Daily Prelims Notes 27 April 2024

Daily Prelims Notes

27 April 2024

Table Of Contents

1. SLU, ‘matchbox’ that feeds EVM candidate info
2. A long way from 1984: when SC junked ECI’s first EVM experiment
3. Corals bred in a zoo have joined Europe’s largest reef
4. Centre accords AEO status to gem and jewellery sector
5. Minimum Requirements for SFBs Transitioning to Universal Banks
6. Tamil Nadu and Kerala to count Nilgiri tahrs in a first synchronised survey from April 29

1. SLU, ‘matchbox’ that feeds EVM candidate info

Subject: Polity

Sec: Elections

Context:

• While rejecting the plea for 100% verification of Voter Verifiable Paper Audit Trail (VVPAT) slips against the Electronic Voting Machine (EVM) count, the Supreme Court on Friday directed the Election Commission of India (ECI) to “seal and secure” the Symbol Loading Unit (SLU) for 45 days after the declaration of election results.

More on news:

• Currently, only the three components of the EVM — the ballot unit, control unit, and VVPAT — are stored for 45 days after the results. 
• This is the first time that SLUs, used to load candidate symbols onto the VVPATs, will also be available for examination along with the EVMs if a candidate challenges the results by filing an election petition in court.
• The election law currently states that an election petition challenging a result can be filed in court by a candidate within 45 days of the declaration of results.

What is a Symbol Loading Unit (SLU) and how does it work?

• Symbol Loading Units (SLUs) were introduced around the same time as VVPATs  a little over a decade ago.
• VVPATs help voters verify their votes — they see a slip with a printed image of the party symbol they voted for.
• But for the VVPAT to print a symbol correctly, information pertaining to the list of candidates and their symbols must be loaded on to the VVPAT machine in the correct order.
• This is where the Symbol Loading Unit, or SLU, comes in.
• In fact, the introduction of VVPATs necessitated the use of SLUs.
• The SLU is used to load the symbols of the candidates onto the VVPAT. 
• It is a matchbox-sized device that is first connected to a laptop or personal computer, from which a symbol loading application is used to load a bitmap file containing the candidates’ names, serial numbers, and symbols.
• The SLU is then connected to the VVPAT to transfer that file on to the paper audit machine.
• This is done under the supervision of a district election officer.

At which point in the election process are SLUs used?

• The SLUs come into the picture only a few days before polling in a particular seat, when the EVMs are being commissioned and the list/ order of contesting candidates is decided and set on the ballot unit (the machine where you press the button to vote) and the VVPAT (which produces the paper audit trail of your vote).
• Candidate-setting can happen at any time from five to two days before voting at a seat. 
• Once the SLU is used to load symbols onto the VVPAT, the EVM is ready for use. 
• After this, the SLU is of no relevance to the actual voting process.

What happens to an SLU after symbols are loaded?

• A small number of SLUs are enough to load symbols onto all VVPATs for a seat. 
• According to EC officials, it takes an SLU two to three minutes to load each VVPAT.
• Once the symbol-loading is complete, the SLUs are handed over to the concerned district election officer for safekeeping. 
• They remain in the officer’s custody until the day after voting. 
• The SLUs are released to the engineers of the two EVM manufacturers, Bharat Electronics Ltd (BEL) or Electronics Corporation of India Ltd (ECIL), so they can be used to load symbols onto VVPATs for other seats in subsequent phases.
• In a multi-phase election like the ongoing one for the 18th Lok Sabha, an SLU is typically reused after one phase of polling to load symbols onto VVPATs meant for other seats in subsequent phases.

What has the SC said about the SLUs?

• The court has said that the SLUs should be sealed and stored immediately after the symbol-loading process for a seat is complete.
• It must be stored for a period of 45 days after the declaration of results, so that it can be opened and examined like EVMs in case of an election petition.
• This  means that an SLU used for loading symbols onto VVPATs for one seat can no longer be reused for other seats. 

And what has the top court said about microcontrollers?

• In an unprecedented move, the court has allowed candidates to seek verification of EVM software. 
• This means that a candidate can ask ECI officials to check the one-time programmable software in the BU (Ballot Unit), CU (Control Unit), and VVPAT for tampering, in case of any doubts regarding the result.
• This verification involves inspecting the burnt memory/ microcontrollers of these three components.
• The court has proposed a formula for doing this: engineers from the EVM manufacturers will conduct checks on 5% of the EVMs per Assembly constituency or Assembly segment of a parliamentary constituency. 
• Candidates must submit a written request within seven days of the announcement of results, and will have to bear the expense of the process.
• This right to seek verification is limited to those candidates who come in second or third.
• Engineers from the manufacturing companies will certify the authenticity and intactness of the memory/ microcontroller.

What happens if the microcontrollers, upon verification, are found tampered?

• The court has only said that if any tampering is found, the candidate will be refunded the cost of verification.

2. A long way from 1984: when SC junked ECI’s first EVM experiment

Subject: Polity

Sec: Elections

Context:

• The Supreme Court on Friday put the stamp of its unequivocal approval on electronic voting machines (EVMs).

More on news:

• Forty years ago, when a voting machine was first used at the Parur Assembly constituency in Kerala, the court had set aside the election and ordered a repoll in 50 of the 85 polling stations.

The first experiment:

• In August 1980, the Electronics Corporation of India Ltd (ECIL) presented political parties with a prototype voting machine.
• In 1982, the Election Commission of India (ECI) announced that the machine would be used as a pilot project in 50 out of 84 polling stations in the Parur constituency during that year’s Assembly elections in Kerala.
• The central government had not sanctioned the use of the machines. 
• ECI used its constitutional powers under Article 324, which gives it the power of “superintendence, direction, and control” over elections.

Supreme court views:

• The ECI argued that its powers under Article 324 would supersede any Act of Parliament, and if there was conflict between the law and the ECI’s powers, the law would yield to the Commission.
• The Bench unanimously held that introducing voting machines was a legislative power that only Parliament and state legislatures could exercise (Articles 326 and 327), not the ECI.
• The ECI also relied on Section 59 of The Representation of the People Act, 1951 and Rule 49 of The Conduct of Elections Rules, 1961.
• Section 59 says votes shall be given by ballot in such manner as may be prescribed, and Rule states the ECI can publish a notification to direct that the method of voting by ballot shall be followed…at such polling stations as may be specified in the notification.
• In 1988, the election law was amended to insert Section 61A, which allowed the ECI to specify the constituencies where votes would be cast and recorded by voting machines.
• In a judgment which coincides with the second phase of the general elections to the Lok Sabha, also refused petitioners’ suggestion to hand over paper slips from Voter Verifiable Paper Audit Trail (VVPAT) units to electors to take a leisurely look before inserting them into the ballot boxes.
• The court refused to intervene against Section 49 MA of the Conduct of Election Rules, which penalises a voter whose complaint of mismatch (of votes cast and votes counted) would attract penal proceedings initiated by poll officials under Section 177 of the Indian Penal Code for submitting false information.
• The Bench further declined petitioners’, NGO Association for Democratic Reforms and Arun Kumar Agarwal, argument to direct the cross-verification of 100% EVMs and VVPATs across the country. Currently, only five percent of EVM-VVPAT counts are randomly verified in any given Assembly constituency. Earlier it had been one percent, until the top court had intervened.
• The court suggested to the Election Commission (EC) to explore the possibility of devising an “electronic machine” to count the VVPAT paper slips. This direction may have been prompted by an affidavit submitted by the EC during the hearing of the case. The poll body had explained that it takes an hour to manually count the VVPAT slips of a single polling station.

Timeline of EVMs:

• The Commission in December 1977 mooted the idea of EVM to overcome certain problems associated with use of ballot papers and taking advantage of development of technology so that voters cast their votes correctly without any resultant ambiguity and removing the possibilities of invalid votes totally.
• MB Haneefa invented the first Indian voting machine in 1980. 
• It was first used in 1981 in the by-election to North Paravur Assembly Constituency of Kerala in 50 polling stations.
• The EVMs were commissioned in 1989 by Election Commission of India in collaboration with Bharat Electronics Limited and Electronics Corporation of India Limited.
• The law was amended by the Parliament in December, 1988 and a new section 61A was inserted in the Representation of the People Act, 1951 empowering the Commission to use voting machines.
• The amended provision came into force with effect from 15th March, 1989.
• A decade later, EVMs were used at 16 Assembly seats in Madhya Pradesh, Rajasthan, and Delhi. This was expanded to 46 Lok Sabha seats in 1999 and, in 2001, state elections in Tamil Nadu, Kerala, Puducherry, and West Bengal were entirely conducted using EVMs.
• By the 2004 Lok Sabha election, EVMs had completely replaced ballot papers at all 543 seats.

Advantage of EVMs

• The EVMs have effectively eliminated booth capturing by restricting the rate of vote casting to four votes per minute, thereby prolonging the time needed and thus check insertion of bogus votes. EVMs have eliminated invalid votes, which were a major issue with paper ballots and had often sparked disputes during the counting process.
• Further, it noted that EVMs reduce paper usage and alleviate logistical challenges. Finally, they provide administrative convenience by expediting the counting process and minimising errors.
• Election officials have complete control of the polling process.
• After the pressing of the ‘CLOSE’ button on the control unit [of the EVM], there is no possibility of voting. By pressing the ‘TOTAL’ button on the control unit at any time, the total number of votes polled up to the time of pressing the button is displayed, without indicating the candidate-wise result of votes,” the judgment noted.
• The court highlighted that the microcontrollers of the EVMs are programmed at the manufacturing stage. Their original programme is agnostic both political party and candidate-wise. This process is done way before the elections and it is impossible to know the serial number of any candidate in advance. Thus, it is not possible to pre-program the EVM in a spurious manner.

3. Corals bred in a zoo have joined Europe’s largest reef

Subject: Geography

Sec: Oceanography

Context:

• On Monday, divers with gloved hands gently nestled the self-bred corals from the World Coral Conservatory project among their cousins in Europe’s largest coral reef at the Burgers’ Zoo in the Netherlands.

More on news:

• This is the first project where we started to keep these corals with a known origin. 
• It’s among several projects worldwide seeking to address the decline of coral reef populations, which are suffering from bleaching caused by rising sea temperatures. 
• Along with two zoos in France and the originator of the project—the Monaco Scientific Center—the zoo in the east of the Netherlands took in more than a dozen coral fragments from off the coast of Seychelles in east Africa.
• The World Coral Conservatory hopes to create a bank of corals in aquariums across Europe that could be used to repopulate wild coral reefs if they succumb to the stress of climate change or pollution.

About Corals:

• Vibrant and healthy reefs form when a coral and an algae — zooxanthellae — start a symbiotic relationship.
• The coral provides protection and compounds zooxanthellae’s need for photosynthesis.
• The algae produces carbohydrates and helps remove the coral’s waste.
• Corals are central to marine ecosystems, and while these projects won’t stem the tide of damage from human-caused climate change, they are seen as part of broader solutions.
• Corals are keystone marine species.

Coral Bleaching:

• Bleaching occurs when coral under stress expels the algae that gives them their vibrant colors.
• The algae is also a coral’s food source, and if the bleaching lasts for too long or is too severe, the coral could die.
• In the world’s largest coral reef ecosystem, Australia’s Great Barrier Reef, bleaching affected 90% of the coral assessed in 2022.
• The Florida Coral Reef, the third-largest, experienced significant bleaching last year.

Places in news:

• Burgers ocean: Arnhem, Netherlands.
• Burgers’ Ocean is a tropical coral reef aquarium that holds eight million litres of water.
• It is the largest living coral reef in Europe.

4. Centre accords AEO status to gem and jewellery sector

Subject: Economy

Sec: External Sector

Inclusion of the Gem and Jewellery Sector:

• The Gem & Jewellery Export Promotion Council (GJEPC), the apex body of the sector, announced that the gem and jewellery sector is now included in the AEO program. Previously, this sector was excluded.
• Following proactive efforts and advocacy by the GJEPC with relevant ministries, the Ministry of Finance declared that units within the gem and jewellery industry are eligible to apply for AEO status and enjoy its benefits.
• Asian Star, a diamond and diamond jewellery manufacturer, became the first company in this sector to be granted AEO status in India, following its application along with 19 other companies.
• This extension of AEO status to the gem and jewellery sector is expected to boost the industry by providing faster and more cost-effective export processes.

About the Authorized Economic Operator (AEO) Program:

• The Authorized Economic Operator (AEO) program is part of the World Customs Organisation (WCO) SAFE Framework of Standards aimed at securing and facilitating global trade.
• This program enhances international supply chain security and eases the movement of legitimate goods.
• Entities engaged in international trade can gain AEO status by complying with supply chain security standards, which brings certain benefits.
• Initially introduced as a pilot project in 2011 by the Customs Department, the AEO program has played a significant role in simplifying export operations and reducing costs for exporters across various sectors.

AEO in India:

• The AEO program in India aligns with the commitments under Article 7.7 of the World Trade Organization’s Trade Facilitation Agreement (WTO TFA).
• The program is voluntary and seeks to improve cargo security through collaboration with key players in the international supply chain, including importers, exporters, logistics providers, and others, as noted by the Central Board of Indirect Taxes (CBIC).

World Customs Organisation (WCO):

• Established in 1952 as the Customs Co-operation Council (CCC)
• It is an independent intergovernmental body whose mission is to enhance the effectiveness and efficiency of Customs administrations.
• Today, the WCO represents 186 Customs administrations across the globe that collectively process approximately 98% of world trade.
• As the global centre of Customs expertise, the WCO is the only international organization with competence in Customs matters and can rightly call itself the voice of the international Customs community.
• WCO Secretariat is based in Brussels, Belgium.

WCO SAFE framework of standards:

• In June 2005, the WCO Council adopted the SAFE Framework of Standards to Secure and Facilitate Global Trade (SAFE Framework) aimed at deterring international terrorism, securing revenue collections, and promoting global trade facilitation.
• The Authorized Economic Operators (AEO) Programme, a key Customs-Business partnership initiative, was introduced in 2007 as part of the SAFE Framework.
• The SAFE Framework serves as the global Customs community’s unified response to supply chain security threats while also supporting the facilitation of legitimate and secure businesses.
• The 2021 update of the SAFE Framework includes enhancements such as stronger cooperation between Customs and other government agencies, the promotion of smart security devices for real-time monitoring of goods, and the development of regional Customs union AEO programs and mutual recognition.

Source: TH

5. Minimum Requirements for SFBs Transitioning to Universal Banks

Subject: Economy

Sec: Monetary Policy

The Reserve Bank of India (RBI) has outlined a roadmap for small finance banks (SFBs) voluntarily transitioning to universal banks, setting forth specific criteria for eligibility:

• Financial Criteria:
• Minimum Net Worth: SFBs aspiring to become universal banks must have a net worth of at least ₹1,000 crore, as audited at the end of the previous quarter.
• Profit Track Record: A track record of net profit in the last two financial years is essential.
• NPA Ratio: SFBs should maintain a low non-performing asset (NPA) ratio, with gross and net NPA norms not exceeding 3% and 1%, respectively, in the last two financial years.
• Operational Requirements:
• Stock Exchange Listing: SFBs seeking conversion must be listed on a stock exchange. (Note: North East Small Finance Bank is not listed)
• CRAR Compliance: Compliance with the prescribed Capital to Risk-Weighted Assets Ratio (CRAR) of 15% for SFBs is mandatory.
• Scheduled Status: SFBs should have a satisfactory track record of performance for a minimum of five years.
• Shareholding Pattern:
  • While there is no mandatory requirement for an identified promoter, existing promoters, if any, must continue post-transition to a universal bank.
  • No addition of new promoters or change in promoters is permitted during the transition.
• Lock-In Requirement:
  • Existing promoters are not subject to new mandatory lock-in requirements for minimum shareholding in the transitioned universal bank.
  • The lock-in period of five years for promoters, as per the guidelines, remains unchanged.
• Loan Portfolio Diversification:
  • SFBs with diversified loan portfolios will be preferred for transition.
• Transition Process:
  • Eligible SFBs must furnish a detailed rationale for the transition.
  • Upon transition, the bank will be subject to all norms, including those governing non-operative financial holding company structure, as per guidelines.

Current Status:

• As of now, there are 11 SFBs, including AU, Capital, Equitas, Suryoday, Ujjivan, Utkarsh, ESAF Jana, North East, Shivalik, and Unity.

About Small Finance Banks (SFBs):

Small Finance Banks (SFBs) are specialized banks licensed by the Reserve Bank of India (RBI) to cater to the financial needs of low-income individuals and underserved communities.

Objective: The primary aim of SFBs is to promote financial inclusion by providing access to banking services for segments of the population often excluded from traditional banking channels.

Services Provided: SFBs offer a range of financial products and services tailored to the needs of their target clientele, including microfinance, micro-enterprise services, small loans, savings accounts, insurance, and other basic banking facilities.

Regulatory Framework:

• SFBs are registered as public limited companies under the Companies Act, 2013, and are governed by various banking regulations, including the Banking Regulation Act, 1949, the RBI Act, 1934, and other relevant statutes and directives issued by RBI.
• The RBI introduced guidelines for SFBs in 2014 to regulate their operations and ensure compliance with regulatory standards.

Key RBI Guidelines for SFBs:

1. Scheduled Bank Status: SFBs are granted scheduled bank status after meeting operational criteria and being deemed suitable under section 42 of the RBI Act, 1934.
2. Financial Requirements: SFBs must maintain a minimum Capital to Risk-Weighted Assets Ratio (CRAR) of 15% and extend 75% of their Adjusted Net Bank Credit to Priority Sector Lending.
3. Branch Expansion: They are mandated to open at least 25% of their total branches in unbanked rural areas to promote financial inclusion.
4. Minimum Capital Requirement: The minimum paid-up voting equity capital for SFBs is set at Rs. 200 crore.
5. Microfinance Focus: SFBs are required to allocate at least 50% of their loan portfolio to microfinance and extend advances of up to Rs. 25,00,000.
6. Compliance: SFBs must adhere to various prudential norms and regulations concerning income recognition, asset classification, and provisioning.
7. Technology Adoption: Encouragement is provided for SFBs to leverage technology to enhance operational efficiency and expand their reach to target segments.

6. Tamil Nadu and Kerala to count Nilgiri tahrs in a first synchronised survey from April 29

Subject: Environment

Sec: Species in news

Context:

• Tamil Nadu is set to conduct a population estimation of its State animal, the Nilgiri tahr.
• The Forest Departments of Tamil Nadu and Kerala will collaborate on a three-day synchronised census to count the mountain ungulate.

Methodology:

• The census will employ the bounded count and double observer methods to estimate the Nilgiri tahr population.
• The census will cover key habitats including Eravikulam and Silent Valley National Parks in Kerala, which adjoin the tahr habitats in Tamil Nadu.

Participating Organizations:

• WWF-India, the Wildlife Institute of India, and the Nature Conservation Foundation are involved in developing the scientific techniques used for this population enumeration.
• This census marks a significant, organized effort to gather essential data on the Nilgiri tahr, which will be instrumental in shaping conservation strategies for this species.

About Nilgiri Tahr (Nilgiritragus hylocrius):

• It is the state animal of Tamil Nadu.
• Nilgiri tahrs inhabit montane grasslands with steep, rocky terrains at altitudes between 300 and 2,600 meters above sea level.
• Endemic species of the Western Ghats.
• A 2015 study by WWF-India estimated that there were slightly over 3,100 Nilgiri tahrs in highly fragmented habitats across the Western Ghats, ranging from the Nilgiris in the north to the Kanniyakumari hills in the south.
• The animal is listed as an endangered species by the International Union for Conservation of Nature (IUCN) and protected under Schedule-I of the Wild Life (Protection) Act, 1972.

Source: TH