Goaltide Daily Current Affairs 2021

Feb 01, 2021

Current Affair 1:
14 new minor forest produce items included under MSP scheme

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Don’t need to remember. Just see once all 14 items.



A small introduction to connect with topic.

Over the past year, due to the unprecedented crisis caused by the ongoing pandemic, the lives and livelihoods of people across all segments, and in particular, the disadvantaged tribals, across the country have been severely disrupted.  At such a time, the ‘Mechanism for Marketing of Minor Forest Produce (MFP) through Minimum Support Price (MSP) & Development of Value Chain for MFP’ has come as a beacon of change.

About the scheme

Mechanism for Marketing of Minor Forest Produce (MFP) through Minimum Support Price (MSP) & Development of Value Chain for MFP’ Scheme

Under the scheme "Mechanism for Marketing of Minor Forest Produce through Minimum Support Price and development of Value chain for MFP" Minimum Support Price (MSP) for Minor Forest Produce (MFP) has been fixed for select MFP. The scheme is designed as a social safety net for improvement of livelihood of MFP gatherers by providing them fair price for the MFPs they collect.

TRIFED, as the apex national organisation involved in the improvement of the livelihood and empowerment of these tribal people, is the nodal agency for the implementation of the scheme. The Van Dhan tribal start-ups, also a component of the same scheme, further complements MSP beautifully and has emerged as a source of employment generation for tribal gatherers and forest dwellers and the home-bound tribal artisans.

What is Minor Forest Produce?

Section 2(i) of the Forest Rights Act, 2006 defines a Minor Forest Produce (MFP) as all non-timber forest produce of plant origin and includes bamboo, brushwood, stumps, canes, cocoon, honey, waxes, Lac, tendu/kendu leaves, medicinal plants etc.

The Minor Forest Produce (MFP), also known as Non-Timber Forest Produce (NTFP), is a major source of livelihood and provides essential food, nutrition, medicinal needs and cash income to a large number of STs who live in and around forests. However, MFP production is highly dispersed spatially because of the poor accessibility of these areas and competitive market not having evolved. Consequently, MFP gatherers who are mostly poor are unable to bargain for fair prices.

Current Affair 2:
Corruption Perception Index 2020

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It is prepared by Transparency International.

What is the Corruption Perceptions Index (CPI)?

The CPI scores and ranks countries/territories based on how corrupt a country’s public sector is perceived to be by experts and business executives. It is a composite index, a combination of 13 surveys and assessments of corruption, collected by a variety of reputable institutions. The CPI is the most widely used indicator of corruption worldwide.

A country/territory’s score indicates the perceived level of public sector corruption on a scale of 0-100, where 0 means that a country is perceived as highly corrupt and a 100 means that a country is perceived as very clean.

Current Affair 3:
Vehicle Scrappage Policy

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In the recently present Union Budget 2021, Finance minister Nirmala Sitharaman announced the much-awaited “Vehicle Scrappage Policy”. While the new scrappage policy is voluntary, it would require mandatory fitness tests for vehicles after certain duration.


Much like the western countries, the scrappage policy comes into effect when a vehicle's lifecycle is complete. In general, a passenger vehicle has a life of 20 years and a commercial vehicle has a life of 15 years, after which they become obsolete and also starts polluting the environment at a greater intensity than they would have been doing earlier. In western countries, these old vehicles are sent to scrapyards where they are dismantled and the steel used for making the body is crushed and recycled again. In India though, there's no such policy. Most of the vehicles either are on run currently polluting the environment or are lying at road sides.

What does the policy aim to achieve?

As explained above, a vehicle should be scrapped at the end of its lifecycle so that they are stopped running on roads that will reduce air pollution. Also, getting off older vehicles will generate space for new vehicles, which will boost the sales in the otherwise battered and bruised Indian auto industry. As of now, there are no clear guidelines on the policy. However, what is understood from the Finance Minister's speech is that commercial vehicles older than 15 years and personal vehicles which are older than 20 are eligible for scrappage.

Will all vehicles over and above time limit will be scrapped?

No, not all vehicles will be scrapped as this is a voluntary scheme and not a mandatory one. However, there's a catch here. All vehicles over and above the time limit (15 and 20 years) will have to undergo mandatory fitness test. If a vehicle fails fitness test, they will not get renewal certificate and won't be able to run on road. However, if they pass fitness test, they will have to undergo fitness test after every 5 years again to show their road worthiness.

What is Fitness Test?

A fitness test, much like Pollution Under Control (PUC) certificate test, determines the road worthiness of a vehicle and checks if the vehicle is harming the environment. But that's one aspect of it. Various other tests will be in place to check the quality of the vehicles. A fitness test, according to the Finance Minister, will be conducted at automated fitness centres. It is estimated that each fitness test will set you back by at least Rs 30,000-40,000 and a green cess will also be levied while renewing the vehicle registration. Govt is hoping that all these additional costs will dissuade vehicle owners from retaining the vehicle.

What benefit will i get from scrapping my vehicle?

While more details, such as incentives and monetary benefits will be disclosed once the policy is rolled out, industry experts are saying that in order to implement this policy successfully govt will have to offer good incentive scheme, else owners will flout the rules in hope of saving money.


Current Affair 4:
Report of the 15th Finance Commission for 2021-26

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The Finance Commission is a constitutional body formed by the President of India to give suggestions on centre-state financial relations.  The 15th Finance Commission (Chair: Mr. N. K. Singh) was required to submit two reports.  The first report, consisting of recommendations for the financial year 2020-21, was tabled in Parliament in February 2020.  The final report with recommendations for the 2021-26 period was tabled in Parliament on February 1, 2021.  Key recommendations in the report for 2021-26 include:

Share of states in central taxes

The share of states in the central taxes for the 2021-26 period is recommended to be 41%, same as that for 2020-21.  This is less than the 42% share recommended by the 14th Finance Commission for 2015-20 period.  The adjustment of 1% is to provide for the newly formed union territories of Jammu and Kashmir, and Ladakh from the resources of the centre.

Criteria for devolution

Table below shows the criteria used by the Commission to determine each state’s share in central taxes, and the weight assigned to each criterion.  The criteria for distribution of central taxes among states for 2021-26 period is same as that for 2020-21.  However, the reference period for computing income distance and tax efforts are different (2015-18 for 2020-21 and 2016-19 for 2021-26), hence, the individual share of states may still change.

Income distance: Income distance is the distance of a state’s income from the state with the highest income.  Income of a state has been computed as average per capita GSDP during the three-year period between 2016-17 and 2018-19.  A state with lower per capita income will have a higher share to maintain equity among states.

Demographic performance: The Terms of Reference of the Commission required it to use the population data of 2011 while making recommendations.  Accordingly, the Commission used 2011 population data for its recommendations. The demographic performance criterion has been used to reward efforts made by states in controlling their population.  States with a lower fertility ratio will be scored higher on this criterion.

Forest and ecology: This criterion have been arrived at by calculating the share of the dense forest of each state in the total dense forest of all the states.

Tax and fiscal efforts: This criterion have been used to reward states with higher tax collection efficiency.  It is measured as the ratio of the average per capita own tax revenue and the average per capita state GDP during the three years between 2016-17 and 2018-19.

Other important recommendations:

Grants to local bodies: The total grants to local bodies will be Rs 4.36 lakh crore (a portion of grants to be performance-linked) including: (i) Rs 2.4 lakh crore for rural local bodies, (ii) Rs 1.2 lakh crore for urban local bodies, and (iii) Rs 70,051 crore for health grants through local governments.

Disaster risk management:  The Commission recommended retaining the existing cost-sharing patterns between the centre and states for disaster management funds.  The cost-sharing pattern between centre and states is: (i) 90:10 for north-eastern and Himalayan states, and (ii) 75:25 for all other states.  State disaster management funds will have a corpus of Rs 1.6 lakh crore (center’s share is Rs 1.2 lakh crore).

Fiscal roadmap

Fiscal deficit and debt levels: The Commission suggested that the centre bring down fiscal deficit to 4% of GDP by 2025-26.  For states, it recommended the fiscal deficit limit (as % of GSDP) of: (i) 4% in 2021-22, (ii) 3.5% in 2022-23, and (iii) 3% during 2023-26.  If a state is unable to fully utilize the sanctioned borrowing limit as specified above during the first four years (2021-25), it can avail the unutilized borrowing amount (calculated in rupees) in subsequent years (within the 2021-26 period).

See below once devolution:

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