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  • [pib] Simhadri PV Project: Largest floating Solar Project in the country

    The National Thermal Power Corporation (NTPC) has commissioned the largest floating solar PV project of 25MW on the reservoir of its Simhadri thermal station in Visakhapatnam, Andhra Pradesh.

    Simhadri PV Project

    • The 2000MW coal-based Simhadri Station is the first power project to implement an open sea intake from the Bay of Bengal which has been functional for more than 20 years.
    • This is the first solar project to be set up under the flexibilization scheme of coal-powered plant, notified in 2018.
    • The floating solar installation which has a unique anchoring design is spread over 75 acres in an RW reservoir.
    • This floating solar project has the potential to generate electricity from more than 1 lakh solar PV modules.
    • This would not only help to light around 7,000 households but also ensure at least 46,000 tons of CO2e are kept at arm’s length every year during the lifespan of this project.
    • The project is also expected to save 1,364 million litres of water per annum. This would be adequate to meet the yearly water requirements of 6,700 households.

    Other important facts you must know

    • As of May 2021, India has 95.7 GW of renewable energy capacity, and represents ~ 25% of the overall installed power capacity.
    • The government plans to establish renewable energy capacity of 523 GW (including 73 GW from Hydro) by 2030.
    • India was the world’s 3rd largest renewable energy producer with 38% (136 GW out of 373 GW) of total installed energy capacity in 2020 from renewable sources.
    • Tamil Nadu has the highest installed solar power capacity in India. Kamuthi Solar Power Project near Madurai is the world’s second-largest solar park.

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    Back2Basics: NTPC

    • NTPC is an Indian statutory corporation engaged in the generation of electricity and allied activities.
    • It is incorporated under the Companies Act 1956 and is under the jurisdiction of the Ministry of Power.
    • NTPC’s core function is the generation and distribution of electricity to State Electricity Boards in India.
    • It is the largest power company in India with an electric power generating capacity of 62,086 MW.
    • It has also ventured into oil and gas exploration and coal mining activities.
    • In May 2010, NTPC was conferred Maharatna status by GoI, one of the only four companies to be awarded this status.

  • [pib] Exercise Malabar

    Indian Naval Ships Shivalik and Kadmatt have arrived at Guam, an Island Territory of the USA to participate in the annual Exercise MALABAR-21.

    Also read:

    [Prelims Spotlight] Various Defence Exercises in News

    Ex Malabar

    • MALABAR series of maritime exercises commenced in 1992 as a bilateral IN-USN exercise and has grown in stature over the years to include four prominent navies in the Pacific and Indian Ocean Region.
    • It is carried out between navies of Australia, India, Japan, and the USA
    • The exercise provides an opportunity for common-minded navies to enhance inter-operability, gain from best practices and develop a common understanding of procedures for Maritime Security Operations.

    Significance

    • The exercise will see the participation of all four Quad countries.
    • Indian Navy also conducted a number of Passage Exercises (PASSEX) with navies from Japan, Australia and the US.

    Another Exercise in news: Ex Konkan 2021

    • Exercise Konkan 2021 was held between INS Tabar and HMS Westminster on 16 Aug 21 in the English Channel.

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    Back2Basics: Quad Security Dialogue

    • QSD is a strategic dialogue between the United States, Japan, Australia and India that is maintained by talks between member countries.
    • The dialogue is paralleled by joint military exercises of an unprecedented scale, titled Exercise Malabar.
    • Quad is widely viewed as a response to increased Chinese economic and military power.

  • [pib] HUID System in Jewellery Industry

    Hallmarking scheme is turning out to be a grand success with more than 1 crore pieces of Jewellery hallmarked in a quick time” with more than 90000 Jewelers registered in a same time period.

    What is Hallmark Gold?

    1. The process of certifying the purity and fineness of gold is called hallmarking.
    2. Bureau of Indian Standards, the National Standards Body of India, is responsible for hallmarking gold as well as silver jewellery under the BIS Act.
    3. If you see the BIS hallmark on the gold jewellery/gold coin, it means it conforms to a set of standards laid by the BIS. Hallmarking gives consumers assurance regarding the purity of the gold they bought.
    4. That is, if you are buying hallmarked 18K gold jewellery, it will actually mean that 18/24 parts are gold and the rest is alloy.
    5. At present, only 30% of Indian Gold Jewellery is hallmarked.

    Here are the four components one must look at the time of buying gold (they are mentioned in the laser engraving of a hallmark seal):

    1. BIS Hallmark: Indicates that its purity is verified in one of its licensed laboratories
    2. Purity in carat and fineness (corresponding to given caratage KT)
    • 22K916 (91.6% Purity)
    • 18K750 (75% Purity)
    • 14K585 (58.5% Purity)

    What is HUID?

    • HUID is a unique code that will be given to every piece of jewellery at the time of hallmarking.
    • It will be helpful in identifying the jeweller or the Assaying and Hallmarking Centres (AHCs) which had hallmarked the jewellery.
    • It will be a six-digit alphanumeric code, with which every piece of jewellery will be tagged.
    • At the hallmarking centre, the jewellery is stamped with the unique number manually.

    What are the new hallmarking rules?

    • The government has made it mandatory for jewellers to hallmark gold jewellery, but with some relaxation.
    • Jewellers with an annual turnover of up to Rs 40 lakh will be exempted from mandatory hallmarking.
    • Similarly, jewellery for international exhibitions and government-approved business-to-business domestic exhibitions will also be exempted.
    • It will also allow hallmarking of additional carats — 20, 23, and 24.

    Issues with HUID

    • Jewellers say the HUID process has increased the time required to get the hallmarking on jewels and this has created huge backlogs at AHCs.
    • Since the process is being done manually, there are also chances of a mismatch of the code, he adds.
    • The inventory pile-up at the centres is also raising concerns about the security of the jewellery.
    • Several industry stakeholders point out the limited number of AHCs, which will not be enough to hallmark the large number of pieces that are sold in India every year.

    Answer this PYQ from CSP 2017

    Q.Consider the following statements:

    1. The Standard Mark of the Bureau of Indian Standards (BIS) is mandatory for automotive tyres and tubes.
    2. AGMARK is a quality Certification Mark issued by the Food and Agriculture Organisation (FAO).

    Which of the statements given above is/are correct?

    (a) 1 only

    (b) 2 only

    (c) Both 1 and 2

    (d) Neither 1 nor 2

     

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  • How are Rajya Sabha members punished for misconduct in the House?

    Context

    The Chairman of the Rajya Sabha is reportedly contemplating action against MPs who, he thinks, were involved in the fracas in the House.

    Provisions in House Rules of Rajya Sabha for punishing members

    1) For conduct inside the House

    • Ground for punishment: Rule 256 of the Rajya Sabha’s Rules of Procedure specifies the acts of misconduct: Disregarding the authority of the chair, abusing the rules of the council by persistently and willfully obstructing the business thereof.
    • However, the power to suspend a member is vested in the House, not in the chairman.
    • Under the rule, the maximum period of suspension is for the remainder of the session.
    •  By convention, a suspended member loses his right to get replies to his questions.
    • Thus, suspension from the service of the House is regarded as a serious punishment.
    • But, surprisingly, the rules do not spell out the disabilities of a suspended member.
    • These are imposed on them as per conventions or precedent.
    • Suspension for the remainder of the session makes sense only when they are suspended immediately after the misconduct has been noticed by the chair.
    • The rules of the House do not empower Parliament to inflict any punishment on its members other than suspension for creating disorder in the House.

    2) Misconduct outside the House

    • For the acts of misconduct by the MPs outside the House, which constitute a breach of privilege or contempt of the House, usually the privilege committee investigates the matter and recommends the course of action and the House acts on it.
    • A special committee is appointed usually when the misconduct is so serious that the House may consider expelling the member.
    • Special committee was appointed in 2005 to inquire into the issue of MPs accepting money for raising questions in Parliament.
    • So, special ad-hoc committees are appointed only to investigate serious misconduct by MPs outside the House.

    Issue in the present context

    • It appears that the Rajya Sabha secretariat has prepared a report on the incident in the Rajya Sabhi, which accuses some MPs of assaulting security personnel.
    • But special ad-hoc committees are appointed only to investigate serious misconduct by MPs outside the House.
    • No special committee is required to go into what happens before the eyes of the presiding officer inside the House.
    • As per the rules of the House, they need to be dealt with then and there.
    • The rules do not recognise any punishment other than suspension for a specific period and in this case, the Session is already over.
    • Article 20 of the Constitution prohibits a greater penalty than what the law provided at the time of committing the offence.

    Conclusion

    Punishing the MPs for their misconduct in the House is restricted by the provision in the House rules. These restrictions need to be looked into in the face of growing disruption by the members.

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  • Malabar Rebellion of 1921

    This August 20, marked the centenary of the Malabar rebellion, which is also known as the Moplah riots.

    Try this question from CSP 2020:

    Q. With reference to the history of India, “Ulgulan” or the Great Tumult is the description of which of the following event?

    (a) The Revolt of 1857

    (b) The Mappila Rebellion of 1921

    (c) The Indigo Revolt of 1859-60

    (d) Birsa Munda’s Revolt of 1899-1900

     

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    Malabar Rebellion

    • The Malabar Rebellion in 1921 started as resistance against the British colonial rule and the feudal system in southern Malabar but ended in communal violence between Hindus and Muslims.
    • There were a series of clashes between Mappila peasantry and their landlords, supported by the British, throughout the 19th and early 20th centuries.
    • It began as a reaction against a heavy-handed crackdown on the Khilafat Movement, a campaign in defence of the Ottoman Caliphate by the British authorities in the Eranad and Valluvanad taluks of Malabar.
    • The Mappilas attacked and took control of police stations, British government offices, courts and government treasuries.

    Who was Variyankunna Kunjahammed Haji?

    • He was one of the leaders of the Malabar Rebellion of 1921.
    • He raised 75000 natives, seized control of large territory from the British rule and set up a parallel government.
    • In January 1922, under the guise of a treaty, the British betrayed Haji through his close friend Unyan Musaliyar, arresting him from his hideout and producing him before a British judge.
    • He was sentenced to death along with his compatriots.

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    Also read

    Important Rebellion

  • Is a caste census desirable?

    With the 2021 Census coming up, several political parties have demanded a nationwide caste census.

    What is Caste Census?

    • Every Census in independent India from 1951 to 2011 has published data on Scheduled Castes and Scheduled Tribes, but not on other castes.
    • Before that, every Census until 1931 had data on caste.
    • However, in 1941, caste-based data was collected but not published.
    • In the absence of such a census, there is no proper estimate for the population of OBCs, various groups within the OBCs, and others.
    • The Mandal Commission estimated the OBC population at 52%, some other estimates have been based on National Sample Survey data.
    • Some political parties make their own estimates in states and Lok Sabha and Assembly seats during elections.

    Arguments for caste census

    A caste census is not merely geared to the reservation issue.

    • Enumerating the marginalized: A caste census would actually bring to the particular the number of people who are at the margins, or who are deprived, or the kind of occupations they pursue, or the kind of hold that institutions like caste have on them.
    • Data for Policymaking: This information is absolutely necessary for any democratic policymaking.
    • Judicial backing: The courts in India have often emphatically said that it is important to have adequate data with regard to the reservation.
    • Caste offers privilege: Caste is not only a source of disadvantage; it is also a very important source of privilege and advantage in our society.
    • Caste doesn’t marginalize: We need to do away with the idea of caste being applicable to only disadvantaged people, poor people, people who are somehow lacking.
    • Rids away caste rigidities: Counting of caste doesn’t necessarily perpetuate caste or the caste system. Myths of caste elitisms can be debunked through a caste census.

    Arguments against caste census

    • 50% breach: It is argued that a Socio-Economic Caste Census is the only way to make a case to breach the 50% cap on reservation and rationalize the reservation matrix in the country.
    • Rising assertiveness: More the State ignores out caste, the more is the tendency to preserve caste, protect it. This has been observed in many states.
    • Chaos: Data gathering itself is a big problem because it can become very, very invasive. But we need to actually balance it with enabling people and asserting citizen equality.
    • Social friction: Caste identification can lead to friction amongst various classes.

    Breaching the 50% cap

    • Judicial Substantiation: The 50% cap, as introduced by the court, has not really been argued through.
    • Questioning the sacrosanctity: Some feel that nothing sacrosanct about the 50% limit − it can be exceeded, if necessary, but a clear argument should be given for why this is being done.

    Inefficacy of reservations

    • Fractional benefits: The way reservation is practiced has invariably led to elites among castes and communities.
    • Domination: These elites within the castes have tended to exercise their dominance over their very communities and not let them exercise the kind of freedoms, or search for equality, which any democratic polity deserves.
    • Welfare isn’t reservation: The state has helped privileged communities far more, even though this help has not taken the explicit form of programs like reservation.

    Why is a caste census always controversial?

    • Data manipulation: This is a manifestation of the principle that those in power control data and information.
    • Censoring of data: We have had instances where this data has been collected but has not been made public.
    • Relative deprivation: Since a caste census is a necessity, it is not a happy thing, it is not a great achievement, it is just something that the State has to do circumstantially.
    • Vote bank politics: Vested interests of particular state governments in hunt for vote banks are also visible these days.

    SECC has the solution

    • We have got locked into a mindset where we think only those communities which want welfare benefits from the state must be enumerated.
    • Many have argued that a Socio-Economic Caste Census would be the best way to rationalize reservation based on data and make a strong case for breaching this gap.
    • Earlier governments argued that counting caste will perpetuate it.

    Conclusion

    • Favoring one caste becomes a disfavor for others. This is an undeniable fact of Indian society.
    • It seems that the caste census will happen unless something extraordinary happens in our polity.
    • There are also important questions of demands coming up because of mismatches between the numbers that we come out with and the share in resources that different communities have.
    • This is a kind of nightmare that all governments fear. So, they would much rather leave things vague.
    • The Backward Classes are more than 50% of the population. And this dispensation knows that it cannot afford to lose the support of the Backward Classes.

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  • Sugarcane Pricing in India

    Earlier this month, the Supreme Court issued notices to States and major sugar producers to develop a mechanism to ensure that farmers are paid on time.

    Who determines Sugarcane prices?

    Sugarcane prices are determined by the Centre as well as States.

    1. The Centre announces Fair and Remunerative Prices which are determined on the recommendation of the Commission for Agricultural Costs and Prices (CACP) and are announced by the Cabinet Committee on Economic Affairs, which is chaired by Prime Minister.
    2. The State Advised Prices (SAP) are announced by key sugarcane producing states which are generally higher than FRP.

    Minimum Selling Price (MSP) for Sugar

    • The price of sugar is market-driven & depends on the demand & supply of sugar.
    • However, with a view to protecting the interests of farmers, the concept of MSP of sugar has been introduced since 2018.
    • MSP of sugar has been fixed taking into account the components of Fair & Remunerative Price (FRP) of sugarcane and minimum conversion cost of the most efficient mills.

    Basis of price determination

    • With the amendment of the Sugarcane (Control) Order, 1966, the concept of Statutory Minimum Price (SMP) of sugarcane was replaced with the Fair and Remunerative Price (FRP)’ of sugarcane in 2009-10.
    • The cane price announced by the Central Government is decided on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).
    • This is done in consultation with the State Governments and after taking feedback from associations of the sugar industry.

    Try this PYQ:

    Q.The Fair and Remunerative Price (FRP) of sugarcane is approved by the:

    (a) Cabinet Committee on Economic Affairs

    (b) Commission for Agricultural Costs and Prices

    (c) Directorate of Marketing and Inspection, Ministry of Agriculture

    (d) Agricultural Produce Market Committee

     

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    What is FRP?

    • FRP is fixed under a sugarcane control order, 1966.
    • It is the minimum price that sugar mills are supposed to pay to the farmers.
    • However, states determine their own State Agreed Price (SAP) which is generally higher than the FRP.

    Factors considered for FRP:

    • The amended provisions of the Sugarcane (Control) Order, 1966 provides for fixation of FRP of sugarcane having regard to the following factors:

    a) cost of production of sugarcane;

    b) return to the growers from alternative crops and the general trend of prices of agricultural commodities;

    c) availability of sugar to consumers at a fair price;

    d) price at which sugar produced from sugarcane is sold by sugar producers;

    e) recovery of sugar from sugarcane;

    f) the realization made from the sale of by-products viz. molasses, bagasse, and press mud or their imputed value;

    g) reasonable margins for the growers of sugarcane on account of risk and profits.

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  • Places in news: Cattle Island on Hirakud Reservoir

    The Odisha Forest and Environment Department is all set to begin ‘Island Odyssey’ and ‘Hirakud Cruise’ ecotourism packages for tourists to islands inside the reservoir.

    Cattle Island

    • ‘Cattle island’, one of three islands in the Hirakud reservoir, has been selected as a sight-seeing destination.
    • When large numbers of people were displaced from their villages when the Hirakud dam was constructed on the Mahanadi river in 1950s, villagers could not take their cattle with them.
    • They left their cattle behind in deserted villages.
    • As the area started to submerge following the dam’s construction, the cattle moved up to Bhujapahad, an elevated place in the Telia Panchayat under Lakhanpur block of Jharsuguda district.
    • Subsequently named ‘Cattle island’, it’s surrounded by a vast sheet of water.

    Other islands

    • Then there is an “island of bats”, also within the reservoir, just 1 km away from the Debrigarh ecotourism project.
    • It is the habitat of hundreds of bats.
    • Tourists also get a magnificent view of the sunset from the reservoir. ‘Sunset island’ is one of the three stops on the unique boat ride.

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  • Emergency award

    Context

    The judgment delivered by the Supreme Court in the legal tussle between Amazon and the Future Group has laid the foundation for recognition and enforcement of emergency awards under the Indian arbitration law.

    What is an emergency award?

    • It is an award rendered by an emergency arbitrator, appointed prior to the formal constitution of an arbitral tribunal by an arbitral institution.
    • It is a recent mechanism introduced by arbitral institutions to encourage parties to seek urgent interim relief from an arbitral institution rather than from a court.
    • Many leading arbitral institutions such as SIAC, ICC, and LCIA have provisions for the appointment of an emergency arbitrator.
    • As far as India is concerned, the 246th Law Commission Report had recommended an amendment in the Arbitration and Conciliation Act, 1996 (‘Indian Arbitration Act’) to grant statutory recognition to an emergency award.
    • Some of the indigenous arbitral institutions though, such as the Delhi International Arbitration Centre, have made provisions for emergency arbitration.

    What is the tussle between Amazon and Future Group about?

    • In August 2020, Biyani Group and the Reliance Industries Group decided to amalgamate Future Retail Ltd. (FRL) with Reliance Industries and complete disposal of its retail assets in favor of the Group.
    • However, prior to the said transaction, Amazon had invested an amount of Rs 1,431 crores in Future Coupons Pvt. Ltd. (FCPL) based on rights granted to FCPL with regard to FRL.
    • So, Amazon initiated arbitration against the Biyani Group, including FRL, under Singapore International Arbitration Centre (SIAC) Rules.
    • Amazon made an application seeking urgent interim reliefs under SIAC rules and the appointment of an emergency arbitrator.
    • The emergency arbitrator appointed, made an award in favor of Amazon in October 2020, restricting the Biyani Group from proceeding ahead with the disputed transaction.
    • However, the Biyani Group proceeded with the disputed transaction, construing the emergency award as a nullity.

    Issue of enforcement of the emergency award in India

    • Amazon filed an application before the Delhi High Court for enforcement of the award.
    • The court had the task of answering two novel legal questions —
    • 1) Whether the emergency award is an interim order under section 17(1) of the Indian Arbitration Act,
    • 2) Whether it can be enforced under section 17(2).
    • The Delhi High Court gave judgment in March 2021 against the Biyani Group.
    • The case eventually reached the Supreme Court.
    • Party autonomy: The Supreme Court judgment emphasized party autonomy in arbitration, which includes the right of the parties to choose institutional rules as the governing rules of arbitration.
    • Once chosen, the parties are bound by such rules.
    • The Supreme Court also held that the Indian Arbitration Act does not prohibit the parties from agreeing to a provision providing for an emergency arbitrator.
    • The Supreme Court also held that the term “during the arbitral proceedings” is wide enough to encompass emergency arbitration proceedings.
    • The Court ultimately held the emergency award to be an interim order under section 17(1) of the Indian Arbitration Act and enforceable under section 17(2).

    Significance of the judgment for arbitration in India

    • This judgment has contributed to the development of Indian arbitration law.
    • In the broader scheme of things, it is a victory for Indian arbitration and a sigh of relief for arbitral institutions.

    Conclusion

    The judgment is a reaffirmation of the fact that India is gradually stepping towards being an “arbitration-friendly” jurisdiction.

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  • Getting the perfect haircut from the IBC

    Understanding the role of IBC 2016

    • For reasons sometimes a company may experience stress, that is, is unable to repay the debt in time — implying that it has assets less than claims against it.
    • So, when a company has inadequate assets, the claim of an individual creditor may be consistent with its assets while claims of all creditors put together may not.
    • In such a situation, creditors may rush to recover their claims before others do, triggering a run on the company’s assets.
    • The IBC provides for reorganisation that prevents a value-reducing run on the company.
    • It aims to rescue the company if its business is viable or close it if its business is unviable, through a market process.
    • Restructuring: The claims of creditors are restructured, which may be paid to them immediately or over time.
    •  In case of closure, the assets of the company are sold, and proceeds are distributed to creditors immediately as per the priority rule.
    • Reorganisation by financial creditor: The IBC entrusts the responsibility of reorganisation to financial creditors as they have the capability and the willingness to restructure their claims.

    Why so much variation in haircut?

    • Where the company does not have adequate assets, realisation for financial creditors, through a rescue, may fall short of their claims known as haircut.
    • The IBC process yields a zero haircut (100% recovery of claimed amount) in one case and 100 per cent haircut (i.e. 0% recovery) in another.
    • Factors: It depends on several factors, including the nature of business, business cycles, market sentiments, and marketing effort.
    • It critically depends on at what stage of stress, the company enters the IBC process.
    • If the company has been sick for years, and its assets have depleted significantly, the IBC process may yield a huge haircut or even liquidation.
    • A haircut is typically the total claims minus the amount of realisation/amount of the claims.
    • But this formulation may not tell the complete story.
    • The realisation often does not include the amount that would be realised from equity holding post-resolution, and through the reversal of avoidance transactions and the insolvency resolution of guarantors — personal and corporate.
    • It also does not include realisations made in other accounts.
    • The amount of claim often includes NPA, which may be completely written off, and the interest on such NPA.
    • These understate the numerator and overstate the denominator, projecting a higher haircut.

    Significance of IBC

    • A haircut should be seen in relation to the assets available and not in relation to the claims of creditors.
    • The market offers a value in relation to what a company brings on the table, not what it owes to creditors.
    • Value maximisation: So, the IBC maximises the value of existing assets, not of assets that probably existed earlier.
    • Market determined value: The IBC enables and facilitates market forces to resolve stress as a going concern.
    • Resolution applicants, who have many options for investment, including in stressed companies, compete to offer the best value.
    • If the best value offered by the market is not acceptable to creditors, the company is liquidated.
    • Maximum realisation: In addition to rescuing the company, the IBC realises, of the available options for creditors, the highest in percentage terms.

    Conclusion

    It is a tool in the hands of stakeholders to be used at the right time, in the right case, in the right manner.

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    Back2Basics: Avoidable Transactions in IBC 2016

    • The UNCITRAL Legislative Guide on Law of Insolvency defines avoidance proceedings as “provisions of the insolvency law that permit transactions for the transfer of assets or the undertaking of obligations prior to insolvency proceedings to be cancelled or otherwise rendered ineffective and any assets transferred, or their value, to be recovered in the collective interest of creditors.”
    • It is very important for the Resolution Professional (RP) or the liquidator to identify such transaction and file applications to avoid it so that creditors can collect their claims.
    • The Insolvency and Bankruptcy Code, 2016 (IBC) contains four types of avoidable transactions- preferential, undervalued, defrauding creditors and extortionate transactions.
    • Usually, the avoidable transactions should be made within the prescribed relevant time or look back period.
    • Look back period is the relevant time up to which an RP or a liquidator can go back to scrutinize an expected avoidable transaction.