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Daily News Analysis 13-08-2015

S.NO.

NEWS ITEM

SYLLUBUS

ESSENCE OF THE ARTICLE

1.         

 

French fighter talks deadlocked over cost, offset stipulation (Page 13)

a)     I.R

a)     Four months since the announcement by PM Modi of direct purchase of 36 Rafale fighters from France citing critical operational necessity of the Air Force, price negotiations are stuck again due to differences over cost and offset requirements.

2.

Needless escalation (Page 10)

a)     I.R

a)     It now appears to be Italys turn to stall the judicial process over the killing of two Indian fishermen off the Kerala coast in 2012. For long, it was Indias hesitating over whether to invoke a strict law against maritime terrorism that delayed progress.

3.

MQM members quit Pakistan Parliament over crackdown (Pg14)

a)     International

a)     The Muttahida Qaumi Movement (the fourth largest party in the Pakistans National Assembly or lower house of Parliament) quit all its seats in the assembly, in the Senate (upper house) and in Sindh provincial assembly.

4.

IS beheads Croatian captive (Page 14)

a)     International

a)     The Islamic State group claimed to have beheaded a Croatian hostage abducted in Egypt, posting a purported picture of victims body on IS affiliated Twitter accounts.

5.

Emulating Singapores success (Page 11)

a)     International

b)     National

a)     At least in two areas (public sector pay and industrial policy) the tiny but prosperous Singapore holds lessons for India as it celebrates the 68th anniversary of its independence.

6.

Concerns raised over Naga  accord (Page 12)

a)     National

a)     Concerns over the recently announced Naga peace accord were aired at a meeting of parliamentarians from north-eastern States at the residence of former Nagaland CM and Nagaland Peoples Front MP Neiphiu Rio.

7.

Circumventing the Rajya Sabha (Page 10)

a)     National

b)     Polity

a)     The Rajya Sabha should not be deprived of its legitimate right to legislative disapproval through plans such as certifying any bill as a money bill.

8.

Rural job scheme empowered women: NCAER (Page 13)

a)     National

b)     Social issue

a)     A new research has found that the MGNREGS reduced poverty by up to a third, gave a large number of women their first opportunity to earn income in cash, reduced reliance on moneylenders, and did not significantly affect rural wages.

9.

Choice, identity and privacy (Page 10)

a)     National

b)     Social issue

a)     Supreme Court has once again made it clear that the govt cannot insist on the possession of an Aadhaar card or number as a precondition for citizens to avail of specified benefits and services.

10.

India steels itself to face yuan devaluation (Pages 1 and 15)

a)     Economy

a)     With Chinas central bank following up devaluation of its tightly controlled currency (yuan) by 1.9 percent with another 1 percent cut, India increased the import duty on certain steel products by 2.5 percent.

 

S.NO.

NEWS ITEM

SYLLUBUS

BACKGROUND

IMPORTANT POINTS

1.         

 

French fighter talks deadlocked over cost, offset stipulation (Page 13)

a)     I.R

a)     India – France relations

b)     Rafale deal

c)     Defence Procurement Procedure (DPP)

d)     Medium Multi-Role Combat Aircraft (MMRCA)

a)     Four months since the announcement by PM Modi of direct purchase of 36 Rafale fighters from France citing critical operational necessity of the Air Force, price negotiations are stuck again due to differences over cost and offset requirements.

b)     Official sources said negotiations between two sides have been held up over issue of offsets which also drove up the cost. As per the DPP, offset applies to all deals worth over Rs. 300 crore under which companies have to invest 30 per cent of the value of the contract back in the country.

c)     This is reminiscent of the original MMRCA contest for 126 fighter jets under which Rafale was shortlisted. The negotiations were stuck for 3 years as the cost shot up to over $20 billion from $10 billion and on issues of technology transfer which eventually forced Modi to announce a govt-to-govt deal to cut time and cost.

d)     Officials said France has expressed reservations over the offset requirements and indicated a cost escalation. Given the logjam, Modi may have to step in once again to clear the hurdle.

2.

Needless escalation (Page 10)

a)     I.R

a)     India – Italy relations

b)     Marines issue

c)     International Tribunal for the Law of the Sea (ITLOS)

d)     UN Convention on the Law of the Sea (UNCLOS)

e)     Suppression of Unlawful Acts against the Safety of Maritime Navigation and Fixed Platforms on Continental Shelf Act 2002

f)     National Investigation Agency (NIA)

 

a)     It now appears to be Italys turn to stall the judicial process over the killing of two Indian fishermen off the Kerala coast in 2012. For long, it was Indias hesitating over whether to invoke a strict law against maritime terrorism that delayed progress.

b)     In an unwarranted escalation, Italy has now moved the ITLOS in Hamburg, at a time when the judicial process in India has been hampered by a petition from the accused marines questioning jurisdiction of the NIA to prosecute them.

c)     It is now a year and a half since the Union govt decided to drop charges under Suppression of Unlawful Acts against the Safety of Maritime Navigation and Fixed Platforms on Continental Shelf Act 2002, a law that provides for mandatory death penalty for the offence involved.

d)     But Italy appears to have returned to its original position of questioning Indias jurisdiction altogether, despite the fact that the incident took place only 20.5 nautical miles off Indian territory, in the Contiguous Zone.

e)     While holding that only the Union govt and not Kerala had the jurisdiction to follow the case, Supreme Court allowed the question of jurisdiction to be raised during trial. It also noted the relevance of Article 100 of the UNCLOS, which says all states shall cooperate to repress piracy.

f)     Italy need not presume that a trial in India will result in any miscarriage of justice. Instead of fighting it out in an international forum, the two countries should agree on finding judicial closure in India.  That will help prevent any deterioration in India-European Union relations as well.

3.

MQM members quit Pakistan Parliament over crackdown (Page 14)

a)     International

a)     Pakistans internal issues

b)     Muttahida Qaumi Movement (MQM)

a)     Lawmakers from a major Pakistani opposition party resigned their seats in protest at what they describe as a campaign of victimisation against them. The MQM (the fourth largest party in the National Assembly or lower house of Parliament) quit all its seats in the assembly, in the Senate (upper house) and in the Sindh provincial assembly.

b)   The party (which dominates politics in the countrys largest city Karachi) says it has been unfairly targeted in a police and paramilitary crackdown on violence in the city, the Sindh provincial capital.

c)     Tensions have been rising between MQM chief Altaf Hussain and powerful military establishment in recent weeks.

4.

IS beheads Croatian captive (Page 14)

a)     International

a)     Islamic State (IS)

b)     Syria and Iraq crisis

c)     Terrorism

d)     Extremism

 

a)     The IS group claimed to have beheaded a Croatian hostage abducted in Egypt, posting a purported picture of victims body on IS affiliated Twitter accounts.

b)     The jihadists had issued a 48-hour deadline that ended last week threatening to kill him if Muslim women prisoners were not released from Egyptian jails. His abduction and purported killing were unprecedented in Egypt, which is battling an IS insurgency in the eastern Sinai Peninsula.

c)     Meanwhile, Irans Foreign Minister Mohammad Javad Zarif met embattled Syrian President Bashar al-Assad in Damascus and called on regional countries to fight terrorism and extremism.

5.

Emulating Singapores success (Page 11)

a)     International

b)     National

a)     Good governance

b)     Public policy

c)     Industrial policy

d)     Economic growth

e)     GDP

f)     FDI

a)     On 29 March 2015, when Singapore offered farewell to Lee Kuan Yew (its first and longest-serving PM), India participated in the event in both top-down and bottom-up ways.

b)     LKY (as he is informally known) led the Little Red Dot republic from the third world to the first in a generation, and has been hailed as one of leading Asian statesmen of 20th century. Singapore recently celebrated 50 years of independence. This is an opportune moment to examine what India can take from this island nations incredible half-century.

c)  Much of Singapores success is attributed to a clean and efficient govt. LKY believed that competitive salaries were required to attract societys best people into public service and bring out their best. In 1996, he argued that low salaries will not attract able men who are or can be successful in their professions or business.

d)     Singapore has a unique system of setting bureaucrats pay - public sector salaries are linked via a formula to comparable private sector jobs. This approach reflects choices and trade-offs individuals face while selecting careers.

e)     By contrast, in India, successive Central Pay Commissions have restructured the salaries of govt officers just six times in the past 68 years. Adjustments often take the form of applying a multiple to existing salaries, which do not take into account changes in the market price for certain skills due to developments in the wider labour market. Carefully designed indexation can address this issue.

f)     Singapore was one of the fastest-growing economies in the world during the post-war period largely due to interventions by an activist state. Singapores govt did not take the comparative advantage of a land-scarce country with no natural resources and unskilled workforce as given. Instead, they invested in infrastructure and institutions to attract FDI in sectors that created low-skilled manufacturing jobs in the late 1960s.

g)    The share of manufacturing in Singapores GDP almost doubled from below 16 percent in 1960 to 28percent by 1980. It also invested heavily in primary education, which enabled a larger share of the population to participate in the economic growth that was to follow. As its own demographics and cost structures changed, Singapores industrial policy evolved, moving up the quality ladder to attract industries that would create jobs to match the skill levels of its increasingly educated population.

h)     Indias growth has been fuelled by services that are skill-intensive and do not readily absorb (unskilled) labour and resources from other sectors. As the Economic Survey 2014-15 highlighted, this has obstructed the potential of these sectors (especially organised manufacturing) to spread the benefits of growth across the economy.

i)     Fortunately, the two flagship campaigns of present govt (Make in India and Skill India) seem to recognise LKYs prescient advice that since the industrial revolution, no country has become a major economy without becoming an industrial power.

j)     When Singapore became independent in 1965, few women worked and the labour force participation (LFP) of Indian women in Singapore was particularly low. The govt embarked on a campaign to encourage women to join the workforce by making it safer for women to travel at night and publicly discussing the benefits of a dual-income family.

k)   This campaign helped shift cultural norms and coupled with rising female educational attainments and greater availability of domestic help, explains the increase in participation of women in Singapores workforce from below 30 percent in 1970 to above 51 percent in 1996.

l)     The Singapore experience demonstrates that political backing and dedicated efforts by the state to reduce costs for women to join the workforce can yield measurable change. Given the confusing differences in size and history between India and Singapore, is not an attempt to draw specific lessons, especially for India, a futile exercise.

m)   In two specific areas (public sector pay and industrial policy) the points highlighted about boosting economic efficiency and strengthening governance have little to do with size. And with regard to womens role in the workplace, Singapore inherited many of the cultural barriers prevalent in Asian societies.

6.

Concerns raised over Naga  accord (Page 12)

a)     National

a)     Naga Peace Accord

a)     Concerns over the recently announced Naga peace accord were aired at a meeting of parliamentarians from north-eastern States at the residence of former Nagaland CM and Nagaland Peoples Front MP Neiphiu Rio.

b)     Former Speaker of the Lok Sabha and Meghalaya MP P.A. Sangma told that the agreement has been arrived at on question of principles and framework. This means that whatever solution comes will be within the framework of the Constitution of India. It also means that they have given up their claim for sovereignty.

c)     He said though they are talking about territorial integration of Naga people, but as evident in the reactions of CMs of the neighbouring States of Arunachal Pradesh, Manipur and Assam, it is not a solution. However, there can be political, cultural and social integration.

d)     CMs of Assam, Manipur and Arunachal Pradesh had earlier told that they were not consulted by the Centre on the issue and that they would seek details of the accord.

7.

Circumventing the Rajya Sabha (Page 10)

a)     National

b)     Polity

a)     Money Bill

b)     Article 110 of the Constitution

c)     Article 122

d)     Consolidated Fund of India (CFI)

e)     Contingency Fund of India

f)     Parliament

g)     Lok Sabha

h)     Rajya Sabha

 

a)     The Chairman of the Rajya Sabha, Vice-President Hamid Ansari and Deputy Chairman, Prof. P.J. Kurien reportedly expressed their concern recently on attempts being made to cut away the legislative powers of the Rajya Sabha and make it a redundant legislative House. Opposition leaders have protested against what they called a move to erode the role and power of the House in making laws.

b)     At the centre of this controversy is the money bill - a technical term in Constitution and the House rules referring to a certain class of bills which contain taxation proposals and proposals relating to money matters etc.

c)     Under Article 110, a money bill only contains matters such as imposition, abolition, remission, alteration or regulation of any tax. It also includes regulations related to borrowing of money or giving guarantee by Govt of India; the custody of CFI or Contingency Fund of India, and payment of moneys into or withdrawal of moneys from such funds; and the appropriation of moneys out of the CFI.

d)     Besides the above, it includes charged expenditures like the salary of the President, Vice-President, Speaker, judges etc.; the receipt of money on account of the Consolidated Fund or the public account, its custody etc.; and matters incidental to any of these.

e)     Article 109 says a money bill can be introduced only in the Lok Sabha. After it is passed by the Lok Sabha, the Bill is transmitted to the Rajya Sabha for its recommendations only. The Rajya Sabha cannot disapprove the money bill but can recommend amendments, which the Lok Sabha can reject in toto. Even then, the bill will be deemed to have been passed by both Houses.

f)     Thus, the Lok Sabha alone has the power to accept or reject money bills. The power to certify a bill as a money bill is vested by Article 110 of the Constitution in the Speaker of the Lok Sabha, whose decision is final. Some Rajya Sabha members have raised concerns about the finality of the Article. Their uneasiness arises from the fact that the Rajya Sabha cant question the decision of the Speaker even when they feel that they have a strong case for contesting decision of Speaker.

g)     The superiority of the Lok Sabha in budgetary sanctions is secured in two ways. One, the demands for grants (estimate of expenditure of individual ministries and departments of govt) are presented before and passed only by the Lok Sabha. Two, the Appropriation Bills (authorising govt to withdraw money from CFI) being money bills, cannot be disapproved by Rajya Sabha.

h)    But here the problem is not the primacy of the Lok Sabha in money matters. The worry among Members is that the govt may bring bills with financial provisions and push them through as money bills in order to circumvent situation in the Rajya Sabha. The Constitution makes it abundantly clear that money bills should contain only the above mentioned matters and nothing else. If a bill is a combination of any of above and some other provisions not incidental to those matters, it cannot be called a money bill. Such a bill needs to be passed by both Houses of Parliament.

i)     Rajya Sabha is the Council of States and has played a crucial role in strengthening the Indian federation. Constitution has assigned special roles to this elders chamber of the Indian Parliament. For example, when the Parliament wants to make a law on an item in the State list, it can do so only if Rajya Sabha passes a resolution by a two-thirds majority. Moreover, the Vice-President of India (the number two in the order of precedence) is the Chairman of this House.

j)     Precedents show that the finality of the Speakers decision has been accepted by the Rajya Sabha. While certifying a bill as money bill, the Speaker is in effect depriving the Rajya Sabha of its legislative power to disapprove a bill. If it is said that the Speaker has absolute power and she does not have to consult anyone, it is equivalent to accepting even a wrong decision by her, maybe even a mala fide decision. The Constitution of India does not grant such absolute power on any authority.

k)     The question is whether there is no remedy if a wrong decision actuated by political considerations is taken by a Speaker - not an impossibility. It may be a bona fide mistake but it renders the Rajya Sabha helpless. Therefore it is necessary to evolve a proper procedure for Speaker to arrive at a decision. A committee of the secretaries-general of both Houses may examine in detail the given bill and submit their views to the Speaker before she takes a final decision.

l)     It may be remembered that Article 122 provides immunity against challenges to the proceedings only on the grounds of procedural irregularities. A wrong decision taken under Article 110(3) is not a procedural irregularity and hence does not grant any immunity.

8.

Rural job scheme empowered women: NCAER (Page 13)

a)     National

b)     Social issue

a)     Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)  

b)     India Human Development Survey (IHDS)

c)     National Council of Applied Economic Research (NCAER)

d)     United Nations Development Programme (UNDP)

e)     Poverty

f)     Women empowerment

a)     A new report by NCAER, which used data from two rounds of IHDS (2004-05 and 2011-12) has found that the MGNREGS reduced poverty by up to a third, gave a large number of women their first opportunity to earn income in cash, reduced reliance on moneylenders, and did not significantly affect rural wages.

b)     The numbers show that the MGNREGS is likely to have had a much smaller impact on the rural job market and rural wages than is commonly believed. At an all-India level, the average days worked under the MGNREGS are fewer than four, pointing to the relatively small impact of the scheme on the overall rural job market.

c)     Overall, while the period from 2004-05 to 2011-12 saw a sharp rise in rural wages, the MGNREGS played only a modest role in the increase of wages. The UNDP also released a review of recent research studies on MGNREGS. It found that the schemes uptake was far greater in the lean season that in the peak agricultural season.

d)   The part of rural job market that the MGNREGS seemed to have a more significant impact on was female work. About 45 percent of female workers were either not working or worked only on a family farm in 2004-05, indicating that the scheme may well be the first opportunity many women got to earn cash income.

9.

Choice, identity and privacy (Page 10)

a)     National

b)     Social issue

a)     Aadhaar

b)     Unique Identification Number programme

c)     Public Distribution System (PDS)

d)     Right to privacy

a)     Supreme Court has once again made it clear that the govt cannot insist on the possession of an Aadhaar card or number as a precondition for citizens to avail of specified benefits and services. The court has been forced to reiterate its earlier order to this effect as more and more entities are trying to link their services with Aadhaar.

b)     By making it clear that no person should be in a position of disadvantage on account of not possessing an Aadhaar number, the court has protected the right of the people to make their own choice in the matter. However, it has not brushed aside the relevance of the Unique Identification Number programme.

c)     It has allowed authorities to link supply of goods under PDS and cooking gas cylinders with Aadhaar numbers. For all its exertions, the govt must be relieved that to this extent its identification programme has obtained the courts approval.

d)     Can a govt force citizens to enrol in an identification programme that involves submitting personal information and biometric data? The question (which involves determining the very validity of the scheme) has now been referred to a Constitution Bench.

e)     The reference will also cover the issue of the citizens right to privacy. One of the key points in the legal challenge is that collecting biometric data without enabling legal provisions and without clear norms to protect the data from misuse and theft may violate constitutional rights.

10.

India steels itself to face yuan devaluation (Pages 1 and 15)

a)     Economy

a)     Chinas currency devaluation

b)     Indias balance of payment crisis 1991

c)     Greek crisis

d)     US Federal Reserve

a)     With Chinas central bank following up devaluation of its tightly controlled currency (yuan) by 1.9 percent with another 1 percent cut, India increased the import duty on certain steel products by 2.5 percent.

b)     As Chinas move sparked fears of a currency war, the rupee weakened to 64.66 to the dollar. It was the lowest level since Sept 2013, when India was in the middle of its worst external account turmoil since 1991 balance-of-payment crisis.

c)     Global experts have expressed extreme views on the devaluation of the yuan. Some have said it is more significant than Greek crisis and coming US Fed interest rate increase. But for others, it is a small and long-overdue adjustment that barely begins to make up for the really big recent moves in the dollar, euro and yen.

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