Insights Daily Current Events, 31 March 2015
Bharat Ratna conferred on Malviya
Freedom fighter and founder of Banaras Hindu University, Madan Mohan Malviya, was recently posthumously conferred the Bharat Ratna, the country’s highest civilian award, by President Pranab Mukherjee at a ceremony in Rashtrapati Bhavan.
- The President also bestowed the highest Padma award, the Padma Vibhushan, on BJP stalwart L.K. Advani, Punjab Chief Minister Parkash Singh Badal and Sanskrit grammar expert, Jagadguru Swami Rambhadracharya.
- Prominent Padma Bhushan awardees included noted lawyer Harish Salve, journalists Swapan Dasgupta and Rajat Sharma and 98-year-old Saichiro Misumi — a proponent of Indo-Japanese friendship who had supported Netaji Subhash Chandra Bose during his visit to Japan in June 1943.
Bharat Ratna:
Bharat Ratna is the highest civilian award of the Republic of India. The provision of Bharat Ratna was introduced in 1954.
Eligibility: Any person without distinction of race, occupation, position or sex is eligible for these awards.
- There is no written provision that Bharat Ratna should be awarded to Indian citizens only. The award has been awarded to a naturalized Indian citizen, Agnes Gonxha Bojaxhiu, better known as Mother Teresa (1980) and to two non-Indians – Khan Abdul Ghaffar Khan and Nelson Mandela (1990).
- It is awarded in recognition of exceptional service/performance of the highest order in any field of human endeavour. The award was originally limited to achievements in the arts, literature, science and public services but the government expanded the criteria to include “any field of human endeavour” in December 2011.
- The recommendations for Bharat Ratna are made by the Prime Minister himself to the President. No formal recommendations for this are necessary.
- The number of annual awards is restricted to a maximum of three in a particular year.
- The Award does not carry any monetary grant.
- In terms of Article 18 (1) of the Constitution, the award cannot be used as a prefix or suffix to the recipient’s name. However, should an award winner consider it necessary, he/she may use the expression in their biodata/letterhead/visiting card etc. to indicate that he/she is a recipient of the award
Sources: The Hindu, mha.nic.in.
India, France to co-develop naval missile
The Defence Acquisition Council has approved the ‘Maitri’ project for the co-development of a Short Range Surface-to-Air Missile (SR-SAM) by the Defence Research and Development Organisation (DRDO) with MBDA of France.
- The project has been in the works since 2007 to meet the requirements of the Army and the Air Force. The DRDO had signed a Memorandum of Understanding with MBDA in 2013, but there has hardly been any progress because the DRDO’s Akash missile system has similar functions.
- The Army and the Air Force have expressed satisfaction with the capabilities of Akash, but the Navy has made it clear that Akash is not suitable for installation on warships.
Project Maitri:
The Maitri missile project is a next-generation quick-reaction surface-to-air missile with a lethal near-hundred per cent kill probability under development by India’s Defence Research and Development Organisation.
- It is a short-range (15 km, 9.3 mi) surface-to-air point defence missile system.
Sources: The Hindu.
Foreign airlines come under sexual harassment Act
The Delhi High Court recently said that any foreign airline having even one office in the country is bound by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Background:
- The High Court was hearing a Public Interest Litigation seeking the implementation of the Vishakha guidelines on sexual harassment against women at the workplace in the aviation industry.
- The case had been transferred as a PIL from another court which was dealing with the plea of an Indian woman, employed with the Sri Lankan Airlines, seeking action against the carrier and its official whom she had accused of sexual harassment.
THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT 2013:
The Act seeks to cover all women, irrespective of their age or employment status and protect them against sexual harassment at all workplaces both in public and private sector, whether organized or unorganized.
Building on the Vishakha guidelines, the Act calls for the formation of an internal complaints committee and a local complaints committee at the district level. It came into force on December 9, 2013.
Some important provisions of the Act:
- The Act defines sexual harassment at the work place and creates a mechanism for redressal of complaints. It also provides safeguards against false or malicious charges.
- The definition of “aggrieved woman”, who will get protection under the Act is extremely wide to cover all women, irrespective of her age or employment status, whether in the organized or unorganized sectors, public or private and covers clients, customers and domestic workers as well.
- While the “workplace” in the Vishaka Guidelines is confined to the traditional office set-up where there is a clear employer-employee relationship, the Act goes much further to include organisations, department, office, branch unit etc. in the public and private sector, organized and unorganized, hospitals, nursing homes, educational institutions, sports institutes, stadiums, sports complex and any place visited by the employee during the course of employment including the transportation.
- Every employer is required to constitute an Internal Complaints Committee at each office or branch with 10 or more employees. The District Officer is required to constitute a Local Complaints Committee at each district, and if required at the block level.
- The Committee is required to complete the inquiry within a time period of 90 days. On completion of the inquiry, the report will be sent to the employer or the District Officer, as the case may be, they are mandated to take action on the report within 60 days.
- The Complaints Committees have the powers of civil courts for gathering evidence.
- The Complaints Committees are required to provide for conciliation before initiating an inquiry, if requested by the complainant.
- Penalties have been prescribed for employers. Non-compliance with the provisions of the Act shall be punishable with a fine of up to 50,000. Repeated violations may lead to higher penalties and cancellation of licence or registration to conduct business.
Sources: The Hindu, PIB, Wiki.
RBI tightens takeover norms for shadow banking
The Reserve Bank of India (RBI) plans tougher rules for takeovers involving non-banking financial companies (NBFCs), according to draft guidelines published recently, outlining a demand that all substantial deals seek its prior approval.
- There are some 12,000 NBFCs registered with the RBI, and they largely offer loans. Some, like traditional banks, also take deposits.
Details:
- In its latest effort to boost transparency and strengthen its grip on the alternative lenders that account for a large part of the domestic shadow-banking sector, the RBI said any purchase of a stake of 26% or more in a company, or a change in more than 30% of its directors, would need the central bank’s permission.
- The RBI has also that the source of funds behind new investors in any NBFC will have to be disclosed. It also asked for an undertaking that the new proposed investors are not associated with any existing but unregistered body that accepts public deposits.
NBFCs play a critical role in extending credit to areas where traditional finance cannot reach in a country where only just over half of the population has access to the mainstream banking system. However, controlling these NBFCs has been made a key priority for the RBI, given their size and reach.
Shadow banking:
The shadow banking system is a term for the collection of non-bank financial intermediaries that provide services similar to traditional commercial banks.
In the context of developing economies, shadow banks play a gainful role in credit delivery and financial inclusion as they can facilitate credit availability to certain sectors that might otherwise have difficulty in access to credit.
Regulation:
Shadow banking operates outside the regular banking system and financial intermediation activities are undertaken with less transparency and regulation than the conventional banking.
Risks posed by them:
- Not all shadow banks take deposits and hence they are subject to less regulation than traditional banks. They can therefore increase the rewards they get from investments by leveraging up much more than their mainstream counterparts, and this can lead to risks mounting in the financial system.
- Unregulated shadow institutions can be used to circumvent the strictly regulated mainstream banking system and therefore avoid rules designed to prevent financial crises.
- Shadow banks can also cause a buildup of systemic risk indirectly because they are interrelated with the traditional banking system via credit intermediation chains, meaning that problems in this unregulated system can easily spread to the traditional banking system.
- As shadow banks use a lot of short-term deposit-like funding but do not have deposit insurance like mainstream banks, a loss of confidence can lead to “runs” on these unregulated institutions.
- Shadow banks’ collateralised funding is also considered a risk because it can lead to high levels of financial leverage.
Sources: The Hindu, PIB, Wiki.
Govt. provides clarity on deposit-taking norms for private firms
The government said recently said that the amounts received by private firms from its members, directors or their relatives prior to April 1, 2014, would not be considered as deposits under the new Companies law.
- However, companies are required to provide details about such money received in their financial statement for the year starting from April 1, 2014 — the date when most provisions of the Companies Act, 2013, came into force.
- The Corporate Affairs Ministry, which is implementing the Act, has provided the clarification after having discussions with the Reserve Bank.
- The government has also said that any renewal or acceptance of fresh deposits on or after April 1, 2014, shall, however, be in accordance with the provisions of the Companies Act, and rules made thereunder.
Sources: The Hindu.
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