Daily Prelims Notes 16 September 2020
- September 16, 2020
- Posted by: OptimizeIAS Team
- Category: DPN
Table Of Contents
- Aircraft (Amendment) Bill, 2020
- Essential Commodities Amendment Bill
- Inter-State Migrant Workmen (ISMW) Act, 1979
- Official languages for state
- WTO’s Dispute Settlement Body
- Trade deficit
- Adjournment motion
- Impossible Trilemma
- Consumer Welfare Fund
- National Fisheries Policy
- Gold Monetisation Scheme
- MPs salary
- Capital gain Tax
- Economic and Social Council
- Article 293
1. Aircraft (Amendment) Bill, 2020
The Aircraft (Amendment) Bill 2020, which has already been cleared by the Lok Sabha in March this year, was passed by Rajya Sabha.
Features of the Act
- The Bill converts three existing bodies under the Ministry of Civil Aviation into statutory bodies under the Act. These three authorities are: (i) the Directorate General of Civil Aviation (DGCA), (ii) the Bureau of Civil Aviation Security (BCAS), and (iii) the Aircraft Accidents Investigation Bureau (AAIB). Each of these bodies will be headed by a Director General who will be appointed by the centre.
- The DGCA will carry out safety oversight and regulatory functions with respect to matters under the Bill.
- The BCAS will carry out regulatory oversight functions related to civil aviation security.
- The AAIB will carry out investigations related to aircraft accidents and incidents.
- Under the Act, the central government may make rules on several matters. These include: (i) registration of aircraft, (ii) regulating air transport services, and (iii) prohibition of flight over any specified area
- Offences and Penalties: Under the Act, the penalty for various offences is imprisonment of up to two years, or a fine of up to Rs 10 lakh, or both. These offences include: (i) carrying arms, explosives, or other dangerous goods aboard aircraft, (ii) contravening any rules notified under the Act, and (iii) constructing building or structures within the specified radius around an aerodrome reference point.
- Under the Bill, the central government may cancel the licences, certificates, or approvals granted to a person under the Act if the person contravenes any provision of the Act. Such licences include those given for: (i) the establishment of an air transport service, (ii) the establishment of aerodromes, and (iii) the operation, repair, and maintenance of aircraft.
- Courts will not take cognizance of any offence under this Act, unless a complaint is made by, or there is previous sanction from the Director General of Civil Aviation, BCAS, or AAIB. Only courts equivalent or superior to a Metropolitan Magistrate or a Magistrate of the first class may try offences under the Act.
- Exemption for Armed Forces: Aircraft belonging to the naval, military, or air forces of the Union are exempted from the provisions of the Act. The Bill expands this exemption to include aircraft belonging to any other armed forces of the Union. However, aircrafts belonging to an armed force other than the naval, military, and air forces which are currently regulated under the Act will continue to do so until specified otherwise by the central government.
Opposition demand for restoration of MPLADS funds in parliamentary session.
- The Members of Parliament Local Area Development Scheme (MPLADS) is an ongoing Central Sector Scheme which was launched in 1993-94.The Scheme enables the Members of Parliament to recommend works for creation of durable community assets based on locally felt needs to be taken up in their constituencies in the area of national priorities namely drinking water, education, public health, sanitation, roads etc.
- The Ministry of Statistics and Programme Implementation has been responsible for the policy formulation, release of funds and prescribing monitoring mechanism for implementation of the Scheme.
- The MPLADS is a Plan Scheme fully funded by Government of India. The annual MPLADS fund entitlement per MP constituency is Rs. 5 crore.
- Lok Sabha Members can recommend works within their Constituencies and Elected Members of Rajya Sabha can recommend works within the State of Election (with select exceptions). Nominated Members of both the Rajya Sabha and Lok Sabha can recommend works anywhere in the country.
3. Essential Commodities Amendment Bill
Lok Sabha passed the Essential Commodities (Amendment) Bill, 2020
Features of the Bill:
- The Bill will replace the Essential Commodities (Amendment) Ordinance which was promulgated on 5th June this year.
- The Bill seeks to amend the Essential Commodities Act, 1955 and empowers the central government in terms of production, supply, distribution, trade, and commerce of certain commodities.
- It also seeks to increase competition in the agriculture sector and enhance farmers’ income. The bill aims to liberalise the regulatory system while protecting the interests of consumers.
- The bill empowers the central government to designate certain commodities including food items, fertilizers, and petroleum products as essential commodities.
- Supply of certain food items including cereals, pulses, potato, onions, edible oilseeds, and oils, can be regulated by the government under extraordinary circumstances as per the provisions of this bill. The extraordinary circumstances include war, famine, extraordinary price rise and natural calamity of grave nature.
- The Essential Commodities (Amendment) Bill, 2020 empowers the central government to regulate the stock of an essential commodity that a person can hold.
- The provisions of the bill regarding the regulation of food items and the imposition of stock limits will however not apply to any government order relating to the Public Distribution System or the Targeted Public Distribution System.
- It requires that imposition of any stock limit on agricultural produce must be based on price rise. A stock limit may be imposed only if there is: (i) a 100% increase in retail price of horticultural produce; and (ii) a 50% increase in the retail price of non-perishable agricultural food items. The increase will be calculated over the price prevailing immediately preceding twelve months, or the average retail price of the last five years, whichever is lower.
4. Inter-State Migrant Workmen (ISMW) Act, 1979
In the last five years, there have been no inter-State migrant workers registered in the Delhi, Dehradun or Patna regions. Nationwide, there were less than 34,000 workers registered in 2019-20 under the Inter-State Migrant Workmen (ISMW) Act, 1979, according to a response to a recent Right to Information Act request.
- Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979. t was enacted to prevent the exploitation of inter-state migrant workmen by contractors, and to ensure fair and decent conditions of employment.
- The law requires all establishments hiring inter-state migrants to be registered, and contractors who recruit such workmen be licensed.
- Contractors are obligated to provide details of all workmen to the relevant authority. Migrant workmen are entitled to wages similar to other workmen, displacement allowance, journey allowance, and payment of wages during the period of journey.
- Contractors are also required to ensure regular payment, non-discrimination, provisioning of suitable accommodation, free medical facilities and protective clothing for the workmen.
Status of implementation
- The onerous requirements set out in this law incentivize contractors and employers to under-report inter-state workmen rather than to register them.
- Since the Act is barely implemented, it exists as another law that potentially provides rent-seeking opportunities to enterprising government inspectors while failing in its main objective.
- Another consequence of weak implementation is the absence of government preparedness and the consequent failure in preventing genuine hardships for vulnerable groups.
5. Official languages for state
On the agenda of the ongoing monsoon session in Parliament is a bill to introduce Hindi, Kashmiri and Dogri as official languages in Jammu and Kashmir, in addition to English and Urdu.
- Part XVII of the Constitution deals with the official language in Articles 343 to 351
- The Constitution does not specify the official language of different states. In this regard, it makes the following provisions.
- The legislature of a state may adopt any one or more of the languages in use in the state or Hindi as the official language of that state. Until that is done, English is to continue as official language of that state.
- Under this provision, most of the states have adopted the major regional language as their official language. For example, Andhra Pradesh has adopted Telugu, Kerala—Malayalam, Assam—Assamese, West Bengal—Bengali, Odisha—Odia.
- Notably, the choice of the state is not limited to the languages enumerated in the Eighth Schedule of the Constitution.
- For the time being, the official language of the Union (i.e., English) would remain the link language for communications between the Union and the states or between various states. But, two or more states are free to agree to use Hindi (instead of English) for communication between themselves.
- The Official Language Act (1963) lays down that English should be used for purposes of communication between the Union and the non-Hindi states (that is, the states that have not adopted Hindi as their official language). Further, where Hindi is used for communication between a Hindi and a non-Hindi state, such communication in Hindi should be accompanied by an English translation.
- When the President (on a demand being made) is satisfied that a substantial proportion of the population of a state desire the use of any language spoken by them to be recognised by that state, then he may direct that such language shall also be officially recognised in that state. This provision aims at protecting the linguistic interests of minorities in the states
6. WTO’s Dispute Settlement Body
- The World Trade Organization upheld a complaint by China over additional duties slapped by the U.S. on some $250 billion worth of Chinese goods.
- A panel of experts set up by WTO’s Dispute Settlement Body ruled the tariffs were “inconsistent” with global trade rules, and recommended that the U.S. “bring its measures into conformity with its obligations”.
- Settling disputes is the responsibility of the Dispute Settlement Body (the General Council in another guise), which consists of all WTO members.
- The Dispute Settlement Body has the sole authority to establish “panels” of experts to consider the case, and to accept or reject the panels’ findings or the results of an appeal. It monitors the implementation of the rulings and recommendations, and has the power to authorize retaliation when a country does not comply with a ruling.
- The Appellate Body was established in 1995 under Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU).
- It is a standing body of seven persons that hears appeals from reports issued by panels in disputes brought by WTO Members.
- The Appellate Body can uphold, modify or reverse the legal findings and conclusions of a panel, and Appellate Body Reports, once adopted by the Dispute Settlement Body (DSB), must be accepted by the parties to the dispute. The Appellate Body has its seat in Geneva, Switzerland.
Contracting for the sixth straight month, India’s exports slipped 12.66 per cent year-on-year to USD 22.7 billion in August, on account of fall in the shipments of petroleum, leather, engineering goods and gems and jewellery items, as per the government data released
- Trade balance of a country shows the difference between what it earns from its exports and what it pays for its imports.
- If it is in negative that is, the total value of goods imported by a country is more than the total value of goods exported by that country, then it is referred to as a “trade deficit”.
Current Account deficit
- A current account deficit is a trade measurement that says a country imported more goods, services, and capital than it exported.
- It encompasses the trade deficit plus capital like net income and transfer payments.
- Current Account = Trade gap + Net current transfers + Net income abroad
Congress moved an adjournment motion notice in the Lok Sabha over the “surveillance” of key Indian personalities, including the President and Prime Minister, by a firm linked to the Chinese government
- It is introduced in the Parliament to draw attention of the House to a definite matter of urgent public importance, and needs the support of 50 members to be admitted.
- As it interrupts the normal business of the House, it is regarded as an extraordinary device. It involves an element of censure against the government and hence Rajya Sabha is not permitted to make use of this
- The discussion on an adjournment motion should last for not less than two hours and thirty minutes.
- The right to move a motion for an adjournment of the business of the House is subject to the following restrictions:
- It should raise a matter which is definite, factual, urgent and of public importance;
- It should not cover more than one matter;
- It should be restricted to a specific matter of recent occurrence and should not be framed in general terms;
- It should not raise a question of privilege;
- It should not revive discussion on a matter that has been discussed in the same session;
- It should not deal with any matter that is under adjudication by court; and
- It should not raise any question that can be raised on a distinct motion.
In a recently released report, the Reserve Bank of India mentioned that an appreciating currency will help contain imported inflationary pressures. This has given rise to a fervent debate as to whether the RBI is no longer able to handle the Impossible Trilemma.
- The policy trilemma refers to the trade-offs a government faces when deciding international monetary policy. In particular, the policy trilemma contends that it is not possible to have all three objectives at the same time, but has to choose two from the following three options:
- Free movement of capital
- Independent (autonomous) monetary policy
- Fixed (managed) exchange rates
- The Impossible Trilemma, an important paradigm of open economy macroeconomics, asserts that a country may not be able to stabilise the exchange rate, and conduct an independent monetary policy when it is financially integrated with the rest of the world.
- Policymakers in all sophisticated economies face this trilemma, forcing them to make choices about which targets they are going to pursue.
- The RBI has tried to avoid these choices: It has tried to pursue all three objectives simultaneously in an especially aggressive manner since the pandemic struck.
- It has reduced its policy interest rate to negative levels in real terms.
- It has bought government securities to push down long-term interest rates.
- It has allowed large capital inflows, then intervened in the foreign exchange market to prevent the appreciation of the rupee. These actions are incompatible, and will eventually generate a serious policy dilemma.
- One of the corners of the trilemma has to do with capital inflows. In the first few months of the pandemic and the associated lockdown, the Indian economy witnessed a net outflow of foreign portfolio investment (FPI). However, this trend has reversed in recent months.
- At the same time, the combination of weak economic growth, lacklustre domestic demand, and low oil prices have shifted the current account balance from deficit into surplus. Imports have fallen more than exports suggesting that India is doing worse than its trading partners. These factors have changed the balance of supply and demand in the foreign exchange markets as a result of which the currency has begun to face appreciation pressures against the dollar. This brings us to another corner of the trilemma — currency stability.
- Retail inflation has now breached the upper limit of 6 per cent for more than three quarters. Core inflation has been rising and inflation expectations have jumped sharply. And while credit to the private sector remains depressed, credit to the government has been strong, implying that overall broad money is growing rapidly.
The Consumer Protection Act, 2019 which came into effect from 20th July 2020, and replaces the Consumer Protection Act of 1986 would give greater fillip to the ongoing consumer movement in the country
- The Consumer Welfare Fund was created in 1992.
- Its objective is providing financial assistance to promote and protect the welfare of the consumers, create consumer awareness and strengthen consumer movement in the country.
- Financial assistance is provided to Voluntary Consumer Organisations / Institutions for undertaking consumer advocacy / awareness and to State Government / Union Territories for setting up State Consumer Welfare Fund.
Government has decided for introducing a comprehensive and integrated ‘National Fisheries Policy, 2020’
- It is by integrating the National Policy on Marine Fisheries, 2017 (NPMF), the Draft National Inland Fisheries and Aquaculture Policy (NIFAP) and the Draft National Mariculture Policy (NMP) along with the elements of Post Harvest.
Six banks, led by State Bank of India (SBI), collectively mobilised 68 per cent more gold year-on-year (yoy) from households and temple trusts, among others, at 4,643.25 kg in 2019-20 against 2,763.12 kg the previous year under the Gold Monetisation Scheme (GMS).
- Indians families keep a lot of gold lying idle at their homes. True that its value grows over time, keeping gold idle doesn’t come cheap. One has to spend on storage in a bank locker, or worry for its safety at home.
- The Gold Monetisation Scheme (GMS) was launched by the Government of India in 2015.
- The main aim of this scheme is to turn the unused gold which is lying idle at our households or institutions into a productive asset. The aim was to mobilise gold and further facilitate its use for productive purposes.
- The scheme would thus also reduce India’s dependability on gold imports.
- The depositors can deposit a minimum of 30 gms of raw gold in the form of bars, coins, jewellery. There is no cap on the maximum amount of gold that can be deposited. The deposits under GMS is held by banks on behalf of the Centre, who also decides the interest rate.The new scheme consists of revamped GDS (Gold Deposit Scheme) and revamped GML ( Gold Metal Loan) scheme.
13. MPs salary
Lok Sabha passed a bill proposing a 30 percent salary cut in the salaries of MPs for one year
- Article 106 of the Constitution empowers MPs to determine their salaries and allowances by enacting laws.
- Till 2018, Parliament periodically passed laws to revise the salaries of MPs. In 2018 through the Finance Act, Parliament amended the law setting the salary for MPs. It revised their salary and provided that the salary, daily allowance, and pension of MPs shall be increased every five years, based on the cost inflation index provided under the Income-tax Act, 1961.
- Further, in 1985, Parliament enacted a law that delegated the power to set and revise certain allowances of MPs such as constituency allowance, office allowance, and housing allowance to the central government.
14. Capital gain Tax
A Parliamentary panel has suggested abolishing tax on long-term capital gains for all investments in start-ups made through collective investment vehicles (CIVs).
- The gain or profit from the sale of assets is classified as a capital gain. The tax for this capital gain needs to be paid in the year that the asset transfer takes place.
- STCG or Short Term Capital Gains Tax is the tax levied on profits generated from the sale of an asset which is held for a government-defined short period is called short-term capital gains tax.
- The short term period differs for various items; for example, for immovable property such as land, building, and house property, the holding period was reduced in FY 2017-18 from 36 months or less to 24 months or less, to deem it as “short term.”
15. Economic and Social Council
India has been elected as a member of the United Nation’s Commission on Status of Women, a body of the Economic and Social Council (ECOSOC)
- The Economic and Social Council is at the heart of the United Nations system to advance the three dimensions of sustainable development – economic, social and environmental.
- It is the central platform for fostering debate and innovative thinking, forging consensus on ways forward, and coordinating efforts to achieve internationally agreed goals. It is also responsible for the follow-up to major UN conferences and summits.
- The UN Charter established ECOSOC in 1945 as one of the six main organs of the United Nations.
- ECOSOC links a diverse family of UN entities dedicated to sustainable development, providing overall guidance and coordination. The entities include regional economic and social commissions, functional commissions facilitating intergovernmental discussions of major global issues, and specialized agencies, programmes and funds at work around the world to translate development commitments into real changes in people’s lives.
- ECOSOC has 54 member Governments which are elected for three-year terms by the General Assembly. Seats on the Council are allotted based on geographical representation with fourteen allocated to African States, eleven to Asian States, six to Eastern European States, ten to Latin American and Caribbean States, and thirteen to Western European and other States.
16. Article 293
The GST Council can recommend to the Central government to permit the States to borrow money, as a measure for meeting the compensation gap, Attorney General (AG) KK Venugopal had opined
Article 293: Borrowing by States
- Subject to the provisions of this article, the executive power of a State extends to borrowing within the territory of India upon the security of the Consolidated Fund of the State within such limits, if any, as may from time to time be fixed by the Legislature of such State by law and to the giving of guarantees within such limits, if any, as may be so fixed
- The Government of India may, subject to such conditions as may be laid down by or under any law made by Parliament, make loans to any State or, so long as any limits fixed under Article 292 are not exceeded, give guarantees in respect of loans raised by any State, and any sums required for the purpose of making such loans shall be charged on the Consolidated Fund of India
- A State may not without the consent of the Government of India raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India or by its predecessor Government.
- A consent under clause ( 3 ) may be granted subject to such conditions, if any, as the Government of India may think fit to impose CHAPTER III PROPERTY, CONTRACTS, RIGHTS, LIABILITIES, OBLIGATIONS AND SUITS