Insights Daily Current Events, 25 June 2016
Paper 2 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Amendments to Specific Relief Act being examined
The Centre is contemplating amendments to the Specific Relief Act, 1963, to limit the compensation and relief that courts can grant in cases relating to execution of infrastructure and development projects.
These amendments are based on the recommendations made by a Central government-appointed expert committee. Anand Desai led Expert committee set up to examine the Specific Relief Act, 1963 recently submitted its report to the government. In its report the committee has recommended modifications in the Specific Relief Act, 1963, which will help in ensuring the ease of doing business. The recommendations are aimed at ensuring that public works contracts happen without unnecessary delays.
Highlights of the recommendations made:
- The committee has asked for specific performance to be made the rule and not an exception. This would mean that even if contractual obligations cannot be met, the court could ask the parties to fulfil terms of the contract. Monetary compensation will be an alternative when contracts cannot be fulfilled.
- It has also suggested guidelines to the courts for exercising discretion in these matters, in order to streamline how courts interpret the provisions. The committee said that there was need to see whether intervention of courts in public works should be minimal.
What does the Specific Relief Act do?
Specific Relief is legalese for performing a contract when monetary compensation for failing to complete contractual obligations is not enough. The law prescribes that in an event where the actual damage for not performing the contract cannot be measured or monetary compensation is not adequate, one party can ask the court to direct the other party to fulfil the requirements of the contract. This is called specific performance of a contract. This extends to infrastructure contracts, like construction of housing societies or sale and purchase of land.
Why does the government want to change this law?
Specific performance of contracts under the 1963 law is an alternative—only when monetary compensation is not sufficient can the court ask for it. There is a provision which says that there will be no specific performance of those contracts where monetary compensation is sufficient, or the contract involves performance of a continuous duty which the court cannot supervise.
- It is also a discretionary relief, that is, it is left to the court to decide whether specific performance should be given to a party asking for it. This gives rise to uncertainty in contracts.
- The government wants to ensure that there is ease of doing business, and the specific relief law is a hindrance. Uncertainty in contracts often means investors become vary of getting entangled in legal trouble.
Sources: the hindu.
Paper 2 Topic: Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.
Can Britain opt for the Norway model?
European leadership is planning to expedite the U.K.’s exit from the EU. But still, the vote doesn’t mean that Britain will be immediately out of the club.
Under the Lisbon treaty, a member state wishing to leave the EU should first notify the European Council its decision, triggering Article 50. This would set in motion a process by which the member and the EU leadership will negotiate the terms of the departure and reach and agreement in two years. This means even if the British government invokes the Article 50 now, the earliest exit of Britain will take place after two years. Even if the new British Prime Minister triggers the Article 50, Britain need not necessarily leave the EU after two years. If there’s no agreement by the end of the two-year period, the EU could unanimously extend the talks.
Is there any other option?
Some economists have suggested that one of the options Britain could follow in the wake of a Brexit vote is the Norway model.
What is Norway model?
Norway, along with Liechtenstein and Iceland are members of the European Economic Area (EEC). They have access to the single market while staying out of the EU. They also make contributions to the EU budget. There is separate secretariat in Brussels to manage the relationship between the EU and EEA countries.
Sources: the hindu.
Paper 3 Topic: Awareness in the fields of IT, Space, Computers, robotics, nano-technology, bio-technology and issues relating to intellectual property rights.
MoU singed between RD Ministry & ISRO for geo-tagging assets
A Memorandum of Understanding was recently signed between the Rural Development Ministry and ISRO, Department of Space for geo-tagging the assets created under MGNREGA in each gram panchayat.
- Around 30 lakh assets are created annually across the country under the rural job scheme and the Ministry has decided that through convergence with other schemes, the geo-tagging of such assets will be done on a mission mode.
- Through Bhuvan Mobile Platform, completed asset will be Geo-tagged along with photograph by Gram Rozgar Sahayak or Junior engineer.
- This move helps to check leakages and for effective mapping of terrain for future developmental works. Application of technology for rural development will go a great way in planning and execution of projects in a transparent manner.
- This is necessary as huge amount of funds are now flowing through the 14th Finance Commission to Gram Panchayats and hence quality assets through MGNREGA has to be ensured. This will lead to poverty reduction in rural areas.
Sources: the hindu.
Paper 2 Topic: Important International institutions, agencies and fora, their structure, mandate.
$500-m ADB loan for bridge in Bihar
Asian Development Bank (ADB) has approved a $500-million loan to build a bridge across the Ganga in Bihar.
- The 9.8-km road bridge in Bihar will be India’s longest river bridge and will provide vital transport link between the northern and southern parts of the State and neighbouring Nepal.
- The new bridge will span both channels of the Ganga and serve as an alternate route to the existing Ganga bridge, which has begun to deteriorate.
Asian Development Bank:
It is a regional development bank established on 22 August 1966 and is headquartered in Philippines. It aims to facilitate economic development of countries in Asia. It also aims for an Asia and Pacific free from poverty.
Membership and voting:
- The bank admits the members of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP, formerly known as the United Nations Economic Commission for Asia and the Far East) and non-regional developed countries.
- Currently, it has 67 members – of which 48 are from within Asia and the Pacific and 19 outside.
- ADB was modeled closely on the World Bank, and has a similar weighted voting system where votes are distributed in proportion with member’s capital subscriptions.
- ADB raises funds through bond issues on the world’s capital markets.
- ADB also rely on its members’ contributions, retained earnings from its lending operations, and the repayment of loans.
- Japan holds the largest proportions of shares at 15.67%. The United States holds 15.56%, China holds 6.47%, India holds 6.36%, and Australia holds 5.81%.
Board of Governors:
- It is the highest policy-making body of the bank.
- It is composed of one representative from each member state.
- The Board of Governors also elect the bank’s President who is the chairperson of the Board of Directors and manages ADB.
The Alternate Board of Governors are nominated by Board of Governors of ADB’s 67 to represent them at the Annual Meeting that meets formally once year to be held in a member country.
It offers both Hard Loans and Soft loans. The ADB offers “hard” loans from ordinary capital resources (OCR) on commercial terms, and the Asian Development Fund (ADF) affiliated with the ADB extends “soft” loans from special fund resources with concessional conditions.
ADB focuses on five core areas of operations: infrastructure; the environment, including climate change; regional cooperation and integration; finance sector development; and education.
Sources: the hindu.
Facts for Prelims:
- Sri Lankan Parliament has unanimously passed the Right to Information (RTI) bill aimed at restoring transparency and good governance in the country. The RTI bill seeks to give citizens access to public information which is in the possession, custody or control of a public authority.