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  • Analysing Insolvency and bankruptcy Code

    InsolvencyContext

    • Speaking at the Sixth anniversary of the insolvency and bankruptcy Board of India (IBBI) on October 1, Union Finance Minister Nirmala Sitharaman said that the country could not afford to lose the “sheen” of its insolvency law, the Insolvency and Bankruptcy code(IBC)

    What is Insolvency?

    • Simply speaking, insolvency is a financial state of being one that is reached when you are unable to pay off your debts on time.
    • Insolvency is essentially the state of being that prompts one to file for bankruptcy. An entity a person, family, or company becomes insolvent when it cannot pay its lenders back on time.
    • Typically, those who become insolvent will take certain steps toward a resolution. One of the most common solutions for insolvency is bankruptcy.

    What is Bankruptcy?

    • Bankruptcy, on the other hand, is a legal process that serves the purpose of resolving the issue of insolvency.
    • Bankruptcy is a legal declaration of one’s inability to pay off debts. When one files for bankruptcy, one obliges to pay off what is owed with help from the government.

    InsolvencyWhat is Insolvency and Bankruptcy Code (IBC)?

    • In a growing economy, a healthy credit flow and generation of new capital are essential.
    • When a company or business turns insolvent or “sick”, it begins to default on its loans.
    • In order for credit to not get stuck in the system or turn into bad loans, it is important that banks or creditors are able to recover as much as possible from the defaulter, as quickly as they can.

    Why the IBC introduced?

    • Increasing Non ­Performing Assets: In 2016, at a time when India’s Non Performing Assets and debt defaults were piling up, and older loan recovery mechanisms were performing badly, the IBC was introduced to overhaul the corporate distress resolution regime in India.
    • Time bound mechanism: To consolidate previously available laws to create a time bound mechanism with a creditor­ in­ control model as opposed to the debtor ­in ­possession system.
    • Two positive outcomes: When insolvency is triggered under the IBC, there can be just two outcomes: resolution or liquidation. liquidation means the process of winding up a corporation or incorporated entity

    InsolvencyImportance of the Insolvency and bankruptcy code

    • Resolution: First objective is finding a way to save a business through restructuring, change in ownership, mergers etc.
    • Maximising the value: The second objective is to maximise the value of assets of the corporate debtor  maximise the value .
    • Credit facility: To promote entrepreneurship, availability of credit, and balancing the interests of all stakeholders.
    • Easy exit: The Insolvency and Bankruptcy Code would provide such an environment to ensure easy exit for sick companies and help the country to improve its position in ease of doing business.
    • Speedy winding up: The bankruptcy code will make it easier for companies to wind up failed businesses and bring India on a par with developed nations in terms of resolving bankruptcy issues.
    • Time bound disposal: Timeliness is key here so that the viability of the business or the value of its assets does not deteriorate further. It minimizes the problem of delay as there are strict timelines within which the case has to be disposed off. Quick disposal of cases will maximize the recovery amount.
    • Information database: It prepares a database to provide information on the insolvency status of individuals. In addition to this, specialized insolvency professionals helps in guiding through the process.
    • Easy process of claim: Easy process of claim by the creditors also encourages financial institutions to extend credit facilities thus strengthening the financial markets with increased availability of credit for business.

    What are the challenges before IBC?

    • Weak Resolution: IBBI data for the 3,400 cases admitted under the IBC in the last six years, more than 50% of the cases ended in liquidation, and only 14% could find a proper resolution.
    • Increasing deadlines: The IBC was thus initially given a 180 day deadline to complete the resolution process, with a permitted 90 day extension. It was later amended to make the total timeline for completion 330 days is almost a year.
    • In FY22, it took 772 days to resolve cases involving companies that owed more than 1,000 crore. The average number of days it took to resolve such cases increased rapidly over the past five years.
    • On Haircuts (Debts that banks forgo):The Parliamentary Standing Committee on Finance pointed out in 2021 that in the five years of the IBC, creditors on an average had to bear an 80% haircut in more than 70% of the cases.
    • As per The Hindu Data Team, in close to 33 of 85 companies so far that owed more than 1,000 crore, lenders had to take above 90% haircuts. In case of the resolution of the Videocon Group for instance, creditors bore a haircut of 95.3%.

    InsolvencyWhat  are experts saying?

    • Addressing the delays: In order to address the delays, the Parliamentary Standing Committee suggested that the time taken to admit the insolvency application and transfer control of the company to a resolution process, should not be more than 30 days after filing the case.
    • New mechanism: The IBBI has also called for a new yardstick to measure haircuts. It suggested that haircuts not be looked at as the difference between the creditor’s claims and the actual amount realized but as the difference between what the company brings along when it enters IBC and the value realized.

    Conclusion

    • Insolvency and Bankruptcy Code is a comprehensive and systemic process, which gives a quantum leap to the functioning of the credit market. However, it is the need of the hour to find new and innovative alternatives to make this system comprehensible and address the challenge of delay and resolution.

    Mains Question

    Q. Insolvency and Bankruptcy Code (IBC) is a comprehensive and systemic process, which gives a quantum leap to the functioning of the credit market. Discuss the challenges and way ahead in the resolution mechanism of IBC.

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  • Marital rape, MTP Act and the Society

    Marital rapeContext

    • The recent Supreme court judgment expands the definition of rape to marital rape for the MTP Act. Marital rape is still not criminalised. If society does not accept “marital rape” as even a moral offence, how will a woman convince doctors to terminate her pregnancy based on the exception provided by the SC’s verdict.

    Background

    • The Supreme Court has held that all women, irrespective of their marital status, are entitled to safe and legal abortion till 24 weeks of pregnancy under the Medical Termination of Pregnancy (MTP).

    What is Medical Termination of Pregnancy (MTP) Act?

    • Abortion in India has been a legal right under various circumstances for the last 50 years since the introduction of the Medical Termination of Pregnancy (MTP) Act in 1971
    • The Act was amended in 2003 to enable women’s access to safe and legal abortion services.

    Marital rapeWhat are the Changes in Medical Termination of Pregnancy (MTP) Act, 2021?

    • The gestation limit: The gestation limit for abortions has been raised from the earlier ceiling of 20 weeks to 24 weeks, but only for special categories of pregnant women such as rape or incest survivors. But this termination would need the approval of two registered doctors.
    • Doctor’s approval: All pregnancies up to 20 weeks require one doctor’s approval. The earlier law, the MTP Act 1971, required one doctor’s approval for pregnancies up to 12 weeks and two doctors’ for pregnancies between 12 and 20 weeks.
    • Contraceptive failure: Women can now terminate unwanted pregnancies caused by contraceptive failure, regardless of their marital status. Earlier the law specified that only a “married woman and her husband” could do this.
    • In case of fetal disability:  There is also no upper gestation limit for abortion in case of fetal disability if so decided by a medical board of specialist doctors, which state governments and union territories’ administrations would set up.

    What is marital rape?

    • Marital rape is the act of sexual intercourse with one’s spouse without her consent.
    • It is no different manifestation of domestic violence and sexual abuse.
    • It is often a chronic form of violence for the victim which takes place within abusive relations.

    Marital rapeStatistics on Marital rape in India

    • The NFHS-5 survey (2019-21):
    • The survey said that 32% of ever-married women have suffered spousal physical, sexual, or emotional violence, and 27% have suffered at least one form of violence.
    • Twenty-nine percent of ever- married women have experienced spousal physical violence and 14% have suffered emotional violence.
    • The form of sexual violence most commonly reported by women is that their husband used physical force to have sexual intercourse when they did not want to (5%).
    • Four per cent reported that their husband forced them with threats or in other ways to perform sexual acts they did not want to and 3% of them reported that their husband forced them to perform any sexual acts they did not want to.
    • Women in rural areas are more likely (34%) than women in urban areas (27%) to experience one or more forms of spousal violence.

    Why modern India still not accepting marital rape as a rape?

    • Definition: The definition of rape codified in Section 375 of the Indian Penal Code (IPC) includes all forms of sexual assault involving non-consensual intercourse with a woman.
    • Non-Criminalization: Non-Criminalization of marital rape in India emanates from Exception 2 to Section 375.
    • Exemption: Section 375 defines rape and lists seven notions of consent which, if vitiated, would constitute the offence of rape by a man. However, the provision contains a crucial exemption, Sexual intercourse or sexual acts by a man with his own wife, the wife not being under eighteen years of age, is not rape.
    • Marriage as perpetual consent: As per current law, a wife is presumed to deliver perpetual consent to have sex with her husband after entering marital relations. The concept of marital rape in India is the epitome of what we call an “implied consent”. Marriage between a man and a woman here implies that both have consented to sexual intercourse, and it cannot be otherwise.

    What is the link between marital rape and MTP Act?

    • The distinction and the cultural ethos: Married women have a different world attire, jewellery, rituals compared to widows or unmarried or deserted women .So is the right to sexual intercourse. In contrast, unmarried women do not have a right to sex. So what does the right to terminate pregnancy mean for them
    • Ownership of women’s sexuality: Unmarried women cannot have sex, married women cannot say no to sex because men own women’s sexuality. Husbands can use the legal remedy of restitution of conjugal rights against runaway wives. Ownership is integral here
    • Cause of Disharmony: An unmarried woman does not have an owner. It causes confusion and disorder. Women’s sexuality is seen as a cause of disharmony.

    Marital rapeWhy marital rape must be a crime?

    • Associated physical violence: Rape by a spouse, partner or ex-partner is more often associated with physical violence.
    • Mental harassment: There is research showing that marital rape can be more emotionally and physically damaging than rape by a stranger.
    • Compulsive relationship: Marital rape may occur as part of an abusive relationship.
    • Revengeful nature: Furthermore, marital rape is rarely a one-time event, but a repeated if not frequent occurrence.
    • Obligation on women: In the case of marital rape the victim often has no choice but to continue living with their spouse.

    Present regulations in India

    • Indian Penal Code criminalizes rape in most cases, although marital rape is not illegal when the woman is over the age of 18.
    • However, until 2017, men married to those between 15 and 18 could not be convicted of rape.
    • Marital rape of an adult wife, who is unofficially or officially separated, is a criminal offence punishable by 2 to 7 year in prison; it is not dealt by normal rape laws which stipulate the possibility of a death sentence.
    • According to the Protection of Women From Domestic Violence Act (2005), other married women subject to such crime by their husband may demand for financial compensation.
    • They also have the right to continue to live in their marital household if they wish, or may approach shelter or aid homes.

    Way forward

    • Sanctioning marital rape is an acknowledgment of the woman’s right to self-determination (i.e., control of all matters relating to her body.
    • The recent judgment on the MTP Act has extended the definition of rape to marital rape which is a big step in the right direction.
    • However in a society with strong social norms and value systems every stakeholder should have more than a legitimate motive. It has to play an important role.

    Mains Question

    Q.While abortion is available under legal regulations in the country, Discuss the relationship between the Medical Termination of Pregnancy Act and Marital Rape.

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  • Parliamentary Committees, their leaders, and their role in law-making

    A recent revamp of the Standing Committees of Parliament could potentially worsen the relations between the government and opposition parties.

    Why in news?

    • Of the 22 committees announced, the erstwhile ruling party has the post of chairperson in only one, and the opposition party from West Bengal has none.
    • The ruling party has the chairmanship of the important committees on Home, Finance, IT, Defence and External Affairs.

    What are Committees of Parliament?

    • A Parliamentary Committee is a panel of MPs that is appointed or elected by the House or nominated by the Speaker, and which works under the direction of the Speaker.
    • It presents its report to the House or to the Speaker.
    • Parliamentary Committees have their origins in the British Parliament.
    • They draw their authority from Article 105, which deals with the privileges of MPs, and Article 118, which gives Parliament authority to make rules to regulate its procedure and conduct of business.

    What do they do?

    • Legislative business begins when a Bill is introduced in either House of Parliament.
    • But the process of lawmaking is often complex, and Parliament has limited time for detailed discussions.
    • Also, the political polarisation and shrinking middle ground has been leading to inconclusive debates in Parliament.
    • As a result of this, a great deal of legislative business ends up taking place in the Parliamentary Committees instead.
    • The aim is to increase Parliamentary scrutiny, and to give members more time and a wider role in examining important legislation.

    What are the various Committees of Parliament?

    • Broadly, Parliamentary Committees can be classified into Financial Committees, Departmentally Related Standing Committees, Other Parliamentary Standing Committees, and Ad hoc Committees.
    • The Financial Committees include the Estimates Committee, Public Accounts Committee, and the Committee on Public Undertakings.
    • These committees were constituted in 1950.
    • Seventeen Departmentally Related Standing Committees came into being in 1993, when Shivraj Patil was Speaker of Lok Sabha.
    • They aimed to examine budgetary proposals and crucial government policies.

    Composition of these committees

    • The number of Committees was subsequently increased to 24.
    • Each of these Committees has 31 members — 21 from Lok Sabha and 10 from Rajya Sabha.
    • Ad hoc Committees are appointed for a specific purpose.

    How are the Committees constituted?

    • There are 16 Departmentally Related Standing Committees for Lok Sabha and eight for Rajya Sabha; however, every Committee has members from both Houses.
    • Lok Sabha and Rajya Sabha panels are headed by members of these respective Houses.
    • Among the important Lok Sabha panels are: Agriculture; Coal; Defence; External Affairs; Finance; Communications & Information Technology; Labour; Petroleum & Natural Gas; and Railways.
    • The important Rajya Sabha panels include Commerce; Education; Health & Family Welfare; Home Affairs; and Environment.
    • There are other Standing Committees for each House, such as the Business Advisory Committee and the Privileges Committee.
    • The Presiding Officer of each House nominates members to these panels. A Minister is not eligible for election or nomination to Financial Committees, and certain Departmentally Related Committees.

    Appointing of chairmen

    • The appointment of heads of the Committees is also done in a similar way. By convention, the main Opposition party gets the post of PAC chairman; it is currently with the Congress.
    • Chairmanship of some key committees has been allocated to opposition parties in the past. However, this pattern has changed in the latest rejig.
    • The heads of the panels schedule their meetings.
    • They play a clear role in preparing the agenda and the annual report, and can take decisions in the interest of the efficient management of the Committee.
    • The chairperson presides over the meetings and can decide who should be summoned before the panel.

    How do they work?

    • Bills that are referred to Committees often return to the House with significant value-addition.
    • The Committees look into the demands for grants of Ministries/departments, examine Bills pertaining to them, consider their annual reports, and look into their long-term plans and report to Parliament.

    What are Ad hoc Committees?

    • Ad hoc Committees cease to exist after they have completed the task assigned to them, and have submitted a report to the House.
    • The principal Ad hoc Committees are the Select and Joint Committees on Bills.
    • Committees like the Railway Convention Committee, Committee on Food Management and Security in Parliament House Complex, etc. also come under the category of Ad hoc Committees.

    What about Joint Parliamentary Committee (JPC)?

    • Parliament can also constitute a JPC with a special purpose, with members from both Houses, for detailed scrutiny of a subject or Bill.
    • Also, either of the two Houses can set up a Select Committee with members from that House.
    • JPCs and Select Committees are usually chaired by ruling party MPs, and are disbanded after they have submitted their report.

    Why need all these committees?

    • The time to speak on a Bill is allocated according to the size of the party in the House.
    • MPs often do not get adequate time to put forward their views in Parliament, even if they are experts on the subject.
    • Committees are small groups with relatively less demands on their time; in these meetings, every MP gets a chance and the time to contribute to the discussion.
    • Parliament has only around 100 sittings a year; Committee meetings are independent of Parliament’s calendar.

    How do discussions/ debates here differ from those in Parliament?

    • The discussions are confidential and off-camera.
    • Political Party affiliations usually do not come in the way of MPs speaking their minds in ways they are unable to do in Parliament.
    • The Committees work closely with multiple Ministries, and facilitate inter-ministerial coordination.

    How important are the recommendations of the Committees?

    • Reports of Departmentally Related Standing Committees are recommendatory in nature.
    • However, suggestions by the Select Committees and JPCs — which have a majority of MPs and heads from the ruling party — are accepted more frequently.
    • They are not binding on the government, but they do carry significant weight.
    • In the past, governments have accepted suggestions given by the Committees and incorporated them into the Bills.

    Significance of Parliamentary committees

    • Many MPs concede that “real discussions” happen inside the Committees.
    • The former US President Woodrow Wilson had observed that “Congress in session is Congress on public exhibition, whilst Congress in its committee rooms is Congress at work”.

    Try this PYQ:

    Q.With reference to the Parliament of India which of the following Parliamentary Committees scrutinizes and reports to the House whether the powers to make regulations, rules, sub rules, bylaws, etc. conferred by the Constitution or delegated by the Parliament are being properly exercised by the Executive within the scope of such delegation?

     

    (a) Committee on Government Assurances

    (b) Committee on Subordinate Legislation

    (c) Rules Committee

    (d) Business Advisory Committee

     

    [wpdiscuz-feedback id=”siihj0de96″ question=”Please leave a feedback on this” opened=”1″]Post your answers here.[/wpdiscuz-feedback]

     

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  • In news: Criterion for SC status

    The Supreme Court has sought the most recent position of the Union government on a batch of petitions challenging the Constitution (Scheduled Castes) Order of 1950, which allows only members of Hindu, Sikh and Buddhist religions to be recognised as SCs.

    The Constitution Order of 1950

    • When enacted, the Constitution (Scheduled Castes) Order of 1950, initially provided for recognising only Hindus as SCs.
    • It was then aimed to address the social disability arising out of the practice of untouchability.
    • The Order was amended in 1956 to include Dalits who had converted to Sikhism and once more in 1990 to include Dalits who had converted to Buddhism.
    • Both amendments were aided by the reports of the Kaka Kalelkar Commission in 1955 and the High Powered Panel (HPP) on Minorities, SCs and STs in 1983 respectively.

    What about Christians?

    • The Union government in 2019 rejected the possibility of including Dalit Christians as members of SCs.
    • This decision was rooted on the exclusion on an Imperial Order of 1936 of the then colonial government, which had first classified a list of the Depressed Classes and specifically excluded “Indian Christians” from it.

    Why are Dalit Christians excluded?

    • SC status is meant for communities suffering from social disabilities arising out of the practice of untouchability that was prevalent in Hindu and Sikh communities.
    • SC status for everyone would significantly swell the population of SCs across the country thus trivializing the purpose itself.

    Why neo-Buddhists are included in SC quota?

    • The amendment to include Buddhist converts as SCs was passed in 1990.
    • Like Dalit Buddhists, Dalits who converted to Islam or Christianity belonged to different sets of caste groups and not just one.
    • As a result of this, they cannot be categorised as a “single ethnic group”, which is required by Clause (2) of Article 341 for inclusion.

    Major concerns of including other religions

    • Sanction of untouchability: The practice of “untouchability” was a feature of Hindu religion and its branches. This would imply that India was trying to “impose its caste system” upon Christians and Muslims.
    • Undue internationalization: Allowing the inclusion of Dalit Muslims and Dalit Christians as SCs could result in being misunderstood internationally.
    • Reviving casteism: Christians and Muslims of Dalit origin had lost their caste identity by way of their conversion and that in their new religious community, the practice of untouchability is not prevalent.

    Is there a case for inclusion?

    • The petitions arguing for inclusion have cited several independent Commission reports that have documented the existence of caste and caste inequalities among Indian Christians and Indian Muslims.
    • Even after conversion, members who were originally from SCs continued to experience the same social disabilities.
    • This was substantiated in the First Backward Classes Commission’s report in 1953, the HPP report on SCs, STs, and Minorities in 1983, the Mandal Commission Report, etc.
    • However, these reports do not have enough empirical evidence to support their claims.

    Why is the issue debated?

    • Non-deserving beneficiaries: The proposition that caste identity is lost upon conversion, noting that even in Sikhism and Buddhism, casteism is not present and yet they have been included as SCs.
    • Continued discrimination: The above-mentioned reports argue that caste-based discrimination continues even after conversion, hence entitling these communities to SC status.

     

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  • Nobel for work on Click Chemistry

    click

    Scientists Carolyn R. Bertozzi, Morten Meldal and K. Barry Sharpless won the 2022 Nobel Prize in Chemistry on for discovering reactions that let molecules snap together to create desired compounds and that offer insight into cell biology.

    What the scientists worked on?

    • Sharpless came up with the term ‘Click Chemistry’ and worked extensively on it,
    • Meldal came up with a special chemical structure called ‘Triazole’ which has many significant applications, and
    • Bertozzi took the next step of developing click reactions that could work inside living organisms — ‘bioorthogonal’ reactions take place living systems without interfering with native biochemical processes.

    What is Click Chemistry?

    • Chemists often try to recreate complex chemical molecules found in nature, and this has applications, among other things, in the field of medicine – how to target and block pathogens in cells.
    • However, this process can be complicated and time-consuming.
    • Instead of trying to wrangle reluctant carbon atoms into reacting with each other, Barry Sharpless encouraged his colleagues to start with smaller molecules that already had a complete carbon frame.
    • If chemists choose simple reactions – where there is a strong intrinsic drive for the molecules to bond together – they avoid many of the side reactions, with a minimal loss of material.

    Applications of click chemistry

    • Meldal through his experiments came up with the useful chemical structure called triazoles, whch are stable and are found in pharmaceuticals, dyes and agricultural chemicals.
    • He also found that the reaction he used could bind together numerous different molecules.
    • Bertozzi, using the work of Sharpless and Meldal, came up with an efficient and innovative method to map glycans, which are carbohydrate-based polymers made by all living organisms.

     

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  • Centre raises credit limit under ECLGS

    The Ministry of Finance has raised the credit limit for airlines under the Emergency Credit Line Guarantee Scheme (ECLGS), making them eligible for a sum equivalent to 100% of their outstanding debt, up to a maximum of ₹1,500 crore.

    Boost for Aviation sector

    • Earlier, airlines were eligible to borrow up to 50% of their credit outstanding up to ₹400 crore.
    • This is the second time the government has liberalized the scheme for the aviation sector.
    • The scheme introduced for medium and small enterprises during the outbreak of the COVID-19 pandemic was extended till March 2023 and its guarantee cover expanded by ₹50,000 crore to ₹5 lakh crore.

    What is ECLGS?

    • Under the Scheme, 100% guarantee coverage to be provided by National Credit Guarantee Trustee Company Limited (NCGTC) for additional funding of up to Rs. 3 lakh crore to eligible MSMEs and interested MUDRA borrowers.
    • The credit will be provided in the form of a Guaranteed Emergency Credit Line (GECL) facility.
    • The Scheme would be applicable to all loans sanctioned under GECL Facility during the period from the date of announcement of the Scheme to 31.10.2020.

    Aims and objectives

    • The Scheme aims at mitigating the economic distress faced by MSMEs by providing them additional funding in the form of a fully guaranteed emergency credit line.
    • The main objective is to provide an incentive to Member Lending Institutions (MLIs), i.e., Banks, Financial Institutions (FIs) and NBFCs to increase access to, and enable the availability of additional funding facility to MSME borrowers.
    • It aims to provide a 100 per cent guarantee for any losses suffered by them due to non-repayment of the GECL funding by borrowers.

    Salient features of ECGLS

    • The entire funding provided under GECL shall be provided with a 100% credit guarantee by NCGTC to MLIs under ECLGS.
    • Tenor of the loan under Scheme shall be four years with a moratorium period of one year on the principal amount.
    • No Guarantee Fee shall be charged by NCGTC from the Member Lending Institutions (MLIs) under the Scheme.
    • Interest rates under the Scheme shall be capped at 9.25% for banks and FIs, and at 14% for NBFCs.

     

     

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  • What is OPEC+?

    Oil prices rose about 1%, as OPEC+ members agreed to its deepest cuts to output since the 2020 COVID pandemic, despite a tight market and opposition to cuts from the United States and others.

    What is OPEC+?

    • The non-OPEC countries which export crude oil along with the 14 OPECs are termed as OPEC plus countries.
    • OPEC plus countries include Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan, and Sudan.
    • Saudi and Russia, both have been at the heart of a three-year alliance of oil producers known as OPEC Plus — which now includes 11 OPEC members and 10 non-OPEC nations — that aims to shore up oil prices with production cuts.

    Why is OPEC+ slashing production?

    • Oil prices skyrocketed after Russia’s invasion of Ukraine.
    • The cut made recently is the biggest of its kind since 2020 when OPEC+ members slashed outputs by 10 million bpd during the Covid-19 pandemic.
    • The reductions would boost prices and be extremely beneficial for the Middle Eastern member states, to whom Europe has turned for oil after levelling sanctions against Russia since it invaded Ukraine.
    • OPEC+ members are concerned that a faltering global economy would reduce the demand for oil, and the cuts are seen as a way to protect profits.

    Concerns for India

    • Even after importing cheap Russian oil, India has not seen any cut in fuel prices.
    • Rising oil prices are posing fiscal challenges for India, where heavily-taxed retail fuel prices have touched record highs, threatening the demand-driven recovery.
    • India imports about 84% of its oil and relies on West Asian supplies to meet over three-fifths of its demand.
    • As one of the largest crude-consuming countries, India is concerned that such actions by producing countries have the potential to undermine consumption-led recovery.
    • This would hurt consumers, especially in our price-sensitive market.

     

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  • Quantum Technology : Next generation Computers are achievible

    QuantumContext

    • The Nobel Prize committee decided to honour three scientists Alain Aspect of France, John Clauser of the US, and Anton Zeilinger of Austria for their work in domain quantum physics.

    What is the contribution of these three scientists?

    • Together, these three have made seminal contributions to not just the foundations of quantum theory but also to efforts that have now enabled the possibility of a wide range of applications.
    • Their experiments have conclusively established that the ‘entanglement’ phenomenon observed in quantum particles was real, not a result of any ‘hidden’ or unknown forces.

    What is the Significance of this Discovery?

    • Wide applications: It could be utilised to make transformative technological advances in computing, hack-free communications, and science fiction-like concept of ‘teleportation’.

    Quantum What is Quantum Theory?

    • Subatomic level: Quantum theory is a fundamental theory in physics that provides a description of the physical properties of nature at the scale of atoms and subatomic particles.It is the foundation of all quantum physics including quantum chemistry, quantum field theory, quantum technology, and quantum information science.
    • Different from conventional physics: Quantum mechanics differs from classical physics in that energy, momentum, angular momentum.

    Development in Quantum Theory so far

    • Planck’s assumption: In 1900, Planck made the assumption that energy was made of individual units, or
    • Albert Einstein’s theory : In 1905, Albert Einstein theorized that not just the energy, but the radiation itself was quantized in the same manner.
    • Louis de Broglie theory: In 1924, Louis de Broglie proposed that there is no fundamental difference in the makeup and behaviour of energy and matter; on the atomic and subatomic level either may behave as if made of either particles or waves. This theory became known as the principle of wave-particle duality: elementary particles of both energy and matter behave, depending on the conditions, like either particles or waves (wave-particle duality).
    • Heisenberg proposed: In 1927, Werner Heisenberg proposed that precise, simultaneous measurement of two complementary values – such as the position and momentum of a subatomic particle – is impossible. Contrary to the principles of classical physics, their simultaneous measurement is inescapably flawed; the more precisely one value is measured, the more flawed will be the measurement of the other value. This theory became known as the uncertainty principle, which prompted Albert Einstein’s famous comment, “God does not play dice.”

    QuantumWhat is Entanglement?

    • Entanglement was another of several weird properties exhibited by these tiny particles. Two particles, having ‘interacted’ with each other at some stage, were found to have got ‘entangled’ in a way that the behaviour of one produced an instantaneous reaction in the other even if the two were no longer connected in any way and were separated by very large distances.
    • The entanglement property to open up new technological possibilities. first time that it was possible to ‘teleport’ the quantum states of a particle to another location without the particle moving anywhere and without a medium.

    What is Superposition?

    • It’s a phenomenon where, a particle exists simultaneously at multiple locations, known as superposition. The chance of finding the particle at any given place was dictated by probabilistic calculations, and once it was found, or observed, at one location, it ceased to exist at all other places.

    What was the Einstein’s assessment?

    • Special theory of relativity: Einstein’s Special Theory of Relativity prohibited any signal from travelling faster than the speed of light. The seemingly instantaneous communication due to entanglement had the danger of further unravelling the foundations of physics.
    • Spooky behaviour: Einstein describes the strange behaviour by quantum particles as ‘spooky’.
    • Speed of light: One major concern of Einstein, that entanglement allows for transmission of information at speeds faster than light, was not entirely accurate.When an operation is performed on one of the entangled particles, there is an instantaneous reaction in the other.
    • Communication problem: There is no way for the observer at the other end to know the reaction has happened. The observer has to be made aware of the operation having been performed, and this happens only through classical communication channels limited by the speed of light restriction.

    QuantumConclusion

    • The entanglement property is now being utilised to build the next generation of computers, called quantum computers, which exploit the quantum behaviour of particles to overcome challenges considered as unsurmountable. It is being used to create secure communication algorithms that would be immune to hacking.

    Mains Question

    Q.What is the quantum theory? How it is different from classical theory of physics? How entanglement property is used in various applications?

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  • India-China Relations

    ChinaContext

    • The National Congress of the Chinese Communist Party (CCP), scheduled in October, promises to deliver important outcomes, which will impact not just China but affairs of other nations, neighbour and beyond. A look into India-china Relationship as china has always been hostile towards its neighbours.

    Background of Indo-China Relations

    • 1950
      • India and China established diplomatic relations on 1st April 1950.
      • India was the first non-socialist country to establish relations with the People’s Republic of China and the catchphrase ‘Hindi Chini Bhai Bhai’ became famous.
    • 1955
      • Both countries attended the Asian-African Conference in which 29 countries participated in Bandung, Indonesia and jointly advocated the Bandung Spirit of solidarity, friendship and cooperation.
      • It has led to the decolonisation of the whole of Asia and Africa and to the formation of a Non-Aligned Movement as the third Way between the Two Blocs of Superpowers.
      • The First NAM Summit Conference took place in Belgrade, Yugoslavia, in September 1961.
    • 1962
      • The border conflict led to a serious setback in bilateral relations.
    • 1976
      • China and India restored ambassadorial relations and bilateral ties improved gradually.
    • 1988
      • Indian Prime Minister Rajiv Gandhi visited China, initiating the process of normalization of bilateral relations.
      • The two sides agreed to look forward and develop bilateral relations actively in other fields while seeking a mutually acceptable solution to boundary questions.

    Areas of Cooperation between India and China

    1.Political Relations between India and China

    • In 1993, Agreement on the Maintenance of Peace and Tranquility along the Line of Actual Control (LAC) on the India-China Border Areas was signed to bring stability and substance in bilateral ties.
    • In 2008, two countries have also extended their strategic and military relations.
    • MoU was signed to open an additional route for Kailash Mansarovar Yatra through Nathu La.
    • India and China have also established a High Level Dialogue Mechanism on Counter Terrorism and Security
    • To facilitate exchanges between Indian states and Chinese provinces, States/Provincial Leaders Forum was established

     2.Commercial and Economic Relations between Indo-China

    • China will establish two Industrial Parks in India and expressed their intention to enhance Chinese investment in India
    • India extended e-visa facility to Chinese nationals
    • Trade and Economic Relationship are shaped through various dialogue mechanism
    • Joint Economic Group led by the Commerce Ministers of both sides
    • Strategic Economic Dialogues led by the Vice Chairman of NITI Aayog and the Chairman of National Development and Reform Commission of China

     3.Cultural Relations between India and China

    • India and China have entered into an agreement on co-production of movies
    • Yoga is becoming increasingly popular in China. China was one of the co-sponsors to the UN resolution designating June 21 as the International Day of Yoga

     4.Education Relations between India and China

    • India and China signed Education Exchange Programme (EEP), which is an umbrella agreement for educational cooperation between the two countries.
    • Chinese students are also annually awarded scholarships to study Hindi at Kendriya Hindi Sansthan, to learn Hindi

     5.Indian Community

    • Presently around 35,500 Indians are staying in China, students and working professional form a major part of it.
    • PICFA” Pondicherry India China friendship association is an NGO dedicated for developing people-to-people relation between India and China in areas of education, culture and tourism.

    What are the recent anti- India moves by China?

    • China continues to stake its claim to Arunachal Pradesh as Southern Tibet.
    • Beijing recently renamed 15 places in Arunachal Pradesh, following the six it had done in 2017.
    • China justifies the renaming as being done on the basis of its historical, cultural and administrative jurisdiction over the area — these old names existed since ancient times which had been changed by India with its “illegal occupation”.
    • On January 1, 2022, Beijing’s new land border law came into force, which provides the People’s Liberation Army (PLA) with full responsibility to take steps against “invasion, encroachment, infiltration, provocation” and safeguard Chinese territory

    China

    What is the present situation of Indo-China relations?

    • Troops in Ladakh: We have been on tenterhooks since the sanguinary Galwan clash of 2020, and borne a heavy cost for the “mirror-deployment” of 50,000-60,000 additional troops in Ladakh.
    • LAC negotiations: Sino-Indian diplomatic parleys having been suspended, the task of LAC negotiations has been foisted on local military commanders.
    • Truce for SCO: The 16th successive commanders’ meeting would have seen yet another futile conclusion, but for compulsions of the impending Shanghai Cooperative Organisation, which apparently led to a modest breakthrough. Consequently, the third round of troop disengagement and the creation of another buffer zone has taken place in Siachen, this time in the area of Gogra-Hot Springs.
    • Bilateral Trade: The India-China trade is on course to cross USD 100 billion for the second consecutive year as it has gone up to USD 67.08 billion in the first half of this year amid a big surge of Chinese exports.
    • “According to the statistics of Chinese competent authorities, bilateral trade volume between China and India stood at USD 125.66 billion in 2021.China remains the largest trade partner of India and for the first time the bilateral trade exceeded USD 100 billion in 2021.

    China

    Issue of concerns in India-China relations:

    China-India border dispute: history shows solution may lie with Xi Jinping and Narendra Modi | South China Morning Post

    • Belt Road Initiative: India has objected this, since its inception on grounds of violating its sovereignty pointing to China Pakistan Economic Corridor.
    • India’s support to China on global issues has not led to Beijing’s reciprocation for instances: China opposed India’s permanent membership to UN Security Council and entry into NSG.
    • India faces trade imbalance heavily in some favor of China. In 2017-18, trade deficit has gone wide to US$62.9 billion in China’s favor.
    • Two countries failed to resolve their border dispute and steadily established military infrastructure along border areas Indian media outlets have repeatedly reported Chinese military incursions into Indian territory
    • China has expressed concerns about Indian military and economic activities in the disputed South China Sea. Same way India is also concerned about rising Chinese activities in Indian Ocean.
    • China’s strong strategic bilateral relations with Pakistan and other neighboring countries like Nepal and Bhutan is cause of concern as these countries act as buffer states.

    China

    What are the options for India to learn from the past and see what lies ahead in India-China relations?

    • Inevitable Race: The prevailing tension on the China-India border is a symptom of the broader strategic competition between the two Asian neighbors.
    • Quad grouping: Immediately after the clashes, India leaned toward the Quad a grouping of the United States, Australia, Japan, and India with multiple summit meetings and other engagements. Until that point, India was unwilling to refer to the Quad as the Quad, instead using the cumbersome India-Australia-Japan-United States grouping.
    • Equal seriousness: Both sides should treat the military escalation in eastern Ladakh with equal seriousness.
    • Armed coexistence: Even after the resolution of the present standoff in eastern Ladakh, both sides may be in a prolonged period of armed coexistence as a new normal. As the forces on both sides are likely to be relatively balanced, it would be advantageous for both to return to the agreements and understandings from 1993 onward and improve upon them. Clarifying the LAC is a crucial step in this effort.
    • Address trade imbalance: India has flagged the unsustainable trade imbalance at the front and centre of the relationship, and this has gone unaddressed. China will need to work on resolving the trade deficit with India. At any rate, decoupling will happen selectively, in the same way and for the same reasons that China is choosing to decouple from the United States. A balanced trade and economic relationship might lay a solid foundation for future relations, given the size of both economies.
    • Dialogue is necessary: Better understanding of each other’s regional initiatives through open dialogue is important to build trust. The Indo-Pacific vision is as much a developmental necessity for India as the BRI may be to China. Part of building trust must be an open discussion on each other’s intentions in key regions South Asia and the northern Indian Ocean and East Asia and the western Pacific as well as respect for each other’s special positions in the western Pacific and northern Indian Oceans.
    • Protect the core interest: The two sides would need to accommodate the legitimate interests of the other side on key partnerships: China’s with Pakistan and India’s with the United States. These may not be desirable, but in the current circumstances neither will give up its partners, and both India and China could talk through a modus vivendi on the red lines of concern.

    Conclusion

    • The two countries are standing at a crossroads, and this might be the final chance to take the path to coexistence of cooperation and competition. If not, a new phase of antagonistic rivalry may be starting, with the countries sliding into possible confrontation as the strategic periphery of China collides with the strategic backyard of India in the Indian Ocean region.

    UPSC Mains Question

    Q.India and China are the two Asian giants aspiring for regional supremacy and global influence, clash is unavoidable. Discuss how India and china can coexist together.

     

  • Is Draft Telecommunications Bill, 2022 Flawless?

    Draft Telecommunications Bill, 2022Context

    • Keeping an eye on the telecommunication regulatory framework Supreme Court issued substantive legal reform on surveillance laws in India. Union government has published the Draft Telecommunications Bill, 2022 to replace the Telegraph Act, 1885.

    Background

    • Over two decades ago, allegations of surveillance against politicians led to a CBI inquiry and report against V P Singh’s government. The allegations revealed that imaginary reasons were given for ordering phone tapping without authorization.
    • Last years, many publications reported that phones of several dozen Indian journalists, lawyers and human rights activists had been compromised using an invasive Israeli-developed malware called Pegasus.

    Draft Telecommunications Bill, 2022What is Draft Telecommunications Bill, 2022?

    • The draft Indian Telecommunication Bill, 2022 is an attempt by the Department of Telecommunications (DoT) to consolidate various legislations presently governing the telecommunication landscape in India.
    • The Bill seeks to replace three laws, the Indian Telegraph Act, 1885, the Indian Wireless Telegraphy Act, 1933 and the Telegraph Wires (Unlawful Possession) Act, 1950.
    • The new regulatory framework is to bring the law at par with technological advancements and remove obsolete provisions from the colonial era laws.

    What are the current laws governing communication surveillance in India?

    Communication surveillance in India takes place primarily under two laws:

    • Telegraph Act, 1885: It deals with interception of calls.
    • Call interception:Under Section 5(2) of this law, the government can intercept calls only in certain situations.
    • For sovereignty:They include the interests of the sovereignty and integrity of India, the security of the state, friendly relations with foreign states or public order, or for preventing incitement to the commission of an offense.
    • Free speech restrictions:These are the same restrictions imposed on free speech under Article 19(2) of the Constitution.
    • Exceptions for journalists:A provision in Section 5(2) states that even this lawful interception cannot take place against journalists.
    • Information Technology Act, 2000: It was enacted to deal with surveillance of all electronic communication, following the Supreme Court’s intervention in 1996.
    • Electronic surveillance:Section 69 of the IT Act and the IT (Procedure for Safeguards for Interception, Monitoring, and Decryption of Information) Rules, 2009 were enacted to further the legal framework for electronic surveillance.
    • Data interception:Under the IT Act, all electronic transmission of data can be intercepted.
    • Section 69 of the IT Act adds another aspect that makes it broader — interception, monitoring, and decryption of digital information “for the investigation of an offense”.

    Draft Telecommunications Bill, 2022How the loopholes in the current system breaching the Data Privacy?

    • No comprehensive data Protection Law:
    • No comprehensive data protection law leaving ambiguities over several laws.
    • A comprehensive data protection law to address the gaps in existing frameworks for surveillance is yet to enact.
    • Unaccountable, opaque exercise of surveillance:
    • The Telegraph Act contains broad and excessive powers of interception and surveillance of communications carried out through any telegraph.
    • The surveillance power is principally contained under Section 5(2), and has resulted in an unaccountable, opaque and unconstitutional exercise of surveillance that has led to accusations across the political spectrum.
    • Less transparency:
    • Ministry of Home Affairs refuses to disclose even aggregate data on the number of surveillance orders issued by it each year illegally gathered evidence is being sought to prosecute people.
    • For instance, the Bombay High Court about three years ago noted in a case that premier investigating agencies such as the CBI have used, interception orders (that) neither have sanction of law nor issued for legitimate aim.

    Draft Telecommunications Bill, 2022Key features of the Draft Telecommunications Bill, 2022

    • Broad Definitions:
    • The Bill introduces a broad definition of ‘telecommunication services’.
    • It now includes internet-based services, in-flight and maritime connectivity, interpersonal communications services, machine to machine communication services, and over-the-top (OTT) based communication services that are made available to users by telecommunication
    • KYC and caller id requirements:
    • The Bill requires licensed entities to ensure that they identify the persons to whom they provide telecommunication services.
    • The Bill places an obligation on telecommunication service providers to do this through a ‘verifiable mode’, as prescribed by the government.
    • Licensing, registration, and authorization:
    • Under the Bill, four types of permissions are identified – license, registration, authorization and assignment.
    • While the Bill does not differentiate between the four types of permissions, it clarifies that a license is only required for providing telecommunication services or operating telecommunication networks
    • Wide ranging powers of Central Government:
    • The Bill includes wide-ranging powers for the central and state governments in the event of a public emergency or in interest of public safety.
    • These powers include taking temporary possession of any telecommunication services, suspension of transmission in cases of public emergency, interception/detainment/disclosure of messages, suspension of communications, or otherwise transmit certain announcements for public safety and national security purposes.
    • User protection and duties: User has been declared as an important policy objective of the Government. It places a duty on users to not furnish false information, suppress material information or impersonate others when proving identity to avail telecommunication services.
    • Offences and penalties: Any offence under the Bill may be punished with a fine, imprisonment, suspension of telecommunication services or a combination of the above. For companies, the employees who were responsible for the conduct or the business relating to the offence at the time the offence was committed will be punished.
    • Dispute resolution mechanism: The Bill provides for the right of appeal before the appellate authority. It also creates an enabling provision for the Central Government to set up an alternate dispute resolution mechanism such as arbitration, mediation or other processes of dispute resolution

    What are Concerns over the Draft Telecommunication bill, 2022?

    • Regulatory overlaps:The broad of the definition of ‘telecommunication services’ include OTT communication platforms such as WhatsApp, Telegram, Signal among others, may potentially lead to regulatory or jurisdictional overlaps.
    • Unchecked use of State powers:The Bill gives broad powers to the central government in prescribed situations without any accompanying checks and balances. The Bill empowers the central and state government to intercept messages in the interest of public safety and emergency without the providing clearly defined guardrails for it.
    • Undefined National security: The term, national security is left undefined and does not match constitutional precedent or text which instead uses the phrase,in the interests of the security of state
    • Users Less choice in the privacy and security of their digital footprint:
    • Power to prescribe standards under Clause 23, which may result in regulations as recently issued by the Computer Emergency Response Team (CERT-In) that have resulted in the closure of servers or services by leading, global VPN providers such as Proton and TunnelBear.
    • All of this practically means that users will have less choice in the privacy and security of their digital footprint, as these powers will lead to requirements to locally register and host data, and comply with requirements to identify users (KYC requirements).

    Conclusion

    • There should be some reasonable basis or some tangible evidence to initiate or seek approval for interception by State authorities. Any digression from the ethical and legal parameters set by law would be tantamount to a deliberate invasion of citizens.

    Mains Question

    Q. Any deviation from the moral and legal parameters set by the law would amount to a deliberate attack on citizens. In this context discuss the data privacy of citizens in the era of massive expansion of internet and mobile usage.

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