Daily Prelims Notes 12 February 2021
- February 12, 2021
- Posted by: admin1
- Category: DPN
Daily Prelims Notes
12 February 2021
All 6 Prelims qualified
4 CSE Mains qualified
If I can do it, you can too
Table Of Contents
- Enforcement Directorate
- Mangar Bani
- Next generation battery technology for Electric vehicles to replace Lithium-ion batteries
- Gilt Funds
- Writer’s Cramp and the Rights of Persons with Disabilities Act 2016
- Hedyotis Sithiravaraiensis (Karumthumbai or Senthumbai or Sakkaraithumba)
- Digital Service Tax
- Crowding Out of Investment
Context: THE raids on the office of online news platform NewsClick and residences of its directors by the Enforcement Directorate (ED) continued for third day w.r.t. remittance cases.
- It is a Multi-Disciplinary Organization mandated with the task of enforcing the provisions of two special fiscal laws – Foreign Exchange Management Act, 1999 (FEMA) and Prevention of Money Laundering Act, 2002 (PMLA).
- An ‘Enforcement Unit’ was formed in 1956 in Department of Economic Affairs, for handling Exchange Control Laws violations under Foreign Exchange Regulation Act, 1947.
- In the year 1957, it renamed as ‘Enforcement Directorate’. The administrative control of the Directorate was transferred from Department of Economic Affairs to Department of Revenue in 1960.
- The Enforcement Directorate recruits some of its officers directly while some others are appointed form other State agencies on deputation, like the Income Tax, Excise, departments, etc
- The Directorate primarily enforces two laws
- FEMA, a Civil Law which has quasi-judicial powers
- PMLA, a Criminal Law (Officers are empowered to conduct enquiries to locate, provisionally attach/confiscate assets derived from acts of Schedules Offences besides arresting and prosecuting the Money Launderers)
- It also performs following role:
- Processing cases of fugitive/s from India under Fugitive Economic Offenders Act, 2018.
- Sponsor cases of preventive detention under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974(COFEPOSA) in regard to contraventions of FEMA.
- PMLA Court (one or more session courts)is designated for the trial of an offence punishable under section 4 of PMLA by the Central Government (in consultation with the Chief Justice of the High Court).
- Any appeal against any order passed by PMLA court can directly be filed in the High Court for that jurisdiction.
Context: THE raids on the office of online news platform NewsClick and residences of its directors by the Enforcement Directorate (ED) continued for third day w.r.t. remittance cases
- It is linked with the foreign remittances allegedly totaling Rs 30.51 crore. This includes a remittance classified as FDI of Rs 9.59 crore from April 2018, and another of Rs 20.92 crore, which has been shown as receipts for “export of services”.
- A remittance is a payment of money that is transferred to another party. However today term is used today for money sent by someone working abroad to his or her family back home.
- Remittances represent one of the largest sources of income for people in low-income and developing nations, often exceeding direct investment and international development assistance.
- Remittances are part of private transfer payment under net transfers which in turn is considered “invisibles” under current account in Balance of Payment.
Role of remittances:
- At the macro level, remittances contribute to maintaining stable foreign reserves.
- On a micro level, remittances have shown a positive impact on healthcare, entrepreneurship, education, and overall economic development of the recipient families.
India and remittances:
- In 2019, India is estimated to have received $83.1 billion in remittances from people working overseas, about 12% of the total expected global inflow making it one of the largest recipients of remittances.
- International remittances in 2018 (2020 report) reached $689 billion, out of which India received $78.6 billion from the 17.5 million living abroad.
Context: A study by CEDAR, the 219 species found in the Mangar landscape include 130 resident species, 53 winter migrants, 12 summer migrants, and 16 passage migrants.
- Mangar Bani is a sacred grove in Aravallis region.
- Mangar is a central part of a continuous north-south stretch of Aravalli forests from Asola, Asola Bhatti Wildlife Sanctuary (ABWLS) and Surajkund to the Damdamalake.
- The nilgai, India’s largest antelope, is one of the most commonly spotted ungulates in the Mangar forests, which provide ample food for the herbivorous mammals.
About sacred grove:
- Sacred groves are part of the forest fragments with religious or ritual significance for the community inhabiting the region. These are generally devoted to local folk deities or tree spirit.
- It is an early manifestation of nature worship.
- It is an example of in-situ conservation.
- It is found in many regions of India: Ex- In Kerala it is also known as “Kavus”, In Bihar it is known as Sarnas, Kovikaadu in Tamil Nadu, and some of the richest groves are found in Meghalaya.
Its significance includes:
- Conservation of biodiversity
- Recharging aquifers
- Soil protection
- Medicinal use with the use of traditional knowledge
- Rich gene pool of rare flora and fauna.
Context: India will work out a policy to institutionalise research and development on the next generation of battery technologies for electric vehicles, like metal-ion, metal air, hydrogen fuel cell, etc, to replace lithium-ion batteries and reduce India’s dependence on other countries for its import within this decade.
- Batteries based on multivalent metals have the potential to meet the future needs of large-scale energy storage, due to the relatively high abundance of elements such as magnesium, calcium, aluminium and zinc in the Earth’s crust.
- These are rechargeable battery in which metal ions provide energy by flowing from the negative electrode of the battery, the anode, to the positive electrode, the cathode.
- These offer the possibilities of low cost and low flammability, together with three-electron-redox properties leading to high capacity
- A metal-air battery uses some type of metal (like aluminum) for the anode, air as the cathode, along with a liquid electrolyte.
- In the case of aluminum, oxygen from the air then combines with the metal to create aluminum hydroxide, which activates the electrolysis process and creates a current.
- Metal-air batteries are light, compact power sources with a high energy density, but they have had a major limitation i.e., they corrode.
- Once this is turned them on, you can’t turn them off. The only way to stop the reaction is to drain the electrolyte out of the system.
Hydrogen fuel cell:
- It is an electrochemical cell that converts the chemical energy of a fuel (often hydrogen in the case of Hydrogen Fuel Cell) and an oxidizing agent (often oxygen) into electricity through a pair of redox reactions.
- A Fuel Cell consists of an anode, a cathode, and an electrolyte that allows ions, often positively charged hydrogen ions (protons), to move between the two sides of the fuel cell.
- A fuel cell converts chemical potential energy (energy stored in molecular bonds) into electrical energy.
Context: The RBI has allowed direct access to its platform to retail investors for deepening the government securities (G-sec) market and to help smooth sailing of the government’s large yearly borrowing program of around Rs 12 lakh crore
- Gilt fund is debt fund or pooled investment vehiclesthat invest in government securities.
- Earlier the government bonds used to be issued in golden-edged certificates, thus the nickname gilt comes from gilded edge certificates.
- There are two kinds of gilt funds.
- One, gilt funds that invest mostly in government securities across maturities. Two, gilt funds with constant maturity of 10 years – these funds must invest at least 80% of their assets in government securities with a maturity of 10 years.
- As per Sebi norms, gilt funds have the mandate to invest at least 80% of their assets in government securities.
- These are zero default risk. However, they have very high interest rate risk.
Context: To ensure equal opportunity to persons with disabilities, the Supreme Court on Thursday asked the Centre to ensure framing of proper guidelines within three months to regulate and facilitate the grant of scribe facility to candidates whose nature of disability imposes a barrier to writing an exam.
- The act is part of the state’s welfare efforts Article 41 of the Directive Principles of State Policy (DPSP) which states that State shall make effective provision for securing right to work, to education and to public assistance in cases of unemployment, old age, sickness and disablement, within the limits of its economic capacity and development.
- The court held that a civil services candidate with writer’s cramp – dysgraphia – was entitled to a scribe (overruling UPSC position that a scribe can be provided only if there was “benchmark disability” as set by the Ministry of Social Justice and Empowerment guidelines under the Act).
- The court applied the principle of reasonable accommodation as part of positive obligation of the State and private parties to provide additional support to persons with disabilities to facilitate their full and effective participation in society
About Writer’s Cramp
- It is a specific type of focal dystonia (neurologic movement disorder) that affects fingers, hand, or forearm.
- In this the brain sends incorrect information to the muscles, causing involuntary, excessive muscle contractions.
- It is a task-specific dystonia. It happens almost only when you perform a particular activity. Other highly skilled movements can incite focal hand dystonia — things like playing a musical instrument, typing or sewing.
- It is also known as musician’s cramp, focal hand dystonia, arm dystonia, finger dystonia.
- Symptoms usually appear between the ages of 30 and 50.
About the Rights of Persons with Disabilities Act, 2016:
- The Rights of Persons with Disabilities Act, 2016
- It replaced the existing PwD Act, 1995.
- Disability has been defined based on an evolving and dynamic concept.
- The types of disabilities have been increased from existing 7 to 21 and the Central Government will have the power to add more types of disabilities.
- Speech and Language Disability and Specific Learning Disability have been added for the first time. Acid Attack Victims have been included. Dwarfism, muscular dystrophy have has been indicated as separate class of specified disability. The New categories of disabilities also included three blood disorders, Thalassemia, Hemophilia and Sickle Cell disease.
- Additional benefits such as reservation in higher education, government jobs, reservation in allocation of land, poverty alleviation schemes etc. have been provided for persons with benchmark disabilities and those with high support needs.
- Every child with benchmark disability between the age group of 6 and 18 years shall have the right to free education.
- Reservation in vacancies in government establishments has been increased from 3% to 4% for certain persons or class of persons with benchmark disability.
- The Act provides for grant of guardianship by District Court under which there will be joint decision – making between the guardian and the persons with disabilities.
- The Chief Commissioner for Persons with Disabilities and the State Commissioners will act as regulatory bodies and Grievance Redressal agencies and also monitor implementation of the Act.
- District level committees by the states to solve local concerns.
- National and State Fund will be created to provide financial support to the persons with disabilities.
Context: Chennai-based botanists have foundNew plant species with possible medicinal properties discovered.
- It is a critically endangered species majorly due to unregulated commercial collection of the plant by the locals
- It is a critically-endangered species of the Rubiaceae family in Pakkamalai in the Gingee Hills (in Eastern Ghats).
- Its leaves are collected for the medicinal properties by the locals for they believe it extends the life span of human beings.
- Inforescence or flower head resembled species of the Lamiaceae (mint) family.
- The plant is closely allied with an Eastern Asiatic species, Hedyotisuncinella and a Western Ghats species, H. rajasekaraniiKarupp&Ravichandran.
- The species had been named after its type locality Sithiravarai (Sethavarai), an archaeologically important site, as it has 3,500-year-old rock paintings in natural caverns. “Sithiram” means painting) and “Varai” means hills.
Context: The United States Trade Representative (USTR) has termed India’s Equalisation Levy (also known as Google Tax) on e-commerce companies as ‘discriminatory’ India.
Base erosion and profit shifting (BEPS) refers to tax planning strategies used by multinational enterprises that exploit gaps and mismatches in tax rules to avoid paying tax. Developing countries’ higher reliance on corporate income tax means they suffer from BEPS disproportionately.
Equalization Levy was introduced in India in 2016-2017, with the intention of taxing the digital transactions i.e. the income accruing to foreign e-commerce companies from India.
- Equalization Levy is a direct tax, which is withheld at the time of payment by the service recipient.
- The two conditions to be met to be liable to equalization levy:
- The payment should be made to a non-resident service provider;
- The annual payment made to one service provider exceeds Rs. 1, 00,000 in one financial year.
- The following services covered:
- Online advertisement
- Any provision for digital advertising space or facilities/ service for the purpose of online advertisement;
- Currently the applicable rate of tax is 6% of the gross consideration to be paid.
- Finance Minister Nirmala Sitharaman has pegged fiscal deficit for the coming year 2021-22 at 6.8% of GDP and aims to bring it back below the 4.5% mark by 2025-26.
- This year’s fiscal deficit has been funded through government borrowings, multilateral borrowings, Small Saving Funds and short term borrowings.
Crowing Out of Investment
- It is a situation when increased interest rates lead to a reduction in private investment spending such that it dampens the initial increase of total investment spending is called crowding out effect.
- Sometimes, government adopts an expansionary fiscal policy stance and increases its spending to boost the economic activity. This leads to an increase in interest rates. Increased interest rates affect private investment decisions. A high magnitude of the crowding out effect may even lead to lesser income in the economy.
- With higher interest rates, the cost for funds to be invested increases and affects their accessibility to debt financing mechanisms. This leads to lesser investment ultimately and crowds out the impact of the initial rise in the total investment spending. Usually the initial increase in government spending is funded using higher taxes or borrowing on part of the government.