Current Affair 1:

The concept of bye-election:

 

Section 151A of the Representation of the People Act, 1951 mandates the Election Commission to fill the casual vacancies in the Houses of Parliament and State Legislatures through bye elections within six months from the date of occurrence of the vacancy, provided that the remainder of the term of a member in relation to a vacancy is one year or more.

See one example of Legislative Assembly, what provision in RPA, 1951 says:

Current Affair 2:

What is Loss and Damage?

 

Ahead of the 27th United Nations Conference of Parties (COP) to be held in Cairo, Egypt, in November 2022, there are growing demands for a Loss and Damage (L&D) Finance Facility under the United Nations Framework Convention on Climate Change (UNFCCC).

What is loss and damage?

The Intergovernmental Panel for Climate Change (IPCC) has two definitions for ‘loss and damage’.

1. The term ‘losses and damages’ refer to the economic and non-economic impacts of climate change, including extreme and slow onset events, in developing countries that are particularly vulnerable to the adverse effects of climate change. It’s destructive, irreversible, and cannot be addressed by mitigation and adaptation measures.
2. Loss and Damage (upper case), or L&D, is a “political debate under the United Nations Framework Convention on Climate Change (UNFCCC) following the establishment of the Warsaw Mechanism on L&D in 2013” to discuss losses and damages.

Loss and damage occur when the frequency and intensity of existing climate impacts increases to such an extent that countries and communities are not equipped to handle it. Their capacity to prepare, cope, recover, recoup or rebuild is no longer there.

For example, Odisha in eastern India frequently witnesses cyclones from the Bay of Bengal, where sea surface temperatures have risen and are likely to increase by 2.0°C -3.5°C by 2100. The state faces sea level rise, intense cyclones, ocean acidification, storm surges, and so on. This cascades into impacts on, among other things, monsoon activity, losses in fisheries and agriculture, damages to coastal infrastructure.

Where does the term ‘L&D’ come from?

L&D was brought up as a demand in 1991 by the island country of Vanuatu, which was representing the Alliance of Small Island States (AOSIS). Thirty-one years and 26 COPs later, this demand has not been realized.

At the COP26 in Glasgow, the G7, a coalition of 134 developing countries, and China, proposed the Loss and Damage Finance Facility (LDFF), a dedicated stream of finance to specifically address losses and damages.

Who will fund the LDFF?

The vulnerable countries are asking the industrialised world to finance the LDFF. But the industrialised countries have not initiated L&D discussions within the formal framework of the COP.

We will wait for updates from COP 26.

Current Affair 3:

Employees’ Pension Scheme (EPS)

 

What was the Employees’ Pension Scheme (EPS), 1995?

The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 originally did not provide for any pension scheme. In 1995, through an amendment, a scheme was formulated for employees’ pension, wherein the pension fund was to comprise a deposit of 8.33 per cent of the employers’ contribution to be made towards provident fund corpus. At that point of time, maximum pensionable salary was Rs 5,000 per month which was later raised to Rs 6,500.

The EPS, which is administered by the EPFO, aims to provide employees with pension after the age of 58. Both the employee and the employer contribute 12 per cent of the employee’s basic salary and dearness allowance to the EPF. The employee’s entire part goes to EPF, while the 12 per cent contribution made by the employer is split as 3.67 per cent contribution to EPF and 8.33 per cent contribution to EPS. Apart from this, the Government of India contributes 1.16 per cent as well for an employee’s pension. Employees do not contribute to the pension scheme.

What was the amendment in 2014?

The EPS amendment of August 22, 2014 had raised the pensionable salary cap to Rs 15,000 a month from Rs 6,500 a month, and allowed members along with their employers to contribute 8.33 per cent on their actual salaries (if it exceeded the cap) towards the EPS. It gave all EPS members, as on September 1, 2014, six months to opt for the amended scheme. The amendment, however, required such members (with actual salaries over Rs 15,000 a month) to contribute an additional 1.16 per cent of their salary exceeding Rs 15,000 a month towards the pension fund.

Supreme Court Judgement on 4th Nov. 2022

(1) Supreme Court ruling gives EPFO members, who have availed of the EPS, another opportunity over the next four months to opt and contribute up to 8.33 per cent of their actual salaries – as against 8.33 per cent of the pensionable salary capped at Rs 15,000 a month – towards pension.

 

(2) Supreme Court also held that the amendment which required members to contribute an additional 1.16 per cent of their salary exceeding Rs 15,000 a month as ultra vires of the provisions of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.

 

Current Affair 4:

Latest data on foreign trade

 

The RBI releases data on foreign trade which is captured by the Directorate General of Commercial Intelligence and Statistics (DGCIS) of the Ministry of Commerce & Industry based on flows/movements of goods across the customs frontiers of India. It must be noted that this data pertains to only goods trade & does not include services.

India’s provisional trade deficit in 2021-22 was Rs. 14.2 lakh crore, the highest ever. Compared to 2020-21, the trade deficit has increased by 88.3%. India’s trade deficit crossed Rs. 10 lakh crores in 2012-13, 2017-18, 2018-19, 2019-20, and 2021-22.

Since 2017-18, the trade deficit has been above Rs. 10 lakh crores in each of the years, except in 2020-21 since the exports and imports were comparatively lower due to the COVID-19 pandemic-related restrictions. In 2020-21, the trade deficit had reduced to Rs. 7.57 lakh crores from Rs. 11.4 lakh crores in 2019-20. Since 2000-01, the trade deficit of the country has increased by more than 50 times in rupee terms.

Trade deficit for both oil and non-oil products touched Rs. 7 lakh crores in 2021-22

India is the third largest consumer of oil globally accounting for 5% of global consumption and with less than 1% of global production.  India is a net importer of oil which explains the deficit in trade balance with respect to oil products.

However, the trade balance for non-oil products was positive in the period from 1991-92 to 1997-98 and 2000-01 to 2003-04. Until 2014-15, oil products were the drivers of the trade deficit. However, in 2015-16, 2017-18, and 2021-22, the contribution of non-oil products toward the deficit was more. The trade deficit of both oil and non-oil products touched Rs. 7 lakh crores for the first time in 2021-22. Both, the imports and exports of oil and non-oil products were the highest in the same year.

Oil imports touched a record Rs. 1.68 lakh crores in July 2022

The RBI also releases monthly data on imports and exports of oil and non-oil products.  Between August 2019 and February 2020, prior to the pandemic, the average monthly export of oil products was about Rs. 24,597 crores while the average import was Rs.76,775 crores.

The monthly import was the highest in January 2020 with Rs. 92,773 crores and exports were the highest in November 2019 with Rs. 27,688 crores. In April 2020, the exports of oil products dropped to Rs. 9,393 crores while the imports dropped to Rs. 27,042 crores in May 2020. However, since then, the imports and exports have improved considerably.

With the US dollar strengthening and the increasing inflation, the trade deficit might further increase in rupee terms in the coming months.

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