Contents

  1. SC declares Maratha quota law unconstitutional
  2. Covid impact: Avg. monthly income for workers drops
  3. RBI steps in to ease COVID-19 burden
  4. China on India’s 5G exclusion
  5. IRDAI pitches for Model Insurance Villages

SC declares Maratha quota law unconstitutional

Context:

  • A five-judge Constitution Bench of the Supreme Court unanimously declared a Maharashtra law which provides reservation benefits to the Maratha community, taking the quota limit in the State in excess of 50%, as unconstitutional.
  • The SC said: The Centre alone is empowered to identify socially and educationally backward classes (SEBC) and include them in the Central List for claiming reservation benefits.

Relevance:

GS-II: Polity and Governance (Judgements & Cases, Judiciary, Government Policies & Interventions), GS-II: Social Justice (Welfare Schemes, Issues Relating to Development, Education related issues)

Dimensions of the Article:

  1. Who are the Marathas?
  2. The 2018 Legislation
  3. The 2019 Judgement
  4. Recent Supreme Court Judgement
  5. Indra Sawhney Case Regarding cap on reservation quota

Who are the Marathas?

  • The Marathas are a group of castes comprising peasants, landowners among others.
  • Not all Marathi-speaking persons belong to Maratha community.
  • A politically dominant community in Maharashtra, it comprises nearly one-third of the population of the state.
  • Historically, Marathas have been identified as a ‘warrior’ caste with large land-holdings.

Situation of Marathas

  • The Marathas are a politically dominant community who make up 32% of Maharashtra’s population.
  • They have historically been identified as a ‘warrior’ caste with large landholdings.
  • Eleven of the state’s 19 chief ministers so far have been Marathas.
  • While division of land and agrarian problems over the years have led to a decline of prosperity among middle- and lower middle-class Marathas, the community still plays an important role in the rural economy.

Why do the politically, socially and economically dominant Marathas want reservation?

  • In 2016 Marathas under the banner of Maratha Kranti Morcha came together at Aurangabad to protest the rape and killing of a 15-year-old girl in Kopardi village of Ahmednagar district in Maharashtra.
  • Although Kopardi was the trigger, the Maratha consolidation, leading to 58 silent, but massive, rallies across the state between 2016-17, was centred on reservation for the community in government jobs and educational institutions.
  • At the end of every rally, a ten-point charter of demands was presented to the district collector. High on the agenda was Maratha reservation.
  • In the second phase of agitation between 2017-18, street protests took a violent turn and even led to some suicides.

The 2018 Legislation

  • In 2018, the Maratha community was given the reservation under the Maharashtra State Socially and Educational Backward Act.
  • The special act was sanctioned by Maharashtra State Backward Class Commission and approved in both the assembly and council.
  • The emphasis on legislation was to give reservation under Socially and Educationally Backward Classes (SEBC), a legal and constitutional validity.

The 2019 Judgement

  • In 2019, a division bench commenced hearing of petitions against the Maharashtra State Socially and Educational Backward Act and the Bombay HC held that the limit of reservation should not exceed 50%.
  • It ruled that the 16% quota granted by the state was not ‘justifiable’.
  • It reduced the quota to 12% in education and 13% in government jobs.
  • For this, the court relied on findings of the 11-member Maharashtra State Backward Class Commission (MSBCC).
  • It also said that in exceptional circumstances and extraordinary situations, this 50% limit can be crossed.
  • This limit should be subject to availability of contemporaneous data reflecting backwardness, inadequacy of representation and without affecting the efficiency in administration.
  • The Court had said that while the backwardness of the community was not comparable with SCs and STs.
  • It was comparable with several other backward classes (OBCs), which find place in the list of OBCs pursuant to the Mandal Commission.

What is the existing reservation in Maharashtra post HC verdict?

  • In Mandal Commission case 1993, the SC had ruled that total reservation for backward classes cannot go beyond the 50%-mark.
  • Maharashtra is one of the few states that are an exception to this.
  • Following the 2001 State Reservation Act, the total reservation in the state was 52%.
  • Along with the 12-13% Maratha quota, the total reservation is 64-65%.
  • The 10 % Economically Weaker Sections (EWS) quota announced by the Centre is also effective in the state.

Recent Supreme Court Judgement

  • The Supreme Court bench found there was no “exceptional circumstances” or “extraordinary situation” in Maharashtra which required the Maharashtra government to break the 50% ceiling limit to bestow quota benefits on the Maratha community.
  • The Supreme Court struck down the findings of the Justice N.G. Gaikwad Commission which led to the enactment of Maratha quota law and set aside the Bombay High Court judgment which validated the Maharashtra State Reservation for Socially and Educationally Backward Classes (SEBC) Act of 2018. 
  • In fact, the Supreme Court held that a separate reservation for the Maratha community violates Articles 14 (right to equality) and 21 (due process of law).
  • Most importantly, the Supreme Court declined to re-visit the its 1992 Indira Sawhney judgment, which fixed the reservation limit at 50%.
  • The Supreme Court also said that the President (that is the Central government) alone, to the exclusion of all other authorities, is empowered to identify SEBCs and include them in a list to be published under Article 342A (1), which shall be deemed to include SEBCs in relation to each State and Union Territory for the purposes of the Constitution. [Article 338B deals with the structure, duties and powers of the Commission while 342-A speaks about the power of the President to notify a class as Socially and Educationally Backward (SEBC) and the power of Parliament to alter the central SEBC list.]
  • If the commission prepares a report concerning matters of identification, such a report has to be shared with the State government, which is bound to deal with it, in accordance with provisions of Article 338B. However, the final determination culminates in the exercise undertaken by the President (i.e., the Central Government, under Article 342A (1).
  • However, the President’s prerogative as far as the identification and inclusion of SEBCs in the List would not affect the States’ power to make reservations in favour of particular communities or castes, the quantum of reservations, the nature of benefits and the kind of reservations, and all other matters falling within the ambit of Articles 15 and 16.

Indra Sawhney Case Regarding cap on reservation quota

  • The Supreme Court in the Indra Sawhney vs Union of India had ruled that the total number of reserved seats/places/positions cannot exceed 50% of what is available, and that under the constitutional scheme of reservation, economic backwardness alone could not be a criterion.
  • While 50% shall be the rule, it is necessary not to put out of consideration certain extraordinary situations inherent in the great diversity of this country and the people.
  • It might happen that in far-flung and remote areas the population inhabiting those areas might, on account of their being out of the main stream of national life and in view of conditions peculiar to and characteristic to them, need to be treated in a different way, some relaxation in this strict rule may become imperative.
  • In doing so, extreme caution is to be exercised and a special case made out.

-Source: The Hindu


Covid impact: Avg. monthly income for workers drops

Context:

According to ‘State of Working India 2021: One Year of Covid-19’, a report brought out annually by Azim Premji University’s Centre for Sustainable Employment, Bengaluru – the COVID-19 pandemic has substantially increased informality in employment, leading to a decline in earnings for the majority of workers, and consequent increase in poverty in the country.

Relevance:

GS-III: Indian Economy (Growth and Development of Indian Economy, Mobilization of Resources)

Dimensions of the Article:

  1. Findings of the Report
  2. The Covid-connect

Findings of the Report

  • Regarding employment, the report notes that 100 million jobs were lost nationwide during the April-May 2020 lockdown.
  • Though most of these workers had found employment by June 2020, about 15 million remained out of work.
  • As for income, for an average household of four members, the monthly per capita income in Oct 2020 (less than 500 Rs.) was still below its level in Jan 2020 (less than 6000 Rs).

Exodus into informal sector

  • The study found that post-lockdown, nearly half of salaried workers had moved into informal work, either as self-employed (30%), casual wage (10%) or informal salaried (9%).
  • The fallback option varied by caste and religion. “General category workers and Hindus were more likely to move into self-employment while marginalised caste workers and Muslims moved into daily wage work”.
  • Education, health and professional services saw the highest exodus of workers into other sectors, with agriculture, construction and petty trade emerging as the top fallback options.
  • For Hindus, agriculture was the major fallback sector, absorbing 10-20% of workers from other sectors, while for Muslims, it was trade, absorbing 20-35% of workers from other sectors.
  • Due to the employment and income losses, the labour share of the GDP fell by 5 percentage points, from 32.5% in the second quarter of 2019-20 to 27% in the second quarter of 2020-21.
  • Of the decline in income, 90% was due to reduction in earnings, while 10% was due to loss of employment. This means that even though most workers were able to go back to work, they had to settle for lower earnings. Though incomes fell across the board, poor households were hit the hardest. While the poorest 20% of households lost their entire incomes in April-May 2020.

The Covid-connect

  • Significantly, the study has found a clear correlation between job losses and the COVID-19 case load, with States showing higher case load, such as Uttar Pradesh, Maharashtra, Tamil Nadu, Kerala, and Delhi, “contributing disproportionately to the job losses”.
  • There was also a correlation between lockdown-related mobility restrictions and losses in earnings. A 10% decline in mobility was associated with 7.5% decline in income.
  • Women and younger workers were more affected by the pandemic-related measures. During the lockdown and in the post-lockdown months, 61% of working men remained employed while 7% lost their job and did not return to work. But in the case of women, only 19% remained employed while 47% suffered a permanent job loss.
  • Besides women, younger workers were impacted more by the lockdown. About 33% of workers in the 15-24 years age group had failed to regain some form of employment even by December 2020. The corresponding figure for those in the 25-44 years category was 6%.

-Source: The Hindu


RBI steps in to ease COVID-19 burden

Context:

With India’s economic recovery threatened by the COVID-19 second wave, the Reserve Bank of India stepped in with measures aimed at alleviating any financing constraints for healthcare infrastructure and services, as well as small borrowers who may be facing distress due to a sudden spike in health expenditure.

Relevance:

GS-III: Indian Economy (Growth and Development of Indian Economy, Mobilization of Resources)

Dimensions of the Article:

  1. Unscheduled Support extended by the RBI
  2. Small businesses, MSMEs to get relief
  3. Credit Support

Unscheduled Support extended by the RBI

  • RBI Governor announced a Term Liquidity Facility of ₹50,000 crore with tenor of up to three years, at the repo rate, to ease access to credit for providers of emergency health services.
  • Under the scheme, banks will provide fresh lending support to a wide range of entities, including vaccine manufacturers, importers/suppliers of vaccines and priority medical devices, hospitals/dispensaries, pathology labs, manufacturers and suppliers of oxygen and ventilators, and logistics firms.
  • These loans will continue to be classified under priority sector till repayment or maturity, whichever is earlier.

Small businesses, MSMEs to get relief

  • As part of a “comprehensive targeted policy response”, the RBI also unveiled schemes to provide credit relief to individual and MSME borrowers impacted by the pandemic.
  • The RBI also announced measures to protect small and medium businesses and individual borrowers from the adverse impact of the intense second wave of COVID-19 buffeting the country.
  • RBI unveiled a Resolution Framework 2.0 for COVID-related stressed assets of individuals, small businesses and MSMEs and also expressed the central bank’s resolve to do everything at its command to ‘save human lives and restore livelihoods through all means possible’.
  • Considering that the resurgence of the pandemic had made these categories of borrowers most vulnerable, the RBI said those with aggregate exposure of up to ₹25 crore, who had not availed restructuring under any of the earlier restructuring frameworks (including under last year’s resolution framework), and whose loans were classified as ‘standard’ as on March 31, 2021, were eligible for restructuring under the proposed framework.

Credit Support

  • To provide further support to small business units, micro and small industries, and other unorganised sector entities adversely affected during the current wave of the pandemic, the RBI decided to conduct special three-year long-term repo operations (SLTRO) of ₹10,000 crore at the repo rate for Small Finance Banks.
  • The SFBs would be able to deploy these funds for fresh lending of up to ₹10 lakh per borrower.
  • In view of the fresh challenges brought on by the pandemic and to address the emergent liquidity position of smaller MFIs, SFBs are now being permitted to reckon fresh lending to smaller MFIs (with asset size of up to ₹500 crore) for onlending to individual borrowers as priority sector lending.
  • To enable the State governments to better manage their fiscal situation in terms of their cash flows and market borrowings, maximum number of days of overdraft (OD) in a quarter is being increased from 36 to 50 days and the number of consecutive days of OD from 14 to 21 days.

-Source: The Hindu


China on India’s 5G exclusion

Context:

China expressed “concern and regret” at India’s move to not include Chinese telecommunication firms among the companies permitted to conduct trials for the use of 5G technology in May 2021.

Relevance:

GS-III: Science and Technology (IT & Computers, Innovations & Discoveries), GS-II: International Relations (India’s neighbors, Foreign Policies and Developments affecting India’s Interests)

Dimensions of the Article:

  1. Trials for 5G technology
  2. 5G Technology and Spectrum
  3. What is 5Gi?
  4. 5G Club plan to counter China

Trials for 5G technology

  • The Department of Telecommunications (DoT) on Tuesday gave permission to Telecom Service Providers (TSPs) to conduct trials for the use and application of 5G technology.
  • The applicant TSPs include Bharti Airtel Ltd., Reliance JioInfocomm Ltd., Vodafone Idea Ltd. and MTNL.
  • These TSPs have tied up with original equipment manufacturers and technology providers which are Ericsson, Nokia, Samsung and C-DOT.
  • Each TSP will have to conduct trials in rural and semi-urban settings also in addition to urban settings so that the benefit of 5G technology proliferates across the country.
  • This formally leaves out Chinese companies like Huawei and ZTE from the 5G race in India.

5G Technology and Spectrum

  • 5G is the 5th generation mobile network. It will take a much larger role than previous generations.
  • Trials and the first commercial services are already showing what great potential 5G networks have. But significant amounts of widely harmonised spectrum are a must for this potential to come true. 5G spectrum is needed across three ranges: Sub-1 GHz, 1-6 GHz and above 6 GHz.
  • Pioneering ultra-high speeds and the lowest latencies are dependent on access to spectrum in the latter range. Here, 26 GHz and 28 GHz have emerged as two of the most important 5G spectrum bands.
  • The result means national governments around the world now have the opportunity to consider 5G spectrum assignments across the identified mmWave spectrum. In doing so, they will help deliver long-lasting socio-economic benefits.

The other mobile network generations are 1G, 2G, 3G, and 4G.

  1. 1G delivered analog voice.
  2. 2G introduced digital voice (e.g., CDMA).
  3. 3G brought mobile data (e.g., CDMA2000).
  4. 4G LTE ushered in the era of mobile Internet.

What is 5Gi?

  • The 5Gi technology has been developed by IIT Madras, Centre of Excellence in Wireless Technology (CEWiT) and IIT Hyderabad and submitted by Telecommunications Standards Development Society India (TSDSI).
  • 5Gi technology was advocated by India, as it facilitates much larger reach of the 5G towers and radio networks.
  • 5Gi standard aims to bridge the rural-urban digital divide in 5G deployment on the back of enhanced coverage.

5G Club plan to counter China

  • India and Australia are sharing experiences on protecting critical infrastructure, including 5G networks, said a senior Australian High Commission official while talking of the huge increase in cybersecurity cooperation between the two countries, however, clarifying that Australia has no intention of banning Chinese apps like India has done.
  • India and Australia have a close and ongoing dialogue and exchange a range of experiences, including what is being done regarding critical infrastructure and aspects, including our 5G network, and how to police the dark web.
  • In August 2018, Australia had banned Chinese companies from offering 5G services, citing national security.
  • India banned 59 Chinese apps citing national security and later banned 47 more Chinese apps.
  • Britain said that it was pushing the U.S. to form a club of 10 nations that could develop its own 5G technology and reduce dependence on Huawei.
  • Proposed D10 club of democratic partners includes G7 countries – UK, US, Italy, Germany, France, Japan and Canada – plus Australia, South Korea and India.
  • It will aim to create alternative suppliers of 5G equipment and other technologies to avoid relying on China.
  • It can be seen as a means to ensure that these new entrants belong to like-minded democratic regimes, thus alleviating any security concerns.
  • This move will also allow more 5G equipment and technology providers to come up.
  • It basically addresses the raised concerns regarding potential surveillance and breach of their national security by China using the state-run Huawei.

-Source: The Hindu


IRDAI pitches for Model Insurance Villages

Context:

At a time when the Covid pandemic is raging across the country, the Insurance Regulatory and Development Authority of India(Irdai) has come out with the concept of model insurance villages to cover the entire population in those areas, with the financial support of various institutions like Nabard and CSR funds.

Relevance:

GS-III: Indian Economy (Banking Sector & NBFCs, Growth and Development of Indian Economy, Mobilization of Resources)

Dimensions of the Article:

  1. What is Model Insurance Village (MIV)?
  2. Need for Model Insurance Village
  3. Insurance Regulatory and Development Authority of India (IRDAI)

What is Model Insurance Village (MIV)?

  • The concept of Model Insurance Village (MIV) is a development towards the aim to offer comprehensive insurance protection to all the major insurable risks that villagers are exposed to and make available covers at affordable or subsidised cost.
  • In order to make the premium affordable, financial support needs to be explored through NABARD, other institutions, CSR (Corporate Social Responsibility) funds, government support and support from reinsurance companies.
  • It may be implemented in a minimum of 500 villages in different districts of the country in the first year and increased to 1,000 villages in the subsequent two years.
  • Every general insurance company and reinsurance company accepting general insurance business and having offices in India needs to be involved for piloting the concept.

Need for Model Insurance Village

  • According to the Economic Survey for 2020-21, India’s insurance penetration, which was at 2.71% in 2001, has steadily increased to 3.76% in 2019, but stayed much below the global average of 7.23%.
  • Recently, the Parliament has passed the Insurance Amendment Bill 2021 to increase the foreign direct investment (FDI) limit in the insurance sector to 74% from 49%.

There are various challenges that need to be addressed to increase the penetration of the concept of Insurance in villages such as:

  1. Lack of awareness,
  2. Limited choice of insurance products,
  3. Absence of people-friendly and transparent claim settlement mechanisms, and
  4. Weak network of insurance firms.

Insurance Regulatory and Development Authority of India (IRDAI)

  • The Insurance Regulatory and Development Authority of India or the IRDAI is the apex body responsible for regulating and developing the insurance industry in India.
  • It is an autonomous body. It was established by an act of Parliament known as the Insurance Regulatory and Development Authority Act, 1999. Hence, it is a statutory body.
  • The IRDAI is headquartered in Hyderabad in Telangana. Prior to 2001, it was headquartered in New Delhi.

The functions of the IRDA are listed below:

  1. Its primary purpose is to protect the rights of the policyholders in India.
  2. It gives the registration certificate to insurance companies in the country.
  3. It also engages in the renewal, modification, cancellation, etc. of this registration.
  4. It also creates regulations to protect policyholders’ interests in India.

The Section 4 of the Insurance Regulatory Development Authority (IRDA) Act, 1999 specifies the composition of authority which consists of a 10-member team appointed by the government of India which includes.

  1. One chairman
  2. Five whole time members
  3. Four part time members

-Source: Indian Express

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