Q.1) What do you understand by the term “constitutional emergency”. Describe how the relationship between centre and States gets modified during the term of this emergency.
Answer: Article 355 imposes a duty on the Centre to ensure that the government of every state is carried on in accordance with the provisions of the Constitution. In performing this duty, Centre takes over the government of a state under Article 356 in case of failure of constitutional machinery in state. This is known as ‘Constitutional Emergency’.
Impact on centre-state relations:
- President can take up functions of the state government and powers vested in the governor or any other executive authority in the state.
- He can declare that the powers of the state legislature are to be exercised by the Parliament.
- President dismisses the state council of ministers headed by the chief minister. The state governor, on behalf of the President, carries on the state administration with the help of the chief secretary of the state or the advisors appointed by the President.
- President either suspended or dissolves the state legislative assembly. The Parliament passes the state legislative bills and the state budget.
- Parliament can delegate the power to make laws for the state to the President or to any other authority specified by him in this regard.
- President can authorise, when the Lok Sabha is not in session, expenditure from the state consolidated fund pending its sanction by the Parliament.
- President can also promulgate ordinances for the governance of the state when the Parliament is not in session.
Q.2) Discuss the significance of the Speaker in light of the tenth schedule of the constitution. Do you agree with the view that Speaker’s power to disqualify a MP should be handed over to the nominal head of the state under tenth schedule.
Answer: The 10th Schedule of Indian Constitution is referred as the ‘Anti-Defection Law’. Defection is an act by a member of a particular party of disowning his loyalty towards that particular party and pledging allegiance to another party.
Significance of speaker: The question of disqualification under 10th Schedule is decided by the Speaker of LS. SC ruled that the decision of the Chairman/Speaker in this regard is subject to JR.
Need to transfer power to nominal head:
- Often, speaker is the member of the ruling party. Thus there are instances where speaker does not disqualify the candidates violating 10th schedule.
- In India, the speaker does not resign from his political party, this continues his loyalty.
- The misuse of Anti-defection law defeats the purpose of 10th schedule and is failing to prevent defections. This is affecting the parliamentary democracy.
- Handing over to president or governor with consultation of EC as in the case of disqualification under Art.103 will ensure fairness and neutrality.
- This is leading to politicisation of neutral posts like that of speaker.
- The problem of continuing defections also leads to unstable coalitions and viability of democratically elected governments.
Q.3) To create strong lending institutions with global standing, government has often mooted the idea of bank consolidation. Critically analyse the need of bank consolidation in current context of bad loans impacting the economy.
Answer: Need for Bank consolidation:
- In geographic areas with a lot of bad loans and weaker banks, consolidation will help in better governance and capital allocation.
- Most PSBs have seen a pile up of bad loans.GNPA ratio of public sector lenders range from 7% to 24% across banks.
- Though government has committed to infusing Rs 10,000 crore into banks this fiscal, most external agencies believe will be inadequate.
- Though consolidation may do nothing to reduce the amount of capital that the government needs to infuse in the short term, in the long term there will be considerable savings.
- Meeting the credit needs of the growing Indian economy.
- Mergers help small banks to gear up to international standards with innovative products and services with the accepted level of efficiency.
Problems with Bank consolidation:
- Consolidation will also present individual implementation challenges for the banks. There will be a possible rise in bad loan ratios.
- Lenders will also have to do significant amount of rearranging of their branch networks. Over time, most banks have set up branches and ATM networks in similar locations particularly in Tier-1, Tier-2 towns.
- Despite automation, most Indian banks have gone for massive expansion of their branch networks in urban India, which will be redundant when some of them merge.
- Banks should consolidate loan books to ensure that individual company and group exposure norms are not breached.
- In case of SBI, following the merger, gross NPAs have jumped from Rs1.08 trillion to Rs1.79 trillion. While its own net profit was Rs2,815 crore in the March quarter, the merged entity reported a loss of Rs 3,300 crore.
- Mergers will result in immediate job losses on account of large number of people taking VRS on one side and slow down or stoppage of further recruitment on the other. This will worsen the unemployment situation further and may create law and order problems and social disturbances.
Q.4) Enumerate the various problems affecting the Sugar Industry in India. Also list down the various initiatives taken by the government to improve this industry.
Answer: Problems affecting sugar industry:
- Low yield per hectare: The average rate of sugar recovery from the sugar cane is less than other sugar producing areas like Java, Hawaii and Australia.
- Monoculture of sugarcane: lack of crop rotation in some areas, leads to depletion of nutrients in soil and adversely affect cane productivity.
- Water availability: Irregularity in availability of water for irrigation especially in north India, adversely affecting the sucrose content in the crop.
- Perishable nature of crop: Post harvest deterioration in cane quality on account of staling and delayed crushing contributes to low sugar recovery.
- Problem of cane farmers: Inadequate availability of quality seed of new sugarcane varieties to farmers.
- Delays in payment to the cane farmers lead to lack of financial resources for the next season.
- Problem of Byproducts: The main by-products of the sugar industry are bagasse and molasses. The industry faces problems in disposing these by-products, especially under pollution control mechanism.
- Problems faced by the Co-operative Sector and Sugar mills
- Fair and remunerative price (FRP): The FRP is the minimum price that sugar mills have to pay to sugarcane farmers for procurement of sugarcane.
- State Advised Price: Although the Central government decides the FRP the state governments can also set a State Advised price which a sugar mill has to pay to the farmers.
- Minimum Indicative Export Quota (MIEQ): Government has implemented an allocation of mill-wise Minimum Indicative Export Quota (MIEQ) of 20 LMT and financial assistance @Rs.5.50/quintal of cane crushed amounting to about Rs.1500 crore.
- Government brought out a comprehensive package which includes creation of buffer stock.
- Government has also declared a MSP for sugarcane which will help clearance of sugarcane dues of the farmers.
- Ethanol Blending Program (EBP) : it helps in the diversion of sugarcane for production of ethanol in surplus sugar season.