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October 2019

Banking Sector Reforms

[oped of the day] The current crisis at PMC Bank serves the country a warning


From UPSC perspective, the following things are important :

Prelims level : Nothing much

Mains level : Cooperative banks; PMC issue

Op-ed of the day is the most important editorial of the day. This will cover a key issue that came in the news and for which students must pay attention. This will also take care of certain key issues students have to cover in respective GS papers.


The crisis unfolding at PMC Bank is a tip of the iceberg of larger, unresolved problems in India’s banking sector. 

Roots of the cause

    • The roots of the crisis in the banking sector go back to the unresolved problem of non-performing assets (NPAs).
    • These are magnified in the case of cooperative banks due to lax governance and a dicey business model.

Problems with RBI’s approach

    • By imposing severe withdrawal restrictions on depositors, those who suffer are largely the poor who prefer the higher deposit rates that cooperative banks offer.

Other problems with the cooperative sector

    • Bad loans and poor governance.
    • The business model offers depositors high-interest rates and lends money to borrowers of dubious credentials at low interests.
    • It can easily run into difficulty due to the resultant wafer-thin profit margins.
    • Poor regulatory response – it has so far been symptomatic and shows little understanding of the underlying disease. 
    • The government does not have a coherent and well-thought-out overarching strategy for economic policy. The policy seems reactive rather than forward-looking.

Way ahead for cooperative banks

    • Fundamentally reformed governance so that a crisis such as this one does not occur in the future. 
    • The long-run health of the banking sector requires short-run transitional costs. This dichotomy—between long-run and short-run cost—is at the root of many deferred or unfinished reforms.
    • Rationalizing taxes is a good start. But it cannot serve as a fix to the sort of problems that we are seeing at PMC Bank and other troubled banks. 
    • They need a more stringent regulatory process and, more fundamentally, legislative reform that overhauls the governance of cooperative banks as well as of the larger public banking sector. 


The fundamental political economy problem is that public sector banks serve multiple masters and, as a consequence, loan decisions are not always based on economic and financial logic. 

Iran’s Nuclear Program & Western Sanctions

[op-ed snap] Seize the opening


From UPSC perspective, the following things are important :

Prelims level : JCPOA

Mains level : Iran nuclear deal - Implications for India


The spokesperson for Iran’s nuclear agency announced that the country had the ability to enrich uranium up to 20% and it had launched advanced centrifuge machines.


    • This further violates its commitments under the Joint Comprehensive Plan of Action (JCPOA). 
    • It is also an escalation of the brinkmanship since US President Donald Trump withdrew from the JCPOA in May 2018. 


    • The 2015 JCPOA came into being after arduous negotiations.
    • It placed restrictions on Iran’s nuclear programme and removed the harsh economic sanctions on the country. 
    • Since the US’s withdrawal from the deal, the Trump administration has ramped up the sanctions, and its anti-Iran rhetoric. Iran has flouted the limits placed on its nuclear programme. 
    • The US assumed that the sanctions would increase disaffection in Iran to such a degree that the government would be overthrown. 
    • The moderate, democratically-elected Rouhani government has suffered due to the sanctions. The nuclear deal was pushed despite the recalcitrant sections of the Islamic state as opposed to any accord with the US.

Indian role

    • India has managed to walk the diplomatic tightrope between the US and Iran.
    • India has a very close relationship with the US and also has close historical and trade ties with Iran.
    • India could join Paris and other world powers in nudging both countries towards talks. 



JCPOA or the Iran nuclear deal between Tehran and the US, France, Germany, Britain, Russia and the European Union

RTI – CIC, RTI Backlog, etc.

[op-ed snap] Making political parties accountable


From UPSC perspective, the following things are important :

Prelims level : Nothing much

Mains level : RTI for political parties


Recently, the Supreme Court in D.A.V. College Trust and Management Society Vs. Director of Public Instructions held that NGOs which were substantially financed by the appropriate government fall within the ambit of ‘public authority’ under Section 2(h) of the RTI Act, 2005. 

Public Authority

    • Under this section of the RTI Act, ‘public authority’ means “any authority or body or institution of self-government established or constituted by or under the Constitution.
    • It also included any NGO substantially financed directly or indirectly by funds provided by the appropriate government.

Impact of the judgement

    • The judgment can have wide ramifications to the ambit of the RTI regime on national political parties.
    • In D.A.V., the court held that ‘substantial’ means a large portion which can be both, direct or indirect. 
    • It need not be a major portion or more than 50% as no simple formula can be resorted to in this regard. If land in a city is given free of cost or at a heavily subsidised rate to hospitals, educational institutions or other bodies, it can qualify as substantial financing.
    • The court resorted to ‘purposive’ interpretation of the provisions. 
    • It underscored the need to focus on the larger objective of percolation of benefits of the statute to the masses.

Application to political parties

    • In 2010, ADR filed an application under RTI to all national parties, seeking information about “10 maximum voluntary contributions” received by them in the past five years. 
    • None of the national political parties volunteered to disclose the information. 
    • In 2013, a full bench of the CIC delivered a historic judgment by declaring that all national parties came under ‘public authorities’ and were within the purview of the RTI Act. 
    • They were directed to designate central public information officers (CPIOs) and the appellate authorities at their headquarters within six weeks.
    • In 2013, The Right to Information (Amendment) Bill was introduced in Parliament to keep political parties explicitly outside the purview of RTI. It lapsed after the dissolution of the 15th Lok Sabha. 
    • Notwithstanding the binding value of CIC’s order under Section 19(7) of the Act, none of the six political parties complied with it. 
    • All the parties were absent from the hearing when the commission issued show-cause notices for non-compliance at the hearing.
    • In 2019, a PIL was filed in the Supreme Court seeking a declaration of political parties as ‘public authority’ and the matter is sub judice. 
    • Irrespective of the ideological differences among these political parties, non-compliance of the RTI mandate has been a great unifier.

DAV judgment to political parties

    • Drawing an analogy between the Supreme Court’s judgment on D.A.V. and the political parties’ issue, it can be argued that national parties are ‘substantially’ financed by the Central government. 
    • The various concessions, such as allocation of land, accommodation, bungalows in the national and State capitals, tax exemption against income under Section 13A of the Income Tax Act, free air time on television and radio, etc. can easily satisfy the prerequisite of Section 2(h) of the RTI. 
    • If an entity gets substantial finance from the government, there is no reason why any citizen cannot ask for information to find out whether his/her money which has been given to the entity is being used for the requisite purpose or not.
    • From the preamble of the RTI Act, the ultimate aim is the creation of an ‘informed’ citizenry, containment of corruption and holding of government and its instrumentalities accountable to the governed. 

Need to bring political parties under RTI

    • The Law Commission opines that political parties are the lifeblood of our entire constitutional system. 
    • Political parties act as a conduit through which interests and issues of the people get represented in Parliament. 
    • Since elections are predominantly contested on party lines in our parliamentary democratic polity, the agenda of the potential government is set by them.
    • As noted by Ambedkar, the working of a Constitution does not depend wholly upon the nature of the Constitution. The factors on which the working of those organs of the State depend are the people and the political parties they will set up.


It is hoped that the Supreme court will further the positive advances made in this direction.

Judicial Reforms

Explained: Legal Rights of Deities


From UPSC perspective, the following things are important :

Prelims level : Read the attached story

Mains level : Legal Persons and its wide definition

  • Among the parties in a famous temple suit appeals now being heard by the Supreme Court is the Lord represented by His “next friend”.

God as a juristic person

  • A juristic person, as opposed to a “natural person” (that is, a human being), is an entity whom the law vests with a personality.
  • The Supreme Court has clarified this in the Shiromani Gurdwara Parbandhak Committee vs Som Nath Dass and Others (2000) order.
  • It states that the very words Juristic Person connote recognition of an entity to be in law a person which otherwise it is not.
  • In other words, it is not an individual natural person but an artificially created person which is to be recognised to be in law as such.
  • Gods, corporations, rivers, and animals, have all been treated as juristic persons by courts.

From when did this recognition begin?

  • The treatment of deities as juristic persons started under the British.
  • Temples owned huge land and resources, and British administrators held that the legal owner of the wealth was the deity, with a shebait or manager acting as trustee.
  • In 1887, then Bombay HC held in the Dakor Temple case: “Hindu idol is a juridical subject and the pious idea that it embodies is given the status of a legal person.
  • This was reinforced in the 1921 order in Vidya Varuthi Thirtha vs Balusami Ayyar, where the court said, “under the Hindu law, the image of a deity… (is) a ‘juristic entity’, vested with the capacity of receiving gifts and holding property”.
  • This idea is now established in Indian law.

God: Not always a legal person

  • A juristic entity or person is one in whom the law reposes rights or duties in its own name.
  • A company is a juristic person, who can hold or deal with property in its own name.
  • While God as an abstract concept is not a juristic entity, deities in Hindu law have been conferred personhood, as capable of being bestowed with property, or leading it out or suing to take back possession.
  • Thus, by a legal fiction installed deities at Hindu places of worship have been treated like other real persons for the purpose of law
  • However, not every deity is a legal person. This status is given to an idol only after its public consecration, or pran pratishtha.
  • In Yogendra Nath Naskar vs Commissioner Of Income-Tax (1969), the Supreme Court ruled: “It is not all idols that will qualify for being ‘juristic person’ but only when it is consecrated and installed at a public place for the public at large.”

The rights deities have

  • Apart from owning property, paying taxes, suing, and being sued, what else do deities as ‘legal persons’ do?
  • In the Sabarimala case one of the arguments presented against allowing women of menstruating age entry into the temple was that this would violate the right to privacy of Lord who is eternally celibate.
  • It was argued that deities have property rights, but not fundamental rights or other constitutional rights.
  • This was upheld by Justice D Y Chandrachud in the Sabarimala judgment.

Other than Hinduism

  • A mosque has never been held as a juristic person, because it’s a place where people gather to worship; it is not an object of worship itself. Neither has a church.
  • In Shiromani Gurdwara Parbandhak Committee vs Som Nath Dass and Others (2000), the SC ruled that the Guru Granth Sahib cannot be equated with other sacred books.
  • Guru Granth Sahib is revered like a Guru and is the very heart and spirit of gurudwara.
  • The reverence of Guru Granth on the one hand and other sacred books on the other hand is based on different conceptual faith, belief and application.
  • However, the court clarified that “every Guru Granth Sahib cannot be a juristic person unless it takes juristic role through its installation in a gurudwara or at such other recognised public place.”

Who else holds such legal status?

  • In May, the Punjab and Haryana High Court held that the “entire animal kingdom” has a “distinct legal persona with corresponding rights, duties, and liabilities of a living person”.
  • On March 20, 2017, the Uttarakhand High Court declared that the Ganga and Yamuna would be legally treated as “living people,” and enjoy “all corresponding rights, duties and liabilities of a living person”.
  • The order was stayed by the Supreme Court in July that year because it “raised several legal questions and administrative issues”.

Rural Distress, Farmer Suicides, Drought Measures

Behavioural aspect of farmer suicides


From UPSC perspective, the following things are important :

Prelims level : Not Much

Mains level : Strategies to combat farmer's distress in India

  • Farmer suicides, which have till now been studied economically and agriculturally, are now being looked at from behavioural and psychological angles.

Study on farmer’s suicide

  • A study is being conducted under the National Agricultural Science Fund of IICAR in three states — Punjab, Telangana and Maharashtra.
  • Till now the issue of farmer suicide was being looked at only from economic and agricultural angles.
  • The study has looked at it from behavioural, psychological and cultural perspectives in addition to the earlier two.

Major causes of suicide

  • Since most discussions and parleys on suicides are overtaken by issues of crop failures, rising debts, new farming techniques, the psychological aspect is largely ignored.
  • One of the major causes behind suicidal intent is depression, found the researchers.
  • It needs to be understood that at times a farmer under a debt of Rs 2 lakh shows a tendency to end his life, while another under a debt of Rs 10 lakh does not.

Need of the hour: Psychological assistance

  • The study suggested roping in psychologists and counselors on various issues.
  • They included battling depressive ruminations, suicidal ideations, negative cognitions, hopelessness, helplessness.
  • It aimed at recognising and managing stressors like financial distress, relationship problems, and enhancing psychological resources through emotional well being, and mindfulness.

Model of 7’s

  • The researchers developed a ‘7D’ model of triggering and confounding factors and a ‘7R’ model of preventive and protecting factors to deal with the problem of farmer suicides.

‘7D’ model

It encapsulates:

  1. Drugs,
  2. Debt,
  3. Disease,
  4. Disputes,
  5. Depression,
  6. Disrepute and
  7. Death

 ‘7R’ model

It looks at prevention of suicides. It consists:

  1. Remunerative agriculture,
  2. Resilience building,
  3. Rational expenditure,
  4. Reassurance through connectivity,
  5. Righteous conduct,
  6. Religious support and
  7. Responsible reporting

Way forward

  • Farmers don’t need money only, they need motivation too.
  • Along with subsidies, increased farm profits, the focus should also be on resilience building and problem solving skills of farming families.
  • In suicide-prone states, agricultural institutes and scientists should start distributing seeds of resilience, tolerance and contentment among farmers, suggested researchers.
  • Agri universities can play a powerful role in dissipating the culture of shame associated with mental illness and depression as it is the fear of stigma that acts as a barrier to seek appropriate treatment.

Wildlife Conservation Efforts

Elephant Endotheliotropic Herpes-virus (EEHV)


From UPSC perspective, the following things are important :

Prelims level : EEHV

Mains level : Treating rare diseases

  • A rare disease has killed five elephants in Odisha.
  • The four deaths in Nandan Kanan Zoo are the first reported cases of EEHV-related deaths in an Indian zoo while the death in the forest too is the first known such case in the wild in India.


  • EEHV is a type of herpesvirus that can cause a highly fatal haemorrhagic disease in young Asian elephants.
  • The disease is caused by a virus called EEHV, or elephant endotheliotropic herpesvirus.
  • EEHV is lethal for young elephants between the ages of one and 12.


  • Most elephants carry just as most humans carry a cold virus.
  • When EEHV is triggered, the elephant dies of massive internal bleeding and symptoms which are hardly visible.
  • Some elephants show symptoms such as reduced appetite, nasal discharge and swollen glands, researchers say.
  • The disease is usually fatal, with a short course of 28-35 hours.

No cure yet

  • There is no true cure for herpes-viruses in animals or in humans because herpes viruses go latent.
  • The disease has a short course which means that we have to take a very quick call on a suspected EEHV case and kick off treatment protocols.
  • This treatment is a combination of anti-viral therapy, aggressive fluid therapy (to counter haemorrhaging), immuno-stimulant drugs (selenium and Vitamins C, E), anti-pyretics and analgesics (to bring down fever).

Why it is a concern?

  • The death of the Chandaka forest elephant has worried officials in Odisha.
  • If elephants in the wild start falling prey to the virus, then treatment will be very difficult.
  • If a young elephant dies before reproducing, it affects the population of the species as a whole in the concerned geography.
  • It will be extremely hard to track down every wild elephant in the state and test whether they are positive for EEHV, and the state government cannot afford the manpower.

Coal and Mining Sector

[pib] PRAKASH  Portal


From UPSC perspective, the following things are important :

Prelims level : PRAKASH portal

Mains level : Not Much

The Union Minister of State for Power and New & Renewable Energy (IC) has launched PRAKASH (Power Rail Koyla Availability through Supply Harmony) portal.


  • PRAKASH Portal is developed by NTPC and sources data from different stakeholders such as Central Electricity Authority (CEA), Centre for Railway Information System (CRIS) and coal companies.
  • The Portal aims at bringing better coordination for coal supplies among all stakeholders viz – Ministry of Power, Ministry of Coal, Coal India, Railways and power utilities.
  • This is an important step in ensuring adequate availability and optimum utilization of coal at thermal power plants.
  • The Portal is designed to help in mapping and monitoring entire coal supply chain for power plants, viz –
  1. Coal Stock at supply end (mines),
  2. Coal quantities/ rakes planned,
  3. Coal quantity in transit and
  4. Coal availability at power generating station.
  • All reports are available in PDF/Excel format. However, to present information in a user friendly method, the Portal gives graphical representation of reports with details shown on the map of India.

Benefits of Portal to the Stakeholders

The portal makes available following information on a single platform –

  • Coal company will be able to track stocks and the coal requirement at power stations for effective production planning
  • Indian Railways will plan to place the rakes as per actual coal available at siding and stock available at power stations.
  • Power stations can plan future schedule by knowing rakes in pipe line and expected time to Reach.
  • Stock at power generating station
  • Ministry of Power /Ministry of Coal/ CEA/ POSOCO can review overall availability of coal at thermal power plants in different regions

Indian Army Updates

[pib] Military Exercises: Ex Nomadic Elephant and Ex Ekuverin


From UPSC perspective, the following things are important :

Prelims level : Ex Nomadic Elephant and Ex Ekuverin

Mains level : India's stratergic relations with neighborhood

  • 14th edition of Indo – Mongolian joint military training is being conducted over a period of 14 days.

Nomadic Elephant-XIV

  • Nomadic Elephant-XIV is aimed at training troops in counter insurgency &counter terrorism operations under United Nations mandate.
  • The Joint Exercise will enhance defence co-operation and military relations between the two nations.
  • It is an ideal platform for the armies of both the nations to share their experiences & best practices and gain mutually during the joint training.
  • The joint training aims at evolving various tactical drills in counter-terror environment like Convoy Protection Drill, Room Intervention Drills, Ambush/ Counter Ambush Drills, while jointly conducting counter terrorist operations under UN mandate.
  • The joint training will also lay emphasis on conducting operations by a cohesive subunit, comprising of troops from both the armies, in an adverse operational conditions thus enhancing the interoperability between the two armies.

Ex Ekuverin

  • Tenth edition of the Joint Military Exercise Ekuverin between the Indian Army and the Maldivian army is to be held this month at Aundh Military Station in Pune, Maharashtra.
  • The Indian Army and the Maldives National Defence Forces have been conducting Exercise Ekuverin meaning ‘Friends’ in the Dhivehi language since 2009.
  • The Exercise focuses on enhancing interoperability between the two forces for carrying out counter insurgency and counter-terrorism operations in a semi-urban environment under the UN mandate.