23^rdJanuary 2019 Daily Current Affairs

SC to take ‘in-chamber’ decision on Article 35A plea

GS PAPER - 02 POLITY - Indian Constitution- historical underpinnings, evolution, features, amendments, significant provisions and basic structure.

Context:

★The Supreme Court on Tuesday said it will be taking an “in-chamber” decision on the listing of petitions challenging the constitutional validity of Article 35-A, which provides special rights and privileges to permanent residents of Jammu and Kashmir.

★The three-judge Bench will decide whether or not to refer the issue to the Constitution Bench.

Article 35 A:

★The heading of Article 35A reads: “saving of laws with respect to permanent residents and their rights”.

★The laws granting special rights to permanent residents would not be deemed a violation of the fundamental rights of other citizens.

Arguments favour of Article 35 A:

★Article 370 (1) (d) empowers the President of India to extend with requisite exceptions and modifications the other provisions of the Indian Constitution to J&K as may be necessary.

★The Delhi Agreement of 1952 followed Article 370. According to the Clause 2 of the agreement, the State Legislature of J&K was given power to make laws for conferring special rights and privileges on the ‘state subjects’.

★Article 35A follows the Instrument of Accession and the guarantee given to the State of J&K that the State’s autonomy will not be disturbed.

★Himachal Pradesh and Uttarakhand and such other states also have laws which say that no outsider can buy land.

Arguments Against :

★The ‘classification’ created by Article 35A has to be tested on the principle of equality as it treats non-permanent residents of J&K as ‘second-class’ citizens.

★Such persons are not eligible for employment under the State government and are also debarred from contesting elections.

★Meritorious students are denied scholarships and they cannot even seek redress in any court of law.

★Further, the issues of refugees who migrated to J&K during Partition are still not treated as ‘State subjects’ under the J&K Constitution.

★It was inserted unconstitutionally, bypassing Article 368 which empowers only Parliament to amend the Constitution.

★The laws enacted in pursuance of Article 35A are ultra vires of the fundamental rights conferred by Part III of the Constitution, especially, and not limited to, Articles 14 (right to equality) and 21 (protection of life).

Source:- The Hindu

Centre’s debt-to-GDP falls, States’ rises

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context:

According to the Status Paper on Government Debt for 2017-18, the Centre’s total debt as a percentage of GDP reduced while State’s debt-to-GDP increased.

Key findings of the Status paper on Government Debt for 2017 - 18:

★Centre’s total debt as a percentage of GDP reduced to 46.5% in 2017-18 from 47.5% as of March 31, 2014.

★Total debt of the States rose to 24% in 2017-18 (increase of 63%), and is estimated to be 24.3% in 2018-19.

★The Central debt has been within control because the government has been trying to stick by-and-large to the fiscal deficit parameters

★The report stated that, Outstanding liabilities of States have increased sharply during 2015-16 and 2016-17, following the issuance of UDAY bonds in these two years, which was reflected in an increase in liability-GDP ratio from 21.7% at end-March 2015 to 23.4% at end-March 2016 and further to 23.8% at end-March 2017.

★Further, ratings agencies have predicted that the combined fiscal deficit of the States to be 3.2% of GDP in financial year 2020

★State governments showed a tendency to hold large cash surpluses/investments in Cash Balance Investment Account on a consistent basis and resorted to market borrowings to finance their GFD (Gross Fiscal Deficit)

N.K. Singh panel recommendation:

★The FRBM Review Committee headed by former Revenue Secretary, NK Singh was appointed by the government to review the implementation of FRBM.

★ In its report submitted in January 2017, titled, ‘The Committee in its Responsible Growth: A Debt and Fiscal Framework for 21st Century India’,

★The Committee suggested that a rule based fiscal policy by limiting government debt, fiscal deficit and revenue deficits to certain targets is good for fiscal consolidation in India.

Recommendations of N.K. Singh Panel:

★Public debt to GDP ratio should be considered as a medium-term anchor for fiscal policy in India.

☆The combined debt-to-GDP ratio of the centre and states should be brought down to 60 per cent by 2023 (comprising of 40 per cent for the Centre and 20% for states) as against the existing 49.4 per cent, and 21per cent respectively.

Fiscal deficit as the operating target:

★The Committee advocated fiscal deficit as the operating target to bring down public debt.

★For fiscal consolidation, the centre should reduce its fiscal deficit from the current 3.5% (2017) to 2.5% by 2023

★Formation of Fiscal Council to advice the government.

☆It recommended setting up an independent Fiscal Council. The Council will provide several advisory functions.

☆It will forecast key macro variables like real and nominal GDP growth, tax buoyancy, commodity prices.

☆Similarly, it will do a monitoring role, besides advising about the use of escape clause and also specify a path of return.

Escape Clause to accommodate counter cyclical issues:

☆The NK Singh Committee points out that there are disadvantages with set fiscal deficit target if some economic instabilities like an external crisis affects the Indian economy.

☆ For example, the government has to spend more during the time of a recession and hence it need not restrict its borrowing to keep the fiscal deficit target.

☆Hence, the committee advocates countercyclical covers in fiscal policy while following the FRBM.

☆Here, the committee recommends fiscal flexibilities to go above or below the fiscal deficit targets in the form of ‘escape clauses’. The Committee set 0.5% as escape clause for fiscal deficit target.

★Buoyancy: What the government has to do with fiscal deficit target when higher economic growth occurs?

☆The Committee also advocates that that the policy responses to sharp changes in output growth should be symmetric (to that of the escape clause).

☆This implies that during higher economic growth, fiscal deficit should be reduced accordingly.

★Fiscal consolidation responsibility for states

☆Now, total state expenditures (as a percent of GSDP) is now even greater than the Centre. Hence, fiscal consolidation should also be made by the states.

☆They should bring down their debt target to 20% of GDP from the current 21%.

Congruence of Fiscal and Monetary Policy:

☆The FRBM Review Commitee observed that both monetary and fiscal policies must ensure growth and macroeconomic stability in a complementary mannger. For this, the Inflation Targeting (IT) regime and Fiscal Rules (FRs) have to interact with each other.

Source:- The Hindu

India among those where trust in govt is high: Report

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context:

According to the 2019 Edelman Trust Barometer report, India is among the most trusted nations globally when it comes to government, business, non-governmental organisations (NGOs) and media.

Key findings:

★China topped the Trust Index among both the informed public and the general population segments, with scores of 79 and 88 respectively.

★India was at the second place in the informed public category and third place in the general population category.

★Trust in government in India rose four points to 74, and was ranked fourth behind Indonesia, UAE and China.

★Trust in media among India population remained low, despite an increase by three points to 63

★In terms of trust in companies headquartered in each market, the most trusted are those from Switzerland, Germany and Canada.

★Companies headquartered in India, Mexico and Brazil are the least trusted, followed by China and South Korea

Source:- Economic Times

Cabinet nod for setting up National Appellate Tribunal for GST

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context:

★Cabinet on January 23 approved the National Bench of the Goods and Services Tax Appellate Tribunal (GSTAT).

★The tribunal has been set up as prescribed by the Central GST Act 2017.

Goods and Services Tax Appellate Tribunal (GSTAT):

★The Goods and Services Tax Appellate Tribunal for hearing appeals against the orders passed by the Appellate Authority or the Revisional Authority.

★GSTAT is the forum of second appeal in GST laws and the first common forum of dispute resolution between the Centre and States.

★Appeal against the orders given in the first appeals issued by the Appellate Authorities under the Central and State, Goods and Services Tax Act, is filed before the GST Appellate Tribunal which is one under Central and State GST Acts.

★All the disputes related to GST will be uniformly resolved in the settlement of disputes with one place being settled and thus GST will be implemented equally throughout the country.

Composition:

★GSTAT shall be presided over by the president.

★It also consist of one technical member from both state and centre each.

Constitutional Provisions:

★Appellate and review mechanism has been arranged for dispute resolution under GST administration in Chapter XVIII of the Item and Service Tax Act.

★Section 109 of the Central Goods and Services Tax Act provides power to the Central Government on the recommendation of the Council, making the order effective in the recommendation by the date specified in the recommendation, and the order passed in the form of commodity and service tax appeal. Will hear the appeals against.

Source:- Hindu Business Line

Bal Sabha

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation

Context:

A new initiative launched by the government in Rajasthan for identifying and resolving issues in upper primary schools situated in the rural areas.

Bala sabha:

★“Bal Sabha” (Children’s Assembly) is set to bring about qualitative changes in education.

★Besides students, the Sabhas will be attended by parents, teachers and village elders.

★The schoolchildren spoke about the problems faced by them in school.

Source:- The Hindu

Southern Railway goes full steam ahead, tops train cleanliness survey

GS PAPER - 03 ECONOMY - Infrastructure: Energy, Ports, Roads, Airports, Railways etc.

Context:

★National transporter Indian Railways conducted Train Cleanliness Survey.

★The survey covered 210 trains and feedback of more than 15,000 passengers was recorded.

The winners are:-

★Premium Category Trains - North Western Railway (NWR), which topped the zonal rankings

★Other than Premium’ category’ trains - Southern Railway.

★The survey’s stated aim was to assess the progress of the ‘Swachh Rail-Swachh Bharat’ mission and promote healthy competition among trains.

Source:- The Hindu

India stares at water scarcity [ Editorial / Opinion ]

GS PAPER - 03 ENVIRONMENT - Conservation, environmental pollution and degradation, environmental impact assessment

Context:

★India faces an acute shortage of safe and sustainable water.

★India is facing a low rainfall year. The rains’ let down this time comes on top of an already low-rain and, in many places, no-rain ground situation.

★The next nearest rains are six months away and there is no guarantee that June will see the onset of a normal monsoon.

★According to the experts, tackling drought must be the immediate priority for administrators across the country.

Rain Deficit facts:

★the actual deficit last monsoon (2018) was modest — barely 10%.

★However, the post-monsoon rainfall (October to December, 2018) or PMR as it is called by meteorologists has registered a 44% deficit.

★This national average deficit conceals shortages in some regions where it is much higher.

★ In Marathwada, according to the IMD, the deficit is 84%, in Vidarbha, 88%.

Concerns:

★Experts have pointed out that years of policy-driven, corporate-driven water transfers from rural to urban, agriculture to industry, poor to rich and so on have made our country-side chronically water-scarce.

★Certain critics opine that urban India does not realise this well enough.

Way forward:

★Appointing a commission like the Farmers’ Commission: The next Prime Minister should appoint a commission like the Farmers’ Commission, which Dr. M.S. Swaminathan headed, to advise him or her on how water scarce India needs to face drought.

★The Commission must be given just one month to complete its study and make its recommendations.

★Penalties should be incorporated rather than making mere advisories or appeals to the defaulters.

★Addressing the deepening drought, agrarian distress and water-management are the most critical issues that India faces today.

Source:- The Hindu

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23rd January 2019 Daily Current Affairs

SC to take ‘in-chamber’ decision on Article 35A plea

GS PAPER - 02 POLITY - Indian Constitution- historical underpinnings, evolution, features, amendments, significant provisions and basic structure.

Context:

★The Supreme Court on Tuesday said it will be taking an “in-chamber” decision on the listing of petitions challenging the constitutional validity of Article 35-A, which provides special rights and privileges to permanent residents of Jammu and Kashmir.

★The three-judge Bench will decide whether or not to refer the issue to the Constitution Bench.

Article 35 A:

★The heading of Article 35A reads: “saving of laws with respect to permanent residents and their rights”.

★The laws granting special rights to permanent residents would not be deemed a violation of the fundamental rights of other citizens.

Arguments favour of Article 35 A:

★Article 370 (1) (d) empowers the President of India to extend with requisite exceptions and modifications the other provisions of the Indian Constitution to J&K as may be necessary.

★The Delhi Agreement of 1952 followed Article 370. According to the Clause 2 of the agreement, the State Legislature of J&K was given power to make laws for conferring special rights and privileges on the ‘state subjects’.

★Article 35A follows the Instrument of Accession and the guarantee given to the State of J&K that the State’s autonomy will not be disturbed.

★Himachal Pradesh and Uttarakhand and such other states also have laws which say that no outsider can buy land.

Arguments Against :

★The ‘classification’ created by Article 35A has to be tested on the principle of equality as it treats non-permanent residents of J&K as ‘second-class’ citizens.

★Such persons are not eligible for employment under the State government and are also debarred from contesting elections.

★Meritorious students are denied scholarships and they cannot even seek redress in any court of law.

★Further, the issues of refugees who migrated to J&K during Partition are still not treated as ‘State subjects’ under the J&K Constitution.

★It was inserted unconstitutionally, bypassing Article 368 which empowers only Parliament to amend the Constitution.

★The laws enacted in pursuance of Article 35A are ultra vires of the fundamental rights conferred by Part III of the Constitution, especially, and not limited to, Articles 14 (right to equality) and 21 (protection of life).

Source:- The Hindu

According to the Status Paper on Government Debt for 2017-18, the Centre’s total debt as a percentage of GDP reduced while State’s debt-to-GDP increased.

Key findings of the Status paper on Government Debt for 2017 - 18:

★Centre’s total debt as a percentage of GDP reduced to 46.5% in 2017-18 from 47.5% as of March 31, 2014.

★Total debt of the States rose to 24% in 2017-18 (increase of 63%), and is estimated to be 24.3% in 2018-19.

★The Central debt has been within control because the government has been trying to stick by-and-large to the fiscal deficit parameters

★Further, ratings agencies have predicted that the combined fiscal deficit of the States to be 3.2% of GDP in financial year 2020

★State governments showed a tendency to hold large cash surpluses/investments in Cash Balance Investment Account on a consistent basis and resorted to market borrowings to finance their GFD (Gross Fiscal Deficit)

N.K. Singh panel recommendation:

★The FRBM Review Committee headed by former Revenue Secretary, NK Singh was appointed by the government to review the implementation of FRBM.

★ In its report submitted in January 2017, titled, ‘The Committee in its Responsible Growth: A Debt and Fiscal Framework for 21st Century India’,

★The Committee suggested that a rule based fiscal policy by limiting government debt, fiscal deficit and revenue deficits to certain targets is good for fiscal consolidation in India.

Recommendations of N.K. Singh Panel:

★Public debt to GDP ratio should be considered as a medium-term anchor for fiscal policy in India.

☆The combined debt-to-GDP ratio of the centre and states should be brought down to 60 per cent by 2023 (comprising of 40 per cent for the Centre and 20% for states) as against the existing 49.4 per cent, and 21per cent respectively.

Fiscal deficit as the operating target:

★The Committee advocated fiscal deficit as the operating target to bring down public debt.

★For fiscal consolidation, the centre should reduce its fiscal deficit from the current 3.5% (2017) to 2.5% by 2023

★Formation of Fiscal Council to advice the government.

☆It recommended setting up an independent Fiscal Council. The Council will provide several advisory functions.

☆It will forecast key macro variables like real and nominal GDP growth, tax buoyancy, commodity prices.

☆Similarly, it will do a monitoring role, besides advising about the use of escape clause and also specify a path of return.

Escape Clause to accommodate counter cyclical issues:

☆The NK Singh Committee points out that there are disadvantages with set fiscal deficit target if some economic instabilities like an external crisis affects the Indian economy.

☆ For example, the government has to spend more during the time of a recession and hence it need not restrict its borrowing to keep the fiscal deficit target.

☆Hence, the committee advocates countercyclical covers in fiscal policy while following the FRBM.

☆Here, the committee recommends fiscal flexibilities to go above or below the fiscal deficit targets in the form of ‘escape clauses’. The Committee set 0.5% as escape clause for fiscal deficit target.

★Buoyancy: What the government has to do with fiscal deficit target when higher economic growth occurs?

☆The Committee also advocates that that the policy responses to sharp changes in output growth should be symmetric (to that of the escape clause).

☆This implies that during higher economic growth, fiscal deficit should be reduced accordingly.

★Fiscal consolidation responsibility for states

☆Now, total state expenditures (as a percent of GSDP) is now even greater than the Centre. Hence, fiscal consolidation should also be made by the states.

☆They should bring down their debt target to 20% of GDP from the current 21%.

Congruence of Fiscal and Monetary Policy:

☆The FRBM Review Commitee observed that both monetary and fiscal policies must ensure growth and macroeconomic stability in a complementary mannger. For this, the Inflation Targeting (IT) regime and Fiscal Rules (FRs) have to interact with each other.

Source:- The Hindu

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context:

According to the 2019 Edelman Trust Barometer report, India is among the most trusted nations globally when it comes to government, business, non-governmental organisations (NGOs) and media.

Key findings:

★China topped the Trust Index among both the informed public and the general population segments, with scores of 79 and 88 respectively.

★India was at the second place in the informed public category and third place in the general population category.

★Trust in government in India rose four points to 74, and was ranked fourth behind Indonesia, UAE and China.

★Trust in media among India population remained low, despite an increase by three points to 63

★In terms of trust in companies headquartered in each market, the most trusted are those from Switzerland, Germany and Canada.

★Companies headquartered in India, Mexico and Brazil are the least trusted, followed by China and South Korea

Source:- Economic Times

GS PAPER - 02 GOVERNANCE - Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context:

★Cabinet on January 23 approved the National Bench of the Goods and Services Tax Appellate Tribunal (GSTAT).

★The tribunal has been set up as prescribed by the Central GST Act 2017.

Goods and Services Tax Appellate Tribunal (GSTAT):

★The Goods and Services Tax Appellate Tribunal for hearing appeals against the orders passed by the Appellate Authority or the Revisional Authority.

★GSTAT is the forum of second appeal in GST laws and the first common forum of dispute resolution between the Centre and States.

★Appeal against the orders given in the first appeals issued by the Appellate Authorities under the Central and State, Goods and Services Tax Act, is filed before the GST Appellate Tribunal which is one under Central and State GST Acts.

★All the disputes related to GST will be uniformly resolved in the settlement of disputes with one place being settled and thus GST will be implemented equally throughout the country.

Composition:

★GSTAT shall be presided over by the president.

★It also consist of one technical member from both state and centre each.

23^rdJanuary 2019 Daily Current Affairs