Daily Prelims Notes 6 August 2021

August 6, 2021
Posted by: OptimizeIAS Team
Category: DPN

Daily Prelims Notes

6 August 2021

Table Of Contents

Subject: Science and Technology

Context: Aurobindo Pharma is working on commercialising a multitope peptide-based Covid vaccine, in collaboration with US-based company Vaxxinty

Concept:

Biologics

When you think of drugs you often think of chemical compounds like aspirin, a pill that you can pick up from your local pharmacy or supermarket. Biologic drugs are different. They are proteins made by living organisms, whereas traditional drugs are chemicals, referred to as small molecules. Biologic drugs are much larger in size than “small molecule drugs” like aspirin.
Biologics or biological products are medicines made from living organisms through highly complex manufacturing processes and must be handled and administered under carefully monitored conditions.
Biologics include a wide variety of products such as gene and cell therapies, therapeutic proteins, monoclonal antibodies, and vaccines.
Biologics are used to prevent, treat or cure a variety of diseases including cancer, chronic kidney disease, diabetes, cystic fibrosis, and autoimmune disorders.

Biosimilar

A biosimilar is , it is a biologic that is “similar” to another biologic medicine (known as a reference product), Biosimilars are highly similar to the reference product in terms of safety, purity and potency, but may have minor differences in clinically inactive components.
Biosimilars are not new drugs, but rather they are copies of biologic drugs that have been used to treat many diseases and conditions. Familiar biologic drugs include widely prescribed therapies like etanercept, infliximab, adalimumab and others.
Each biosimilar is made using the same amino acid starting materials and the same precise, step-by-step processes as its reference drug a well-tested, widely used biologic drug that’s already been on the market for years. All biosimilars are prescription drugs.
Biosimilars as sort of like generic drugs not true, since biosimilars are not completely identical copies of their reference drugs.
Biosimilars use the exact same starting materials and similar manufacturing processes as the original biologic. They are designed and developed to be highly similar to the original drug upon which they are based, and they will not be approved as a biosimilar if they are not.
They’re made of biological materials (bio-) and are highly similar to an approved, widely tested, and prescribed biologic

2. Circular Economy

Subject: Environment

Context:

After the pandemic, we need to shift towards a circular economy in which waste and pollution are removed from the system.

Concepts:

What is a circular economy?

It is an economic system aimed at eliminating waste; and the continual use of resources.
It includes 3 R’s (Reduce, Reuse and Recycle), Refurbishment, Recover, and Repairing of materials.
Consumables in the circular economy are largely made of biological ingredients that are non-toxic and possibly even beneficial, and can safely be returned to the biosphere, either directly or in a cascade of consecutive uses.
It is an alternative to a traditional linear economy. This linear economy is modeled on the take-make-waste industrial model (make, use, dispose).
Circular economy aims to design out waste.
Sustainable Development Goal 12 → responsible consumption and production→ requires changing the linear production model and shifting towards circular economy.
The circular economy has the potential to increase productivity and create jobs, whilst reducing carbon emissions and preserving valuable raw materials.
Example: The ‘For Days’ model
- US clothing firm For Days was inspired by the volume of clothing hoarded in consumer wardrobes. ‘For Days’ encourages customers to send their old clothes in the post. It doesn’t matter whether they were made by For Days in the first place, and people receive money-off vouchers for new items in return.

Circular Economy in India:

The Ministry of Electronics and Information Technology (MeitY) has formulated a policy paper on “Circular Economy in Electronics and Electrical Sector” to deal with e-waste.
The patent certificate is issued recently to KVIC’s Kumarappa National Handmade Paper Institute (KNHPI) by the Controller of Patent for The plastic-mixed handmade paper developed under Project REPLAN (REducingPLAstic from Nature).

3. Major and Minor Ports

Subject: Geography

Context: Adani Ports and Special Economic Zone (APSEZ) is weighing the acquisition of Karaikal and Gopalpur ports

About APSEZ:

Adani Ports and Special Economic Zone Limited is India’s largest private multi-port operator.
APSEZ represents a large network of ports with India’s largest SEZ at Mundra.

Major Ports in India:

India has 12 major seaports and 200 notified minor and intermediate ports that handle a huge volume of traffic.
About 95 per cent by volume and 70 per cent by value of India’s total international trade are carried on through maritime transportation.
All major ports, except one Ennore Port are government administered. It is the first port in India which is a public company.
The Government of India plans to modernise these ports and has approved a project called Sagarmala.
India is a signatory to Hong Kong International Convention for the safe and environmentally sound recycling of ships.
Largest Port in Arabian Sea –NhavaSheva Port (Maharashtra)
Largest Port in Bay of Bengal- Chennai Port (Tamil Nadu)
Tamil Nadu has the maximum number of major sea ports in India.
Port Blair was notified as a major port in 2010 but was removed of its status recently.
Major Ports of India include:

Minor Ports:

As per the Indian Constitution the maritime transport comes under the concurrent list.
The ports are thus either under the management of the Central government or the State government
The Central Shipping Ministry controls and supervises the major ports, whereas the minor ports and intermediate are managed by the state government’s maritime board.
The increase in private sector participation has resulted in an increase in the number of minor ports.
Cargo traffic handled by the minor ports has exceeded cargo traffic at major ports.
Some of the important minor ports are:
- Azhikkal Port (Mouth of Valapattanam River Kerala)
- Kannur (Kerala)
- Kundapur (Udupi District Karnataka)
- Dahej (Gujarat)
- Jafrabad (Gulf of Cambay Gujarat)
- Kasargod (Kerala)
- Karaikal (Puducherry)
- Gopalpur (Odisha)

4. Long Term Repo Operation (LTRO)

Subject: Economy

Context:

The Reserve Bank of India (RBI) is understood to have broached the possibility of conducting Long Term Variable Rate Reverse Repo (LTRR) auctions with banks in the run-up to the normalisation of its ultra-accommodative policy

Concept:

Open market operations:

Open Market Operations (OMOs) are market operations conducted by RBI by way of sale/purchase of government securities to/from the market with an objective to adjust the rupee liquidity conditions in the market on a durable basis.
If there is excess liquidity, RBI resorts to sale of securities and sucks out the rupee liquidity.
Similarly, when the liquidity conditions are tight, RBI buys securities from the market, thereby releasing liquidity into the market.
It is one of the quantitative (to regulate or control the total volume of money) monetary policy tools which is employed by the central bank of a country to control the money supply in the economy.

Long Term Reverse Repo Operation (LTRO)

LTRR is one of the instruments to manage durable liquidity under the RBI’s revised liquidity management framework. It has a tenor of over 14 days Banks’ prefer investing in treasury bills of 91 days, 182 days and 364 days duration as the bills can be easily liquidated to fund future demand for loans. However, if they invest in LTRR, this flexibility will not be available.
Long Term Reverse Repo Operation (LTRO) is a mechanism to facilitate the transmission of monetary policy actions and the flow of credit to the economy. This helps in injecting liquidity in the banking system.
Funds at LTRO are provided at the repo rate. The banks can avail one year and three-year loans at the same interest rate of one day repo. The loans with higher maturity period (here like 1 year and 3 years) will have a higher interest rate compared to short term (repo) loans.
LTROs are conducted on Core Banking Solution (E-KUBER) platform. The operations would be conducted at a fixed rate.
The minimum bid amount would be Rs 1 crore and multiples thereof. There will be no restriction on the maximum amount of bidding by individual bidders.

Reverse Repurchase Agreement

A reverse repurchase agreement, or “reverse repo”, is the purchase of securities with the agreement to sell them at a higher price at a specific future date. For the party selling the security (and agreeing to repurchase it in the future) it is a repurchase agreement (RP) or repo; for the party on the other end of the transaction (buying the security and agreeing to sell in the future) it is a reverse repurchase agreement (RRP) or reverse repo.

5. Anti-dumping duty

Subject: Economy

Context: The Directorate General of Trade Remedies has recommended that the existing antidumping duties on import of ceramic tableware and kitchenware (excluding knives and toilet items) from China should be extended to imports of similar items from Malaysia as well as it has established that Chinese items are being routed through Malaysia to avoid the penal duties

Concept:

It has been found that the ceramic tableware and kitchenware being produced in China were just “incrementally” being processed in Malaysia and then being exported to India, declared as originating in Malaysia to avoid payment of anti-dumping duty
An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value.
Dumping is a process where a company exports a product at a price lower than the price it normally charges in its own home market. For protection, many countries impose stiff duties on products they believe are being dumped in their national market, undercutting local businesses and markets.
Countervailing Duties (CVDs) are tariffs levied on imported goods to offset subsidies made to producers of these goods in the exporting country. CVDs are meant to level the playing field between domestic producers of a product and foreign producers of the same product who can afford to sell it at a lower price because of the subsidy they receive from their government.

Director General of Trade Remedies

The Directorate General of Trade Remedies (earlier known as Directorate General of Anti-dumping and Allied Duties) was named in May 2018 as an integrated single window agency for providing comprehensive and swift trade defence mechanism in India.
Earlier, the Directorate General of Anti-dumping and Allied Duties (DGAD) dealt with anti-dumping and CVD cases, Directorate General of Safeguards (DGS) dealt with safeguard measures and DGFT dealt with quantitative restriction (QR) safeguards.
The DGTR brings DGAD, DGS and Safeguards (QR) functions of DGFT into its fold by merging them into one single national entity.
DGTR now deals with Anti-dumping, CVD and Safeguard measures.
It also provides trade defence support to our domestic industry and exporters in dealing with increasing instances of trade remedy investigations instituted against them by other countries. DGTR provides a level playing field to the domestic industry against the adverse impact of the unfair trade practices like dumping and actionable subsidies from any exporting country, by using Trade Remedial methods under relevant framework of WTO arrangements, Customs Tariff Act & Rules and other relevant laws and International agreements, in a transparent and time bound manner.
The anti-dumping duties will be applicable once they are notified by the Finance Ministry.
DGTR functions as an attached office of Department of Commerce, Ministry of Commerce and Industry.

6. Island of Agalega

Subject: Mapping

Context: Mauritius has denied a report that it has allowed India to build a military base on the remote island of Agalega, with a government official telling AFP that no such agreement exists between the two nations

Concept:

The small, remote Mauritian island of North Agalega, located in the south-western Indian Ocean, 1,122 kilometres north of Mauritius
North Agalega Island is some 12 kilometres long and 1.5 kilometres wide, with a total population of less than 300 people
There is anMoU between the governments of Mauritius and India to develop the Agaléga islands and resolve infrastructural problems faced by Agaleans.
The jetty and port facilities India is constructing. A port is being constructed at the north end of the island. This development is a manifestation of Modi’s 2016 vision for the Indian Ocean, articulated as Security and Growth for All in the Region(SAGAR). Under SAGAR, New Delhi aims to work together with Indian Ocean regional governments to “engineer virtuous cycles of cooperation”.

The Chagossian experience

The people were forcibly removed from the Chagos Archipelago in the early 1970s to make way for the joint UK-US military base on Diego Garcia – sound alarms for ethnic Creole Agaléens and their supporters.
The 1965 decision by Britain to separate the Chagos Islands from Mauritius and set up a joint military base with the United States on Diego Garcia, the largest of the isles. The decades-old move has sparked protests by Chagossians, who accuse Britain of carrying out an “illegal occupation” and barring them from their homeland.
Britain insists the islands belong to London and has renewed a lease agreement with the United States to use Diego Garcia until 2036. Diego Garcia played a strategic role during the Cold War, and then as an airbase, including during the war in Afghanistan

7. Nano Urea

Subject: Science and Technology

Context: Harish Hirani, director of Indian Council of Scientific and Industrial Research’s Central Mechanical Engineering Research Institute (CSIR-CMERI), Durgapur, recently inaugurated a “naturally ventilated polyhouse facility” and laid the foundation stone of “retractable roof polyhouse” its Ludhiana centre.

Concept:

Nano Urea (Liquid) is a source of nitrogen which is a major essential nutrient required for proper growth and development of a plant. Nitrogen is a key constituent of amino acids, enzymes, genetic materials, photosynthetic pigments and energy transfer compounds in a plant. Typically, nitrogen content in a healthy plant is in the range of 1.5 to 4%.
Foliar application of Nano Urea (Liquid) at critical crop growth stages of a plant effectively fulfils its nitrogen requirement and leads to higher crop productivity and quality in comparison to conventional urea.
Nano Urea (Liquid) contains nanoscale nitrogen particles which have more surface area (10,000 times over 1 mm Urea prill) and number of particles (55,000 nitrogen particles over 1 mm Urea prill).which makes it more impactful.
In comparison to Urea the uptake efficiency of Nano Urea is more than 80 %. It is thus, required in lesser measure compared to the conventional urea fertiliser to fulfil plant’s nitrogen requirement.
Nano Urea (liquid) increases crop productivity and can reduce the requirement of conventional Urea by 50%.
Application of nano urea (liquid) improves yield, biomass, soil health and nutritional quality of the produce.
Nano Urea (liquid) has been tested for biosafety and toxicity as per the guidelines of Department of Biotechnology (DBT), Government of India and OECD international guidelines.
Nano Urea (liquid) is completely safe for human, animals, birds, rhizosphere organisms and environment at the recommended levels of application.
Nano Urea (Liquid) does not involve any government subsidy and will be made available to farmers at a 10% lower price than a bag of subsidised Urea.
Transportation would be easier and economical, as one 500 ml bottle would be equivalent to one bag of regular urea fertiliser.

Benefits of IFFCO Nano Urea

Nano Urea (liquid) has manifold benefits:

Reduces the requirement of conventional Urea by 50% or more
Required less and produces more: Efficacy of one bottle of Nano Urea (500 mL) is equivalent to one bag of urea.
Environment friendly product, can improve Soil, Air & Water quality thus, helps in addressing the concerns of Global Warming and in meeting the UN SDGs.
Cheaper than conventional urea.
Reduce input cost to farmers, leads to increase in farmers’ income.
Improves crop productivity, soil health and nutritional quality of produce.

Mechanism of assimilation by plants

When sprayed on leaves Nano Urea easily enters through stomata and other openings and is assimilated by the plant cells.
It is easily distributed through phloem from source to sink inside the plant as per its need. Unutilised nitrogen is stored in the plant vacuole and is slowly released for proper growth and development of plant.

8. Sunset clause of the Essential Defence Services Bill 2021

Subject: Polity

Context: The Essential Defence Services Bill, 2021, passed in the Rajya Sabha on Thursday does not come into effect unless it is invoked and is in place for only one year, a defence official said. The Defence Services Bill will lapse after a year’ Right to protest stays, says defence official

Concept:

The Essential Defence Services Bill, 2021 was promulgated to prevent the employee unions of the Ordnance Factory Board (OFB) from going on strike against the corporatisation plan that was announced.
“There is a sunset clause introduced in Clause 1 as an amendment. It is applicable only for one year, after which it will lapse.
It does not come into effect by default. Employees have the right to peaceful protest.
The Bill also did not violate the International Labour Organisation convention. It was meant to ensure uninterrupted supply to the Services, which was “especially essential in the current situation.

sunset provision

A provision in a Bill that gives it an expiry date once it is passed into law. Sunset clauses are included in legislation when it is felt that Parliament should have the chance to decide on its merits again after a fixed period.
Sunset provision, or sunset law, is a clause in a statute, regulation, or similar piece of legislation that expires automatically. A sunset provision provides for an automatic repeal of the entire or sections of the law once a specific date is reached.
Once the sunset provision date is reached, the pieces of legislation mentioned in the clause are rendered void. If the government wishes to extend the length of time for which the law in question will be in effect, it can push back the sunset provision date any time before it is reached.

9. Polyhouse

Subject: Science and Technology

Context: Mr. Harish Hirani, director of Indian Council of Scientific and Industrial Research’s Central Mechanical Engineering Research Institute (CSIR-CMERI), Durgapur, recently inaugurated a “naturally ventilated polyhouse facility” and laid the foundation stone of “retractable roof polyhouse” its Ludhiana centre.

Concept:

What is a polyhouse?

Polyhouse or a greenhouse is a house or a structure made of translucent material like glass or polyethylene where the plants grow and develop under controlled climatic conditions.
The size of structure can differ from small shacks to big-size buildings as per the need. Above all, a greenhouse is a glass house whose interiors become warm when exposed to sunbeams as the house stops the greenhouse gas to leave. So when it is cold outside, the temperature inside is survival friendly and warm for the plants.
Polyhouses are also helpful in reducing threats such as extreme heat and pest attacks in crops.
This is especially important for crops growing in the open field with no protection from the weather, and therefore its yield, quality, and crop maturity timings are changed
A combination of open field conditions and conventional greenhouse conditions is a more robust way to deal with climate change and associates problems in the future.
Crop losses in India due to insect pests is about 15 per cent at present and this loss may increase as climate change lowers the plant defense system against insects and pests.
Conventional greenhouses have a stationary roof to reduce the effect of weather anomalies and pests. However, there are still disadvantages due to roof covering which sometimes lead to excessive heat and insufficient light (early morning). Besides this, they are also prone to insufficient levels of carbon dioxide, transpiration and water stress.

Retractable Roof Polyhouse Technology

It will have an automatic retractable roof which will be operated based on weather conditions and crop requirements from the conditional database using PLC software.
This ongoing development will be useful in our country with its 15 different agro-climatic zones and will help farmers to cultivate off-season crops that can fetch higher value and income
The retractable roof would be used to manipulate sunlight quantity, quality & duration, water stress, humidity, carbon dioxide levels as well as crop and soil temperatures.

Difference between Greenhouse and Polyhouse Farming

Polyhouse is a type of greenhouse or we can say that it is a smaller version of greenhouse, where polyethylene is used as the cover. In developing countries like India, polyhouse farming is a popular greenhouse technology due to its low cost of construction and easy maintenance. Lath house is one more greenhouse technology where wood is used as the cover.
Poly house is cheaper as compared to greenhouse but the later is more long-lasting than polyhouse.

Crops grown in Polyhouse

Fruits that can be grown are Papaya, Strawberry etc.
Vegetables that can be grown include Cabbage, Bitter Gourd, Capsicum, Radish, Cauliflower, Chili, Coriander, Onion, Spinach, Tomato etc.
Flowers like Carnation, Gerbera, Marigold, Orchid, and Rose can

Benefits of Polyhouse Farming

Polyhouse is very beneficial for the farmers specially those who prefer organic farming.
The plants are grown under controlled temperature thus there is less chances of crop loss or damage.
You can grow crops throughout the year and will not have to wait for any particular season.
There are less pests and insects in a polyhouse.
External climate will not have any impact of the growth of crops.
Quality of produce is obviously higher in polyhouse.
Good drainage and aeration
Propagation of Ornamental Crops can also be done effortlessly in a polyhouse.
Poly House gives the right environmental facilities to your plants in any season.
It also increases yield for about 5 to 10 times.
Less cropping period
Fertilizer application is easier and is controlled automatically with the help of drip irrigation.

Types of Polyhouse

Based on environmental control system, polyhouse are of two types:

Naturally ventilated polyhouse – This type of polyhouse or greenhouse does not have any environmental control system except for sufficient ventilation and fogger system to save the crops from bad weather conditions and natural pests and diseases.
Environmental controlled polyhouse – They are constructed primarily to extend the growing period of crops or to increase the off-season yield by controlling the light, temperature, humidity, etc.

10. Measures to stabilize population growth

Subject: Government Schemes

Context : As per the Report of the Technical Group on Population Projections (TGPP) July 2020, chaired by Registrar General of India (RGI), the projected population of the country, State/UT-wise and percentage growth of population, State/UT-wise during last five years,.

Concept:

Details of steps taken by the Government to stabilize population growth in last five years are given below:

Mission Parivar Vikas has been introduced for substantially increasing access to contraceptives and family planning services in 146 high fertility districts in 7 high focus states.
Expanded Contraceptive Choices: The current contraceptive basket has been expanded with inclusion of new contraceptives namely Injectable contraceptive (Antara programme) and Cent chroman (Chhaya).
Post-partum Intrauterine contraceptive device (PPIUCD) incentive scheme under which PPIUCD services are provided post-delivery.
Redesigned Contraceptive Packaging: The packaging for Condoms, OCPs and ECPs has now been improved and redesigned so as to augment the demand for these commodities.
Family Planning Media Campaign: A holistic media campaign is in place to generate contraceptive demand.
The World Population Day & fortnight (July 11 – July 24) is observed each year to boost Family Planning efforts all over the country.
Vasectomy fortnight is observed throughout the country in November each year to lay emphasis on male participation.
Scheme for Home Delivery of contraceptives by ASHAs at doorstep of beneficiaries has been taken up.
Family Planning Logistics Management Information System(FP-LMIS)is being implemented to ensure last mile availability of FP commodities.

The Government has been implementing National Family Planning Programme which has been instrumental in controlling the population:

The TFR of the country has declined from 2.9 in 2005 to 2.2 in 2018 (SRS)
28 out of 36 States/UTs have already achieved the replacement level fertility of 2.1 or less
The Crude Birth Rate (CBR) has declined from 23.8 in 2005 to 20.0 in 2018 (SRS)
The Decadal growth rate has declined from 21.54% in 1990-2000 to 17.64% during 2001-11
The Wanted Fertility Rate has declined from 1.9 in NFHS III to 1.8 in NFHS IV

11. PM-DAKSH

Subject: Government Schemes

Context: Union Minister for Social Justice and Empowerment Dr. Virendra Kumar will launch ‘PM-DAKSH’ Portal and ‘PM-DAKSH’ Mobile App on 7th August, 2021 at Nalanda Auditorium, Dr. Ambedkar International Centre, Delhi.

Concept:

PM-DAKSH’ Portal will make all information related to skill development programmes, provided under Pradhan Mantri Dakshta Aur Kushalta Sampann Hitgrahi (PM-DAKSH) Yojana, available at one place for Scheduled Castes, Backward Classes and SafaiKaramcharis
The Ministry of Social Justice and Empowerment, in collaboration with NeGD, has developed this portal and app to make the skill development schemes accessible to the target groups of Backward Classes, Scheduled Castes and SafaiKaramcharis. By the virtue of this initiative the youth of the target groups will now be able to avail the benefits of skill development training programmes more easily.
The Pradhan MantriDakshtaAurKushaltaSampannHitgrahi (PM-DAKSH) Yojana is being implemented by the Ministry of Social Justice and Empowerment from the year 2020-21.
Under this Yojana, eligible target group are being provided skill development training programmes on
- Up-skilling/Re-skilling
- Short Term Training Programme
- Long Term Training Programme and
- Entrepreneurship Development Program (EDP).

12. Non-tax revenue

Subject: Economy

Concept:

Tax revenue is charged on income earned by an individual or an entity (direct tax) and on the value of transaction of goods and services (indirect tax).

Non-tax revenue is charged against services provided by the government. It also includes interest charged on loans advanced by the government for various purposes.

Current situation of Non-tax revenue in states

Both the Centre and States revenues have been on petroleum and alcohol GST levies,
States also need to look closely at their non-tax revenues which are not insignificant at around 10 per cent of States’ total revenue collection
The three main administrative non-tax receipts heads —
general services,
social services and
economic services — account for about 80 per cent of States’ own non-tax revenue.

Steps that can be taken to augment Non-tax revenue

To augment additional revenues from non-tax sources, the fees/user charges for the various services provided by the State government need to be reformed.
The State must focus on meeting the cost of public services through proper pricing, wherever feasible.
Services such as education and health are merit in nature and involve a degree of positive externality and, to some extent, subsidisation may be justified.
The extent of subsidisation and its pattern over time need to be examined.
It is essential to understand and appraise the performance of some of the non-tax sources of States with a view to examining their trends, identifying the factors responsible for their growth or lack of growth, exploring the scope for rationalising their price structures and, thereby, improving the overall budgetary position of the States as well as efficiency in resource use.
One of the reasons States’ own revenues have been neglected is that they have not been able to create a credible State Finance Commission.

13. State Finance Commission

Subject: Polity

Context: The Covid crisis has stretched State finances by impacting both GST and cess collections. This, along with the imminent end of GST compensation in July 2022, has forced States to look at other revenue options. Hence, states must raise non-tax revenues. Therefore, strengthening State Finance Commissions will help

Concept:

Under Article 243-I of the Constitution of India, the governor of a state is required to constitute a Finance Commission every five years. This is in order to decide the resource allocation between the state government and the Panchayati Raj Institutions.
Article 243-Y also brought city councils or municipalities under the purview of the State Finance Commission.
A State Finance Commission reviews the financial position of the panchayats in a state and makes recommendations to the Governor about the principles that should govern the distribution of tax proceeds – taxes, duties, levies, toll fee collected by the state between the state and its Panchayati Raj Institutions at all three levels – village level, block level and district level.
Under Article 243-I of the Indian Constitution, the governor of a state ensures the laying of a State Finance Commission’s recommendations to the table of the state legislature.
It also includes a memorandum of action taken by the government on the Commission’s report

State Finance Commission recommends the following:

Taxes, levies and fees levied or appropriated by Panchayats themselves.
Grants-in-aid to Panchayati Raj Institutions from the consolidated fund of a state.
Ways to improve the financial position of the Panchayati Raj Institutions.
Measures for the overall improvement of Panchayat’s finances.

15th Finance Commission report on Functioning of SFC

According to 15th Finance Commission report, most State governments did not constitute them in time and did not give due importance to strengthening this critical constitutional mechanism. Therefore, States have not got the benefit of a systematic review of their revenue position and recommendations for resource mobilisation.
The State Finance Commissions need to play a much more critical role in recommending taxes assigned to municipalities and other local governments and related financial relations between the States and their municipalities.
The State Finance Commissions are not a permanent body; therefore, a lot of time goes towards getting office space, technical manpower, arranging office infrastructure and collecting data on local body finances which lead to considerable delay in filing their reports.
The State governments should strengthen the State Finance Commissions and ensure they have proper resources, adequate administrative support for their smooth functioning and are provided adequate time for carrying out the task assigned to them so as to ensure timely submission of reports to the government.
A strengthened State Finance Commission would ensure that States get the benefit of appropriate distribution of resources to their Panchayati Raj institutes and also periodic recommendations for augmenting own source of revenues.