Daily Prelims Notes 19 March 2021

March 19, 2021
Posted by: OptimizeIAS Team
Category: DPN

Daily Prelims Notes

19 March 2021

Table Of Contents

1. VOLUNTARY VEHICLE FLEET MODERNIZATION POLICY

Subject: Economy

Context: Road Transport and Highways Minister Nitin Gadkari stated in Parliament that the Ministry is introducing a voluntary vehicle fleet modernization programme aimed at creating an ecosystem to phase out unfit and polluting vehicles

Concept:

It is proposed that private vehicles be de-registered after 20 years if found unfit or in case of failure to renew registration certificate.
As a disincentive measure, increased re-registration fees will be applicable for private vehicles 15 years onward from the date of initial registration.
It is being proposed that all government vehicles may be de-registered and scrapped after 15 years from date of registration.
Road Ministry has also proposed increasing the registration charges for vehicles that are over 15 years, with effect from October 1 this year.
The criteria, decided on the basis of practices in Germany, the UK, the US and Japan, will take into account emission tests, braking and safety equipment, among many other tests.

2. DAILY MINIMUM WAGES

Subject: Economy

Context: Govt must look into scheme for those who lost jobs amid lockdown: Report

Concept:

The Delhi government should consider launching a scheme guaranteeing jobs at a fixed minimum daily wage to tackle the alarming surge in the city’s unemployment rate during the pandemic-induced lockdown, according to an official document.
The unemployment rate in Delhi rose from 11.1% in January-February 2020 to 28.5% in October-November, according to a Delhi government-commissioned survey.
The survey, prepared jointly by the Delhi Directorate of Economics and Statistics and the Centre for Market Research and Social Development.
It says the government is planning to launch a scheme to provide guaranteed jobs for a few months in a year at minimum wages of Rs 569 per day to one adult member of a household in Delhi.
Economist Jean Dreze, one of the architects of the National Rural Employment Guarantee scheme, had last September proposed that an urban jobs guarantee scheme should be considered to help people tide over the widespread lockdown-induced distress.

National Rural Employment Programme (NREP, 1980)

The National Rural Employment Programme was launched in 1980 as an anti-poverty and anti-unemployment program.
The aim was to develop key assets, such as fisheries, fuel and energy plantations and fodder and pasture development plantations by mobilizing unemployed and under-employed laborers.
It was also hoped that the project would succeed in the development of homestead projects for the home-less alongside essential economic infrastructures, such as godowns, banks and workshops for the beneficiaries.

3. POINT OF ORDER

Subject : Polity

Context : The Congress and other Opposition parties on Thursday forced adjournments of Rajya Sabha proceedings for four times during the post-lunch sitting as they insisted on referring to a standing committee a Bill on raising the FDI in the insurance sector to 74% from the current 49% by raising a point of order.

Concept:

A Member can raise a point of order when the proceedings of the House do not follow the normal rules of procedure.
A point of order should relate to the interpretation or enforcement of the Rules of the House or such articles of the Constitution that regulate the business of the House and should raise a question that is within the cognizance of the Speaker.
It is usually raised by an opposition member in order to control the government. It is an extraordinary device as it suspends the proceedings before the House. No debate is allowed on a point of order.
Speaker/Chairman is the final decision making authority.

4. INSURANCE AMENDMENT BILL

Subject : Legislations

Context : The Rajya Sabha passed the Insurance Amendment Bill, 2021 which increases the maximum foreign investment allowed in an insurance company from 49% to 74%.

Concept :

The Bill amends the Insurance Act, 1938 to increase the maximum foreign investment allowed in an Indian insurance company.
The Act provides the framework for functioning of insurance businesses and regulates the relationship between an insurer, its policyholders, its shareholders, and the regulator (the Insurance Regulatory and Development Authority of India).

Foreign investment:

The Act allows foreign investors to hold up to 49% of the capital in an Indian insurance company, which must be owned and controlled by an Indian entity.
The Bill increases the limit on foreign investment in an Indian insurance company from 49% to 74%, and removes restrictions on ownership and control.
However, such foreign investment may be subject to additional conditions as prescribed by the central government.

Investment of assets:

The Act requires insurers to hold a minimum investment in assets which would be sufficient to clear their insurance claim liabilities.
If the insurer is incorporated or domiciled outside India, such assets must be held in India in a trust and vested with trustees who must be residents of India.
The Act specifies in an explanation that this will also apply to an insurer incorporated in India, in which at least: (i) 33% capital is owned by investors domiciled outside India, or (ii) 33% of the members of the governing body are domiciled outside India.
The Bill removes this explanation.

5. GLOBAL WAGES REPORT

Subject : International reports

Context : The ILO report titled ‘Global Wage Report 2020-21: Wages and minimum wages in the time of COVID-19’ is available at ILO’s official website.

Concept :

Key Highlights of Global Wage Report 2020-21

It comments on various issues including on Indian workers having low average wages, longer hours as well as that the workers in Asia and the Pacific.
The 2020-21 edition analyses the relationship of minimum wages and inequality, as well as the wage impacts of the COVID-19 crisis.
The global wage growth fluctuated between 1.6 and 2.2 per cent in the four years preceding the COVID-19 pandemic (2016–19).
In advanced G20 economies, the real wage growth fluctuated between 0.4 and 0.9 per cent.
Among advanced G20 economies, wage growth accelerated the most (by 22 per cent) in the Republic of Korea, followed by Germany (15 per cent).
The impacts of the crisis on total wages have fallen differently on men and women, the latter being disproportionately affected.
The COVID-19 crisis disproportionately affected lower-paid workers, thereby increasing wage inequalities.
The report highlighted that minimum wages, statutory or negotiated, exist in 90 per cent of the 187 ILO Member States.

Global Wage Report

It is a flagship report of ILO which examines the evolution of real wages around the world, giving a unique picture of wage trends globally and by region.
It is central to the analysis of wage trends and labour market developments as well as to the theoretical debate about the role of labour in the economy.

International Labour Organisation (ILO)

It is the only tripartite United Nations agency established in 1919.
It brings together governments, employers and workers of 187 member States.
It aims to set labour standards, develop policies and devise programmes promoting decent work for all women and men.

6. SUPPLEMENTARY GRANTS

Subject : Polity

Context : The Lok Sabha on Thursday passed the supplementary demand for grants (second batch for 2020-21).

Concept :

During the year, if the government needs to spend any money which has not been approved by Parliament or needs to incur additional expenditure, it can introduce Supplementary Demands for Grants.
Typically, Supplementary Demands for Grants are passed in every Parliament session.
Article 115 of the constitution provides for Supplementary, additional or excess grants.
Note that, unlike the Demands for Grants presented with the budget, these supplementary demands have never been scrutinised by Standing Committees.

7. STATE INFORMATION COMMISSION

Subject : Governance

Context :A Division Bench of the Kerala High Court on Thursday dismissed a writ petition challenging the recommendation to appoint former Chief Secretary Vishwas Mehta as State Chief Information Commissioner (CIC).

Concept :

It is an independent, statutory committee formed under the RTI Act to ensure freedom of information to citizens. It has jurisdiction over state government bodies, PSU and authorities.

Composition:

It has chief information commissioner and up to 10 information commissioners. All are appointed by the governor on recommendation of chief minister, cabinet minister nominated by him and leader of opposition in legislative assembly.

Qualification:

Qualification for membership to commission are persons should person of eminence in public life with experience in field of law, science and technology, governance, social service, management, journalism, mass media or administration.
They should not be MP / MLA’s or connected to any political party, doing some business/ profession or holding office of profit.

Term:

They hold office till age of 65 or 5 years. The information commissioner is eligible for post of state chief information commissioner but can be in office for maximum 5 years including his tenure of information commissioner.
However , after RTI Amendment 2019 , the tenure of central and state information commissioners has now been reduced from five to three years.

Removal:

Removal is done by governor on grounds of bankruptcy, unsound mind, infirmity of body or mind, sentenced to imprisonment for a crime, or engages in paid employment.
He can also be removed for proved misbehavior or incapacity if SC inquiry finds him guilty. They can resign by writing to governor.

Powers and functions:

Acts as second appellate authority for RTI applications.
Inquires into complaints under RTI Act
Have powers of a civil court. No public record can be withheld from it during inquiry of complaints.
Can secure compliance of its orders from a public authority
Submits annual reports to the state govt which are tabled before the house.
Commission can recommend steps to be taken by an authority to become complaint under RTI.

8. BOND YIELDS

Subject : Economics

Context :Indian equity benchmarks dropped by more than 1% for the second straight session on Thursday on concern that rising U.S. bond yields in the wake of the Federal Reserve’s dovish policy stance could herald foreign fund outflows.

Concept :

Bond yield is the return an investor gets on that bond or a particular G-sec.
Factors affecting the yield: Monetary policy of the RBI (interest Rates), fiscal position of the government and its borrowing programme, global markets, economy, and inflation.
A fall in interest rates makes bond prices rise, and bond yields fall.
Rising interest rates cause bond prices to fall, and bond yields to rise.
So, a rise in bond yields means interest rates in the monetary system have fallen, and the returns for investors have declined.

9. OPEN MARKET OPERATIONS

Subject : Economics

Context : The Reserve Bank of India (RBI) has decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for an amount of ₹10,000 crore each on March 25.

Concept :

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

About G-secs

A Government Security (G-Sec) is a tradable instrument issued by the Central Government or the State Governments.
It acknowledges the Government’s debt obligation.
Such securities are short term (usually called treasury bills, with original maturities of less than one year- presently issued in three tenors, namely, 91 day, 182 day and 364 day) or long term (usually called Government bonds or dated securities with original maturity of one year or more.

10. S400 & CAATSA

Subject : International Relations

Context : US Senator Bob Menendez, has written to U.S. Secretary of Defense Lloyd Austin asking him to raise concerns about democracy and India’s purchase of the S-400 Russian missile defence system, during his visit to New Delhi.

Concept :

The S-400 Triumf, (NATO calls it SA-21 Growler), is a mobile, surface-to-air missile system (SAM) designed by Russia.
It is the most dangerous operationally deployed modern long-range SAM (MLR SAM) in the world, considered much ahead of the US-developed Terminal High Altitude Area Defense system (THAAD).
The system can engage all types of aerial targets including aircraft, unmanned aerial vehicles (UAV and ballistic and cruise missiles within the range of 400km, at an altitude of up to 30km. The system can track 100 airborne targets and engage six of them simultaneously.
The S-400 Triumf air defence system integrates a multifunction radar, autonomous detection and targeting systems, anti-aircraft missile systems, launchers, and command and control centre.
It is capable of firing three types of missiles to create a layered defence.

CAATSA:

Countering America’s Adversaries through Sanctions Act (CAATSA) was passed unanimously by the US Congress and signed reluctantly by US President Donald Trump. Enacted on August 2, 2017, its core objective is to counter Iran, Russia and North Korea through punitive measures.