Current Affair 1:

Impact & spatial dimensions of COVID-19 on States Demography

This topic is based on the report: ‘State Finances: A Study of Budgets’, which provides a detailed review of the financial situation of the States based on the annual budgets of the state governments.

The RBI released this year’s report on 27 October 2020. The current annual report assumes significance in view of COVID-19 epidemic and its impact on the economy of the country as well as states. Here, we take a look at few of the key observations made by RBI in this regard.

There is a precedence of Pandemics resulting in a negative impact on the economy.

The RBI’s report notes that an event study analysis of four pandemic outbreaks – 1896 plague, 1918 Spanish flu, 1957 Asian Flu & 1974 Smallpox, indicate a contraction/deceleration of GDP in conjecture with these events.

If you see above chart, among them, Spanish Flu of 1918 had the greatest impact resulting in a contraction of 13%. It is important to note that, Spanish Flu-1918 resulted both in greatest number of cases and deaths in India. The estimates show 125 million cases and death of 12-18 million people in India due to the Spanish Flu. In comparison, COVID-19 pandemic in India has resulted in 8.23 million cases and around 1.22 lakh deaths so far.

Recovery pattern of early Pandemics and COVID-19

A positive aspect from the earlier precedence of pandemics is the recovery pattern. It is observed that there is a sharp rebound following the contraction, due to the stimuli and other efforts.

However, a crucial difference this time around is that the current slowdown is not only due to COVID-19, since there were indications of a slowdown even before the pandemic, due to various reasons. In this context, it is not clear whether the previous pattern of rebound would be applicable in this case also.

Impact of COVID-19 and their response influenced by the varying Demography

India has so far reported the second highest number of COVID-19 cases globally and has the third highest number of deaths.

1. Meanwhile, it also has the highest number of recovered cases with a fatality rate around 1.5%, which is decreasing.
2. Nearly every State & UT has recorded COVID-19 cases with differences in the severity of COVID-19 infection. Maharashtra, Andhra Pradesh, Karnataka & Tamil Nadu account for nearly half of the total cases in the country, followed by Uttar Pradesh & Kerala.
3. We can see larger variance in the rate per million, both for number of cases recorded as well as the fatality rate.  For example, although Uttar Pradesh has the fifth highest number of cases, its cases per million is less owing to its huge population.

As per the information provided by the World Health Organization (WHO), the vulnerability to COVID-19 and the mortality risk it carries is higher among older people and those with co-morbidities like Hypertension, cardiovascular diseases, respiratory diseases etc.

Therefore, the demographic profile of the state/country has a bearing on the susceptibility to COVID-19.

1. Furthermore, the demographic profile also has an impact on the GSDP (Gross State Domestic Product) of the states, since the older population ( above 60 + years) & younger population are beneficiaries (healthcare, education ) etc. while the working age population are the donors to the state exchequer.
2. The ratio of these population groups influences the GSDP of the state, state spending on healthcare facilities, spending capability of individuals etc. impacting the response of each of the states to COVID-19.
3. Few of the states like Kerala, Tamil Nadu, Himachal Pradesh, Punjab, Andhra Pradesh, Maharashtra have a higher share of 60 + population, making these states more vulnerable to COVID-19.

1. The extent of the 60+ population also has an influence on the imposition and implementation of lockdown & isolation measures as there is a greater need to protect this group of vulnerable population.
2. This demographic indicator proves to be advantageous to states like Uttar Pradesh, Bihar, Madhya Pradesh etc. which have considerably a less share of the older population.
3. However, there is another factor which influences the isolation strategy i.e. per capita GSDP. States with higher GSDP like Delhi, Kerala, Haryana, Karnataka, Telangana, Gujarat etc. have a better ability to survive lockdown for a longer period of time with lesser impact on economy.
4. States which had the advantage of younger demographic like U.P & Bihar do not fare well on this aspect as their per capita GSDP is low. Furthermore, the propensity of the states to be able to spend on health infrastructure is another factor.

Tomorrow we will see impact of COVID-19 in the areas of employment, migration of workers, MSMEs & businesses, financial transactions etc.

Current Affair 2:

WWF identifies 30 cities in India facing ‘severe water risk’ by 2050

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A hundred cities worldwide, including 30 in India, face the risk of ‘severe water scarcity’ by 2050, according to a recent report by Worldwide Fund for Nature (WWF).

The cities would face a ‘grave water risk’ by 2050 due to a dramatic increase in their population percentage to 51 per cent by 2050, from 17 per cent in 2020, according to a press statement by WWF-India.

More than half of the identified cities are from China and India. 

 

What needs to be done?

1. Cities needed to invest more in nature-based solutions and enhance the health of river basins, watersheds and wetlands to build resilience to water risks.
2. To manage these initiatives, a public funding pool needed to be created in collaboration with the private sector to invest, reduce risk and generate returns and fuel sustainable economic growth.
3. Cities also needed to support greater global efforts to mitigate greenhouse gas emissions to avoid reaching these scenarios.
4. The Smart Cities initiative in India could offer an integrated urban water management framework combining urban planning, ecosystem restoration and wetland conservation for building future- ready, water smart and climate resilient cities.

Worldwide Fund for Nature

The Worldwide Fund for Nature (WWF) is an international non-governmental organization founded in 1961 that works in the field of wilderness preservation and the reduction of human impact on the environment.

WWF aims to "stop the degradation of the planet's natural environment and to build a future in which humans live in harmony with nature. "The Living Planet Report has been published every two years by WWF since 1998; it is based on a Living Planet Index and ecological footprint calculation.

In addition, WWF has launched several notable worldwide campaigns, including Earth Hour and Debt-for-Nature Swap, and its current work is organized around these six areas: food, climate, freshwater, wildlife, forests, and oceans.

Worldwide Fund for Nature- India

WWF-India is the Indian part of the WWF. It has an autonomous office, with the Secretariat based in New Delhi.

 

Current Affair 3:

Emergency Credit Line Guarantee Scheme

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The Union Government has extended the Emergency Credit Line Guarantee Scheme (ECLGS) by one month till 30th November 2020, or till such time that an amount of Rs. 3 lakh crores is sanctioned under the Scheme, whichever is earlier. Before it was till 30 October.

Emergency Credit Line Guarantee Scheme

Emergency Credit Line Guarantee Scheme provides 100% guaranteed loans to eligible MSMEs. The scheme basically provides credit guarantee for the loans taken by MSMEs from banks and NBFCs with conditionalities.

What is the objective of the Scheme?

The Scheme is a specific response to the unprecedented situation COVID-19. It seeks to provide much needed relief to the MSME sector by incentivizing Member Lending Institutions (MLIs) to provide additional credit of up to Rs. 3 lakh crores at low cost, thereby enabling MSMEs to meet their operational liabilities and restart their businesses.

Who provides the guarantee?

The credit facility is guaranteed by the National Credit Guarantee Trustee Company (NCGTC). It gives the guarantee to Member Lending Institutions (MLIs) up to Rs. 3 lakh crores to eligible MSMEs.

Loans provided by these banks and NBFCs to the eligible MSMEs will be qualified for getting the guarantee. An important condition is that the loan availing MSMEs should not have any NPAs.

Who are the MLIs under the Scheme?

All Scheduled Commercial Banks are eligible as MLIs. NBFCs which have been in operation for at least 2 years as on 29.2.2020, and Financial Institutions are also be eligible as MLIs under the Scheme.

Who are the eligible MSMEs?

For the scheme, the eligible MSMEs include MSMEs/ Business Enterprises which are constituted as Proprietorships, Partnerships, Registered Companies, Trusts and Limited Liability Partnerships (LLPs), besides interested borrowers under Pradhan Mantri Mudra Yojana (PMMY). In terms of loan size following are the eligibility criteria for MSMEs:

1. All MSMEs with combined outstanding loans across of up to Rs. 25 crores as on 29.2.2020, and annual turnover of up to Rs 100 crores in financial year 2019-20.
2. Loan accounts classified as NPA or SMA-2 as on 29.2.2020 will not be eligible under the Scheme.
3. The MSME must be GST registered and this will not apply to those MSMEs that are not required to obtain GST registration.
4. In case accounts for FY 2019-20 are yet to be audited/finalized, the MLI may rely upon the borrower’s declaration of turnover.

Does PMMY beneficiaries eligible for ECLGS?

Loans under PMMY extended on or before February 29, 2020 and reported on the MUDRA portal are also eligible under the Scheme.

What would be the tenor of loans provided under Emergency Credit Line Guarantee Scheme?

The tenor of loans provided under GECL shall be four years from the date of disbursement. No pre-payment penalty shall, however, be charged by the MLIs in case of early repayment.

Current Affair 4:

Can states refuse to implement Central laws?

Many States are passing Bills to stall Centre’s farm laws. Are states allowed to do so?

What does the Constitution say on this?

Agriculture is in the state list under the Constitution. But Entry 33 of the Concurrent List provides Centre and the states powers to control production, supply and distribution of products of any industry, including agriculture.

What usually happens when State wants to amend Central Laws?

1. Usually, when a state wants to amend a Central law made under one of the items in the concurrent list, it needs the clearance of the Centre.
2. When a state law contradicts a Central law on the same subject, the law passed by Parliament prevails.

So, in both the cases, State Government can loose discretion.

So, what are the options available to States? This is an arrangement envisaged as most Parliament laws apply to the whole of India and states amending the Central laws indiscriminately could lead to inconsistencies in different regions on the application of the same law.

The other option available with the states is:

1. To take Centre to the Supreme Court over the validity of these laws.

Unlike individuals, State governments cannot complain of fundamental rights being violated. Therefore, the Constitution provides that whenever a State feels that its legal rights are under threat or have been violated, it can take the “dispute” to the Supreme Court. States have filed such cases under Article 131 against neighbouring State and Centre.

1. Article 254 (2) of the Constitution empowers state governments to pass legislations which negate the Central acts in the matters enumerated under the Concurrent List.

A state legislation passed under Article 254 (2) requires the assent of the President of India.

 

Current Affair 5:

Extradition Law in India.

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A UK judge presiding over the extradition proceedings of Nirav Modi on Tuesday ruled that the evidence submitted by the Indian authorities to establish a prima facie case of fraud and money laundering against the fugitive diamantaire is broadly admissible.

We see all details related to Extradition in India.

What is Extradition?

As defined by Hon’ble Supreme Court of India, ‘Extradition is the delivery on the part of one State to another of those whom it is desired to deal with for crimes of which they have been accused or convicted and are justifiable in the Courts of the other State’.

An Extradition request for an accused can be initiated in the case of under-investigation, under-trial and convicted criminals.

In cases under investigation, abundant precautions have to be exercised by the law enforcement agency to ensure that it is in possession of prima facie evidence to sustain the allegation before the Courts of Law in the Foreign State.

What is the Legislative Basis for Extradition in India?

The Extradition Act 1962 provides India’s legislative basis for extradition. To consolidate and amend the law relating to the extradition of fugitive criminals and to provide for matters connected therewith, or incidental thereto, the Extradition Act of 1962 was enacted. It consolidated the law relating to the extradition of criminal fugitive from India to foreign states. The Indian Extradition Act, 1962 was substantially modified in 1993.

Who is the nodal authority for Extradition in India?

Consular, Passport & Visa (CPV) Division, Ministry of External Affairs, Government of India is the Central/Nodal Authority that administers the Extradition Act, and it processes incoming and outgoing Extradition Requests.

Does India need a treaty with a foreign country to make a provisional arrest request?

No. India does not need a treaty to make a provisional arrest request to a foreign country. India can make a provisional arrest request to any country. India’s treaty partners have obligations to consider India’s requests. In the absence of a treaty, it is a matter for the foreign country in accordance with its domestic laws to determine whether to arrest the person according to India’s provisional arrest request.

What are the bars to Extradition?

An alleged offender may not be extradited to the requesting state in the following cases:

1. No treaty – In absence of a treaty, States are not obligated to extradite aliens/nationals
2. No treaty crime – Extradition is generally limited to crimes identified in the treaty which may vary in relation to one State from another, as
3. provided by the treaty.
4. Military and Political Offences – Extradition may be denied for purely military and political offences. Terrorist offences and violent crimes are excluded from the definition of political offences for the purposes of extradition treaties.
5. Want of Dual Criminality – Dual criminality exists when conduct constituting the offence amounts to a criminal offence in both India and the foreign country.
6. Procedural considerations – Extradition may be denied when due procedure as required by the Extradition Act of 1962 is not followed.

Can the decision to be extradited be appealed against by the alleged offender?

The decision of the Extradition Magistrate is submitted to the Government of India, which finally decides if an alleged offender shall be extradited. The decision of the Government of India can be appealed against in a higher court.

India has Extradition Treaties currently in force with the following Countries: Click here Must see once.

 

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