Daily Current Affairs 6 May 2020 | UPSC Current Affairs 2020

Current Affairs Of Today Are

1) Samudra Setu

Indian Navy has launched Operation “Samudra Setu” - meaning “Sea Bridge”, as a part of national effort to repatriate Indian citizens from overseas. Indian Naval Ships Jalashwa and Magar are present en route to the port of Malè, Republic of Maldives to commence evacuation operations from 08 May 2020 as part of Phase-1.
The Government has been closely monitoring the situation concerning the effect of COVID-19 pandemic on our citizens abroad. The Indian Navy has been directed to make suitable preparations for their evacuation by sea.
The Indian Mission in the Republic of Maldives is preparing a list of Indian nationals to be evacuated by Naval ships and will facilitate their embarkation after the requisite medical screening. A total of 1000 persons are planned to be evacuated during the first trip, catering for COVID- related social distancing norms vis-a-vis the carrying capacity and medical facilities available onboard.
The ships have been suitably provisioned for the evacuation operation. The evacuated personnel would be provided the basic amenities and medical facilities during the sea-passage. Given the unique challenges associated with COVID-19 stringent protocols have also been stipulated.
The evacuated personnel will be disembarked at Kochi, Kerala, and entrusted to the care of State authorities. This operation is being progressed in close coordination with Ministries of Defence, External Affairs, Home Affairs, Health, and various other agencies of the Government of India and State governments.

Source: PIB

2) India flays nod for Gilgit-Baltistan polls

The External Affairs Ministry issued a strong protest over an order by the Pakistan Supreme Court allowing the government to hold elections in the region of Gilgit-Baltistan of Pakistan-occupied Kashmir (PoK).

Gilgit-Baltistan:

Gilgit-Baltistan borders China in the North, Afghanistan in the west, Tajikistan in the northwest, and Kashmir and Ladakh to the southeast.
It shares a geographical boundary with Pakistan-occupied Kashmir, and India considers it as part of the undivided Jammu and Kashmir, while Pakistan sees it as separate from PoK.
The China-Pakistan Economic Corridor (CPEC) also passes through this region.

The main reason behind India’s opposition towards China’s One Belt One Road (OBOR) policy is the China-Pakistan Economic Corridor (CPEC), which is a part of OBOR.

Three of the world’s longest glaciers outside the Polar regions are found in Gilgit-Baltistan.

Details:

Gilgit-Baltistan has functioned as a “provincial autonomous region” since 2009.
India has issued a demarche to protest what it called Pakistan’s attempt to make material changes to the disputed area, by bringing federal authority to Gilgit-Baltistan (G-B).
India asserts that the Government of Pakistan or its judiciary has no locus standi on territories illegally and forcibly occupied by it.
India’s reaction is consistent with its previous objections against elections in G-B and in other parts of PoK.
India maintains that Gilgit-Baltistan is a part of the former princely state of Jammu and Kashmir that is an integral part of India.

Source: The Hindu

3) Manufacturing Hits Record Low

According to a recent IHS Markit India monthly survey, Manufacturing Purchasing Managers’ Index (PMI) fell to 27.4 in April 2020 from 51.8 in March 2020.

Key Points

India’s manufacturing sector activity has witnessed a contraction in April 2020 due to national lockdown restrictions.

The new business orders have collapsed at a record pace severely hampering the demand.
This is the sharpest deterioration in business conditions across the manufacturing sector since data collection began over 15 years ago.

The deteriorating demand conditions have led the manufacturers to drastically cut back staff numbers.
Export orders have also witnessed a sharp decline.
There was also evidence of supply-side disruption due to the lockdown.
The PMI slipped into contraction mode, after remaining in the growth territory for 32 consecutive months.

In PMI’s language, a reading above 50 means expansion, while a score below that denotes contraction.

According to the 12-month outlook for production, the demand will rebound once the Covid-19 threat is diminished and lockdown restrictions are eased.
The Index (PMI) is compiled by IHS Markit for more than 40 economies worldwide. IHS Markit is a global leader in information, analytics, and solutions for the major industries and markets that drive economies worldwide.

Purchasing Managers' Index

Purchasing Managers’ Index (PMI) is an indicator of business activity - both in the manufacturing and services sectors.

It is calculated separately for the manufacturing and services sectors and then a composite index is also constructed.
The PMI summarizes whether market conditions as viewed by purchasing managers are expanding, neutral, or contracting.

The purpose of the PMI is to provide information about current and future business conditions to company decision-makers, analysts, and investors.
The PMI is a number from 0 to 100.

PMI above 50 represents an expansion when compared to the previous month;
PMI under 50 represents a contraction, and
A reading at 50 indicates no change.

The PMI is usually released at the start of every month. It is, therefore, considered a good leading indicator of economic activity.
It is different from the Index of Industrial Production (IIP), which also gauges the level of activity in the economy.

Index of Industrial Production

The Index of Industrial Production (IIP) is an index which details out the growth of various sectors in an economy such as mineral mining, electricity, manufacturing, etc.
It is compiled and published monthly by the National Statistical Organisation (NSO), Ministry of Statistics and Programme Implementation.
The Base Year of the Index of Eight Core Industries has been revised from the year 2004-05 to 2011-12 from April 2017.

The eight core industries comprise 40.27% of the weight of items included in the Index of Industrial Production (IIP).
The eight Core Industries in decreasing order of their weightage: Refinery Products> Electricity> Steel> Coal> Crude Oil> Natural Gas> Cement> Fertilizers.

Difference between PMI and IIP

IIP covers the broader industrial sector compared to PMI.

IIP shows the change in production volume in major industrial sub-sectors like manufacturing, mining, and electricity.
Similarly, the IIP also gives use based (capital goods, consumer goods, etc) trends in industrial production.

PMI is more dynamic compared to a standard industrial production index.

The PMI senses dynamic trends because of the variable it uses for the construction of the index compared to volume-based production indicators like the IIP.
For example, new orders under PMI show growth-oriented positive trends and not just the volume of past products that can be traced in an ordinary Index of Industrial Production.

Source: Indian Express

4) Liquor Revenue for States

Recently, the central government eased restrictions in the third phase of the nationwide lockdown and allowed the sale of liquor. The Delhi government announced a 70% hike as ‘Special Corona Fee’ in the price of liquor across categories.

This shows the importance of liquor to the economy of the states.

Key Points

State’s Earnings from Liquor

Liquor contributes a considerable amount to the exchequers of all states and Union Territories (UTs) except Gujarat and Bihar, both of which have enforced prohibition.

Andhra Pradesh announced prohibition in 2019, however, the sale of the liquor has been allowed with “prohibition tax”.

States levy excise duty on manufacture and sale of liquor.
States also charge special fees on imported foreign liquor, transport fee, and label & brand registration charges.
A few states like Uttar Pradesh, have imposed a ‘special duty on liquor’ to collect funds for special purposes, such as maintenance of stray cattle.

The Reserve Bank of India published the report ‘State Finances: A Study of Budgets of 2019-20’ in September 2019.

It shows that state excise duty on alcohol accounts for around 10-15% of Own Tax Revenue of a majority of states.
In fact, state excise duties on liquor are the second or third largest contributor to the category State’s Own Tax revenue; Goods and Services Tax-GST is the largest. This is the reason states have always wanted liquor kept out of the purview of GST.
According to the report, in 2019-20, state GST had the highest share, 43.5%, in states’ Own Tax Revenue, followed by Sale Tax at 23.5% (mainly on petroleum products which are out of GST), state excise at 12.5%, and taxes on property and capital transactions at 11.3%.

State Excise

Excise duty on production of few items including that on liquor and other alcohol-based items is imposed and collected by state governments and is called ‘State Excise’ duty.

Excise duty is basically a production tax. It is imposed on manufactured items in India that are meant for domestic consumption.

Revenue receipts from state excise come mainly from commodities such as Country Spirits; Liquor; Foreign Liquors and Spirits; Medicinal and Toilet Preparations containing Alcohol, Opium, etc; Opium, Hemp and other Drugs; Sales to Canteen Stores Depots.
Apart from these, a substantial amount comes from licenses, fines, and confiscation of alcohol products.

Sources of Revenue for States

Tax Revenue

State’s Own Tax Revenue

Taxes on Income (agricultural income tax and taxes on professions, trades, callings, and employment)
Taxes on Property and Capital Transactions (land revenue, stamps and registration fees, urban immovable property tax)
Taxes on Commodities and Services (sales tax, state sales tax/VAT, central sales tax, a surcharge on sales tax, receipts of turnover tax, other receipts, state excise, taxes on vehicles, taxes on goods and passengers, taxes and duties on electricity, entertainment tax, state GST, and “other taxes and duties”)

Share in Central Taxes

Article 280 of the Indian Constitution requires the composition of the Finance Commission every five years so that the states can get a reasonable part in the tax revenue of the union government.

Non-Tax Revenue

These are collected by the governments for providing/facilitating any goods and services.
It is compulsory to pay a part of the income earned/generated and the number of goods and services consumed as tax. However, non-tax revenue becomes payable only when services offered by the government are availed.
Components:

Interest: It comprises interest of loans given to states and union territories for reasons like non-plan schemes and planned schemes with a maturity period of 20 years and also interest on loans advanced to Public Sector Enterprises (PSEs), Port Trusts, and other statutory bodies, etc.
Dividends and profits, Petroleum license, Power supply fees, Fees for Communication Services, Broadcasting fees, Road, Bridges usage fees, Examination fees, etc.

Source: Indian Express

5) Jharkhand Launches Employment Schemes

Recently, Jharkhand launched three employment schemes — Birsa Harit Gram Yojana (BHGY), Neelambar Pitambar JAL Sammridhi Yojana (NPJSY), and Veer Sahid Poto Ho Khel Vikas Scheme (VSPHKVS) — to create wage employment for workers in rural areas.
Earlier, the Odisha government has announced a Rs 100-crore Urban Wage Employment Initiative to generate employment for the urban poor in 114 urban local bodies.

Key Points

These three schemes have been devised in convergence with the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
Issue: According to the Centre for Monitoring Indian Economy (CIME) data, the State is reeling under severe joblessness with unemployment rate pegged at 47.1% — double that of the national average (23.5%).

The arrival of an estimated 5 lakh to 6 lakh stranded migrant workers (due to Covid-19 lockdown) from other states is likely to worsen the situation.

Through MGNREGA and these special schemes, the state government plans to create 30 crore person days and provide wage employment to the rural people in the coming 5 years.
Birsa Harit Gram Yojana (BHGY):

The BHGY is envisaged at bringing over two lakh acres of unused government fallow land under the afforestation program.
About five lakh families will be provided 100 fruit-bearing plants.
The initial plantation, maintenance, land work, and afforestation will be taken up through MGNREGA.
Each family is estimated to receive an annual income of ₹50,000 from fruit harvest after three years while the ownership of land will remain with the government.

Neelambar Pitambar Jal Sammridhi Yojna (NPJSY):

Under this, the government is aiming at creating agro-water storage units by arresting rainwater and runaway groundwater.
Nearly 5 lakh acres of cultivable land can be irrigated through the initiative.
An estimated 10 crore person days will be generated through the scheme in the next 4-5 years.

Veer Sahid Poto Ho Khel Vikas Scheme (VSPHKVS):

Under VSPHKVS, the government is linking sports with rural job schemes for the creation of assets in rural areas to give a boost to sports.
About 5,000 sports grounds are being planned to be set up, with one each in all the 4,300 panchayats.

Source: The Hindu

6) Mathematical and Simulation Aspects of Covid-19

The Science and Engineering Research Board (SERB) has approved funding for 11 projects under the MATRICS scheme for studying mathematical modeling and computational aspects to tackle the Covid-19 pandemic.

It is a statutory body under the Department of Science and Technology (DST), Government of India.

Key Points

These studies attempt to propose mathematical/simulation models to account for various factors relevant to Covid-19 by modifying the basic SIR (Susceptible-Infected-Recovered) models.
A SIR model is an epidemiological model that computes the theoretical number of people infected with a contagious illness in a closed population over time.
The name of this class of models derives from the fact that they involve coupled equations relating to the number of susceptible people, the number of people infected, and the number of people who have recovered.
Some such factors are the heterogeneity of population, the role of asymptomatic (showing no symptoms) population, migration and quarantine, the effect of social distancing and lockdown, socioeconomic factors, and so on.

Aim

To study Indian conditions and provide an estimate of Basic Reproduction Number (R0)- the qualitative indicator of the degree of contagiousness of the disease.
R0 tells the average number of people who will catch the disease from one contagious person.
The larger this number, the more contagious is the disease caused by the virus, and the faster it will spread in the community.
It also aims to identify the maximum likelihood infection tree when infection reports and contact network structure are known to the administration.
To identify possible cures of Covid-19 through the study of DNA (DeoxyriboNucleic Acid) structures by creating patterns of DNA of different viruses.

MATRICS Scheme

It was launched in 2017 by the Science and Engineering Research Board (SERB).
It aims to provide fixed grant support to active researchers with good credentials in Mathematical Sciences, Theoretical Sciences, and Quantitative Social Sciences.
The support is provided in the form of a research grant of Rs. 2 lakh per annum plus overheads for a period of three years.

Source: PIB

7) Year of Awareness on Science and Health (YASH)

The National Council for Science & Technology Communication (NCSTC), Department of Science & Technology (DST) has launched a program on health and risk communication ‘Year of Awareness on Science & Health (YASH)’ with focus on Covid-19.
The program is a comprehensive and effective science and health communication effort for promoting grass-root level appreciation and response to health.

Key Points

The program is aimed at minimizing risks at all levels with the help of public communication and outreach activities, promoting public understanding of common minimum science for community care and health safety measures like:
personal sanitation and hygiene,
physical distancing,
maintaining desired collective behavior and so on.
It aims to reduce the fear of risks and build confidence with necessary understanding for adopting sustainable healthy lifestyles and nurturing scientific culture among masses and societies.

Source: PIB

8) Covid-19 in States with High Swine Flu Rates

Maharashtra, Gujarat, Rajasthan, Delhi and Tamil Nadu account for about 70% of India’s confirmed Covid-19 cases till now.

Data from the Health Ministry’s National Centre for Disease Control (NCDC), show that these are also the states which consistently accounted for the majority of Swine Flu (H1N1) cases, since 2015.
The NCDC recorded Swine Flu cases this year as well as part of India's Integrated Disease Surveillance Programme.

Key Points

Data History of Swine Flu

2019: Rajasthan, Gujarat, Delhi, and Maharashtra accounted for 54%.
2018: Tamil Nadu, Maharashtra, Rajasthan, and Gujarat accounted for 65%.
Uttar Pradesh and Bihar are among India's most populous states and see intense migration to other states for work still they have not been in the top list always.

Parallels between Covid-19 and Swine Flu

Both are caused due to pathogens that trace their origins to viruses from non-human hosts even though they belong to different families.
Both respiratory viruses that spread through contact.
Both infiltrate the lungs and cause characteristic pulmonary infections but they have varying lethality.
Swine flu infections have a higher case fatality rate (deaths per confirmed cases) and can cause significant deaths in children as well as those less than 60.
Covid-19 is relatively more dangerous to those above 60 and almost harmless in children.
However, due to the lack of sufficient research, it cannot be said which age group is safer or not.
The high number of Covid-19 and Swine Flu cases have been observed in Gujarat and Maharashtra.
The relative dominance of these diseases can be attributed to the migration for work.

Observations

February-March is typical months for influenza (viral infection of the upper or lower respiratory tract) in India.
Most influenza activity in northern India has been seen during the summer months but in southern and western India, cases occurred mostly during winter months.
According to scientists, due to the novel nature of Covid-19, the possibility of another spike later in the year cannot be ruled out.
For Swine flu, this year there is an exceptional rise in testing and active surveillance across states otherwise only a few states have the infrastructure and system to actively report cases.
Maharashtra and Tamil Nadu have 50 testing laboratories each for Covid-19 many of which are also deployed for Swine flu.

Swine Flu

It is caused by the swine flu virus, the H1N1.
It is an infection of the respiratory tract characterized by the usual symptoms of flu-like cough, nasal secretions, fever, loss of appetite, fatigue, and headache.
It is called swine flu because in the past it was known to occur in people who had been in the vicinity of pigs.
The virus is transmitted by short-distance airborne transmission, particularly in crowded enclosed spaces. Hand contamination and direct contact are other possible sources of transmission.

Source: The Hindu

9) Insurance Claims amid Covid-19 Outbreak

Companies that suffered business interruption losses due to the Covid-19 outbreak and lockdown are likely to bat for the “loss of profit” clause in their insurance contracts.

Many companies had taken insurance policies to cover loss arising due to certain unforeseen circumstances but the question has arisen whether the Covid-19 outbreak is covered by such policies.
The net result is that they may not get any insurance claim from the insurance companies under the Standard Fire and Special Perils Policy, commonly known as property policy.

Note:

Corporations usually take two types of insurance policies -Material damage policy and Business interruption policy.

Material damage policy is triggered if there is the loss of property due to fire or flood or machine breakdown.
Business interruption, on the other hand, only comes into force if the loss of profit has happened due to the clauses mentioned under the material damages policy.

Key Points

Provisions of Property Policy:
If the insured plant or office is shut down due to any damage or fire, the company is eligible for claims.
Also, the Policy specifies if the building insured or containing the insured property becomes unoccupied and so remains for a period of more than 30 days (not applicable for dwellings), the insurance claims may not be applicable.
For claim, before the occurrence of any loss or damage to the property, the continuation of the coverage needs to be ensured.
Relaxation from Policy Lapse:
The insurers have given relief to corporates, which shut their units for more than a month. Their policies will be allowed to be operational despite the clause that if a unit is shut for 30 days continuously, the policy cover will lapse.
The above relief is applicable for the “unoccupied properties” for more than one month till May 3 under the property policy.
It means companies can claim insurance if the property is damaged due to fire or any other loss even if the factory or unit is not operational during the period till May 3.
Force Majeure, or “Act of God” Clause :
Most insurers will also use the Force Majeure, or “Act of God” clause but again there is no concrete conclusion or clause stating that loss of profit due to Covid-19 is Force Majeure.
Force majeure is a common clause in contracts that essentially frees both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties occurs. It prevents one or both parties from fulfilling their obligations under the contract.

Source: Indian Express

DAILY NEWS TELLER

Search This Blog