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Distribution: weekly

  • Making a Law ‘Operational’

    In the ongoing stalemate between protesting farmers and the Centre, the government has repeated its offer of keeping the three contentious farm laws on hold for one to one-and-a-half years.

    Bringing/removing a law

    • Parliament has the power to make a law and to remove it from the statute books (a law can be struck down by the judiciary if it is unconstitutional).
    • But the passing of a Bill does not mean that it will start working from the next day.
    • There are three more steps for it to become a functioning law.

    Try this PYQ:

    Q.Who/Which of the following is the custodian of the Constitution of India?

    (a) The President of India

    (b) The Prime Minister of India

    (c) The Lok Sabha Secretariat

    (d) The Supreme Court of India

    Making a law operational

    • The first step is the President giving his or her assent to the Bill.
    • Then the law comes into effect from a particular date. President Kovind signed the three farm Bills into law within a week of their passing in September 2020.
    • And finally, the government frames the rules and regulations to make the law operational on the ground.
    • The completion of these steps determines when the law becomes functional.

    Presidents’ actions

    • Article 111 of the Constitution specifies that the President can either sign off on the Bill or withhold his consent.
    • The President rarely withholds their assent to a Bill.
    • The last time it happened was in 2006 when President APJ Abdul Kalam refused to sign a Bill protecting MPs from disqualification for holding an office of profit.
    • A Bill is sent to Parliament for reconsideration if the President withholds his or her assent on it.
    • And if Parliament sends it back to the President, he or he has no choice but to approve it.

    A curious case of date of effect

    • The next step is deciding the date on which the law comes into effect.
    • In many cases, Parliament delegates to the government the power to determine this date.
    • The Bill states that the law “shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act”.

    Example:  Parliament passed the Recycling of Ships Act in December 2019. In October 2020, the government brought Section 3 of the law into force.  This section empowers the government to designate an officer to supervise all ship recycling activities in India.

    Giving effect to the implementation

    • There are also instances when the government does not bring a law into force for many years.
    • Two examples are the National Environment Tribunal Act and the Delhi Rent Control Act, which Parliament passed during PM P V Narasimha Rao’s tenure.
    • The government never brought these laws into force, which were passed in 1995 and cleared by the President.
    • The NGT Act finally repealed the environmental tribunal law in 2010. And a Bill to repeal the Delhi Rent Control Act introduced in 2013 is still pending in Rajya Sabha

    Rules & regulations to be made

    • For the law to start working on the ground, individuals need to be recruited or given the power, to administer it.
    • The implementing ministry also needs to finalise forms to gather information and provide benefits or services.
    • These day-to-day operational details are called rules and regulations. And Parliament gives the government the responsibility of making them. These regulations are critical for the functioning of law.
    • If the government does not make rules and regulations, law or parts of it will not get implemented.

    Example: The Benami Transactions Act of 1988 is an example of a complete law remaining unimplemented. For 25 years, such properties were immune from seizure in the absence of framing relevant government rules. The law was finally repealed in 2016 and replaced with a new one.

    A final word on implementation

    • Parliament has recommended that the government make rules within six months of passing a law.
    • But parliamentary committees have observed that this recommendation is being followed in breach by various ministries.
    • The government not only has the power to make rules but can also suppress rules made by it earlier.

  • [pib] Shramshakti Portal

    The Union Minister of Tribal Affairs has launched the “ShramShakti” Portal.

    Earlier we had ONORC move, now a repository for migrant workers. Keep a tab on all such updates for the welfare of migrant workers.

    Shramshakti Portal

    • It is a National Migration Support Portal.
    • It will record various data including demographic profile, livelihood options, skill mapping, and migration pattern.
    • It would effectively help in the smooth formulation of state and national level programs for migrant workers.

    Why need such a portal?

    • Migrants all over the country had to face after the lockdown was announced due to the pandemic caused by a coronavirus.
    • The migration of the tribal population is distress-driven and the migrants are exposed to difficult and unsafe conditions.
    • Sometimes they face trafficking or wage harassment issues including many occupational hazards at the workplace.
    • The lack of real-time data of migrants was the biggest challenge for governments in formulating effective strategies and policy decisions for the welfare of migrant workers at both source and destination states.

    Benefits of the portal

    • The tribal migration repository would be able to successfully address the data gap and empower migrant workers who generally migrate in search of employment and income generation.
    • It would also help the government for linking the migrant population with the existing Welfare Scheme- under Aatmanirbhar Bharat.

    A move for tribals

    • Tribal migrant workers often have low awareness about their rights and entitlements and ways to access services and social security in source and destination areas.
    • With this, they will be able to demand and access services, rights, and entitlements related to livelihood and social security at their village before migration, as well after migration at destination towns and cities.

  • China builds a new village in Arunachal Pradesh

    Satellite images show that China has constructed a new village in Arunachal Pradesh, around 4.5 kilometres inside of the de facto border on the Indian side.

    Indian and Chinese soldiers have confronted each other in their deadliest clash in decades in Ladakh last year and the earlier one in Doklam. Now another front has been opened up by China in Arunachal.

    This year could face another ugliest standoffs and skirmishes.

    Location of the village

    • The village, located on the banks of the River Tsari Chu, lies in the Upper Subansiri district.
    • It is an area that has been long disputed by India and China and has been marked by armed conflict.
    • Sources in the defense ministry have said that Beijing has, for years, maintained an army post on this territory, and the various constructions by the Chinese have not happened suddenly.

    Background of the story

    • China’s June 1959 operation known as the Longju incident reportedly accused Indian troops of occupying some places in Tibet and colluding with Tibetan rebels.
    • In August same year, the PLA clashed with the Indian personnel of the 9 Assam Rifles.
    • Two Indian soldiers were killed in action and the issue was finally resolved through diplomatic channels. Both sides withdrew from the area on August 20, 1960.
    • And the Assam Rifles then did not re-occupy the post.
    • In the late 1990s however, China established a company level post 3 kilometers inside the Indian Territory. Since then, the area remains contested to this day.

    India and Arunachal

    • Arunachal Pradesh (called South Tibet in China) is a full-fledged state of India.
    • India’s sovereignty over the area is internationally recognized and its residents have not shown any inclination to leave India.
    • The majority of the international maps acknowledge the area to be an Indian Territory.
    • China has some (pre-) historical claims through its ownership of Tibet, but the people and geography primarily favor India.

    Back2Basics: Chinese claim over Arunachal Pradesh

    • When the new Peoples Republic of China was formed in February 1912 after the abdication of the Qing emperor, the Tibetans asserted their independence.
    • They forced the Chinese troops based in Lhasa to return to the mainland-via India. A year later, Tibet declared independence from China.
    • In order to ensure that the unrest did not spread to India and assert their boundaries, the ruling British convened a tripartite meeting at Shimla with Tibetan and Chinese delegates to define the border.
    • The meeting gave China suzerainty over most of Tibet, and the boundary defined in this treaty was later known as the McMohan line.

    Chinese reluctance

    • The essential dispute is over China’s refusal to acknowledge the McMohan Line as the border between the two nations, and staking claim to large tracts of land as a contiguous part of Tibet.
    • However, it laid claim to the entire state of Arunachal Pradesh.
    • In the 16th century, the most important heritage of the state – Tawang Monastery was built. This is one of the most important sites for Tibetan Buddhists.
    • China never recognized Tibet’s independence nor the 1914 Simla convention.
    • In 1950 China completely took over Tibet. Thus, according to their version, the Tawang region belongs to them.
    • It especially wants to hold on to the monastery as that is a leading center of Tibetan Buddhism in India.

  • What is Nitrogen-Use Efficiency (NUE)?

    A group of Indian scientists have found a way to improve crops by reducing wastage of nitrogen fertilizers applied to them.

    Try this PYQ:

    Q.Which of the following adds/add nitrogen to the soil?

    1. Excretion of Urea by animals
    2. Burning of coal by man
    3. Death of vegetation

    Select the correct answer using the code given below:

    (a) 1 only

    (b) 2 and 3 only

    (c) 1 and 3 only

    (d) 1, 2, and 3

    Nitrogen-Use Efficiency

    • NUE is calculated as a ratio between nitrogen used and harvest: A higher number denotes low wastage.
    • With the efficiency on the decline, farmers use more fertiliser in the hope of raising yield. This in turn worsens NUE.
    • Crops generally use up 30 per cent of nitrogen fertilizer applied; the rest seeps into the environment, harming health and adding to climate change.
    • Researchers were able to identify phenotypes or visibly identifiable features that determine the efficiency with which cultivated rice varieties (cultivars) use nitrogen.
    • This efficiency is known as nitrogen-use efficiency (NUE).
    • Cereals consume over 69 per cent of nitrogen fertilizers in India; rice tops the list with 37 per cent, followed by wheat (24 per cent).

    Nitrogen Pollution: the reason behind

    • Agriculture leads to 70 per cent of nitrous oxide emissions in India.
    • Of this, 77 per cent is contributed by fertilizers, mostly urea, according to the Indian Nitrogen Assessment published in 2017.
    • This greenhouse gas (GHG) is 300 times more potent than carbon dioxide.
    • It has replaced methane as the second-largest component of GHG emissions from Indian agriculture in the past 15 years.

    Must read:

    [Burning Issue] Nitrogen Pollution in India

  • [pib] Exercise Kavach

    A large scale all-services exercise ‘Exercise Kavach’ will be conducted next week under the aegis of the Andaman and Nicobar Command (ANC), the only Joint Forces Command of the country.

    All-time generic question seeking ‘match the pairs’ can be asked from the news as such.  Click here for more exercises.

    Exercise Kavach

    • The tri-services exercise aims to fine-tune joint war-fighting capabilities and SOPs towards enhancing operational synergy in the Andaman Sea and Bay of Bengal.
    • This exercise would involve assets of Indian Army, Indian Navy, Indian Air Force and Indian Coast Guard.
    • The exercise involves synergized application of maritime surveillance assets, coordinated air and maritime strikes, air defence, submarine and landing operations.
    • Concurrently Joint Intelligence Surveillance and Reconnaissance (ISR) exercise involving various technical, electronic and human intelligence from three services will be conducted.
    • The ISR exercise will validate the capabilities of intelligence gathering from space, air, land and sea-based assets/ sensors, its analysis and sharing to achieve battlefield transparency.
    • It would carry out amphibious landing operations, air landed operation, helicopters-borne insertion of Special Forces from sea culminating in tactical follow-on operations on land.

  • True empowerment of the electricity consumer

    The article examines the various provisions of the Electricity (Rights of Consumers) Rules, 2020 and analyses whether or not these Rules will empower the consumers. 

    Empowering electricity consumers

    • The Electricity (Rights of Consumers) Rules, 2020 was promulgated in December to deal with the problems faced by the consumers.
    • The enactment of consumer-centric rules does spark public debate that brings the rights of consumers to the fore.
    • the Rules lay an emphasis on national minimum standards for the performance parameters of DISCOMs. without urban-rural distinction.
    • They also reiterate the need for automatically compensating consumers.

    Let’s analyse the changes introduced by the new Rule and issues with them

    Supply quality issue

    • Many States have not been able to provide quality supply, especially to rural and small electricity consumers.
    • Provisions similar to made in the new Rule already exist in the Standards of Performance (SoP) regulations of various State Electricity Regulatory Commissions (SERCs).
    • It is not because of a lack of rules or regulations that quality supply is not provided; rather, it is on account of a lack of accountability systems to enforce them.
    • Unfortunately, neither these rules nor past efforts address these accountability concerns.
    • Guarantee of round the clock supply is a provision that the Rules emphasise, which might be missing in State regulations.
    • It is difficult to enforce since the availability of power supply is inadequately monitored even at 11 kV feeders, let alone at the consumer location.
    • This highlights not only the need for implementation of existing provisions in letter and spirit but also amending them with strong accountability provisions.

    Weakening of existing provision

    • The Rules, in few cases, dilute progressive mechanisms that exist in State regulations.
    • For example, the Rules say that faulty meters should be tested within 30 days of receipt of a complaint.
    • Compared to this, regulations t in Andhra Pradesh, Bihar, and Madhya Pradesh, respectively, say that such testing needs to be conducted within seven days.
    • A similar observation can be drawn from the suggested composition of the Consumer Grievance Redressal Forum. 
    •  The Rules say that the forum — constituted to remedy complaints against DISCOMs should be headed by a senior officer of the company.
    • This is a regressive provision that would reduce the number of cases that are decided in favour of consumers.

    Lack of clarity on net-metering

    • The Rules guarantee net metering for a solar rooftop unit less than 10 kW.
    • However, there is no clarity if those above 10 kW can also avail net metering.
    • This could lead to a change in regulations in many States based on their own interpretations.
    •  The possible litigation that follows would be detrimental to investments in rooftop solar units, and would discourage medium and large consumers to opt for an environment-friendly, cost-effective option.

    Way forward

    • SERCs should assess the SoP reports of DISCOMs and revise their regulations more frequently.
    • SERCs should organise public processes to help consumers raise their concerns.
    • DISCOMs could be directed to ensure automatic metering at least at the 11 kV feeder level, making this data available online.
    • The Forum of Regulators — a central collective of SERCs — could come up with updated model SoP regulations.
    • Central agencies have taken proactive efforts to ensure regular tariff revision.
    • They could also support independent surveys and nudge State agencies to enforce existing SoP regulations.
    • The central government could disburse funds for financial assistance programmes based on audited SoP reports.

    Consider the question”What are the problems faced by the electricity consumers in India? Will the Electricity (Rights of Consumers) Rules, 2020 help consumers to deal with the existing issues?”

    Conclusion

    The governments, DISCOMs and regulators need to work jointly and demonstrate the commitment and the will power to implement existing regulations. It is not yet late to recognise this and initiate concerted efforts to truly empower consumers.

  • What is Section 32A of IBC?

    The Supreme Court has held that the bidders for a corporate debtor under the Insolvency and Bankruptcy Code (IBC) would be immune from any investigations being conducted either by any investigating agencies.

    Q.Examine the impact of various amendments to the Insolvency and Bankruptcy Code (IBC) and suggest further improvements in the IBC.

    Backgrounder: IBC

    • IBC was enacted on May 28, 2016, to effectively deal with insolvency and bankruptcy of corporate persons, partnership firms and individuals, in a time-bound manner.
    • It has brought about a paradigm shift in laws aimed to maximize the value of assets, providing a robust insolvency resolution framework and differentiating between impropriety and business debacle.
    • The predominant object of the Code is the resolution of the Corporate Debtor.
    • It has been amended four times to resolve problems hindering the objectives of the Code.

    What is Section 32A?

    • In cases involving property of a corporate debtor, Section 32A covers any action involving attachment, seizure, retention, or confiscation of the property of the corporate debtor as a result of such Proceedings.
    • It provides immunity to the corporate debtor and its property when there is the approval of the resolution plan resulting in the change of management of control of the corporate debtor.
    • This is subject to the successful resolution applicant being not involved in the commission of the offense.

    What were the challenges?

    • Since the IBC came into being in 2016, the implementation of the resolution plan of several big cases has been delayed because of various challenges mounted by its own agencies and regulators.
    • For example, a debt-laden company, admitted into insolvency in 2017, owes more than Rs 47,000 crore to banks and other financial institutions.
    • After a prolonged bidding battle, another won the rights to take over it with a bid of Rs 19,700 crore.
    • However, before it could move to take over, the ED/SEBI swooped in, and attached assets worth Rs 4,000 crore citing alleged fraud in a bank loan under the Prevention of Money Laundering Act (PMLA).

    Observations made by the SC

    • In its judgment, the apex court upheld the validity of Section 32.
    • It said it was important for the IBC to attract bidders who would offer reasonable and fair value for the corporate debtor to ensure the timely completion of the corporate insolvency resolution process (CIRP).
    • Such bidders, however, must also be granted protection from any misdeeds of the past since they had nothing to do with it.
    • Such protection, the court said, must also extend to the assets of a corporate debtor which will help banks clean up their books of bad loans.
    • The apex court has, however, also said that such immunity would be applicable only if there are an approved resolution plan and a change in the management control of the corporate debtor.

    Significance of SC’s intervention

    • With the Supreme Court upholding the validity of Section 32 A will give confidence to other bidders to proceed with confidence while bidding on such disputed companies and their assets.

    Must read

    [Burning Issue] Insolvency and Bankruptcy Code

  • Ratle Hydroelectric Project

    The Centre has decided to go ahead with the long-pending 850-megawatt Ratle hydroelectric power project on the river Chenab in J&K Kishtwar district, despite objections raised by the Pakistan government over the same.

    Tap to read more about Indus River System

    Ratle Hydel Plant

    • It is a run-of-the-river hydroelectric power station currently under construction on the Chenab River, downstream of the village near Drabshalla in Kishtwar district of the Indian UT of Jammu and Kashmir.
    • The project includes a 133 m (436 ft) tall gravity dam and two power stations adjacent to one another.
    • The installed capacity of both power stations will be 850 MW.
    • In June 2013, then PM Manmohan Singh laid the foundation stone for the dam.
    • Pakistan has frequently alleged that it violates the Indus Water Treaty.

    What is the Indus Water Treaty?

    • The Indus Waters Treaty is a water-distribution treaty between India and Pakistan, brokered by the World Bank signed in Karachi in 1960.
    • According to this agreement, control over the water flowing in three “eastern” rivers of India — the Beas, the Ravi, and the Sutlej was given to India.
    • The control over the water flowing in three “western” rivers of India — the Indus, the Chenab, and the Jhelum was given to Pakistan
    • The treaty allowed India to use western rivers water for limited irrigation use and unrestricted use for power generation, domestic, industrial, and non-consumptive uses such as navigation, floating of property, fish culture, etc. while laying down precise regulations for India to build projects
    • India has also been given the right to generate hydroelectricity through the run of the river (RoR) projects on the Western Rivers which, subject to specific criteria for design and operation is unrestricted.

  • Secured Overnight Financing Rate (SOFR)

    State Bank of India (SBI) has executed two inter-bank short term money market deals with pricing linked to SOFR (Secured Overnight Financing Rate).

    Try this PYQ:

    Q.The money multiplier in an economy increases with which one of the following?

    (a) Increase in the cash reserve ratio

    (b) Increase in the banking habit of the population

    (c) Increase in the statutory liquidity ratio

    (d) Increase in the population of the country

    What is SOFR?

    • Secured Overnight Financing Rate (SOFR) is a secured interbank overnight interest rate.
    • It is a replacement for USD LIBOR (London Inter-bank Offered Rate) that may be phased out end-2021.
    • The overnight rate is generally the interest rate that large banks use to borrow and lend from one another in the overnight market.

    Why SOFR?

    • Global regulators decided to move away from the Libor, a vital part of the financial system after it was revealed in 2012 that banks around the world manipulated it.
    • It also didn’t help that volume underlying the benchmark dried up.
    • U.K regulators set the deadline at 2021 for financial firms and investors to transition away from the Libor.

  • Impact of RERA on real estate sector

    The article highlights the various provision of RERA and its overall impact on the sector.

    How it changed the real estate sector

    • Real Estate (Regulation and Development) Act (RERA) was enacted in 2016 and it had been in the works for more than a decade.
    • RERA has infused governance in a hitherto unregulated sector.
    • Along with demonetization and GST, it has, to a large extent, cleansed the real estate sector of black money.
    • It has transformational provisions, conscientiously addressing issues that have been a constant bane for the sector.

    Important provisions of RERA

    • The Act stipulates that no project can be sold without project plans being approved by the competent authority and the project is registered with the regulatory authority.
    • This provision ended the practice of selling on the basis of deceitful advertisements.
    • Promoters are required to maintain “project-based separate bank accounts” to prevent fund diversion.
    • The mandatory disclosure of unit sizes based on “carpet area” strikes at the root of unfair trade practices.
    • The provision for payment of “equal rate of interest” by the promoter or the buyer in case of default reinforces equity.
    • These and many other provisions have empowered consumers, rectifying the power asymmetry prevalent in the sector.

    How RERA is an effort in cooperative federalism

    • Though the Act has been piloted by the Central government, the rules are to be notified by state governments.
    • The regulatory authorities and the appellate tribunals are also to be appointed by them.
    • The regulatory authorities are required to manage the day-to-day operations, resolve disputes, and run an active and informative website for project information.
    • Since RERA came into full force, 34 states and Union territories have notified the rules, 30 states and Union territories have set up real estate regulatory authorities and 26 have set up appellate tribunals.
    • The operationalization of a web-portal for project information, which is at the heart of ensuring full project transparency, has been operationalized by 26 regulatory authorities.
    • Around 60,000 projects and 45,723 real estate agents have been registered with regulatory authorities.
    • Twenty-two independent judicial officers have been appointed to redress consumer disputes, and 59,649 complaints have been disposed-off.

    Consider the question “What were the various problems faced by the consumers in real estate sector? How various provisions in RERA helped in the protection of consumers’ interests?” 

    Conclusion

    RERA is to the real estate sector what SEBI is to the securities market. It helped consumers from the various malpractices in the real estate sector.