the next 20 years.
  • Attract big investments and cutting-edge technology into the sector to improve India’s hydrocarbons recovery.
  1. Challenges for Enhanced Recovery (ER)
  • ER is capital intensive, technologically complex and calls for supporting infrastructure, logistic support, fiscal incentives and enabling environment.

 

Cabinet decision:Sops for more ethanol output from sugarcane

News

  1. Cabinet Committee on Economic Affairs (CCEA) has taken a decision to provide incentives for the production of ethanol from sugar cane.

Important Facts

  1. In India, ethanol is mainly produced from sugarcane molasses by fermentation process
  2. Since ethanol is produced from plants that harness the power of the sun, ethanol is also considered as renewable fuel.
  3. Ethanol Blended Petrol programme was launched in 2003 on a pilot basis and has been subsequently extended to 21 states and 4 Union Territories.
  4. The government has been notifying the administered price of ethanol since 2014.
  5. India has set a target of 10 percent ethanol blending in petrol by 2022.

 

CCEA Recommendations

  1. Government has announced that it will offer higher rate to those sugar mills that produce 100 percent ethanol from sugarcane, without producing sugar.

 

  1. The government has announced three progressive rates for ethanol based on their purity.
  • Ethanol produced from 100 per cent sugarcane juice will be priced the highest.
  • Ethanol produced from B grade molasses: They are made from partial sugarcane juice and will be priced lower than those produced from 100 per cent sugarcane juice.
  • Ethanol produced from C grade molasses: Inferior than B grade molasses and will be priced the least
  1. Advisory to Oil Market Companies (OMCs): They have been advised to prioritize ethanol procurement based on the purity and give preference to ethanol made from 100 per cent sugarcane juice.

Benefits

  1. The move will encourage the production of ethanol and will thus reduce the sugar production in the country, thereby preventing the price crash of sugar.
  2. It will increase the liquidity with the sugar mills and will help them settle the dues of the farmers.
  3. It will incentivize ethanol output and will increase Investment in capacity addition.
  4. It will help in making Ethanol available for Ethanol Blended Petrol (EBP).

Challenges

  1. Sugar Mills will have to invest in distillery capacity.
  2. They will also have to invest in pollution control, storage and logistics

Criticism

  1. When fuel prices will decline the oil companies will want to pay lower for ethanol which will result in ethanol producers suffering.
  2. If ethanol price will decline, the sugar mills will find their margin reduced because their sugarcane purchase price is fixed.
  3. If the government forces the oil companies to pay the same ethanol price then oil companies will suffer.
  4. Bad weather can damage cane resulting in decline in sugar output and market price of sugar will thus increase.

Suggestions

  1. Government should allow the market to determine the cane price.
  2. Government should link the price of cane to the blended realization that a mill earns from sugar ethanol, cogeneration of power.
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