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  • Do India require All India Judicial Services

    Note4Students:

    There has been lingering issues of inefficiency, pendency of cases and vacancy of judges within the Indian judiciary. Recently union government sought the opinion of attorney general with regards to the AIJS. So discussion over AIJS is important.

    Introduction

    1. Article 309 of the Constitution deals with the recruitment and conditions of service of persons serving the Union or a State.
    2. It empowers the appropriate Legislature to regulate the recruitment and conditions of service of persons appointed to public services and post in connection with the affairs of the Union or of any State.
    3. The Constitution was amended in 1977 to provide for an AIJS under Article 312.
    4. Under article 312,if the Council of States has declared by resolution supported by not less than two-thirds of the members present and voting that it is necessary or expedient in the national interest so to do, Parliament may by law provide for the creation of one or more all-India services (including an all-India judicial service)] common to the Union and the States
    5. Earlier recommendations: The first Law Commission recommended the creation of an AIJS.  It opined that such a course is necessary in the interest of efficiency of the subordinate judiciary.
    6. This proposal was considered in the Law Ministers’ Conference held in the year 1960, but the proposal was shelved.
    7. The 8th Law Commission while examining the problem of arrears in trial courts, recommended formation of an AIJS.

    Analysis

    Problems of subordinate judiciary:

    1. Vacancies: There are at least 4,400 vacancies for judges in the subordinate judiciary, including for district judges.
    2. There always 20 per cent vacancies in the courts.
    3. Vacancies are never filled in time because the judiciary is unable to attract talent.
    4. Not attractive: Today the subordinate judiciary depends entirely on state recruitment. But the brighter law students do not join the state judicial services because they are not attractive.
    5. Career progression: With no career progression, no one with a respectable bar practice wants to become an additional district judge, and deal with the hassles of transfers and postings.
    6. Quality : Consequently, the quality of the subordinate judiciary is by and large average, although there are some bright exceptions.
    7. By extension, at least one-third of high court judges elevated from the subordinate judiciary are also mostly average. As a result, the litigants are left to suffer.
    8. Pendency of cases :As of December 31, 2015, 51.2 per cent of all cases pending in the subordinate courts have been pending for more than two years.

    Why AIJS Required

    1. Improved quality: It will improve the quality of judicial officers in high courts.
    2. Proved quality: One-third of the judges would enter the high courts through the route of promotion from subordinate courts. Judges of the Supreme Court are drawn from the high courts. In this process, the persons eventually selected into the judiciary would be of proven competence.
    3. Quality of judgements: Simultaneously, the quality of adjudication and the dispensation of justice would undergo transformative changes across the judicial system, from the lowest to the highest levels. This can have far-reaching impact on the quality of justice and on people’s access to justice as well.
    4. Accountability: A career judicial service will make the judiciary more accountable, more professional, and arguably, also more equitable.
    5. Time consumption: Well trained and qualified judicial officers would be instrumental to reduce the time required for the litigation.

    Recommendations of the National Judicial Pay Commission

    1. The AIJS should be constituted only in the cadre of District Judges as per provisions of Article 312 (3) of the Constitution.  The District Judges directly recruited and promoted should constitute the AIJS.
    2. The selection for direct recruitment should be by the National Judicial Commission / UPSC and the promotes by the respective High Courts.
    3. The qualification for direct recruitment to AIJS should be in conformity with that prescribed under Article 233(2) of the Constitution.
    4. Service Judges also should be allowed to compete for recruitment of AIJS, by appropriately amending Article 233(2) of the Constitution.
    5. Not exceeding 25% of the posts in the cadre of District Judges in every State should be earmarked for direct recruitment.
    6. The age limit for recruitment to AIJS should be between 35 years to 45 years.
    7. Appointment: The National Judicial Commission / UPSC, after selecting the candidates for direct recruitment to the cadre of District Judges, must allocate to the States / UTs, the candidates equal to the vacancies that are surrendered by them.
    8. The High Court thereupon will recommend those names to the Governor for appointment as per Article 233 of the Constitution.

    Arguments against AIJS

    1. Status of Legal education: The Bar Council of India has mismanaged legal education. Within this incredibly small talent pool, the judiciary competes by offering unremunerated pay and limited avenues for career advancement.so attractive remuneration will increase the quality of the judicial system.
    2. Disadvantages of national exam A “national exam” risks shutting out those from less privileged backgrounds from being able to enter the judicial services
    3. Inadequate knowledge of regional language would corrode judicial efficiency both with regard to understanding and appreciating parole evidence pronouncing judgments.
    4. Career prospects of state judiciary members: Promotional avenues of the members of the State judiciary would be severely curtailed causing heart burning to those who have already entered the service and manning of the State judicial service would be adversely effected.
    5. Statistics from different time period’s :shows that both the decentralised approach of each High Court conducting its own appointment and a centralised one of all India civil services seem to have roughly the same efficacy in filling up the vacancy.
    6. Erosion of control of the High Court over subordinate judiciary would impair independence of the judiciary.
    7. Overburdened judicial officers If clerical task of judicial officers has removed, entrusted to non-judicial clerks , it will help judges to focus on judicial matters. This will infuse more efficiency. AS per independent studies conducted by Centre for Civil Society and Daksh, clerical tasks constitute almost half of subordinate judges’ time.
    8. Source of real experience Richness of judiciary comes from experience and exposure to real cases which the AIJS exam will take away from.

    Conclusion

    The problems of the Indian judiciary at all levels have reached catastrophic level. The public is losing confidence in the judiciary despite the latter’s assertions. Data show that they are acting on this belief by filing fewer cases year on year. It is likely to be a combination of delays, cost, uncertainty, inefficiency and corruption. So, solution of these problems lies in the identifying a sustainable mechanism of appointment. That mechanism should address the negative aspects of the AIJS and de centralised appointment system.

    Questions:

    1. Do you support the idea of constituting an “All India Judicial Service .?

    2. The constitution of AIJS will solve the problems of judiciary. Critically analyse

     

  • IPR Policy 2016

     

    https://lh6.googleusercontent.com/XQwVamlGZ6MecYa6aoxzoyHZNJb73cm41s0NgcsXP1ce5_rRJH1VzKRpQXUinSWdout5hjiXi3LYb10hcmCydKO5pIU0RCEVCNGujOF_F8iBQIFmyjEQQv0VRm1ZrRdbe2zyxcGros7LK_QjEA

    Image Source

    Note4students

    It is very important for India to defend its IPR. And India wants to protect its rights in world trade.

    Introduction

    Last year, Indian Government has released India’s National Intellectual Property Rights (IPR) Policy. The Policy which is in compliance with WTO’s (World Trade Organisation) agreement on TRIPS (Trade Related aspects of IPRs), aims to sustain entrepreneurship and boost Prime Minister Narendra Modi’s pet scheme ‘Make in India.’

    Why we need this Policy?

    1. Global drug brands led by US companies have been pushing for changes to India’s intellectual property rules for quite some time now. They have often complained about India’s price controls and marketing restrictions.
    2. Also, an IPR policy is important for the government to formulate incentives in the form of tax concessions to encourage research and development (R&D). It is also critical to strengthen the Make In India, Startup and Digital India schemes.
    3. The IPR policy comes at a time when India and other emerging countries faces fresh challenges from the developed world and mega regional trade agreements such as the Trans-Pacific Partnership (TPP).

    Aim of the Policy

    1. The Policy aims to push IPRs as a marketable financial asset, promote innovation and entrepreneurship, while protecting public interest.
    2. The plan will be reviewed every five years in consultation with stakeholders.
    3. In order to have strong and effective IPR laws, steps would be taken — including review of existing IP laws — to update and improve them or to remove anomalies and inconsistencies.
    4. The policy is entirely compliant with the WTO’s agreement on TRIPS.
    5. Special thrust on awareness generation and effective enforcement of IPRs, besides encouragement of IP commercialisation through various incentives.
    6. What do Policy say on Interanational Treaties and Agreements?
    7. India will engage constructively in the negotiation of international treaties and agreements in consultation with stakeholders.
    8. The government will examine accession to some multilateral treaties which are in India’s interest, and become a signatory to those treaties which India has de facto implemented to enable it to participate in their decision making process

    Suggestion for DIPP

    1. It suggests making the department of industrial policy and promotion (DIPP) the nodal agency for all IPR issues.
    2. Copyrights related issues will also come under DIPP’s ambit from that of the Human Resource Development (HRD) Ministry.
    3. On Compulsory Licensing – According to the policy, India will retain the right to issue so-called compulsory licenses to its drug firms, under “emergency” conditions.
    4. Also, the government has indicated that there is no urgent need to change patent laws that are already fully World Trade Organizationcompliant.
    5. So India has resisted pressure from the US and other Western countries to amend its patent laws.
    6. The policy also specifically does not open up Section 3(d) of the Patents Act, which sets the standard for what is considered an invention in India, for reinterpretation.
    7. As per the WTO norms, a CL can be invoked by a government allowing a company to produce a patented product without the consent of the patent owner in public interest.
    8. Under the Indian Patents Act, a CL can be issued for a drug if the medicine is deemed unaffordable, among other conditions, and the government grants permission to qualified generic drug makers to manufacture it.

    Possible Benefits of the Policy

    1. The new policy will try to safeguard the interests of rights owners with the wider public interest, while combating infringements of intellectual property rights.
    2. By 2017, the window for trademark registration will be brought down to one month. This will help in clearing over 237,000 pending applications in India’s four patent offices.
    3. It also seeks to promote R&D through tax benefits available under various laws and simplification of procedures for availing of direct and indirect tax benefits.
    4. Unlike earlier where copyright was accorded to only books and publications, the recast regime will cover films, music and industrial drawings. A host of laws will also be streamlined — on semi-conductors, designs, geographical indications, trademarks and patents.
    5. The policy also puts a premium on enhancing access to healthcare, food security and environmental protection.
    6. Policy will provide both domestic and foreign investors a stable IPR framework in the country. This will promote a holistic and conducive ecosystem to catalyse the full potential of intellectual property for India’s growth and sociocultural development while protecting public interest.
    7. It is expected to lay the future roadmap for intellectual property in India, besides putting in place an institutional mechanism for implementation, monitoring and review. The idea is to incorporate global best practices in the Indian context and adapt to the same.

    Question

    Q.) “According to the IPR policy, India will retain the right to issue so-called compulsory licenses to its drug firms, under “emergency” conditions.” Discuss the concerns of some of the westerner countries which are against this policy of India

    Source:

    The Hindu

    PIB

  • Hydrocarbon exploration and licensing policy

    Note4Students:

    The NDA government has announced a radical overhaul of the oil and gas exploration policy. It has launched Hydrocarbon exploration and licensing policy to replace the existing NELP which was introduced in 1999.

    Hydrocarbon Exploration and Licensing Policy (HELP) is a policy adopted by Government of India on 10.03.2016 indicating the new contractual and fiscal model for award of hydrocarbon acreages towards exploration and production (E&P). HELP is applicable for all future contracts to be awarded.

    Background

    1. India’s offer of oil and gas exploration blocks under NELP since 1999 had limited success in terms of commercial discoveries and their monetisation. Of the 254 blocks auctioned in the nine NELP rounds, commercial production started in three blocks with total output of 0.4 million tonnes of crude oil and 26.11 million standard cubic metres of gas per day.
    2. The present New Exploration Licensing Policy (NELP) has are separate policies and licenses for different hydrocarbons.  Unconventional hydrocarbons (shale gas and shale oil) were unknown when NELP was framed 18 years ago. This fragmented policy framework is leading to inefficiencies in exploiting natural resources. For example, while exploring for one type of hydrocarbon, if a different one is found, it will need separate licensing, adding to cost.
    3. The NELP mechanism of profit-sharing where explorers first recovered their costs and then shared profits with the government was severely criticized by the CAG during an audit of KG-D6 block operated by Reliance Industries. The CAG alleged that RIL is exaggerating the costs to lower the government’s profit share.

    Key Features of HELP

    1. A Single License: A single license for exploration and production of all forms of hydrocarbons in blocks to firms offering the maximum revenue to the government would be given.
    2. Open acreage policy: Blocks would be allocated under the ‘open acreage policy’, wherein companies can submit bids for areas of their choice.under open acreage policy companies can choose blocks from the designated area round the year without waiting for roadshows and auctions like in NELP.
    3. Revenue Sharing model: production-sharing contract between government and contractors would henceforth be governed by a revenue-sharing model instead of a profit-sharing one
    4. It provides for a common license for all hydrocarbons, including shale gas and coal bed methane, and does away with computing complex investment multiples and scrutinizing cost recoveries
    5. It also provides marketing and pricing freedom for the crude oil and natural gas produced.
    6. On the lines of NELP, cess and import duty will not be applicable on blocks awarded under the new policy.

    Benefits of HELP

    1. Will promote ease of doing business: In the NELP, contractors gold-plated their costs to artificially depress profits. This not only led to disputes and litigation but also caused project delays as government pored over each decision by the contractor to check for possible fraud. Such problems are less likely to occur under revenue-sharing. Under the new regime, the Government will not be concerned with the cost incurred and will receive a share of the gross revenue from the sale of oil, gas etc. This is in tune with Government’s policy of “Ease of Doing Business”.
    2. Will allow producers to charge a competitive market price : One of the reasons why domestic oil and gas exploration has suffered over the years despite the fact that India has a huge import dependence as over three-fourths of the domestic crude oil demand and about a third of the domestic demand for gas are met by imports — is the inability of companies to price the output in a profitable manner. Now, instead of pricing being determined by a formula set by a committee, Help will allow producers to charge a competitive market price for new production, subject to a ceiling determined by the landed price of alternative fuels, such as fuel oil, liquefied natural gas and naphtha. It would boost investment in the sector.
    3. Help’ will also allow energy companies to produce whatever form of hydrocarbon is available from a licensed block—coal bed methane, shale gas/oil, tight gas and gas hydrates—without seeking separate permission for producing each of the fuels.
    4. Promote investment: Under the new regime, there will not be yearly auction of a cluster of identified blocks. Instead, investors can access data about all the blocks available and would be encouraged to bid at any time of their choice under the open acreage principle.
    5. Recognising the higher risks and costs involved in exploration and production from offshore areas, lower royalty rates for such areas have been provided as compared to NELP royalty rates to encourage exploration and production.  A graded system of royalty rates have been introduced, in which royalty rates decreases from shallow water to deepwater and ultra-deep water.
    6. Increase Transparency: It would increase transparency and would reduce government intervention in the sector since government would not face the burden of scrutinizing the cost of the firms involved in the sector. This is in tune with the government motto of minimum government maximum governance/

    Concerns Raised

    1. The costs involved in exploration is very high and it is also marked by uncertainty. The shift to revenue-sharing could prove to be a disincentive as the investment recovery period for producers gets prolonged since he has to share the revenue with the government from day 1.
    2. Blocks already under production aren’t covered
    3. Banks may not give credit easily to such projects given their high gestation periods and the rising NPAs
    4. Since royalty rates over land is uniform, regions like NE may be ignored by companies
    5. If the gas prices are set too high, sectors like power, fertilizers etc. may be affected

    HELP VS NELP

    Image result for hydrocarbon exploration and licensing policy

    Conclusion

    1. Overall, the policy is a step in the right direction. It will not only bring transparency in the energy sector but would also attract much needed investment in the sector; It should be tweaked in the future to ensure better implementation. If followed in its letter and spirit, the policy can help India achieve energy security in the long run.

    Source:

    http://www.arthapedia.in/index.php?title=Hydrocarbon_Exploration_and_Licensing_Policy_(HELP)

    http://pib.nic.in/newsite/PrintRelease.aspx?relid=137638

    Questions:

    Q.1) Examine how would the new Hydrocarbon Exploration Licensing Policy (Help) affect interests of consumers and producers.

    Q.2) The new Hydrocarbon Exploration Licensing Policy, or HELP, is said to signal one of the most important market-oriented sectoral reforms of the past two decades. Examine why.

  • HEERA To Replace UGC, AICTE As A Single Higher Education Regulator


    Note4Student:

    The deficiencies of UGC have been highlighted by various reports and committees. At such a time, the idea of setting up this body has come forward. Its probable a question might be asked.

    Context

    With an aim to simplify and consolidate the mass of regulations and compliances that currently operate in the sector, the Central Government has proposed to do away with the All India Council for Technical Education (AICTE) and the University Grants Commission (UGC) and replace them with a single body, tentatively titled Higher Education Empowerment Regulation Agency (HEERA).

    What are UGC and AICTE?

    UGC (university Grants Commission)

    1. The UGC has two primary responsibilities: (a) providing funds to educational institutions; and (b) coordinating, determining and maintaining standards in institutions of higher education.
    2. Its main functions are: promoting and coordinating education in universities, determining and maintaining standards for teaching, examination and research in universities, framing regulations on minimum standards for education, disbursing grants to universities and colleges, liaising between the CG, State governments and higher educational institutions, and advising the CG and State governments on possible policy measures to improve higher education in India.

    AICTE (All India Council of Technical Education)

    1. AICTE is a professional council constituted by the government to govern technical education in India.
    2. AICTE’s objectives include: promoting quality in technical education, planning the co-ordination and development of the technical education system and regulation of technical education and maintenance of norms and standards for technical education in India.

    Why does India’s higher education need a reform?

    1. The idea to have a single higher education regulator is not a new one, but has been recommended by various committees set up by previous governments. While the National Knowledge Commission (2006) had recommended an independent regulatory authority for higher education, the Committee on Renovation and Rejuvenation of Higher Education (2009) had also advocated an apex regulatory body by converging multiple agencies in the field of higher education.
    2. The TSR Subramanian committee, which had been tasked with coming up with a new education policy, too called for the scrapping of the UGC and AICTE.
    3. The UGC Review Committee in 2014 had also recommended the commission be replaced with an apex institution named National Higher Education Authority.

    What will be HEERA’s role and function?

    1. HEERA is expected to eliminate the overlaps in the jurisdiction and remove irrelevant regulatory provisions.
    2. It will bring the regulation of both technical and non-technical higher education institutions under one umbrella.
    3. The way UGC and AICTE have been roundly criticised for their poor handling of higher education so far, HEERA is likely to be structured in a manner that addresses these deficiencies.

    Advantages of HEERA:

    1. The introduction of a unified regulator for both UGC and AICTE would eliminate all overlaps in jurisdiction and also do away with regulatory provisions that may no longer be relevant.
    2. Sponsoring bodies of institutes of higher education would no longer be required to approach multiple authorities for clearances, which is likely to promote ease of development of institutions of higher learning.
    3. HEERA is also expected to have sharper teeth than the extant AICTE and UGC: the HEERA Law is likely to empower HEERA to take strict penal action against defaulting institutions.
    4. The multiple sets of rules and sub-regulations prescribed by UGC and AICTE, unfortunately, seem to have acted as a deterrent to the development of premier educational institutions would be done away with by setting up of a single body.
    5. India has separated technical and non-technical education which is “outmoded and out of sync” with the rest of the world. Having a single regulator would result in better outcomes.
    6. Having a single statutory body for higher education will simplify and consolidate the mass of regulations and compliances that currently operate in the sector.

    Conclusion:

    1. The multiple sets of rules and sub-regulations prescribed by UGC and AICTE, unfortunately, seem to have acted as a deterrent to the development of premier educational institutions. There has long been a need for change in the regime governing higher education in India.
    2. The separation between the standards governing technical and non-technical education is seen as unnecessary and illusory. Therefore, the time is ripe for single unified authority for the regulation of higher education in the country.

    Present situation

    Though, India’s higher education sector needs reforms which are pending since long, the government’s plan to replace the University Grants Commission (UGC) and the All India Council for Technical Education (AICTE) with a single higher education regulator seems to have hit a roadblock with the HRD ministry putting the idea on hold.

    Source

    http://indianexpress.com/article/education/ugc-aicte-to-be-scrapped-replaced-by-heera-reports-4691511/

    http://www.thehindu.com/education/the-heera-conundrum/article19384415.ece

    http://www.thehindu.com/education/colleges/new-body-to-replace-ugc-aicte/article18730891.ece

    http://www.livemint.com/Education/YitGMlErQCF6PqnJoVWnTI/HRD-plan-to-replace-UGC-AICTE-with-single-regulator-in-limb.html

    Question:

    Q.1) The higher education reforms in India have been pending since long. Do you think at such a time, the creation of a body like HEERA will be game changing? Examine.

    Q.2) In view of the multiple sets of rules and sub-regulations prescribed by UGC and AICTE,  which have unfortunately, acted as a deterrent to the development of premier educational institutions, the time is ripe for single unified authority for the regulation of higher education in the country. In this context, discuss the advantages of HEERA, a proposed body.

  • Should Criminal defamation law be amended

    Note4Students

    Supreme Court of India in subramnanian swamy case upheld the validity of the criminal defamation law. The court pronounced its verdict on a batch of petitions challenging the constitutional validity of sections 499 and 500 of the Indian Penal Code providing for criminal defamation.This issue has been lingering about from last 2-3 years.A number of op-eds on this issue have been published in Hindu and IE in last few years.

    Introduction

    What is Defamation?

    1. Defamation refers to the act of publication of defamatory content that lowers the reputation of an individual or an entity when observed through the perspective of an ordinary man. Defamation in India is both a civil and a criminal offence.

    Sections 499 and 500:

    Sections 499 and 500 in the IPC deal with criminal defamation. While the former defines the offence of defamation, the latter defines the punishment for it.

      1. Section 499: Whoever, by words either spoken or intended to be read, or by signs or by visible representations, makes or publishes any imputation concerning any person intending to harm, or knowing or having reason to believe that such imputation will harm, the reputation of such person, is said, except in the cases hereinafter expected, to defame that person.
      2. Section 500: Whoever defames another shall be punished with simple imprisonment for a term which may extend to two years, or with fine, or with both.

    Analysis

    Why it should be retained?

    1. Reputation of an individual, constituent in Article 21 is an equally important right as free speech
    2. It has interpreted art 21 to provide for right to reputation and brought a new concept of constitutional fraternity – that is, an assurance of mutual respect and concern for each other’s dignity.
    3. The Supreme Court declared that the right to free speech under Article 19(1)(a) had to be “balanced” against the right to “reputation” under Article 21.
    4. It has been part of statutory law for over 70 years. It has neither diluted our vibrant democracy nor abridged free speech
    5. Protection for “legitimate criticism” on a question of public interest is available in the Civil law of defamation & Under exceptions of Section 499 IPC
    6. Mere misuse or abuse of law can never be a reason to render a provision unconstitutional rather lower judiciary must be sensitized to prevent misuse
    7. Monetary compensation in civil defamation is not proportional to the excessive harm done to the reputation
    8. Editors have to take the responsibility of everything they publish as it has far-reaching consequences in an individual and country’s life
    9. Since there is no mechanism to censor the Internet from within, online defamation could only be adequately countered by retaining defamation as a criminal offence.
    10. Also, criminalisation of defamation is part of the state’s “compelling interest” to protect the right to dignity and good reputation of its citizens.
    11. Unlike in the U. S, defamation in India cannot be treated only as civil liability as there is always a possibility of the defamer being judgment free, i.e., not having the adequate financial capability to compensate the victim.

    Why it should be deleted?

    1. These restrictions have a chilling effect on freedom of speech; they create an anomaly whereby the threshold for criminal prosecution for defamation is now possibly lower than the threshold for civil damages;
    2. “Constitutional fraternity” is not a part of Article 19(2) of the Constitution, which specifically limits the circumstances under which the state can restrict speech to eight enumerated categories.
    3. It is also nowhere in the fundamental rights chapter of the Constitution, so the question of “balancing” free speech against constitutional fraternity does not arise.
    4. Article 21 which is a shield to protect the individual against State persecution or indifference, is used as a sword to cut down the fundamental right to freedom of speech and expression because of this provision.
    5. Freedom of speech and expression of media is important for a vibrant democracy and the threat of prosecution alone is enough to suppress the truth. Many times the influential people misuse this provision to suppress any voices against them.
    6. Considering anecdotal evidence, every dissent may be taken as unpalatable criticism. Sections 499 and 500 of IPC prescribes two years’ imprisonment for a person found guilty of defamation.
    7. The right to reputation cannot be extended to collectives such as the government, which has the resources to set right damage to their reputations.
    8. The process in the criminal cases itself becomes a punishment for the accused as it requires him to be personally present along with a lawyer on each date of hearing.

    Given that a civil remedy to defamation already exists, no purpose is served by retaining the criminal remedy except to coerce, harass and threaten.

    It goes against the global trend of decriminalizing defamation

    1. Many countries, including neighbouring Sri Lanka, have decriminalized defamation.
    2. The United Kingdom abolished criminal defamation altogether
    3. More recently, the Constitutional Court of Zimbabwe struck it down as an unconstitutional restriction upon the freedom of speech.
    4. In 2011, the Human Rights Committee of the International Covenant on Civil and Political Rights called upon states to abolish criminal defamation, noting that it intimidates citizens and makes them shy away from exposing wrongdoing
    5. Investigative journalism can be curtailed and ombudsman would be threatened.
    6. The dozens of defamation cases filed in Tamil Nadu to silence journalists show that criminal defamation can fetter democratic accountability.

    Conclusion

    1. While the right to reputation may be protected by the Constitution, it should not be at the cost of freedom of speech.
    2. Free speech is necessary because, it enables the media to hold governments and individuals accountable. Freedom of speech should also protect the right to offend within reasonable limits.
    3. If the ability to legitimately criticize is not protected, voices throwing light on important issues will continue to be silenced by the rich and powerful

    Questions

    Do you think there a need for reform of India’s defamation laws? Critically comment

    “Supreme Court’s judgment on criminal defamation is the latest illustration of a syndrome” Critically comment

    “The Supreme Court verdict upholding the provisions of the Indian Penal Code that make defamation a criminal offence is retrograde and out of tune with the times”. Discuss

     

  • Judicial activism and Judicial overreach

    Note4Students:

    There lies a very thin line between the judicial overreach and judicial activism. Considering the recent pronouncements of SC, this topic has become important for mains.

    Context

    1. Some time back, it was commented that  judiciary must draw its own ‘Lakshman rekha (inviolable boundary)’ and not take decisions that fall in the domain of executive, highlighting the increasing friction between the judiciary and executive over a perceived overreach by the courts.

    What is judicial activism and judicial overreach?

    1. Judicial Review” is the process by which a court reviews the constitutionality of a statue or the application of a statute, and rules either for it or against it on that basis.
    2. “Judicial Activism” is the view that courts make political rather than legal decisions to further some agenda, rather than strictly reviewing the legality of a law under the letter of the law and prior precedent. It refers to the process in which judiciary steps into the shoes of legislature and comes up with new rules and regulations, which the legislature ought to have done earlier.
    3. Judicial Overreach refers to an extreme form of judicial activism where arbitrary, unreasonable and frequent interventions are made by judiciary into the legislature’s domain, often with the intention of disrupting the balance of powers between executive, legislature and judiciary.

    What is the need of judicial activism?

    Failure of other organs to discharge their duties:

    1. When the other political branches of the government viz. the legislature and the executive fail to discharge their respective functions, it leads to an erosion of the confidence of the citizens in the constitutional values and democracy. In such a scenario, the judiciary steps into the areas usually earmarked for the legislature and executive.

    Taking proactive steps by the judiciary:

    1. In case the fundamental rights of the people are trampled by the government or any other third party, the judges may take upon themselves the task of aiding the ameliorating conditions of the citizens cited as judicial activism.

    To fill the vacuum created by other organs of government:

    1. To fill the legislative vacuum and to meet the societal needs, the courts often indulge in judicial legislation thereby encroaching in the domain of legislature.

    What does constitution say about judicial activism?

    1. The Indian judiciary has been constitutionally vested with the power of review to keep the Executive and Legislature within constitutional boundaries. The Judiciary can strike down any law that is beyond Parliament’s legislative competence or is violative of the Constitution. Similarly, it can strike down any Executive action, if there is any patent illegality or arbitrariness to it.
    2. While Articles 13, 21, 32, 226 and 227 encompass this power, Article 142 extends a unique, extraordinary power to our Supreme Court to do ‘complete justice’ in any matter before it.

    Criticism of this idea:

    Disturbs the balance between organs of government:

    1. According to some critics, judicial overreach is upsetting the constitutional balance among the three organs of state – the legislature, the executive and the judiciary.

    Viewed as a challenge to basic structure:

    The judicial activism, at one point of time, was considered necessary to correct the failings of the legislature and the misdeeds of the executive. But it has now grown into a situation where the idea of separation of powers, which should be considered a feature of the basic structure of the Constitution, is challenged.

    Judiciary must perform its judicial functions:

    1. Activism can deteriorate into overreach if the judiciary considers itself the sole custodian of public interest, interprets public interest in its own fashion and seeks to force the legislature and the executive to implement its version of it. Judiciary has only got to interpret the laws and decide whether they conform to the Constitution and not more than that.

    Understanding thin line between activism and overreach:

    1. There is a thin line between activism and overreach. While judicial activism is considered positive to supplement the fallings of the executive, but the overreach into the executive’s domain is considered an intrusion into the proper functioning of democracy.
    2. Just as independence of the judiciary is part of basic structure, the primacy of the legislature in policy making is also part of basic structure and interference by the courts into their domain is not justified.

    Way Forward

    1. Although,  judicial review is legitimate domain of judiciary but then a limit or boundary has to be drawn. Judiciary, like all institutions in a democracy, should be accountable and know its own limits. It should not become a super parliament that frames laws and a super executive that seeks to implement them.
    2. The quality and speed of the mainstream judicial system can be improved by a comprehensive and integrative approach, focussed on improving judicial infrastructure and reducing indiscipline. Following points define the way in which judicial activism can prove constructive:
    3.  Improving judicial infrastructure
    4.  Develop discipline in the judicial system
    5.  Improve strength of judges
    6. Develop judicial competence, effective case management and use of information technology
    7. Review media role.

    Question:

    (Q) This is not the first time when questions have been raised on the judicial overreach and activism in India. Is judicial activism when executive is not able to efficiently perform its duties justified? Give arguments.

    (Q) Judicial activism and judicial overreach are separated by very thin line, and the judiciary has to be careful of it. If that line is crossed, judicial activism may be  considered an encroachment on legislature? Discuss.

    Sources

    http://www.thehindu.com/todays-paper/tp-opinion/Judicial-activism-romanticism-amp-overreach/article15177963.ece

    http://www.thehindu.com/opinion/lead/Disturbing-trends-in-judicial-activism/article12680891.ece

    http://indianexpress.com/article/opinion/columns/arun-jaitley-judicial-activism-supreme-court-2828018/

    http://www.livemint.com/Opinion/lPqfldPjTc9t4aBYupFZKK/The-judiciary-is-shifting-the-balance-of-power.html

    http://www.livemint.com/Opinion/hB3zoJOiAEKkUd6YUxw0rM/Judicial-boundaries.html

  • Article 35A debate

    Note4Students

    Article 35A triggers the discussion of special privileges of Kashmir. Kashmir had been stirred with terrorism and other unrest.  Another political controversy will drag the region into unrest again. It is important to find a solution. This article looks into various aspects of article 35A. In last, few years UPSC has asked a number of Questions on controversial constitutional articles and SC judgements, for example in 2013 UPSC asked a Question on Article 371 A and last year it asked a question on Article 239AA . Thus a question can be expected from this topic in Mains 2017.

    Introduction

    What is it?

    1. Article 35A is a provision incorporated in the Constitution giving the Jammu and Kashmir Legislature the authority to decide who all are ‘permanent residents’ of the State and confer on them special rights and privileges in public sector jobs, acquisition of property in the State, scholarships and other public aid and welfare
    2. The provision mandates that no act of the legislature coming under it can be challenged for violating the Constitution or any other law of the land.

    Implications

    1. Article 370 grants special status to J&K, while Article 35A, added to the Indian Constitution through a presidential order, empowers the J&K legislature to define the state’s “permanent residents” and their special rights and privileges.
    2. Article 35A was incorporated into the Constitution in 1954 by an order of the then President Rajendra Prasad on the advice of the Jawaharlal Nehru Cabinet. The controversial Constitution (Application to Jammu and Kashmir) Order of 1954 followed the 1952 Delhi Agreement entered into between Nehru and the then Prime Minister of Jammu and Kashmir Sheikh Abdullah, which extended Indian citizenship to the ‘State subjects’ of Jammu and Kashmir.
    3. So Article 35A was added to the Constitution as a testimony of the special consideration the Indian government accorded to the ‘permanent residents’ of Jammu and Kashmir.

    Recent Developments

    1. The threat of abrogation of Article 35A is leading to unprecedented political developments in the Valley. For instance, it is the first time in recent past that all major political parties in Kashmir, including the ruling People’s Democratic Party and the opposition National Conference, independent MLAs and even the Hurriyat have come together on an issue.
    2. Attorney General KK Venugopal telling Supreme Court, during a hearing on 35A, that the Centre was in favour of a ‘larger debate’ sent alarm bells ringing through the Valley
    3. Recently, a Kashmiri woman called Charu Wali Khan, settled outside the state, challenged the legality of Article 35A of the Indian Constitution that allows J&K to define its “permanent residents”. She claimed in her petition to the Supreme Court that such a law takes her succession rights away and disenfranchises her.
    4. In 2014, NGO approached the Supreme Court challenging Article 35A on the grounds that it was illegally added to the Constitution as it was never floated before Parliament.

    ANALYSIS

    WHAT’S THE CHALLENGE TO IT?

    1. Article 14 of the Constitution gives a fundamental right to equality before law. But 35A is heavily loaded in favour of males because even after marriage to women from outside, they will not lose the right of being permanent residents
    2. Outsider vs insider: while a woman from outside the state shall became a permanent resident on marrying a male permanent resident of the state, a daughter who is born state subject will lose her permanent resident status on marrying an outsider.
    3. It facilitates the free and unrestrained violation of fundamental rights of those workers and settlers like Scheduled Caste and Scheduled Tribe people who have lived there for generations. The Valmikis who were brought to the state during 1957 were given Permanent Resident Certificates on the condition that they and their future generations could stay in the state only if they continued to be safai-karmacharis (scavengers).
    4. Children of non-state subjects do not get admission to state colleges.
    5. It ruins the status of West Pakistani refugees. Being citizens of India they are not stateless persons, but being non-permanent residents of Jammu and Kashmir, they cannot enjoy the basic rights and privileges as being enjoyed by permanent residents of Jammu and Kashmir.
    6. It gives a free hand to the state government and politicians to discriminate between citizens of India, on an unfair basis and give preferential treatment to some by trampling over others, since the non-residents of the state are debarred from buying properties, getting a government job or voting in the local elections.
    7. At this juncture, it may be important to recall a landmark judgment delivered on October 2002, by the Jammu and Kashmir High Court, which held that women married to non-permanent residents, will not lose their rights, though children of such women will not enjoy succession rights.

    Why does it matter?

    1. The parliamentary route of lawmaking was bypassed when the President incorporated Article 35A into the Constitution.
    2. Article 368 (i) of the Constitution empowers only Parliament to amend the Constitution. So did the President act outside his jurisdiction? Is Article 35A void because the Nehru government did not place it before Parliament for discussion? A five-judge Bench of the Supreme Court in its March 1961 judgment in Puranlal Lakhanpal vs. The President of India discusses the President’s powers under Article 370 to ‘modify’ the Constitution. Though the court observes that the President may modify an existing provision in the Constitution under Article 370, the judgment is silent as to whether the President can, without the Parliament’s knowledge, introduce a new Article. This question remains open.
    3. A writ petition filed by NGO We the Citizens challenges the validity of both Article 35A and Article 370.
    4. It argues that four representatives from Kashmir were part of the Constituent Assembly involved in the drafting of the Constitution and the State of Jammu and Kashmir was never accorded any special status in the Constitution.
    5. Article 370 was only a ‘temporary provision’ to help bring normality in Jammu and Kashmir and strengthen democracy in that State, it contends. The Constitution-makers did not intend Article 370 to be a tool to bring permanent amendments, like Article 35A, in the Constitution.
    6. The petition said Article 35 A is against the “very spirit of oneness of India” as it creates a “class within a class of Indian citizens”. Restricting citizens from other States from getting employment or buying property within Jammu and Kashmir is a violation of fundamental rights under Articles 14, 19 and 21 of the Constitution.

    Issues Involved

    1. The major political parties of the Kashmir Valley, NC and PDP have remained in support to the preservation and safeguarding of Article 370 and Article 35A.
    2. In defense of Article 35-A, the Jammu and Kashmir state Government in November 2015, prepared a report which read, “though Article 368 has been applied to State of Jammu and Kashmir, that would not curtail power of President under Article 370 to amend any provision of Constitution of India in its application to Jammu and Kashmir”.
    3. The constitutional validity of Article 35A is, therefore, well established as it protects legislation passed by the J&K legislature relating to benefits to Permanent Residents from challenge on the ground of violation of Fundamental Rights, while extending the chapter on Fundamental Rights of the Indian Constitution to J&K. Thus this provision is in the nature of a proviso to the extension of the chapter on Fundamental Rights in the Indian Constitution to J&K. In fact, the Fundamental Rights were extended to J&K through the 1954 Presidential Order.
    4. The ruling party believes that the special status, certain rights and privileges are enjoyed only by the residents of the state which has given rise to alienation and separatist identity to the people of Jammu and Kashmir.
    5. Scrapping the Article 35A is seen as an assault on the special status of the Jammu and Kashmir by the state government.
    6. Article 35A cannot be challenged on the ground that they affect the fundamental rights of the other Indian Citizens.
    7. The rights of the state legislature are not unlimited and can be given only in the case of – Employment, Property, Settlement and Scholarship.
    8. Former chief minister Omar Abdullah also stated that this would create a bigger agitation as was witnessed in 2008 over the transfer of land to the Amarnath Shrine Board.
    9. Any alteration to Article 35A may leave the government at the Centre with a hot mess in its hands, damaging the vestiges of goodwill that ordinary Kashmiris may still have towards the Union of India.
    10. Any attempt to undermine, or dilute, these principles, already enshrined in the Constitution and wrenched after many decades of violence and bloodshed, can only serve to perpetuate the current cycle of unrest. In any case, it won’t act as a deterrent to terrorism in the valley.

    Conclusion

    Kashmir has been on the boil since last July, after Hizbul Mujahideen leader Burhan Wani was killed by the Indian Army. Since then, hundreds of ordinary people have been injured or killed in clashes with the armed forces and regular Internet shutdown has crippled normal life in the state. Taking a hasty step to deal with Article 35A under such dire circumstances, out of purely jingoistic or ideological concerns, may prove to be the last straw in the Centre’s relationship with the state.

    Question

    Article 35A undermines the unity of our nation. Critically analyse

    What is article 35A. what are the issues involved in it??

  • 100 Most Probable Topics + Q&A for IAS Mains 2017


    Dear students,

    One of the great advantages of having a tech platform which connects daily news and op-eds dynamically to its relevant newstrail is that over the time it helps us understand how a topic has evolved both qualitatively (facets of issues, complexity) and qualitatively (# of newscards, op-eds written and connected).

    With that objectivity in hand and UPSC’s changing patterns in mind, we sat together to write down Explainers on some 100+ probable topics for this years’ IAS Mains.

    Each explainer has an N4S and a parting question for you to attempt and review. All the blue links that you see here are LIVE hyperlinks where you can go and study. Rest will be up in no time.

    Note: A PDF compilation of these 100+ issues is available to the subscribers of our MegaCombo99 subscription. (Click2buy). The PDF is available in the dropboDropboxr/ google drive along with the monthly magazines and prelims daily compilations.

     


    Don’t have time to read links one by one? Get compilation PDF here, now FREE- http://imojo.in/5stnir


    Read all the issues? Attempt 100 most important questions for Mains 2017 here- http://imojo.in/39qdux


    Economy

    1. Advance in date of budget (pros and cons)
    2. A-Z of GST
    3. All about the Bankruptcy code 
    4. All about the NPA problem in India
    5. All about Cashless Economy
    6. Merger of Banks: Need & Challenges
    7. MPC an evaluation 
    8. Hydrocarbon exploration licensing policy
    9. Port Led Development growth (Focus on Sagarmala)
    10. UDAN scheme : Opportunities and Challenges
    11. Should PDS system be replaced by DBT
    12. Demonetization (An analysis)
    13. Labour reforms in recent years
    14. Banking reforms in recent years
    15. Recent PPP models (EPC, HAM ) an analysis
    16. Do India require High speed rail
    17. Air India disinvestment: Need & Challenges
    18. Abolition of FIPB
    19. Twin balance sheet problem
    20. Proposed wage code bill: Significance & issues
    21. Concept of PARA : Need & Challenges
    22. Should Agriculture be taxed
    23. Should India adopt Universal Basic income Model

    Polity and Governance

    1. Right to privacy Debate
    2. Should no detention policy be Scrapped
    3. Proxy voting for NRI
    4. HEERA To Replace UGC, AICTE As A Single Higher Education Regulator
    5. Should Lateral entry be allowed in civil services
    6. Swatch bharat mission (performance appraisal) 
    7. Skill India (performance appraisal) 
    8. Setting up of common water disputes settlement tribunal
    9. Should Criminal defamation law be amended
    10. Should section 124 be amended
    11. Judicial activism and Judicial overreach 
    12. VVPAT debate
    13. Curb on VIP Culture 
    14. Should there be simultaneous elections for Lok Sabha and Rajya Sabha 
    15. Should  Liquor be banned on highways 
    16. Should national anthem be Made mandatory in cinema halls 
    17. Enemy protection ordinance: issues and analysis 
    18. Proposal for National court of appeal
    19. Do India require All India Judicial Services
    20. Issue of Paid news
    21. Article 35 A debate
    22. Should First past the post system be replaced with Proportional Representation system

    Social Issues

    1. Should Section 498 be amended
    2. Child labour amendment bill 
    3. Surrogacy Bill 
    4. HIV Aids bill
    5. Mental Health Care Bill 
    6. Transgender bill 
    7. Demand for smaller states (in context of Gorkhaland issue)
    8. Maternity benefit amendment bill
    9. New Health policy 
    10. Why Dominant castes are asking for reservation 
    11. Prevention of Cruelty to Animals (Regulation of Livestock Markets) Rules, 2017
    12. Proposed medical termination of pregnancy amendment bill 
    13. Should Marital rape be criminalized
    14. National strategic plan for Malaria

    International Relations

    1. Qatar crisis and impact on India
    2. India Israel relations
    3. effect of US president Trump on India 
    4. Should India fight for membership of NSG 
    5. Doklam plateau issue
    6. BBIN agreement  
    7. BIMSTEC as counter to SAARC 
    8. Rohingaya Issue 
    9. Indo-Myanmar Relations 
    10. India-Japan Nuclear Deal : Significance & Challenges
    11. Model Bilateral Investment Treaty

    Science and tech

    1. Li-Fi
    2. CRISPR
    3. Reusable Launch vehicle
    4. ISRO soft power
    5. Cloud seeding
    6. IPR policy 2016
    7. GM Mustard debate
    8. Indian Neutrino observatory controversy
    9. Artificial intelligence
    10. Big data
    11. Internet of things
    12. Block Chain Technology and Bitcoins
    13.  Gravitational Waves
    14. Hyperloop
    15. Agri Research (role of ICAR)
    16. DNA profiling bill
    17. Hybrid electric vehicle
    18. Pressurized Heavy water Reactor

    Security

    1. Why India should have an evacuation plan for Overseas workers 
    2. Do we require a security policy 
    3. Naxalism Problem faced by India 
    4. Cyber security threats Faced by India 
    5. Fake news menace 

    Environment 

    1. Should Culling of animals be allowed
    2. Kigali agreement: Prospects and Issues
    3. Should we Adopt Polluters pay model
    4. A Direct Shift from BS-1V to BS-VI by 2020: Issues & Challenges
    5. Declaring river as living entity
    6. Compensatory Afforestation Fund Bill: Significance & Challenges
    7.  E-waste management Rules 2016
    8.  Plastic waste management Rules, 2016
    9. Solid waste management rules, 2016
    10.  Interlinking of rivers: Significance & Challenges
  • Monetary Policy Committee

    Note4Students

    Recently the Government amended the RBI Act to hand over the job of monetary policy-making in India to a newly constituted Monetary Policy Committee (MPC). The new MPC is to be a six-member panel that is expected to bring “value and transparency” to rate-setting decisions. It has started to function recently.

    Background/ Introduction

    1. India’s central bank used to take its monetary policy decisions based on the multiple indicator approach. Its rate decisions were expected to take into account inflation, growth, employment, banking stability and the need for a stable exchange rate.
    2. RBI would be subject to hectic lobbying ahead of each policy review and trenchant criticism after it. The Government would clamour for lower rates while consumers bemoaned high inflation. Bank chiefs would want rate cuts, but pensioners would want high rates.
    3. The MPC is not new and traces back to 2002 when the Y. V. Reddy Committee recommended for a MPC to decide policy actions. Subsequently, suggestions were made to set up a MPC in 2006 by the Tarapore Committee, in 2007 by the Percy Mistry Committee, in 2009 by the Raghuram Rajan Committeeand then in 2013, both in the report of the Financial Sector Legislative Reforms Commission (FSLRC) and the  Urjit R. Patel (URP) Committee.
    4. According to the URP Committee, “Heightened public interest and scrutiny of monetary policy decisions and outcomes has propelled a worldwide movement towards a committee based approach to decision making with a view to bringing in greater transparency and accountability in India.”
    5. It suggested that RBI abandon the ‘multiple indicator’ approach and make inflation targeting the primary objective of its monetary policy.
    6. The erstwhile technical advisory committee (TAC) that earlier advised the RBI on interest rates. The TAC is made up of external academicians and members from within the RBI, including the governor, and it meets ahead of every monetary policy.
    7. The TAC has no voting rights, while the MPC have them. TAC is an advisory committee and the RBI can disregard its advice, which governors have done in several instances.The members of the TAC, which was first constituted in 2005, have had tenures of two years.

    Newly Created MPC

    1. The Reserve Bank of India Act, 1934 (RBI Act) has been amended by the Finance Act, 2016,  to provide for a statutory and institutionalised framework for a Monetary Policy Committee, for maintaining price stability, while keeping in mind the objective of growth.
    2. The Monetary Policy Committee would be entrusted with the task of fixing the benchmark policy rate (repo rate) required to contain inflation within the specified target level.
    3. A Committee-based approach for determining the Monetary Policy will add lot of value and transparency to monetary policy decisions.
    4. The meetings of the Monetary Policy Committee shall be held at least 4 times a year and it shall publish its decisions after each such meeting

    Composition

    1. Altogether, the MPC will have six members – the RBI Governor (Chairperson), the RBI Deputy Governor in charge of monetary policy, one official nominated by the RBI Board and the remaining three members would represent the Government of India.
    2. These Government of India nominees are appointed by the Central Government based on the recommendations of a  search cum selection committee consisting of the cabinet secretary (Chairperson), the RBI Governor,  the secretary of the Department of Economic Affairs, Ministry of Finance, and three experts in the field of economics or banking as nominated by the central government.
    3. The three central government nominees will hold office for a period of four years and will not be eligible for re-appointment. These three central government nominees in MPC are mandated to be persons of ability, integrity and standing, having knowledge and experience in the field of economics or banking or finance or monetary policy.
    4. RBI Act prohibits appointing any Member of Parliament or Legislature or public servant, or any employee / Board / committee member of RBI or anyone with a conflict of interest with RBI or anybody above the age of 70 to the MPC.
    5. The Central government also retains powers to remove any of its nominated members from MPC subject to certain conditions.

    Working and Functions of MPC

    1. The proceedings of MPC are confidential and the quorum for a meeting shall be four Members, at least one of them shall be the Governor and in his/her absence, the Deputy Governor who is the Member of the MPC.
    2. The MPC takes decisions based on majority vote (by those who are present and voting). In case of a tie, the RBI governor will have the second or casting vote. The decision of the Committee would be binding on the RBI.
    3. As per the Act, RBI has to organise at least four meetings of the MPC in a year. (More meetings can be held if the RBI Governor is of that opinion)
    4. The government may, if it considers necessary, convey its views, in writing, to the MPC from time to time.
    5. RBI is mandated to furnish necessary information to the MPC to facilitate their decision making and if any Member of the MPC, at any time, requests the RBI for additional information, including any data, models or analysis, the same have to be provided, not just to that member but to all members.

    International Comparisons:

    1. With the introduction of the monetary policy committee, the RBI will follow a system similar to the one followed by most global central banks.
    2. The US Federal Reserve sets its benchmark fund rate through the Federal Open Market Committee(FOMC). The federal funds rate is the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight. The Board of Governors of the Federal Reserve System is responsible for the discount rate and reserve requirements, and the Federal Open Market Committee is responsible for open market operations.
    3. Bank of England also has a MPCto decide the official interest rate in the United Kingdom . The MPC meets every month to set the interest rate and meets over three days.  A representative from the Treasury also sits with the Committee at its meetings. The purpose is to ensure that the MPC is fully briefed on fiscal policy developments and other aspects of the Government’s economic policies.

    Conclusion

    1. Till now RBI was having complete autonomy over monetary policy rates. But now the same will be decided by MPC, in which RBI as half member including presiding officer.  Though to some extent autonomy of RBI reduced, but still RBI remains in charge of monetary policy decisions.
    2. Monetary policy of Reserve Bank of India will go under review in October. This is the first time monetary policy review will held under the new regime of a monetary policy committee.

    MODEL QUESTIONS

    Q. Why a new institution named Monetary Policy Commission was given with the responsibility of monetary policy?

    Q. The Monetary Policy is one of the most important decision in a country. The new institution will collectively decide and implement the monetary policy in a better manner. Comment.

    References:

     

  • Abolition of FIPB

    Note4Students

    Creating employment opportunities is a challenge for every reigning government. Indian has ranked 130th in 2017 Ease of Doing Business index.it is important to take necessary actions to transform India into a business friendly destination. This will attract more FDI and create more job opportunities. So abolition of FIPB deserves deeper analysis.

    Introduction

    The Foreign Investment Promotion Board (FIPB) was a national agency of Government of India, with the remit to consider and recommend foreign direct investment (FDI) which does not come under the automatic route.

    It acted as a single window clearance for proposals on foreign direct investment (FDI) in India. The Foreign Investment Promotion Board (FIPB) was housed in the Department of Economic Affairs, Ministry of Finance.

    Recent Developments

    The Union Cabinet approved phasing out of the 25-year-old Foreign Investment Promotion Board (FIPB)

    Successor mechanism

    The Department of Industrial Policy and Promotion (DIPP) under the Commerce ministry will be in charge of its successor mechanism.

    This includes the old FIPB portal that has now been placed under the DIPP under a new name – the Foreign Investment Facilitation Portal

    Henceforth, the work relating to processing of applications for FDI and approval of the Government thereon under the extant FDI Policy and Foreign Exchange Management Act, shall now be handled by the concerned Ministries/Departments in consultation with the Department of Industrial Policy & Promotion (or the DIPP, in the) Ministry of Commerce, which will also issue the Standard Operating Procedure for processing of applications and decision of the Government under the extant FDI policy.

    National Security

    1. In cases of applications where there are security concerns, the home ministry’s approval will be required.

    Analysis

    Reasoning behind the abolition

    1. ‘Maximum Governance and Minimum Government The move to phase out the FIPB is aimed at making India a more attractive FDI destination and increasing FDI inflows by providing greater ease of doing business and promoting the ‘Maximum Governance and Minimum Government’ principle.

    Diminished Importance

    1. FIPB was the epitome of license raj, where powerful bureaucrats decided the fate of a foreign investor willing to pump in precious foreign investment into India.
    2. But in today’s more liberalised India, the FIPB’s role had already shrunk considerably, especially after the Narendra Modi government further relaxed FDI norms for many sectors last year.
    3. Currently around 91-95% of FDI inflow happens through the automatic route, adding that there are only 11 sectors (including defence and retail) needing government approval.
    4. The FIPB has successfully implemented e-filing and online processing of FDI applications.

    Concerns And Challenges

    1. The Office Memorandum made Department of Industrial Policy & Promotion (DIPP) as the nodal agency for coordinating FDI proposals requiring government approval and entrusted it with the task of preparing and issuing a standard operating procedure (SOP) for processing the FDI applications.
    2. it is encouraging to see that SOP has explicitly provided timelines for all ministries/ departments involved at different stages, there still remains scope where these timelines are not strictly binding
    3. While the cabinet’s decision is seen as a simplification of the existing procedure to seek clearance on FDI proposals, experts have also raised doubts whether line ministries are equipped to take such decisions on an expedited manner.

    Liberising norms

    1. Cumbersome rules, not the FIPB, have been responsible for a less than enthusiastic response from foreign investors in some sectors.
    2. For instance, global insurers can hold up to 49% ownership in Indian ventures but only if Indians retain management and control over these entities — this is an onerous definition of control that has inhibited deal-making. Despite allowing 100% FDI in food retail, rules prohibit foreign players from using a small fraction of their shelf space for non-food items, affecting investment plans. This, in a sector that can create millions of jobs and boost farm incomes.
    3. Archaic land acquisition and labour laws continue to make it difficult for large factories to come up.
    4. If the government considers liberalising the norms for foreign investors in the wake of the recent Tata-Docomo dispute, it would go a long way towards creation of a far more stable investor-friendly taxation regime that will bolster investor confidence.

    Conclusion

    1. FIPB has been handling the task of approving and vetting FDI proposals for more than 25 years, it will be interesting to see how the new authorities fill its shoes under the new regime.
    2. While initial glitches within the ministry or while coordinating between different designated authorities are expected, DIPP is expected to assume a pro-active approach and hand-holding them to settle down in the new set-up and deliver the expectations of the business community efficiently.
    3. “Abolition of FIPB will propel the inflow of FD”I-comment
    4. “India needs to create a business friendly eco system to reduce the unemployment.” Analyse the statement in the light of abolition of FIPB

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