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Daily Current affairs 12 January 2019

UPSC - Daily Current Affair

Views divided on vote on account option for Central government

The News

  • 2019 is an election year for Lok Sabha elections and the government is going to place the vote on account on 1st February.


What is a vote on account?

  • The Vote on Account is the special provision given to the government to obtain the vote of Parliament to withdraw money from consolidated fund of India in three situations-
    • When the budget for the new financial year is not released
    • The elections are underway
    • The caretaker government is in place
  • The approval given by the parliament to withdraw a certain sum of money from the consolidated funds of India is called as Vote on Account.
  • The vote on account represents the expenditure side of the government’s budget.
  • In vote on account, the government gives the estimate of the funds required during the first three to four months of election financial year until the new government takes its place.
  • According to the Article 266 of the Constitution, it is mandatory for the government to seek approval from the parliament before raising any funds from the consolidated funds of India.
  • One of the essential features of a vote on account is that it cannot alter the Direct Taxes since these need to be passed by the Financial Bill.


Highlights of the news

  • During the vote on account, the government is likely to announce schemes and token expenditure.
  • Against the speculations, the Finance Ministry confirmed that the vote on account will not be accompanied by the release of the economic survey. 
  • Moreover, there are speculations that the government could announce corporate, income tax relief to be given in the budget this year.
  • Now, if the government wants to give income tax or corporate tax relief in the Budget, it will need to amend the Finance Act and the Income Tax Act, as through vote on account it cannot alter the direct taxes.
    • It is possible to amend those acts constitutionally, theoretically and technically.
    • The amendments of a normal Act of Parliament (as against a Constitutional Amendment) require only a simple majority.
    • Moreover, the bill changing tax rates is a money bill, which requires it to only be passed in the Lok Sabha.
    • Such bills can easily be passed as the ruling party has a majority in Lok Sabha.
  • However, practically, this has some hurdles-
    • It would go against the established convention of parliament.
    • This amendment might face Opposition in the Lok Sabha as we are so close to the general elections.


What is the established convention that could impede the move?

  • As per the convention, the Income Tax Act is amended only during the main Budget.
  • Also, the convention obliges that before upcoming elections for Lok Sabha, the outgoing government does not make any significant changes in the vote on account.
  • Hence, if the government announces the amendment to Finance bill or income tax bill, then it would be considered against the established convention.


Earlier disregards to the established convention

  • The then Finance Minister P. Chidambaram announced the One Rank One Pension scheme in the vote on account in 2014-15.
  • Pranab Mukherjee, as the Finance Minister in 2009-10extended interest subvention scheme for exporters and increased defence spending.
  • Finance Minister Jaswant Singh announced the extension of the Antyodaya Anna Yojana, additional allocations for tribal areas under the scheme, the expansion of a pilot farm income insurance scheme, restructuring of loans taken by sugar factories.

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Section : Polity & Governance


Trusted workhorse PSLV set to get new features

The News

  • India’s workhorse launch vehicle, PSLV is all set for a major technology upgrade in its new version PSLV-C44, which will be capable of putting a dead rocket stage back in orbit.


About PSLV C44

  • ISRO is working on a new technology where it will recycle and use the last stage of the PSLV rocket for space experiments on board PSLV C44 rocket.
  • The PSLV’s fourth and final stage weighs about 450 kg and equals two micro satellites (100-500 kg class).
  • In a normal scenario, the initial stages of the rocket, once they detach, drop back into the sea.
  • However the last stage of a PSLV rocket after releasing the primary satellite in space becomes dead, wanders around in space as junk and categorised as space debris.
  • Now in its PSLV-C44 mission to launch Microsat-R payload, ISRO is upgrading the PSLV to transform the expendable last stage P4 into valuable platform for space-based experiments.
  • The last stage of PSLV-C44 will be equipped with lithium-ion batteries to keep the spent stage in orbit.
  • Eventually in subsequent missions ISRO is planning to use solar panels to recycle the last stage.
  • This could reduce the cost of launching experimental satellites.
  • India is the only country in the world that is working on this new technology.




About Polar Satellite Launch Vehicle

  • Polar Satellite Launch Vehicle, a smaller vehicle, has been in use since 1994, and slowly built a reputation for reliability.
  • The PSLV is a launch system primarily developed to launch remote sensing satellites into sun synchronous orbits.
  • It has also demonstrated its capability as a workhorse launch vehicle in its missions including launches to Geosynchronous Transfer Orbit (GTO) and Low Earth Orbits (LEO).
  • The PSLV's three versions can lift satellites of 1,000-1,750 kg to distances of around 600 km in pole-to-pole orbits.


Why is PSLV, India’s workhorse launch vehicle?

  • Since 2008, there began a spike in interest towards PSLV.
  • Further in 2013, when it successfully launched India’s Mars Orbiter, the cheapest ever mission to Mars, there was a further boost to orders.
  • ISRO has launched 237 foreign satellites from 28 countries successfully by PSLV during the period 1999-2018.
  • In 2017 alone, PSLV launched 130 foreign satellites.
  • PSLV-C37 successfully launched 104 satellites on February 15, 2017.
  • This is the highest number of satellites launched in a single flight so far.
  • Another 28 foreign satellites were launched by PSLV on January 12, 2018.
  • With its capability to put small satellites in Lower Earth Orbit, PSLV is the key to Indian presence in the Global space business.

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Section : Science & Tech


Gaganyaan project: ISRO sets up human space flight centre

The News

  • India has made the formal beginning of its ambitious Gaganyaan Human Spaceflight Programme with setting up of a Human Space Flight Center in Bengaluru to implement the project.


Highlights of Human Space Flight Center

  • ISRO has established the Human Space Flight Centre at Bengaluru to carry out all its human space programmes.
  • First of the human space programme of ISRO is the Gaganyaan project that will send three astronauts to orbit the earth.
  • ISRO will also expand its human space programme of sending humans to a space station and the moon.
  • The Human Space Flight Center will be headed by scientist Unnikrishnan Nair.




About Human Spaceflight Programme

  • Recently the Union Cabinet approved Rs 10,000 crore for India’s 1st Human spaceflight programme, Gaganyaan to be launched by 2022.
  • In August 2018 the Prime Minister announced that India will attempt a manned mission, Gaganyaan into space by 2022. 
  • The Gaganyaan programme will include two unmanned flights to be launched in December 2020 and July 2021 and one humanspace flight to be launched in December 2021.
  • India’s first human spaceflight will carry 3 astronauts to a low earth orbit of 300 to 400 kilometres on board GSLV Mark III vehicle, for at least 7 days.
  • If successful, India would be the 4th country to send manned mission after the Russia, USA and China.


Components of Gaganyaan

The most critical elements of the human mission are:

Rocket: GSLV Mk-III

  • GSLV Mk-III with an indigenous cryogenic engine is capable of delivering heavier payloads deeper into space.
  • In 2014, ISRO successfully tested an experimental flight of GSLX Mk-III
  • In June 2017, ISRO successfully launched the first “developmental” flight of GSLV Mk-III carrying GSAT-19 satellite into space.
  • The rocket will take the crew to the low-earth orbit (300-400 km)

Crew Module

  • A crew module carrying three Indians will be attached with a service module.
  • These two modules will be integrated with an advanced GSLV Mk III rocket.
  • The crew members will be selected by the IAF and ISR.
  • The crew will perform micro-gravity and other scientific experiments for a week.

Crew Module Atmospheric Re-entry technology - CARE

  • Satellites that are launched for communication or remote sensing are meant to remain in space.
  • However, a manned spacecraft needs to come back.
  • While reentering Earth’s atmosphere, the spacecraft needs to withstand very high temperatures created due to friction.
  • A prior critical experiment was carried out in 2014 along with GSLV MK-III when the CARE (Crew Module Atmospheric Re-entry Experiment) capsule successfully demonstrated that it could survive atmospheric re-entry.

Crew Escape System - PAT

  • The Crew Escape System is an emergency accident avoidance measure designed to quickly get astronauts and their spacecraft away from the launch vehicle if a malfunction occurs during the initial stage of the launch.
  • In July 2018, ISRO completed the first successful flight ‘pad abort test or Crew Escape System.


Environmental Control & Life Support System ECLSS

  • The crew module carrying human beings must have conditions inside suitable for humans to live comfortably.
  • ECLSS will:
    • Maintain steady cabin pressure and air composition
    • Remove carbon dioxide and other harmful gases
    • Control temperature and humidity
    • Manage parameters like fire detection and suppression
  • The layout, design and configuration of ECLSS inside the crew module have been finalised.


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Section : Science & Tech


Centre signs pact with 5 States on Renuka dam

Why In News?

The Centre has signed an agreement with Chief Ministers of five States i.e. Uttar Pradesh, Rajasthan, Uttarakhand, Delhi, Himachal Pradesh, to restart construction of the Renuka multipurpose dam project in the Upper Yamuna Basin.


About Renuka Dam:

 It will be constructed on Giri river (Tributary of Yamuna) in Sirmaur district of Himachal Pradesh.



Need for the project:

  • To supply of drinking water to Delhi and other basin States.
  • It will also generate 40 MW of power.


States to get benefit from Renuka dam

Water from the Renuka dam will be used by U.P., Haryana and National Capital Territory of Delhi from Hathnikund barrage, by the NCT of Delhi from Wazirabad barrage and by U.P., Haryana and Rajasthan from the Okhla barrage.


Cost sharing of the project

Around 90% of the cost of irrigation/drinking water component of the project will be provided by the Central government and the remaining by the rest of the basin States.


Issues involved:

  • Destruction of the ecology and biodiversity of the Renuka Wildlife Sanctuary (Himachal Pradesh) due to construction of the Renuka The dam and its reservoir will submerge 909 ha of reserved forestland, including 49 hac of the Renuka Wildlife Sanctuary.
  • The total agricultural land to be diverted for this project is 1,231 hectares belonging to 32 villages.



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Section : Economics


India takes European Union to WTO's safeguard committee


  • India has taken the European Union (E.U.) to WTO's safeguard committee over duty on steel products.



  • In July 2018, EU imposed safeguard duties on certain steel products, against the US move to impose high customs duties on certain steel and aluminium products.
  • However, India is concerned about the European Union’s move as it exports nearly 6 per cent of its steel output to Italy. Italy is a member of the EU.


Why consultation with the safeguard committee?

  • The country has sought these consultations under WTO's Agreement on Safeguards with a view to review information and exchange views on the measures.
  • Also, it is a way to inform the other country that they are not fulfilling their commitments under the global trade rules.
  • The consultations however don’t fall under the World Trade Organisation’s (WTO’s) dispute settlement system.


About WTO and safeguard action

  • WTO is a Geneva-based, 164-member global body which frames rules and norms for exports and imports.
  • Its main function is to ensure that trade flows as smoothly, predictably and freely as possible.
  • The WTO has many roles:
    • It operates a global system of trade rules,
    • It acts as a forum for negotiating trade agreements,
    • It settles trade disputes between its members and it supports the needs of developing countries.
  • A WTO member may take a “safeguard” action (i.e., restrict imports of a product temporarily) to protect a specific domestic industry from an increase in imports of any product which is causing, or which is threatening to cause, serious injury to the industry.



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Section : Economics


Direct Transfers: Learnings from Telangana’s Rythu Bandhu and Odisha’s KALIA  Editorial 12th Jan’19 FinancialExpress

Farmers in focus again with elections nearing:

  • The Indian farmers and the financial stress they have endured through the years is centre-stage today.
  • With general elections nearing, politicians are desperately looking for ways to alleviate the grave reality.
  • Direct income transfer in the offing:
    • There is a high chance that the union government decides to roll out an unconditional direct income transfer (DIT) to all-India farmers soon.


Cases of Direct income transfer schemes by States:

  • There are learnings that one can draw from states who have already implemented or are in the process of rolling-out a DIT.
  • Two of the biggest such schemes - RBS and KALIA:
    • Telangana’s Rythu Bandhu Scheme (RBS)
      • Telangana’s RBS has been implemented since May 2018  
    • Odisha government’s Krushak Assistance for Livelihood and Income Augmentation (KALIA)
      • Odisha’s KALIA is in the process of being rolled out, where the first phase of payments is to be released by the end of January, 2019.

KALIA goes beyond RBS:

  • RBS was a type of UBI (transfers not to everyone but everyone within an identified segment - like all farmers, not just poor farmers).
  • Odisha's KALIA scheme can be seen as the next level.
  • Many problems associated with RBS are being addressed by KALIA.

Basic comparison between the two schemes:


Major differences:

  1. Inclusion/Exclusion of sharecroppers and the landless:
  • RBS: Exclusion of sharecroppers and the landless was one of the biggest problems with RBS.
  • KALIA: Under KALIA, this problem is resolved as it has three components which cover landowners, sharecroppers, landless labourers and other vulnerable agri-HHs (Households).
  1. Payments to rich farmers:


  • By making payments on a per acre basis, RBS is criticised for being regressive, i.e. as landholding size grew, so did the payment.
  • As per calculations based on Telangana agri-landholdings and the RBS payout schedule, it was found that about 38% of RBS payouts went to farmers with greater than 2 hectares.


  • KALIA is progressive as it makes a standard payment to all on just the condition that the individual is identified as a beneficiary.
  • Besides, KALIA is only designed to deliver to small and marginal farmers, all others are outside the ambit of the scheme.
  • Other farmers excluded from KALIA include ones paying taxes or having a government job.
  1. Agri-allied activities:
  • As per NSSO and NAFIS (NABARD All India Rural Financial Inclusion Survey) data on farmer incomes, as landholding sizes shrink, an increasing share of incomes come from livestock.
  • RBS: Payments under RBS are meant only for farmers growing crops.
  • KALIA: On the other hand, KALIA has announced support to its landless for livestock and allied activities with an amount of Rs 12,500/year.


Reach of both the schemes could be higher:

  • In terms of actual reach, however, both schemes were found inadequate.
  • Upon comparing targetted number of scheme beneficiaries with actual state agri-workforce (sum of cultivators and agri-labourers (main plus marginal) from Census 2011), actual coverage was found to be lower than what is suggested.
  • Nevertheless, as both schemes are a work-in-progress, reach is likely to improve overtime.
  • There is no dispute, however, that both are good examples to be studied if a national DIT is on the cards.


Key takeaways from the two schemes:

  1. Creating a correct list of beneficiaries:
  • Creating a robust list of beneficiaries is most crucial.
  • A list that excludes the better-off and includes all those vulnerable associated with agriculture is the foundation of a successful direct income transfer (DIT) .
  • Updated land records hugely important: Centrality of data on land records in this case cannot be overstated—they need to be updated, linked to unique farmer IDs (possibly Aadhaar) and to bank accounts of farmers.
  • A 100% financial inclusion is indisputably a necessary condition in this case.
  • Other databases like ones from the Census and farmer schemes can also be synergised for the purpose.
  1. Finding funds without creating huge fiscal defecits:
  • Finding funds to finance this DIT while balancing the fiscal deficit is crucial.
  • A pan-India DIT with a payment of Rs 4,000 per acre twice a year on the country’s net sown area of about 140 million hectares is likely to cost about Rs 3 lakh crore.
  • Cost sharing between the Centre and states (possibly in a 70:30 ratio) can resolve this issue to some extent, but getting states onboard won't be easy.
  1. Replacing all subsidies with DIT may be only feasible way:
  • A national DIT on lines of RBS and KALIA is likely to be a transfer that is made over and above existing input subsidy schemes and, therefore, the fiscal implication of this looks dauntingly high.
  • But if the government can subsume input subsidies like seed, fertiliser, power (and, possibly, food grains, at least in the better-off cities/states) in DIT, then it might be fiscally possible.
  • The saved resources can be used to finance a perhaps larger DIT.


Conclusion - a national DIT could be the way forward:

  • A national DIT has scope of becoming the new face of Indian agri-support policy schemes.
  • Such transfers reach more beneficiaries, save on pilferages, is less market distortionary compared to schemes of farm-loan waivers, MSP increases (ones that alienate markets) and inefficient input subsidies and is good economics and, evidently, good politics.



GS Paper II: Polity & Governance

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Section : Editorial Analysis