Insights Daily Current Affairs, 22 September 2016
Paper 3 Topic: Government Budgeting.
Merger of rail budget with general budget
The Union Cabinet has approved the proposal of Ministry of Finance to merge Railway budget with the General budget.
Background:
The presentation of separate Railway budget started in the year 1924, and has continued after independence as a convention rather than under Constitutional provisions.
The arrangements for merger of Railway budget with the General budget have been approved by the Cabinet with the following administrative and financial arrangements:
- The Railways will continue to maintain its distinct entity -as a departmentally run commercial undertaking as at present.
- Railways will retain their functional autonomy and delegation of financial powers etc. as per the existing guidelines.
- The existing financial arrangements will continue wherein Railways will meet all their revenue expenditure, including ordinary working expenses, pay and allowances and pensions etc. from their revenue receipts.
- The Capital at charge of the Railways estimated at Rs.2.27 lakh crore on which annual dividend is paid by the Railways will be wiped off. Consequently, there will be no dividend liability for Railways from 2017-18 and Ministry of Railways will get Gross Budgetary support. This will also save Railways from the liability of payment of approximately Rs.9,700 crore annual dividend to the Government of India.
The merger would help in the following ways:
- The presentation of a unified budget will bring the affairs of the Railways to centre stage and present a holistic picture of the financial position of the Government.
- The merger is also expected to reduce the procedural requirements and instead bring into focus, the aspects of delivery and good governance.
- Consequent to the merger, the appropriations for Railways will form part of the main Appropriation Bill.
Sources: pib.
Paper 3 Topic: Government Budgeting.
Advancement of the Budget presentation
The Cabinet has approved, in principle, for advancement of the date of Budget presentation from the last day of February to a suitable date.
- The exact date of presentation of Budget for 2017-18 would be decided keeping in view the date of assembly elections to be held in States.
This would help in following ways:
- The advancement of budget presentation by a month and completion of Budget related legislative business before 31st March would pave the way for early completion of Budget cycle and enable Ministries and Departments to ensure better planning and execution of schemes from the beginning of the financial year and utilization of the full working seasons including the first quarter.
- This will also preclude the need for seeking appropriation through ‘Vote on Account’ and enable implementation of the legislative changes in tax; laws for new taxation measures from the beginning of the financial year.
Sources: pib.
Paper 3 Topic: Government Budgeting.
Merger of Plan and Non Plan classification in Budget and Accounts
The cabinet has approved the merger of Plan and Non Plan classification in Budget and Accounts from 2017-18, with continuance of earmarking of funds for Scheduled Castes Sub-Plan/Tribal Sub-Plan. Similarly, the allocations for North Eastern States will also continue.
This would help in resolving the following issues:
- The Plan/Non-Plan bifurcation of expenditure has led to a fragmented view of resource allocation to various schemes, making it difficult not only to ascertain cost of delivering a service but also to link outlays to outcomes.
- The bias in favour of Plan expenditure by Centre as well as the State Governments has led to a neglect of essential expenditures on maintenance of assets and other establishment related expenditures for providing essential social services.
- The merger of plan and non-plan in the budget is expected to provide appropriate budgetary framework having focus on the revenue, and capital expenditure.
Sources: pib.
Paper 3 Topic: Conservation, environmental pollution and degradation, environmental impact assessment.
Cabinet approves the River Ganga (Rejuvenation, Protection and Management) Authorities Order, 2016
The Union Cabinet under has approved the River Ganga (Rejuvenation, Protection and Management) Authorities Order, 2016.
Key facts:
- The Order lays down a new institutional structure for policy and implementation in fast track manner and empowers National Mission for Clean Ganga to discharge its functions in an independent and accountable manner.
- It has also been decided to grant a Mission status to the Authority with corresponding powers under Environment (Protection) Act, 1986 to take cognizance of the provision of the said Act and follow up thereon.
- Similarly, there is adequate delegation of financial and administrative powers which will distinctly establish NMCG as both responsibility and accountability centre and effectively accelerate the process of project implementation for Ganga Rejuvenation.
Briefly, the Order envisages:
- Creation of the National Council for River Ganga (Rejuvenation, Protection and Management), as an Authority under the Chairperson of Hon’ble Prime Minister, in place of the existing NGRBA for overall responsibility for superintendence of pollution prevention and rejuvenation of river Ganga Basin.
- Setting up of an Empowered Task Force chaired by Hon’ble Minister of Water Resources, River Development and Ganga Rejuvenation to ensure that the Ministries, Departments and State Governments concerned have an action plan with specific activities, milestones, and timeliness for achievement of the objective of rejuvenation and protection of River Ganga and a mechanism for monitoring implementation of its action plans.
- Declaration of National Mission for Clean Ganga (NMCG) as an Authority with powers to issue directions and also to exercise the powers under the Environment (Protection) Act, 1986 to enable it to carry out efficiently its mandate. The NMCG will have a two-tier management structure with a Governing Council (GC), to be chaired by DG, NMCG. Below the GC, there will be an Executive Committee (EC) constituted out of the GC, to be chaired by the DG, NMCG.
- NMCG will comply with the decisions and directions of the National Ganga Council and implement the Ganga Basin Management Plan approved by it; co-ordinate and carry out all activities necessary for rejuvenation and protection of River Ganga and its tributaries.
- At the State level, it is proposed to create the State Ganga Committees in each of the defined States as Authority, to function as Authorities in respect of each State and perform the superintendence, direction and control over the District Ganga Protection Committees under their jurisdiction.
- Similarly, the District Ganga Committees in each of the Ganga Bank Districts will carry out the assigned tasks as an Authority at the district level, to take cognizance of local threats and needs of river Ganga and conceptualise such measures as necessary to ensure overall quality of water in river Ganga and monitor various projects being implemented.
Background:
The Ganga Action Plan (GAP) Phase-I was launched in 1985 and later GAP Phase-II was initiated in 1993 with the objective of improving the water quality of river Ganga and was later expanded to include some of its tributaries also.
In May, 2015, the Government approved the Namami Gange programme as a comprehensive mechanism to take up initiatives for rejuvenation of river Ganga and its tributaries as a Central Sector Scheme with hundred per cent funding by the Union Government.
Sources: pib.
Paper 2 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Submarine optical fibre cable connectivity between mainland (Chennai) and Andaman & Nicobar Islands
The Union Cabinet has given its approval for provision of a direct communication link through a dedicated submarine Optical Fibre Cable (OFC) between Mainland (Chennai) and Port Blair & five other islands viz. Little Andaman, Car Nicobar, Havelock, Kamorta and Great Nicobar.
Key facts:
- The estimated cost of the project is Rs. 1102.38 crore including operational expenses for 5 years. The project is likely to be completed by December 2018.
- The approval would equip Andaman & Nicobar Islands (ANI) with appropriate bandwidth and telecom connectivity for implementation of e-Governance initiatives; establishment of enterprises & e-commerce facilities.
- It will also enable the provision of adequate support to educational institutes for knowledge sharing, availability of job opportunities and fulfil the vision of Digital India.
Need for submarine OFC:
The Andaman and Nicobar Islands are of immense strategic significance for India. The geographical configuration and the location of the Andaman & Nicobar Islands chain in the Bay of Bengal safeguard India’s eastern seaboard.
- Provision of secure, reliable, robust, and affordable telecom facilities in these islands is of importance from a strategic point of view to the country and also an important requirement for the socio-economic development of the islands.
- Currently the only medium of providing telecom connectivity between Mainland and Andaman & Nicobar Islands is though satellites, but the bandwidth available is limited to 1 Gbps. Satellite bandwidth is very costly and its availability is limited due to which future bandwidth requirement cannot be met solely through it.
- Then, there is an issue of redundancy, that is, no alternate media is available in case of any emergency. Lack of bandwidth and telecom connectivity is also hampering socio-economic development of the islands.
- Hence it is essential to have submarine OFC connectivity between the Mainland India and Andaman & Nicobar Islands, being the only option for catering to projected future bandwidth requirements.
Sources: pib.
Paper 2 Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Admiralty (Jurisdiction and Settlement of Maritime Claims) Bill 2016
The Union Cabinet has given its approval to the proposal of Ministry of Shipping to enact Admiralty (Jurisdiction and Settlement of Maritime Claims) Bill 2016 and to repeal five archaic admiralty statutes.
- The repealing of five admiralty statutes is in line with the Government’s commitment to do away with archaic laws which are hindering efficient governance.
Key facts:
- The Bill consolidates the existing laws relating to admiralty jurisdiction of courts, admiralty proceedings on maritime claims, arrest of vessels and related issues.
- It also repeals five obsolete British statues on admiralty jurisdiction in civil matters, namely, (a) the Admiralty Court Act, 1840 (b) the Admiralty Court Act, 1861, (c) Colonial Courts of Admiralty Act, 1890, (d) Colonial Courts of Admiralty (India) Act, 1891, and (e) the provisions of the Letters Patent, 1865 applicable to the admiralty jurisdiction of the Bombay, Calcutta and Madras High Courts.
Salient Features of Admirability Bill, 2016:
- The Bill confers admiralty jurisdiction on High Courts located in coastal states of India and this jurisdiction extends upto territorial waters.
- The jurisdiction is extendable, by a Central Government notification, upto exclusive economic zone or any other maritime zone of India or islands constituting part of the territory of India.
- It applies to every vessel irrespective of place of residence or domicile of owner.
- Inland vessels and vessels under construction are excluded from its application but the Central Government is empowered to make it applicable to these vessels also by a notification if necessary.
- It does not apply to warships and naval auxiliary and vessels used for non-commercial purposes.
- The jurisdiction is for adjudicating on a set of maritime claims listed in the Bill.
- In order to ensure security against a maritime claim a vessel can be arrested in certain circumstances.
- The liability in respect of selected maritime claims on a vessel passes on to its new owners by way of maritime liens subject to a stipulated time limit.
- In respect of aspects on which provisions are not laid down in the Bill, the Civil Procedure Code, 1908 is applicable.
Background:
India is a leading maritime nation and maritime transportation caters to about ninety-five percent of its merchandise trade volume. However, under the present statutory framework, the admiralty jurisdiction of Indian courts flow from laws enacted in the British era.
What is admiralty jurisdiction?
Admiralty jurisdiction relates to powers of the High Courts in respect of claims associated with transport by sea and navigable waterways.
Sources: pib.
Paper 2 Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
USOF support to BSNL
The Union Cabinet has approved the proposal to extend subsidy support of Rs. 1,250 crore to Bharat Sanchar Nigam Limited (BSNL) from Universal Service Obligation Fund (USOF), as compensation for deficit incurred by BSNL in operating the Rural Wire-line connections installed prior to 1st April, 2002.
Key facts:
- The government has also said that the subsidy support would be the last and final payment and no further request from BSNL for financial/subsidy support from USOF on this count shall be considered.
- In order to make Bharat Sanchar Nigam Limited (BSNL) eligible for subsidy funding on nomination basis from USOF, amendment will be required in Rule 526 of the Indian Telegraph Rules (ITRs), 1951. It stipulates that the criteria for selection of Universal Service Providers shall be made by bidding process from amongst eligible entities for implementation of USOF schemes. Corresponding Amendment in Rule 525 will also be required.
Background:
USOF since its inception in 2002 has been providing subsidy for BSNL for the rural wire line connections installed prior to 1.4.2002. A total of Rs. 8,692 crore has been extended as USOF subsidy support till date, for the rural wire-line connections, installed by BSNL prior to 1.4.2002.
Universal Service Obligation Fund:
USOF, established in 2002, provides effective subsidies to ensure telegraph services are provided to everyone across India, especially in the rural and remote areas. It is headed by the USOF Administrator who reports to the Secretary, Department of Telecommunications (DoT).
- Funds come from the Universal Service Levy (USL) of 5% charged from all the telecom operators on their Adjusted Gross Revenue (AGR) which are then deposited into the Consolidated Fund of India, and require prior parliamentary approval to be dispatched.
- The USOF works through a bidding process, where funds are given to the enterprise quoting the lowest bid. However, the funds for NOFN were made an exception to this process since BBNL was the sole party involved in the implementation having being specifically created for it.
Sources: pib.
Paper 2 Topic: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.
Agreement between India and Samoa for exchange of information with respect to Taxes
The Union Cabinet has given its approval for signing and ratification of Agreement between India and Samoa for the exchange of information with respect to Taxes.
- The Agreement will stimulate the flow of exchange of information between India and Samoa for tax purposes which will help curb tax evasion and tax avoidance.
Salient features of the Agreement:
- The Agreement enables the competent authorities of India and Samoa to provide assistance through exchange of information that is foreseeably relevant to the administration and enforcement of the domestic laws of the two countries concerning taxes covered by this Agreement.
- The information received under the Agreement shall be treated as confidential and may be disclosed only to persons or authorities (including courts or administrative bodies) concerned with assessment, collection, enforcement, prosecution or determination of appeals in relation to taxes covered under the Agreement. Information may be disclosed to any other person or entity or authority or jurisdiction with the prior written consent of the information sending country.
- The Agreement also provides for Mutual Agreement Procedure “for resolving any difference or for agreeing on procedures under the Agreement.
- The Agreement shall enter into force on the date of notification of completion of the procedures required by the respective laws of the two countries for entry into force of the Agreement.
Background:
The Central Government is authorized under section 90 of the Income Tax Act, 1961 to enter into an Agreement with a foreign country or specified territory for exchange of information for the prevention of evasion or avoidance of income-tax chargeable under the Income-tax Act, 1961.
Sources: pib.
Paper 3 Topic: Infrastructure: Energy, Ports, Roads, Airports, Railways etc.
IWAI Signs Contract with DST
With its objective of providing safe, environment friendly and economical mode of transportation through National Waterway-1 (NW-1), the Inland Waterways Authority of India (IWAI), Ministry of Shipping has signed a contract with M/s DST, Germany to design vessels, especially suited to navigate the 1620 km stretch of NW-1.
Background:
Government is developing NW-1 under the Jal Marg Vikas Project, with assistance from the World Bank at an estimated cost of Rs. 4,200 crore.
- The project would enable commercial navigation of vessels with capacity of 1500-2,000 tons. Phase-I of the project covers the Haldia-Varanasi stretch.
- The project includes development of fairway, Multi-Modal Terminals at Varanasi, Haldia, and Sahibganj, strengthening of river navigation system, conservancy works, modern River Information System (RIS), Digital Global Positioning System (DGPS), night navigation facilities, modern methods of channel marking, construction of a new state of the art navigational lock at Farakka etc.
Sources: pib.
Facts for Prelims
- 5th BIRAC Innovators Meet: BIRAC (Biotechnology Industry Research Assistance Council), a non-profit Public Sector Enterprise under the aegis of Department of Biotechnology (DBT), Government of India, is organizing the 5th Innovators Meet in New Delhi. The theme of the meet would be ‘Biotech Innovation Ecosystem – Strategizing the Next Leap’. The Innovators Meet is being organized for marking BIRAC’s continuous efforts to foster innovation and entrepreneurship in all places of research. BIRAC’s mandate is to serve as a single window interface to promote affordable innovation in key social sectors with higher focus on start-ups & small and medium enterprises.
- Incredible India Tourism Investors Summit (IITIS)-2016: It was recently inaugurated by Finance Minister Arun Jaitley. IITIS is a platform for domestic and international investors to meet project owners from across Indian states and the private sector. The Key Highlights of the Summit are- Participation from 29 Indian States and UTs; Around 700 investable projects from across the country and from across various sectors of tourism; Total participation of more than 1800 registered delegates; Participation from 250 National and International investors; Key Policy Makers from Central and State Government; Welcome Diner & Cultural Evening and 23 seminars across the two days event.
