Daily Prelims Notes 7 July 2023

Daily Prelims Notes

7 July 2023

Table Of Contents

1. Internationalisation of rupee
2. Capital Account Convertibility
3. Finance Ministry stresses on reforms for higher FDI inflows
4. GST Council to discuss demand of CGST and IGST refund in 11 hill states
5. GloBE rules Pillar II to come in action soon
6. Understanding solar flares: How explosions on Sun’s surface can lead to radio blackouts
7. What are the provisions of the High Seas Treaty?
8. IIT Madras scientists develop prototype to use seawater for green hydrogen production
9. Environmentalists revive contentious call to declare a tiger reserve in Goa
10. Madras HC declares election of Theni MP as null and void
11. Non­compliance of orders of the green court by governments is a serious issue
12. Manipur HC to hear Internet ban today; SC declines to intervene
13. Virtual private network
14. The journey of Bengal art and pat painting
15. Bank locker agreements: RBI’s conditions, customer complaints
16. A semaglutide ‘miracle’: repurposing diabetes drug for weight loss

1. Internationalisation of rupee

Subject: Economy

Section: External Sector

Context: The Reserve Bank of India’s (RBI) inter-departmental group (IDG) has recommended a roadmap to achieve the internationalisation of the rupee.

Key Points:

What is Internationalisation?

• Internationalisation is a process that involves increasing the use of the rupee in cross-border transactions, similar to the other reserve currencies such as the US dollar, the Euro, the Japanese yen and the pound sterling.
• It involves promoting the rupee for current account transactions including import and export trade, and eventually capital account transactions.
• It requires further opening up of the currency settlement and a strong swap and forex market.
• Full convertibility of the currency on the capital account is also needed along with cross-border transfer of funds without any restrictions. (India has allowed only full convertibility on the current account as of now.)

Why do it?

• India remains one of the fastest-growing countries and showing remarkable resilience in the face of major headwinds, the rupee has the potential to become an internationalised currency.
• Impact of Sanctions on Russia:
  • Timing of recommendation is significant as it comes at a time when the economic sanctions imposed by the US on Russia for invading Ukraine is resulting in countries looking at an alternative to the US dollar.
  • Countries also want to reduce theri dependence on dominant international payment mechanisms based on the Society for Worldwide Interbank Financial Telecommunications (SWIFT) messaging system.
  • Countries are realising that having a strong foreign exchange reserves to manage external shocks, is no longer a sufficient defence against the threat of economic sanctions.

Advantages of internationalisation of the rupee:

• Reduced currency risk: The use of the rupee in cross-border transactions mitigates currency risk for Indian businesses.
• Reduced volatility: With wider adoption of a currency its value is more stable. Protection from currency volatility not only reduces the cost of doing business, it also enables better growth of business, improving the chances for Indian businesses to grow globally.
• Freedom from reserve: Internationalisation of the rupee reduces the need for holding foreign exchange reserves. Reducing dependence on foreign currency will make India less vulnerable to external shocks.
• Bargaining power: As Rupee’s acceptance in the world grows the bargaining power of Indian businesses would improve, as they can price goods in Rupee and not worry about currency fluctuations.

Concerns:

• Short term volatility: Internationalisation may initially result in increased volatility in the exchange rate of INR.
• Monetary policy difficulties: There will be monetary implications as the global obligations towards supplying currency to meet the global demand may conflict with its domestic monetary policies objectives. (This is known as the Triffin dilemma)
• External Shock: Internationalisation of a currency may magnify external shocks, given the open channel of the flow of funds into and out of the country and from one currency to another.
• Financing: International currency use can have an undesirable impact on financing conditions, especially when a country is a net receiver of capital flows in the form of FDI and FPI.
• Cost of additional demand: Costs of meeting the additional demand for money along with the increase in the volatility of the demand pose other challenges.

2. Capital Account Convertibility

Subject : Economy

Section: External Sector

Context: India is on the cusp of fundamental shifts in the capital account convertibility space, with increased market integration in the offing and freer non-resident access to debt on the table

Concept :

• Capital account of any country records the net changes in its foreign assets and liabilities, while convertibility refers to the ability to convert domestic currency into foreign currencies and vice versa for making payments for balance of payments (BoP) transactions.
• BoP refers to financial transactions undertaken by a country with other nations across the world during a particular period of time, normally one year.
• The Tarapore Committee (2006) defined capital account convertibility as the “freedom to convert local financial assets into foreign financial assets and vice versa.”
• The country is also on the cusp of witnessing some fundamental shifts in this space with greater market integration expected in the near future.
• The rate of capital account convertibility will also accerate through measures like freer non-resident access to debt and greater market integration.
• There is an effort to liberalise foreign portfolio investment (FPI) debt flows further, with the introduction of the Fully Accessible Route (FAR), which places no limit on non-resident investment in specified benchmark securities.

What is Capital Account Convertibility?

• The balance of payments account, which a statement of all transactions made between a country and the outside world, consists of two accounts — current and capital account. While the current account deals mainly with import and export of goods and services, the capital account is made up of cross-border movement of capital by way of investments and loans.
• Current account convertibility refers to the freedom to convert your rupees into other internationally accepted currencies and vice versa without any restrictions whenever you make payments.
• Similarly, capital account convertibility means the freedom to conduct investment transactions without any constraints. Typically, it would mean no restrictions on the amount of rupees you can convert into foreign currency to enable you, an Indian resident, to acquire any foreign asset. Similarly, there should be no restraints on your NRI cousin bringing in any amount of dollars or dirhams to acquire an asset in India.
• India has come a long way in liberating the capital account transactions in the last three decades and currently has partial capital account convertibility.
• Some of the recent moves include increasing the foreign portfolio investment limits in the Indian debt markets, introducing the Fully Accessible Route (FAR) — through which non-residents can invest in specified government securities without any restrictions and the easing of the external commercial borrowing framework by relaxing end-user restrictions. Inward FDI is allowed in most sectors, and outbound FDI by Indian incorporated entities is allowed as a multiple of their net worth.

Why is it important?

• Developing are usually cautious in opening up their capital account. This is because inflows and outflows of the foreign and domestic capital, which are prone to volatility, can lead to excessive appreciation/depreciation of their currency and impact the monetary and financial stability.
  ⦁ India’s prudence in opening up its capital account was lauded after the currency crisis in East Asian countries in 1997 exposed the problems arising from the potent combination of high current account imbalances, dependence on short-term capital flows and the whimsical nature of these flows. The SS Tarapore committee’s report on fuller capital account convertibility released in 2006 argued that even countries that had apparently comfortable fiscal positions have experienced currency crises and rapid deterioration of the exchange rate, when the tide turns.
• The report further points that most currency crises arise out of prolonged overvaluation in exchange rates leading to unsustainable current account deficits. An excessive appreciation of the exchange rate causes exporting industries to become unviable, and imports to become much more competitive, causing the current account deficit to worsen. Thus, it suggests transparent fiscal consolidation is necessary to reduce the chances of a currency crisis.
• If you are an investor looking to park money overseas or an NRI wanting to invest in Indian assets, full convertibility on capital account may give you a greater opportunity to diversify investments and reduce geographical risk. Note that cross-border investments are allowed even now under RBI’s Liberalised Remittance Scheme but within the overall limit of $250000.

3. Finance Ministry stresses on reforms for higher FDI inflows

Subject : Economy

Section: External Sector

Key Points:

• Finance Ministry has pointed to the importance of reforms in key areas to push-up the FDI inflows. FDI flows, have dropped since last year and may remain subdued in the near term.
  • Gross FDI flows moderated 16% last year from the record high of $84.8 billion in 2021-22
  • Net FDI inflows to emerging market economies declined 36% in 2022.
• The major observations were as follows:
  • India needs to resolve challenges faced by global investors, including last-mile infrastructure issues, labour availability and the inability to set up larger factories.
  • FDI flows may also be impacted by “political distance more than geographical distance” as “geopolitics has dominated geography”. This is seen in the “Friend shoring” of FDI as more FDI movement restricted between geopolitically aligned countries, this is leading to a fragmentation in FDI flows across the globe
  • India faces external sector challenges such as escalation of geopolitical stress, enhanced volatility in global financial systems, sharp price correction in global stock markets, a high magnitude of El-Nino impact, and modest trade activity and FDI inflows owing to frail global demand could constrain growth.
  • Remarkably the flows from foreign portfolio investors (FPIs) into the Indian markets have become less volatile.
  • European Union’s introduction of the Carbon Border Adjustment Mechanism (CBAM), for which carbon content reporting will be mandatory from October 1, 2023, as an impending downside risk to India’s exports.

4. GST Council to discuss demand of CGST and IGST refund in 11 hill states

Subject : Economy

Section: Fiscal Policy

In News: GST Council is likely to discuss a demand of industrial units located in 11 Himalayan and North-Eastern states for reimbursement of full Central GST and 50% of net Integrated GST (IGST) paid.

Key Points:

• Currently, the Centre reimburses 58% of net CGST and 29% net IGST under the Scheme of budgetary support notified in October 2017.
• But the industrial units located in the Himalayan and North-Eastern states have been seeking implementation of a mechanism for reimbursement of balance 42% of the CGST and 21% of the IGST paid by them in cash along with appropriate interest.
• States are reluctant to reimburse their share of CGST and IGST collection they receive on account of tax devolution citing unsatisfactory revenue growth and implementation of similar schemes by the state to incentive industries.
• In the pre-GST era of excise duty, industrial units in J&K, Himachal Pradesh, Uttarakhand, Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura enjoyed a tax holiday.

5. GloBE rules Pillar II to come in action soon

Subject : Economy

Section: Fiscal Policy

Background:

• Organisation for Economic Co-operation and Development (OECD)’s Base Erosion and Profit Shifting (BEPS) emerged in 2015 in an effort to set rules for taxing international business income especially in the digitalised and globalised business environment.
• OECD’s BEPS 1.0, published in 2015, comprised 15 action plans that aimed to enhance transparency, prevent treaty abuse, align taxation with substance, and ensure that profits are taxed where the economic activities generating the profits are conducted and where value is created.
• India’s adoption of the equalisation levy, significant economic presence, interest limitation rules, and country-by-country reporting (CbCR) under BEPS 1.0 aimed to capture tax revenues from the digital economy and prevent profit shifting.
• BEPS 1.0 Action Plans while changing the international tax systems to a certain extent failed in addressing the tax challenges arising from the digitalisation of the economy.
• To achieve the unfinished work of BEPS 1.0 the Global Anti-Base Erosion (GloBE) Rules Pillar One It proposes to tax large multi-national enterprises (MNEs), defined as having a global turnover of more than 20 billion euros—in jurisdictions where they have a significant consumer presence, even if they lack a physical presence .
• Initially the Pillar One targeted MNEs engaged in the business of Automated Digital Services (ADS) and Consumer Facing Businesses (CFB), the revised framework issued in 2021 expanded the scope to all MNEs satisfying the turnover threshold criteria.
• Although the reforms are steered by the OECD, developing countries have been involved in it indirectly. An Inclusive Framework (IF) was formed by 142 countries (including India) and all of them, except Pakistan, Sri Lanka, and Nigeria, have come together to endorse the BEPS 2.0 proposals.
• India is an IF member and a signatory to the ‘common approach’, whereby it has committed to respect the rights of other IF countries to impose legitimate top-up taxes on eligible entities.

Relevance for India:

• It is not necessary under the Pillar Two-GloBE Rules for each IF jurisdiction to adopt the GloBE rules to trigger a compliance obligation for the MNEs. Thus these will be applicable to India too.
• The GloBE Rules have been framed and agreed to be applied as a ‘common approach’. This means that jurisdictions are not required to formerly adopt the GloBE rules, but if they choose to do so, they agree to implement and administer them in a way that is consistent with the agreed outcomes set out under those rules.
• One jurisdiction accepts the application of the GloBE Rules by another in respect of MNEs operating in its jurisdiction. This implies that India-headquartered MNEs having presence in jurisdictions which have already adopted the GloBE Rules need to gear up and be prepared to comply with the legislative provisions of the rules.

6. Understanding solar flares: How explosions on Sun’s surface can lead to radio blackouts

Subject :Science and technology

Section: Space technology

Context:

• The Sun emitted an X-class solar flare on July 2, 2023, disrupting radio communications over parts of the United States and the Pacific Ocean, according to media reports.

Details:

• The flare, classified as an X1.0 flare, peaked at 7:14 pm ET.
• X-class denotes the most intense flares, while the number provides more information about its strength.
• A sunspot — a huge dark patch — known as AR3354 appeared on the solar surface and reached its maximum size on June 29, generated a significant M-class flare, and then was calm until July 2, when it unleashed an X-class flare that was directly targeted at Earth.
• Initially, researchers thought the flare might have triggered a coronal mass ejection (CME) — a fast-moving cloud of magnetised plasma.
  • A geomagnetic storm, or substantial disturbance of Earth’s magnetic field, would probably result from a CME from a flare of this size striking the planet.
• If a huge geomagnetic storm like the one in 2003 occurred today, it would result in prolonged outages of the electrical power grid, resulting in widespread electrical disruptions, blackouts and devastation.
• The most powerful flare on record was in 2003, during the last solar maximum. It was so powerful that it overloaded the sensors measuring it.

What are solar flares?

• A solar flare is a tremendous explosion on the Sun that happens when energy stored in ‘twisted’ magnetic fields (usually above sunspots) is suddenly released.
• There are five different classes of solar flares: A, B, C, M, and X; each class is at least ten times more potent than the one before it.
• Solar flares are large energy explosions that can affect radio communications, power grids and navigation signals and endanger astronauts and spacecraft.
• They can heat a substance to several millions of degrees in a matter of minutes, producing a burst of radiation that spans the electromagnetic spectrum, from radio waves to x-rays and gamma rays.
• Solar flares cause energy particles to be released into space and directly impact the ionosphere and radio communications at the Earth.
• Therefore, to understand and predict space weather and the effect of solar activity on the Earth, an understanding of both CMEs and flares is required.

Classification of solar flares:

• Solar flares can be divided into various categories based on their brightness in X-ray wavelengths.
  • X-class flares are large, significant events that have the power to cause global radio blackouts and persistent radiation storms in the upper atmosphere.
  • Medium-sized M-class flares typically result in brief radio blackouts that affect the Earth’s polar regions.
  • Sometimes an M-class flare is followed by small radiation storms.
  • C-class flares are slight and have little effect on the Earth.

Other important terms:

1. Geomagnetic storms: A geomagnetic storm refers to the disruptions to the Earth’s magnetic field caused by solar emissions.
   • When a Coronal Mass Ejection (CME) or a high-speed solar stream reaches our planet, it slams into the
   • The Earth’s magnetosphere is created by its magnetic fields and it usually protects us from the particles emitted by the Sun.
2. Coronal mass ejection (CME): large-scale eruptions of charged particles (plasma) and magnetic fields from the solar atmosphere into space. They can disrupt a range of ground- and space-based technologies and satellites on Earth.
3. Solar cycle: The solar cycle, also known as the solar magnetic activity cycle,sunspot cycle, or Schwabe cycle, is a nearly periodic 11-year change in the Sun’s activity measured in terms of variations in the number of observed sunspots on the Sun’s surface.
   • Over the period of a solar cycle, levels of solar radiation and ejection of solar material, the number and size of sunspots, solar flares, and coronal loops all exhibit a synchronized fluctuation from a period of minimum activity to a period of a maximum activity back to a period of minimum activity.

7. What are the provisions of the High Seas Treaty?

Subject : Environment

Section: International conventions

Context:

• On June 19, the UN adopted the Marine Biodiversity of Areas Beyond National Jurisdiction (BBNJ) or the High Seas Treaty.

Treaty on Marine Biodiversity of Areas Beyond National Jurisdiction (BBNJ):

• It became the third agreement to be approved under UNCLOS, after the 1994 and 1995 treaties, which established the International Seabed Authority and the Fish Stocks Agreement.
• Timeline:
  • 2002: The idea of protecting the marine environment emerged
  • 2008: The need for implementing an agreement was recognised,
  • 2015: UNGA resolution to form a Preparatory Committee to create the treaty.
  • The Committee recommended the holding of intergovernmental conferences (IGC).
  • 2023: After five prolonged IGC negotiations, the treaty was adopted.
• The treaty’s objective is to implement international regulations to protect life in oceans beyond national jurisdiction through international cooperation.

Key information about the treaty:

• The treaty aims to address critical issues such as:
  • Increasing sea surface temperatures,
  • Overexploitation of marine biodiversity
  • Overfishing
  • Coastal pollution, and
  • Unsustainable practices beyond national jurisdiction
• The first step is establishing marine protected areas to protect oceans from human activities through a “three-quarterly majority vote,” which prevents the decision from getting blocked by one or two parties.
• On the fair sharing of benefits from marine genetic resources, the treaty mandates sharing of scientific information and monetary benefits through installing a “clear house mechanism.”
  • Through the mechanism, information on marine protected areas, marine genetic resources, and “area-based management tools” will be open to access for all parties.
  • This is to bring transparency and boost cooperation.
• The last pillar of the treaty is capacity building and marine technology.
  • The Scientific and Technical Body will also play a significant role in environmental impact assessment.
  • The body will be creating standards and guidelines for assessment procedures, and helping countries with less capacity in carrying out assessments.
• This will facilitate the conference of parties to trace future impacts, identify data gaps, and bring out research priorities.

Challenges in the adoption of the treaty:

• The marine genetic resources issue was the treaty’s most contended element.
• The negotiations on the subject were prolonged due to the absence of a provision to monitor information sharing.
• In IGC-2,small island states supported the idea of having a licensing scheme for monitoring, but was opposed by the likes of the U.S., and Russia, stating its notification system would hinder “bioprospecting research.”
• The use of the phrases “promote” or “ensure” in different parts of the treaty, especially with respect to the sharing of benefits from marine genetic resources, was heavily debated over.
• There was a prolonged negotiation over the adjacency issue. This was specifically applicable to coastal states whose national jurisdictions over the seas may vary.
• Who opposed the treaty?
  • Many developed countries opposed the treaty as they stand by private entities which are at the forefront of advanced research and development in marine technology (patents relating to marine genetic resources are held by a small group of private companies).
  • Russia and China also are not in favour of the treaty.

8. IIT Madras scientists develop prototype to use seawater for green hydrogen production

Subject :Science and technology

Section: Msc

Context:

• IIT-Madras researchers have developed components for an alkaline water electrolyser that can use seawater directly to make green hydrogen.

Details:

• The technology is simple and cost-effective.
• This is proposed as an alternative to the use of freshwater which is currently the key input for green hydrogen production.
• The technology is still nascent and will take a few years to be commercially deployed, if proven successful.
• India is ambitious about producing green hydrogen, but the scarcity of the critical input, freshwater, is a challenge.
• Along with India, globally there are efforts to study and develop technologies to tap the abundant seawater for green hydrogen production.

What is Green Hydrogen?

• Green hydrogen is a type of hydrogen that is produced through the electrolysis of water using renewable energy sources such as solar or wind power.
• The electrolysis process splits water into hydrogen and oxygen, and the hydrogen produced can be used as a clean and renewable fuel.

Green Hydrogen Mission:

• India’s National Green Hydrogen Mission, which aims to boost India’s green hydrogen production and ecosystem, has set a target to build capabilities for producing at least five Million Metric Tonnes (MMT) GH2 per annum by 2030.
• However, the government also recognises its impact on freshwater – one of the key inputs for GH2 production – so it is pushing to maximise industrial and municipal wastewater use for hydrogen production wherever feasible.

The traditional method of green hydrogen production:

• Green hydrogen is produced from pure water through a process known as electrolysis, which uses an electric current from renewable energy to split water into its component molecules, hydrogen and oxygen, using a device called an electrolyser.
• In effect, green hydrogen is “clean” as it has low carbon emissions and is expected to play a prominent role in decarbonising heavy industries, including oil refineries, steel mills and fertiliser plants.
• The traditional electrolysers, however, are designed to work with pure water, and scaling up the GH2 process could exacerbate global freshwater shortages.

New technology:

• The new technology and research from IIT Madras aim to tap into the abundantly available seawater directly to make GH2.
• The researchers used a carbon-based support material for the electrodes instead of metals to almost eliminate the possibility of corrosion.
• There are two ways in which seawater can be used to replace fresh water for the production of GH2:

1. Desalination of seawater to produce fresh water to remove the salt before the water flows to conventional electrolysers and
2. The use of seawater directly for the electrolysis process.

• Drawbacks:
  • According to UNEP, about 1.5 litres of liquid polluted with chlorine and copper are created for every litre of potable water produced through desalination. When pumped back into the ocean, the toxic brine depletes oxygen and impacts organisms along the food chain.

Other types of Hydrogen:

9. Environmentalists revive contentious call to declare a tiger reserve in Goa

Subject :Environment

Section: Protected Areas

Context:

• An incident of tiger deaths in Goa’s Mhadei Wildlife Sanctuary in 2020 and concern over development activities affecting tiger movement around the Goa-Karnataka border, have revived the call for notifying a tiger reserve in Goa.

Details:

• The demand for a tiger reserve is debated and political, with some members of the government claiming that a tiger reserve is not needed because Goa does not have a resident tiger population.

Western Ghats in Goa region:

• The Ghats cover 600 sq. km. on the coastal state’s eastern side and include:
  • Mhadei Wildlife Sanctuary,
  • Bhagwan Mahavir National Park and Wildlife Sanctuary,
  • Netravali Wildlife Sanctuary and
  • Cotigao Wildlife Sanctuary.

• Goa is the only state in India which has protected the complete Western Ghats section within a state.
  • Goa’s four wildlife sanctuaries are located on the eastern side of the state in the Western Ghats, covering an area of about 750 km2 (290 sq mi).
  • The Mahdei Wildlife Sanctuary and Bhagwan Mahaveer Sanctuary and Mollem National Park all fall within the Mhadei River basin.
• The Mhadei sanctuary includes the Vagheri Hills, the highest in the sanctuary.
  • Other peaks in Goa include Sonsogor, the highest in Goa at 1,166 m (3,825 ft),Catlanchimauli 1,107 m (3,632 ft), Vaguerim 1,100 m (3,600 ft) and Morlemchogar1,000 m (3,300 ft).
  • A unique discovery of theVagheri hills is the presence of a flowing lake or waterbody shaped in the exact map of India, midway to climbing the hill while looking down at the valley.
• The Mhadei River, known downstream as the Mandovi River, the lifeline of the state of Goa, originates in Karnataka, travels28.8 km (17.9 mi) in Karnataka, passes 9.4 km (5.8 mi) through the Mahdei Wildlife Sanctuary and meets the Arabian Sea at Panaji after traveling 81.2 km (50.5 mi) in Goa.

Goa, an important tiger corridor:

• Tigers have been spotted in the Goa part of Western Ghats. In 2022, the forest department recorded six tiger sightings in Goa.
• Once it is converted into a tiger reserve, it could lead to a rise in tiger population and create a conducive environment for breeding.
• According to the Status of Tigers 2022 report by the NTCA, the tiger population in the Western Ghats, has shrunk to 824 unique tiger individuals, down from 981 in 2018.
  • This decline is in contrast to the national level increase to 3080 tigers from 2461, during the same period.
  • While tiger populations within protected areas have either remained stable or increased, tiger occupancy outside of these regions has significantly decreased, notes the report.
  • The border areas of Goa and Karnataka are one region where tiger occupancy has decreased.

Significance of declaring an area as a tiger reserve:

• There is no minimum base population required to declare an area as a tiger reserve.
• Even without the presence of any wildcats,a region can be marked as a tiger reserve if it can serve as a natural habitat, with sufficient prey base, for tigers.
• Tiger reserves are designated habitats for the conservation of tigers and their prey base. Under the Wildlife Protection Act, of 1972, a tiger reserve is legally mandated to designate a critical core area over which human habitation and resource extraction is not permitted.
• This area is encircled by a buffer zone that permits multiple human activities which gives precedence to conservation objectives.
• The declaration of a tiger reserve will ensure improved monitoring and perhaps lead to an increase in tiger population while bringing enhanced technical and financial support from the National Tiger Conservation Authority (NTCA).
• It will also empower the local communities residing inside the sanctuary by giving access to development opportunities as they will be able to utilise a voluntary resettlement scheme for joining mainstream society.
• Declaring a tiger reserve will also prevent human encroachment, disallow red category industry operation and provide access to national and international funding for the upkeep of the tiger habitat.

10. Madras HC declares election of Theni MP as null and void

Subject : Polity

Section: Elections

Concept :

• The Madras High Court on Thursday declared as “null and void”, the 2019 election of expelled AIADMK member O P Ravindhranath from Tamil Nadu’s Theni parliamentary constituency while allowing an election petition filed against him.

Election Petition

• Election petition means a method for challenging the legitimacy of the results of parliamentary or local government elections.
• In other words, it is a legal way of contesting a candidate’s election in a Parliamentary, Assembly, or local election.
• The “High Court” shall be the authority for presenting election petitions under Article 329(b) of the Constitution, according to Section 80-A of the Representation of the People Act, 1951.

Concept of Election Petition

• An election petition is a legal remedy accessible to a voter or a candidate who feels there has been electoral malpractice.
• Election petitions are heard by the High Court of the state in question, and if upheld, the election in that constituency may be rescheduled.
• A petition of this nature must be filed within 45 days after the date of the poll results; anything filed beyond that is not considered by the courts.
• Although the Representative of the People Act (RP Act) of 1951 requires the High Court to try to complete the trial within six months, it generally takes considerably longer, even years.
• The High Court should notify the Election Commission of India and the Speaker of the House or the Chairman of the State Legislature of the content of its judgement as soon as possible after the end of the trial of an election petition.
• The High Court must also provide the ECI an authorised copy of the ruling.
• If the ruling on an election petition is in favour of the petitioner, the court may order a new election or declare a new winner.
• Every decision made by a High Court is subject to an appeal to the Supreme Court on any matter.

Grounds of Election petition

• Section 100 of the Representation of the People Act, 1951, allows the election of a certain candidate to be ruled null and invalid.
• An election petition can be filed on one or more of the following grounds:
• On the day of his election, a returning candidate was ineligible or disqualified to fill the seat.
• A returned candidate or his election agent, or any other person with the approval of a returned candidate or his election agent, has engaged in any corrupt activity (as defined below).
• Improper acceptance of any nomination.
• By improperly receiving, refusing, or rejecting any vote, or receiving an invalid vote.
• Any violation of the provisions of the Constitution or RPA, or any rules or directives issued under this act.

Corrupt practices

• The following are considered corrupt acts under Section 123 of the Representation of the People Act, 1951:
• Bribery (any gift, offer, promise, or pleasure of any kind made by the candidate or his/her agent to the voter or another candidate running for office)
• Undue influence: direct or indirect influence exercised by the candidate or his/her agent; includes threats, efforts to convince voters or other candidates, statement of public policy or action, or the simple exercise of a legal right, among other things.
• A candidate or his election agent requests that voters refrain from voting on the basis of religion, race, caste, community, or language.
• Use of national symbols, national emblems, and national flags to advance the candidate’s election prospects or to negatively impact the election of any other candidate.
• False statements made by the candidate or his election agent. A remark of this type can also include one that is reasonably designed to harm the chances of that candidate’s election.
• Making incorrect statements about election expenditure.
• Attempting to gain the services of government employees in order to advance electoral prospects. These government employees may include gazetted officers, magistrates, members of the armed forces, police officers, excise officers, revenue officers, and others.
• Booth capturing by the candidate of election agent.

Legal provisions regarding the disqualification of MPs/MLAs

• Disqualification of a lawmaker is prescribed in three situations.
• First is through the Articles 102(1) and 191(1) for disqualification of a member of Parliament and a member of the Legislative Assembly respectively.
• The grounds here include holding an office of profit, being of unsound mind or insolvent or not having valid citizenship.
• The second prescription of disqualification is in the Tenth Schedule of the Constitution.
• This provides for the disqualification of the members on grounds of defection.
• The third prescription is under The Representation of The People Act (RPA), 1951.
• This law provides for disqualification for conviction in criminal cases.

Under Representation of The People Act, 1951

• There are several provisions that deal with disqualification under the RPA.
• Section 8 of the RPA deals with disqualification for conviction of offences.
• Section 8(1) of the act includes specific offences such as promoting enmity between two groups, bribery, and undue influence or personation at an election.
• Section 8(2) lists offences that deal with hoarding or profiteering, adulteration of food or drugs and for conviction and sentence of at least six months for an offence under any provisions of the Dowry Prohibition Act.
• Section 8(3) disqualifies a convicted person who has been sentenced to imprisonment for not less than two years.
• He is disqualified from the date of such conviction and shall continue to be disqualified for a further period of six years since his release.
• Section 9 deals with disqualification for dismissal for corruption or disloyalty, and for entering into government contracts while being a lawmaker.
• Section 10 deals with disqualification for failure to lodge an account of election expenses.
• Section 11 of the act deals with disqualification for corrupt practices.

How does the disqualification operate?

• The disqualification can be reversed if a higher court grants a stay on the conviction or decides the appeal in favour of the convicted
• In 2018, in ‘Lok Prahari v Union of India’ case, the SC clarified that the disqualification will not operate from the date of the stay of conviction by the appellate court.
• Here, it should be noted that the stay cannot merely be a suspension of sentence, but a stay of conviction.
• Under Section 389 of the CrPC, an Appellate Court can suspend the sentence of a convict while the appeal is pending.
• This is akin to releasing the appellant on bail.

How does an appeal against the conviction impact disqualification?

• Section 8(4) of the RPA stated that the disqualification takes effect only after three months have elapsed from the date of conviction.
• Within that period, a person can file an appeal against the sentence before the higher Court.
• Earlier, the law had provided for a pause on disqualification if an appeal against the conviction was filed before a higher court.
• However, in the landmark 2013 ruling in ‘Lily Thomas v Union of India’, the Supreme Court struck down Section 8(4) of the RPA as unconstitutional.
• This means that simply filing an appeal will not be enough to prevent disqualification.
• The convicted MP must secure a specific order of stay against the conviction of the trial court.

11. Non­compliance of orders of the green court by governments is a serious issue

Subject :Environment

Section: Environment law

Concept :

• Justice Adarsh Kumar Goel, who took over as the chairperson of National Green Tribunal (NGT) in July 2018, retired on Thursday.

National Green Tribunal (NGT)

• It is a specialised body set up under the National Green Tribunal Act (2010) for effective and expeditious disposal of cases relating to environmental protection and conservation of forests and other natural resources.
• With the establishment of the NGT, India became the third country in the world to set up a specialised environmental tribunal, only after Australia and New Zealand, and the first developing country to do so.
• NGT is mandated to make disposal of applications or appeals finally within 6 months of filing of the same.
• The NGT has five places of sittings, New Delhi is the Principal place of sitting and Bhopal, Pune, Kolkata and Chennai are the other four.

Structure of NGT

• The Tribunal comprises of the Chairperson, the Judicial Members and Expert Members. They shall hold office for term of three years or till the age of sixty-five years, whichever is earlier and are not eligible for reappointment.
• The Chairperson is appointed by the Central Government in consultation with Chief Justice of India (CJI).
• A Selection Committee shall be formed by central government to appoint the Judicial Members and Expert Members.
• There are to be least 10 and maximum 20 full time Judicial members and Expert Members in the tribunal.

Powers & Jurisdiction

• The Tribunal has jurisdiction over all civil cases involving substantial question relating to environment (including enforcement of any legal right relating to environment).
• In October 2021, the Supreme Court declared the National Green Tribunal’s (NGT) position as a “unique” forum endowed with suo motu (on its own motion) powers to take up environmental issues across the country.
• As per SC, the role of the NGT is not simply adjudicatory in nature; it has to perform equally vital roles that are preventative, ameliorative or remedial in nature.
• Being a statutory adjudicatory body like Courts, apart from original jurisdiction side on filing of an application, NGT also has appellate jurisdiction to hear appeal as a Court (Tribunal).
• The Tribunal is not bound by the procedure laid down under the Code of Civil Procedure 1908, but shall be guided by principles of ‘natural justice‘.
• While passing any order/decision/ award, it shall apply the principles of sustainable development, the precautionary principle and the polluter pays principle.
• NGT by an order, can provide
  • relief and compensation to the victims of pollution and other environmental damage (including accident occurring while handling any hazardous substance),
  • for restitution of property damaged, and
  • for restitution of the environment for such area or areas, as the Tribunal may think fit.
  • An order/decision/award of Tribunal is executable as a decree of a civil court.
  • The NGT Act also provides a procedure for a penalty for non compliance:
  • Imprisonment for a term which may extend to three years,
  • Fine which may extend to ten crore rupees, and
  • Both fine and imprisonment.
• An appeal against order/decision/ award of the NGT lies to the Supreme Court, generally within ninety days from the date of communication.
• The NGT deals with civil cases under the seven laws related to the environment, these include:
  • The Water (Prevention and Control of Pollution) Act, 1974,
  • The Water (Prevention and Control of Pollution) Cess Act, 1977,
  • The Forest (Conservation) Act, 1980,
  • The Air (Prevention and Control of Pollution) Act, 1981,
  • The Environment (Protection) Act, 1986,
  • The Public Liability Insurance Act, 1991 and
  • The Biological Diversity Act, 2002.
• Any violation pertaining to these laws or any decision taken by the Government under these laws can be challenged before the NGT.

12. Manipur HC to hear Internet ban today; SC declines to intervene

Subject :Polity

Section: Constitution

Concept :

• The Supreme Court on July 6 refrained from intervening in a petition challenging the “mechanical and repeated shutdown” of internet services in Manipur, noting that a Division Bench of the Manipur High Court is already hearing the issue and has constituted an expert committee on June 27 to examine the possibility of providing limited internet to the public.

Internet Shutdown

• Section 144 of the Code of Criminal Procedure used to shut down the Internet.
• The Code of Criminal Procedure used to shut down the Internet empowers the government of the state to take steps, including the imposition of such limitations, to preserve public tranquilly.
• Temporary suspension of Telecom Services (Public Emergency or Public Safety) Law, 2017 Rule 2(1) provides the ‘competent authority’ with the process and powers to issue a direction for Internet suspension.
• The ‘competent authority’ can be Home Secretary of the Union or the government of the state.
• Where it is not possible to obtain prior instructions from the competent authority, that order may be issued by an officer not below the rank of Joint Secretary to the Government of India.

SC Judgment – Anuradha Bhasin vs Union of India and Ors

• The Indian constitution renders every citizen ‘s right to freedom of speech and expression a fundamental right. It was listed in point (a) of Article 19(1) of the Constitution.
• A non-citizen can benefit from the same advantages, but may not assert it as his or her fundamental right.
• The Court declared that, pursuant to Article 19(1)(a) and Article 19(1)(g) of the Constitution, the freedom of speech and expression and the freedom to practice any career or to participate in any trade, company or occupation on the internet enjoy constitutional security.
• The restriction of such fundamental rights should be compatible with the mandate laid down in Article 19(2) and (6) of the Constitution, including
• Suspension of internet for indefinite period not permissible. It can only be for a reasonable duration and periodic review should be done.
• The court also said the orders suspending the Internet would have to necessarily state how the action was justified and proportionate to the imminent threat to law and order.
• Going forward any net ban will be subject to the scrutiny. The observations made by the court essentially laid out guidelines that Internet shutdowns cannot be arbitrary and can be challenged in courts.

13. Virtual private network

Subject :Science and technology

Section: Awareness in IT

What is a VPN?

• A virtual private network, or VPN, is an encrypted connection over the Internet from a device to a network.
• The encrypted connection helps ensure that sensitive data is safely transmitted. It prevents unauthorized people from eavesdropping on the traffic and allows the user to conduct work remotely.
• VPN technology is widely used in corporate environments.
• As it is totally disconnected from the rest of the web, it is a secure system. The network can be used safely by the government, companies, and military to utilise system resources.

How does a virtual private network (VPN) work?

• A VPN extends a corporate network through encrypted connections made over the Internet. Because the traffic is encrypted between the device and the network, traffic remains private as it travels.
• An employee can work outside the office and still securely connect to the corporate network. Even smartphones and tablets can connect through a VPN.

Is VPN traffic encrypted?

• Yes, traffic on the virtual network is sent securely by establishing an encrypted connection across the Internet known as a tunnel.
• VPN traffic from a device such as a computer, tablet, or smartphone is encrypted as it travels through this tunnel. Offsite employees can then use the virtual network to access the corporate network.

Protocols of VPN

To build stable networks, there are many distinct VPN protocols are used. Some protocols of this kind are listed below

• IPsec (IP security)
• PPTP (Point to Point Tunneling Protocol)
• L2TP (Layer 2 Tunneling Protocol)
• SSL (Secure Sockets Layer)
• TLS (Transport Layer Security)

14. The journey of Bengal art and pat painting

Subject :History

Section :Art and Culture

Concept :

• Bengal art is a journey of different perspectives, of creative expressions through the cultural and political lens, of personal and private trials and tribulations, pathos of the great Bengal famine, many incidents of devastation during Partition and more.
• Artworks of Abanindranath Tagore, a pioneer of the Bengal School, Jamini Roy, Gaganendranath Tagore, Benode Bihari Mukherjee, Nandlal Bose, Hemen Majumdar, Paresh Maity, Anjolie Ela Menon, Arpita Singh and several others highlight the artist’s contribution to creating a comprehensive understanding of Indian art.

Pattachitra painting:

• This form of art is closely related to the cult of Shri Jagannath and the temple traditions in Puri.
• It is believed to have originated as early as the 12th century
• Region:
  • The art is based in the eastern Indian states of Odisha, West Bengal and parts of Bangladesh.
  • People in Odisha practice it to this day.
• Etymology:
  • It is a Sanskrit word.
  • When broken down into its two parts, Patta means cloth, and Chitra means picture.
  • Hence, Pattachitra is a picture painted on a piece of cloth.
• Painting process:
  • Traditionally the painters are known as chitrakars.
  • Chitrakars follow a traditional process of preparing the canvas.
  • A gauze-like fine cotton cloth is coated with white stone powder and gum made out of tamarind seeds.
  • This makes the canvass ready to accept the paint, made of natural colors.
  • The gum of the kaitha tree is the chief ingredient, used as a base for making different pigments by adding available raw materials.
  • Following completion of a painting, the canvas is held over a charcoal fire and lacquer is applied to the surface.
  • In recent days Chitrakars have also painted on palm leaves and Tussar silk and have created wall hangings and showpieces.

    Significant features:

• Pattachitra is predominantly icon painting.
• A floral border is a must around the paintings, and so is the use of natural colors.
• The paintings are executed primarily in profile with elongated eyes.
• Generally, there are no landscapes, perspectives, and distant views.
• The dress style has Mughal influences.
• Some of the popular themes of this religious art are:
• The Badhia(a depiction of the temple of Jagannath);
• Different “Vesas” of Shri Jagannath, Balabhadra and Subhadra.
• Krishna Lila (an enactment of Jagannath as Lord Krishna displaying his powers as a child);
• Dasabatara Patti (the ten incarnations of Lord Vishnu); and
• Panchamukhi (a depiction of Lord Ganesh as a five-headed deity).

15. Bank locker agreements: RBI’s conditions, customer complaints

Subject : Economy

Section: Monetary Policy

Concept :

• The Reserve Bank of India’s (RBI) stipulation that bank locker owners should renew their locker agreements on a stamp paper within a set of new deadlines has sent locker owners scrambling to comply, as banks have started asking customers for inking new agreements on stamp papers and hiking charges across the board.
• The central bank had asked banks to notify all their customers of the revised requirements by April 30, 2023 and ensure that at least 50 per cent and 75 per cent of their existing customers have executed the revised agreements by June 30 and September 30, 2023 respectively.

Background:

• A New Bank Locker Rule has come into effect from January 1, 2023, according to a Reserve Bank of India (RBI) notification.
• Over the past few days, many Banks have sent text messages to customers to renew their safe deposit locker agreements. As part of this, existing locker depositors were required to furnish proof of eligibility for a renewed locker arrangement.
• Additionally, they were required to sign a renewal agreement by December 31, 2022.
• While some customers have received messages regarding the bank locker agreement from their lenders, others are saying that they haven’t got any such instructions from their banks. This, indeed, leaves a question mark on the consequences for such locker-holders as the deadline has already lapsed.
• It is in this context, that RBI has extended the deadline for banks to renew locker agreements with existing locker customers in a phased manner to December 31, 2023.

Locker Agreement:

• At the time of allotment of the locker to a customer, the bank shall enter into an agreement with the customer to whom the locker facility is provided, on a paper duly stamped.
• A copy of the locker agreement in duplicate signed by both parties shall be furnished to the locker- hirer to know his/her rights and responsibilities. Original Agreement shall be retained with the bank’s branch where the locker is situated.

16. A semaglutide ‘miracle’: repurposing diabetes drug for weight loss

Subject : Science and technology

Section: Health

Concept :

• People who have been struggling to cope with being overweight or obese and trying to shed a few kilos, over the past few years, have it seems been offered a silver bullet.
• While initially on trial for once-a-week diabetes therapy, an unexpected side effect – weight loss – swept the drug (semaglutide) off the shelves of a pharmacy and put it in the celebrity section on social media.
• Initial results seemed like a fantasy, as stunning weight loss was recorded in those put on the drug as a treatment for diabetes, and celebrities, even those without diabetes, did not take too long to cotton on, starting oral and injectible semaglutide doses to lose weight.

Semaglutide

• Semaglutide is a glucagon-like peptide-1 receptor agonist (GLP-1 RA) drug that increases the secretion of insulin (which helps decrease blood sugar levels) after a meal while reducing the production of glucagon (which helps increase blood sugar levels).
• Besides regulating glucose levels in the body, the drug also aids in weight loss, lowers the risk of hypoglycemia, and improves heart health and kidney function.
• The drug was approved by the US Food and Drug Administration in 2017.
• According to a study, semaglutide specifically showed greater weight loss in subjects than other GLP-1 RA drugs. It roughly reduced body weight by 4kgs, as compared to other drugs which saw reductions of 1.4-2.5 kgs.
• Apart from regulating glucose, it also increases gastric emptying time, meaning food takes longer to pass through the gastrointestinal tract and it makes you feel full for a longer period of time

Drug repurposing (DR)

It is (also known as drug repositioning) is a process of identifying new therapeutic use(s) for old/existing/available drugs. It is an effective strategy in discovering or developing drug molecules with new pharmacological/therapeutic indications. In recent years, many pharmaceutical companies are developing new drugs with the discovery of novel biological targets by applying the drug repositioning strategy in drug discovery and development program. This strategy is highly efficient, time saving, low-cost and minimum risk of failure.

 It maximizes the therapeutic value of a drug and consequently increases the success rate. Thus, drug repositioning is an effective alternative approach to traditional drug discovery process. Finding new molecular entities (NME) by traditional or de novo approach of drug discovery is a lengthy, time consuming and expensive venture. Drug repositioning utilizes the combined efforts of activity-based or experimental and in silico-based or computational approaches to develop/identify the new uses of drug molecules on a rational basis. It is, therefore, believed to be an emerging strategy where existing medicines, having already been tested safe in humans, are redirected based on a valid target molecule to combat particularly, rare, difficult-to-treat diseases and neglected diseases.