Current Affairs 25 May 2024

CONTENTS

1. ECI’s Enforcement of Model Code of Conduct Sparks Debate
2. World Bank Report Highlights Global Water Crisis
3. RBI Approves Record Surplus Transfer to Central Government
4. Global Agencies Call for Action Against Transnational Organized Crime
5. IMD Issues Colour-Coded Alerts for Heavy Rainfall in Kerala
6. ASMPA Missile

ECI’s Enforcement of Model Code of Conduct Sparks Debate

Context:

Recently, the Election Commission of India (ECI) highlighted the enforcement of the Model Code of Conduct (MCC), stressing that star campaigners should lead by example and maintain societal harmony. This announcement has ignited a debate regarding the ECI’s authority to address MCC violations, including the power to deregister political parties.

Relevance:

GS II: Polity and Governance

Dimensions of the Article:

1. What Does the Derecognition of Political Parties Mean?
2. What Does the Deregistration of a Political Party Mean?
3. Need for Deregistration of Political Parties
4. Way Forward

What Does the Derecognition of Political Parties Mean?

Derecognition Explained

• Definition: Derecognition refers to the Election Commission of India (ECI) withdrawing recognition from a political party.
• Status Change: These parties are then classified as registered-unrecognised parties.
• Election Participation: They can still contest elections but lose the privileges granted to recognised parties.

Authority of the ECI

• The ECI can derecognise a political party if it violates provisions of the Indian Constitution or the Representation of the People Act, 1951.

Recognised Party

• A registered political party without recognition is known as a Registered Unrecognised Political Party (RUPP).
• Political parties are classified as either ‘national’ or ‘state’ parties based on the Election Symbols (Reservation and Allotment) Order, 1968.

Criteria for Recognition

• To be recognised at the national or state level, a party must win a requisite number of seats and/or secure a required percentage of votes in general elections to the Lok Sabha (LS) or State Assembly (SA).

Current Status

• There are currently six recognised national parties and sixty-one recognised state parties.

Privileges of Recognised Parties

• Reserved Symbol: They receive a reserved symbol for elections.
• Star Campaigners: They are allowed up to forty star campaigners.
• Media Access: Since the 1998 Lok Sabha elections, they have free access to state-owned television and radio during elections.

Grounds for Derecognition as a National Party

• Voting Threshold: Failing to secure at least 6% of total votes in a general election to the LS or the state legislative assembly, and failing to elect at least 4 MPs in the last LS polls or not winning 1 seat in the LS from the same state.
• Seat Threshold: Not winning at least 2% of total seats in the LS from at least 3 states.
• Vote Share: Failing to secure 8% of total valid votes in the state at a General Election to the LS or State Legislative Assembly.
• Financial Compliance: Failing to submit audited accounts to the ECI on time.
• Internal Elections: Failing to hold organisational elections (inner party elections) on time.

What Does the Deregistration of a Political Party Mean?

Deregistration Explained

• Definition: Deregistration is the process of canceling the registration of a political party.
• ECI’s Limitation: The Election Commission of India (ECI) currently does not have the authority to deregister political parties.
• Consequences: Once deregistered, a political party cannot contest elections.

Registered Parties

• Section 29A: According to the Representation of the People Act, 1951 (RP Act), political parties must register with the ECI.
• Requirements: Parties seeking registration must submit a constitution that declares allegiance to the Indian Constitution and the principles of socialism, secularism, and democracy.
• Legal Benefits: Registered parties receive tax exemptions for donations under Section 13A of the Income Tax Act, 1961, a common symbol for elections, and the ability to have twenty ‘star campaigners’ during election campaigns.

Current Status

• Statistics: As per the ECI, there are 2,790 active registered political parties in India.

Grounds for Deregistration

A political party can be deregistered if:

• Fraud: The registration was obtained fraudulently.
• Illegality: The party is declared illegal by the Central Government.
• Non-compliance: The party revises its internal constitution and refuses to comply with the Indian Constitution.

ECI’s Power

• Limitations: The RP Act does not grant the ECI the authority to deregister parties for not contesting elections, failing to hold inner-party elections, or not submitting required returns.
• Supreme Court Ruling: In the Indian National Congress vs. the Institute of Social Welfare, 2002, the Supreme Court held that the ECI lacks the power to deregister political parties under the RP Act.

Need for Deregistration of Political Parties

Concerns and Issues

• Low Participation: Less than one-third of Registered Unrecognized Political Parties (RUPPs) participate in elections.
• Misuse of Benefits: Potential misuse of income tax exemptions and donations for money laundering.
• MCC Violations: Recognized parties often breach the Model Code of Conduct (MCC), but the ECI can only temporarily bar leaders from campaigning.
• Electoral Integrity: Deregistration mechanisms enhance electoral integrity by removing inactive entities and increasing transparency and fairness.
• Democracy: The proliferation of inactive political parties undermines democracy by diluting the electoral process and lacking genuine participation.

Way Forward

Recommendations and Proposals

• ECI Memorandum: The ECI, in its 2016 memorandum for electoral reforms, suggested amending the law to empower the ECI to deregister parties.
• Law Commission’s 255th Report: Recommended amendments to deregister parties that fail to contest elections for 10 consecutive years.
• Identification of Inactive Parties: In 2016, the commission aimed to identify registered, unrecognized parties that hadn’t fielded candidates from 2005 to 2015, to discourage the formation of paper parties for tax benefits.
• Regular Exercises: Regular exercises to weed out inactive parties.
• National Electoral Fund: Proposed by former chief election commissioner T.S. Krishnamurthy as an alternative to state funding to discourage inactive parties.
• 170th Law Commission Report: Recommended introducing Section 78A in the RPA and penalties for parties defaulting in account maintenance.
• Greater Transparency: Empowering the ECI to audit political party accounts for enhanced transparency.

-Source: The Hindu

World Bank Report Highlights Global Water Crisis

Context:

The World Bank’s new report, “Water for Shared Prosperity,” unveiled at the 10th World Water Forum in Bali, Indonesia, underscores the severe global water crisis and its significant impact on human and economic development worldwide.

Relevance:

GS I: Water Resources

Dimensions of the Article:

1. Key Highlights of the Report on Water and Sanitation
2. World Water Forum 2024

Key Highlights of the Report on Water and Sanitation

Global Access to Water and Sanitation

• Significant Gaps: As of 2022, 2.2 billion people lack access to safely managed drinking water services, and 3.5 billion lack access to safely managed sanitation.
• Rural Disparities: Eight out of ten people without basic drinking water and sanitation services live in rural areas.

Regional Disparities in Access to Water

Freshwater Distribution:

• China and India: Represent 36% of the global population but only hold 11% of the world’s freshwater.
• North America: Represents 5% of the global population but possesses 52% of freshwater.

Africa and Asia:

• The Democratic Republic of the Congo has over half of Africa’s water resources.
• Regions such as the Sahel, Southeastern Africa, and South and Central Asia remain water-stressed.

Low-Income Countries:

• These areas have experienced a decline in access to safe drinking water, with an additional 197 million people lacking access since 2000.

Marginalised Groups:

• Disparities also affect marginalized groups based on gender, location, ethnicity, race, and other social identities.

Impact of Climate Change

• Increased Risks: Climate change exacerbates water-related risks, with developing countries facing more severe and prolonged droughts and floods.
• High Risk: Over 800 million people are at high risk of drought, and twice as many live in flood-prone areas.

Future Projections:

• By 2100, meteorological drought is expected to impact 15% more of the global land area, potentially increasing to nearly 50% with temperature effects.
• Areas most affected will include Central Europe, Asia, the Horn of Africa, India, North America, Amazonia, and central Australia.
  • Vulnerable Populations: Poor populations are more exposed to water-related risks and have limited capacity to adapt, perpetuating a cycle of poverty.

Importance of Water and Sanitation Services

• Human Capital Development: Access to these services is essential for educational attainment and overall human capital development.

Economic Impact:

• In low-income countries, 56% of jobs are in water-intensive sectors that are highly sensitive to water availability.
• In Sub-Saharan Africa, 62% of employment is in water-dependent jobs, with low rainfall significantly impacting GDP growth.

Water Management and Social Impact

• Community Trust: Effective and equitable water management fosters community trust and cooperation.
• Conflict Prevention: Mismanagement can exacerbate conflicts, whereas proper water resource management promotes peace, social cohesion, inclusivity, and reduces tensions.

Recommended Interventions for Sustainable Water Management

• Strengthening Resilience: Enhance resilience to hydro-climatic risks for the poorest populations.
• Resource Development: Improve development, management, and allocation of water resources.
• Equitable Delivery: Promote equitable and inclusive delivery of water services to reduce poverty and increase shared prosperity.

World Water Forum 2024

• Event: The 2024 World Water Forum (10th WWF)
• Theme: “Water for Shared Prosperity”
• Organizers: Jointly organized by the Government of the Republic of Indonesia and the World Water Council.

World Water Council

• Establishment: Founded in 1996
• Location: Marseille
• Membership: Comprises 260 member organizations from 52 countries, including India.
• Mission: To unite the international community to advocate for water as a critical political priority for sustainable and equitable global development.

Significance of the Forum

• Scale: The World Water Forum is the world’s largest event of its kind, held every three years since 1997 with a different host country each time.
• Platform: Provides a unique venue for the water community and key decision-makers to collaborate and make long-term commitments to address global water challenges.
• Goal: To ensure clean and equitable access to water for all, fostering sustainable development and cooperation among nations.

-Source: Down To Earth

RBI Approves Record Surplus Transfer to Central Government

Context:

The Central Board of the Reserve Bank of India (RBI) has approved a record surplus transfer of Rs 2.11 lakh crore to the Central government for the fiscal year 2023-24. This transferable surplus has been calculated based on the Economic Capital Framework (ECF).

Relevance:

GS III: Indian Economy

Dimensions of the Article:

1. What is the Economic Capital Framework (ECF)?
2. What is the Surplus Distribution Policy of the Revised ECF?
3. Surplus Transfer by the RBI to the Central Government
4. What Led to the Higher Dividend Transfers to the Government?

What is the Economic Capital Framework (ECF)?

• Purpose: The ECF provides a methodology for determining the appropriate level of risk provisions and profit distribution as per Section 47 of the RBI Act 1934.
• Profit Distribution: The central bank must pay the balance of its profits to the central government after accounting for bad and doubtful debts, asset depreciation, and staff contributions.

Old ECF

• Development: The old ECF was developed in 2014-15 and became operational in 2015-16.
• Review: In 2018, the RBI constituted an Expert Committee chaired by Dr. Bimal Jalan to review the existing economic capital framework and propose a suitable surplus distribution policy.

Revised ECF

• Adoption: The RBI adopted the revised ECF on August 26, 2019, based on the recommendations of the Bimal Jalan Committee. This framework may be reviewed every five years.

What is the Surplus Distribution Policy of the Revised ECF?

Previous Policy

• Focus: The earlier surplus distribution policy targeted only the total economic capital.
• Components: Economic capital includes the central bank’s capital, reserves, risk provisions, and revaluation balances.

Expert Committee Recommendations

• Inclusion of Realised Equity: The target should also include realised equity, which is part of RBI’s economic capital comprising its capital, reserve fund, and risk provisions.
• Total Economic Capital: Should be maintained between 20.8% to 25.4% of the RBI’s balance sheet.

Contingent Risk Buffer (CRB):

• Range: The CRB should be maintained within 5.5-6.5% of the RBI’s balance sheet.
• Purpose: Covers monetary, fiscal stability, credit, and operational risks.
• Role: Acts as the country’s savings for financial stability crises, maintained by the RBI as the Lender of Last Resort.

Surplus Distribution

• Above Required Levels: If realised equity is above the required levels, the entire net income of the RBI will be transferred to the government.
• Below Required Levels: If realised equity is below the required levels, risk provisioning will be made as needed, and only the residual net income will be transferred to the government.

Surplus Transfer by the RBI to the Central Government

• Amount Transferred: The Central Board of Directors of the RBI approved a transfer of Rs 2,10,874 crore as surplus to the Central Government for the accounting year 2023-24.
• Comparison with Previous Year: This transfer is more than double the Rs 87,416 crore transferred in FY23.
• CRB Adjustment: The RBI Board decided to increase the Contingent Risk Buffer (CRB) to 6.50% for 2023-24 from 6% the previous year, reflecting the robust and resilient economy.
• Fiscal Deficit Target: The Interim Budget for FY2025 set a target to reduce the fiscal deficit to 5.1% of GDP in FY25 from 5.8% in FY24.
• Impact: The significant dividend payout is expected to ease the FY25 fiscal deficit by about 0.2% of GDP, considering potential shortfalls in disinvestment receipts and moderate tax collection growth.

What Led to the Higher Dividend Transfers to the Government?

Variable Repo Rate (VRR) Auctions:

• Revenue Increase: The higher dividend, which represents an additional fiscal revenue of 0.4% of GDP, is partly due to increased revenue from the RBI’s VRR auctions conducted last year to provide funding support to banks amid tight liquidity.

Revaluation Gains on Forex Reserves:

• Interest Rates: Higher interest rates on domestic and foreign securities.
• Foreign Exchange Sales: Significantly higher gross sales of foreign exchange also contributed to the increased dividend.

Surplus Income:

• Sources: The RBI’s surplus income from investments, valuation changes on dollar holdings, and fees from printing currency.

Rupee Depreciation:

• Effect: The rupee’s depreciation against the dollar has also led to the increased surplus transfer.

-Source: The Hindu

Global Agencies Call for Action Against Transnational Organized Crime

Context:

Recently, the leaders of the Financial Action Task Force (FATF), Interpol, and the United Nations Office on Drugs and Crime (UNODC) stressed the urgent need to enhance efforts to combat the substantial illicit profits generated by transnational organized crime (TOC).

Relevance:

GS III: Security Challenges

Dimensions of the Article:

1. What is Transnational Organised Crime?
2. Impact of Transnational Organized Crime (TOC)
3. Challenges Regarding Controlling TOC

What is Transnational Organised Crime?

Definition

• Organised Crime: Illegal activities carried out by groups or networks, often involving violence, corruption, or related actions to gain financial or material benefits.
• Transnational Organised Crime (TOC): Occurs when these activities or groups operate across multiple countries.

Different Forms of TOC

Money Laundering:

• Conceals the origins of illegally obtained money.
• Converts proceeds of crime into seemingly legal funds.
• Globally, money laundering exceeds 2% to 5% of the global GDP, approximately USD 800 billion to USD 2 trillion annually.

Drug Trafficking:

• The most lucrative business for criminals.
• Global drug trafficking is worth around USD 650 billion, contributing 30% of the overall illicit economy.

Human Trafficking:

• Exploitation of men, women, and children for sexual or labor purposes.
• Generates estimated annual global profits of USD 150 billion.
• Victimizes approximately 25 million people worldwide (80% forced labor, 20% sex trafficking).
• In 2009, USD 6.6 billion was generated from the smuggling of 3 million migrants from Latin America to North America.

Arms Trafficking:

• Illicit trade of small arms, explosives, and ammunition.
• Generates around USD 170 million to USD 320 million annually.

Trafficking in Natural Resources:

• Involves the trade of non-renewable resources (minerals, fuels) and renewable resources (wildlife, forestry, fishery).
• Called “environmental crime” by international organizations.
• The sale of elephant ivory, rhino horn, and tiger parts in Asia was worth an estimated USD 75 million in 2010.

Fraudulent Medicines:

• Includes counterfeit medicines and diverted legal medicines.
• Can result in death or drug resistance instead of curing diseases.

Cybercrime and Identity Theft:

• Criminals use the internet to steal private data, access bank accounts, and fraudulently obtain payment card details.

Impact of Transnational Organized Crime (TOC)

Health and Safety

• Counterfeit Medicines: Common in low- and middle-income countries, these can be ineffective or harmful, leading to approximately 1 million deaths globally each year.
• WHO Estimate: Over 1 million deaths annually due to falsified or substandard medicines, with 200,000 deaths in Africa.

Economic Impact

• Money Laundering: Undermines financial integrity and state public financing, obstructing economic development.
• Foreign Exchange Reserves: TOC drains these reserves and affects asset
• prices, undermining economic stability.
• Global Offshore Economy: Conceals an estimated 10% of the world’s wealth, including proceeds from organized crime.

Environmental Impact

• Organized Environmental Crime: Drives deforestation, biodiversity loss, and carbon emissions, contributing to climate change.
• Synthetic Refrigerants (HFCs): Illicit production and smuggling undermine the Montreal Protocol, exacerbating climate change.
• Lack of Consensus: On defining and criminalizing environmental crimes enables criminals to evade enforcement.
• Social and Political Impact
• Illicit Arms Trade: Fuels armed conflicts, violent crime, and other organized criminal activities.
• Non-State Armed Groups: Engage in illicit markets, supporting activities like natural resource extraction and smuggling.
• Organized Crime-Related Violence: Particularly in Central and South America, often exceeds casualties from armed conflicts.

Local Impact

• Destabilization: TOC can destabilize countries and regions, undermining development assistance.
• Local Criminal Collaboration: Increases in corruption, extortion, racketeering, and violence, alongside sophisticated crimes.
• Public Spending: Adds to security and policing costs, undermining human rights standards.

Challenges Regarding Controlling TOC

Legal and Policy Challenges

• Variations in Legal Frameworks: Across countries complicate international efforts to combat TOC.
• Global Consensus: Difficult to achieve on strategies to address TOC due to varying national interests and priorities.

International Cooperation

• UN Convention Against Transnational Organized Crime (UNTOC): The main legal instrument, but its implementation and cooperation regime are often ineffective.
• UNODC and Other Bodies: Lack a coherent strategy, often taking a piecemeal approach.

Enforcement and Governance

• Informal Solutions: Powerful states prefer unilateral solutions, which often lack oversight, challenging the rule of law and human rights.
• Corruption: Infiltrates and undermines law enforcement and governance structures.
• Technology: Criminals exploit technology for illicit activities, staying ahead of law enforcement capabilities.

Conflict and Terrorism

• Regions of Conflict: TOC can fuel violence and instability, complicating efforts to control it.
• Terrorism Connection: Criminal profits fund terrorist activities, posing a significant threat.

-Source: The Hindu

IMD Issues Colour-Coded Alerts for Heavy Rainfall in Kerala

Context:

The India Meteorological Department (IMD) has issued colour-coded alerts for multiple districts in Kerala, warning of potential isolated heavy to very heavy rainfall in the state.

Relevance:

Facts for Prelims

Weather Warnings

• Color-Coded System: The IMD uses color-coded weather warnings to alert the public about severe or hazardous weather conditions that could cause damage, disruption, or danger to life.

Categories:

• Green: No warning.
• Yellow: Be aware.
• Orange/Amber: Be prepared.
• Red: Take action.

Indian Meteorological Department (IMD)

• Founded: Established in 1875.
• Affiliation: An agency under the Ministry of Earth Sciences, Government of India.

Responsibilities:

• Meteorological observations.
• Weather forecasting.
• Seismology.

Headquarters and Global Role

• Location: Headquartered in New Delhi.
• Global Integration: One of the six Regional Specialized Meteorological Centres of the World Meteorological Organization.

-Source: The Hindu

ASMPA Missile

Context:

France has marked a significant milestone in its defence capabilities by successfully testing the updated ASMPA supersonic missile, capable of carrying a nuclear warhead.

Relevance:

Facts for Prelims

About ASMPA Missile

• Type: The Air-Sol Medium Range (ASMP/ASMP-A) is an air-launched land-attack supersonic cruise missile.
• Payload: Carries a nuclear payload.
• Role: Central component of France’s nuclear deterrent force.

Versions

ASMP (1986):

• Range: 80 to 300 km.
• Warhead: TN 81 with a variable yield of 100 to 300 kilotons of TNT.

ASMP-A (2009):

• Range: Extended up to 500 km.
• Warhead: New 300 kt thermonuclear warhead.
• ASMPA-R Project: A renovated version intended to add additional range and support new advancements in the warhead.

Features

Dimensions:

• Length: 5.38 meters.
• Body Diameter: 0.38 meters.
• Launch Weight: 860 kg.
• Guidance: Inertial-guided, likely using terrain-mapping and a pre-programmed onboard computer.
• Motor Assembly: Comprises a solid-propellant engine that fires after the missile is released from the aircraft.

Performance

Initial Acceleration:

• Speed: Accelerates to Mach 2.0 in five seconds.
• Process: After ignition, the booster cartridge is ejected from the ramjet exhaust nozzle.

Secondary Acceleration:

• Motor: Liquid (kerosene)–powered ramjet motor.
• Maximum Speed: Mach 3.0, depending on altitude.

-Source: The Hindu