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Current Affairs for IAS Exams - 15 March 2018

::NATIONAL::

No discussion, LS passes Financial Bill

The Lok Sabha passed the Finance Bill, 2018, with 21 amendments, some of which had to do with the controversial long-term capital gains tax on equity announced in the Budget speech by Finance Minister ArunJaitley and tax exemptions for start-ups.
The Bill was passed without discussion amid ruckus, following which both Houses of Parliament were adjourned for the day.
Regarding the long-term capital gains (LTCG) tax, one of the major amendments made was that the grandfathering of gains till January 31, 2018 will now be incorporated in the computation of the gains itself, rather than for the purposes of computing tax at the rate of 10%.
“This resolves the ambiguity contained in the language of the Finance Bill, 2018, on the need for a duplicated computation, viz. first for computing LTCG without grandfathering and then for applying 10% tax rate with grandfathering,” Rajiv Chugh, Tax Partner at EY India, said in a note.
The amended Finance Bill, 2018 clears the air on several ambiguities and anomalies on the new LTCG regime.
Cost base for depreciation allowance on stock in trade converted into capital asset, valuation of securities held as inventory by scheduled banks and public financial institutions.
Due date for CbCR (country by country reporting) compliance by Indian constituent entity of non-resident parent entity and turnover cap for eligible start-ups.”
However, tax experts say that ambiguities on other proposals continue to exist, such as the deemed dividend taxation of accumulated profits of an amalgamating company.
Potential extension of SEP to physical transactions, applicability of prosecution for non-filing of returns of income to foreign companies whose incomes are fully covered by withholding tax, and restrictive relief from minimum alternate tax (MAT) for non-resident companies under presumptive basis of taxation.
The amended Finance Act also made changes to the rules regarding how start-ups can avail of tax deductions on profits.
Previously, start-ups were allowed 100% deduction of profits for any three out of seven years from the year of incorporation.
To avail of this incentive, the start-ups were required to comply with a condition that stipulated that their turnover could not exceed Rs. 25 crore in those seven years.

Very good value for Darjeeling Brand: Mamta

West Bengal Chief Minister Mamata Banerjee said that the ‘Darjeeling brand’ has very good value and the ongoing Darjeeling Business Summit has garnered Rs. 1,500 crore investment proposals.
“The Darjeeling brand has very good value and needs to be nurtured for proper utilisation to attract more tourists and investments. We are happy to receive Rs. 1,500 crore investment proposals at the first Darjeeling Business Summit,” Ms. Banerjee said
The Confederation of Indian Industry, which partnered the State government and the Gorkha Territorial Administration in organising the business summit, has already prepared an action plan for development in the hills, she said, adding that the final plan will be submitted later.
The Chief Minister also welcomed Sikkim businessmen who are interested in investing in Darjeeling. “You too take part in this initiative to boost development in Darjeeling,” she said.
On the unrest in the hills, Ms. Banerjee said, “Whenever Darjeeling makes progress some dirty games begin in its neighbouring areas. Don’t allow this to happen.”
Darjeeling had experienced turmoil last year with the GorkhaJanmuktiMorcha sponsoring a 104-day-long strike to push for a separate Gorkhaland State. The strike ended in September and hit hard its tea industry.

ASICS Ranking for 2017, Pune tops

The Annual Survey of India’s City-Systems (ASICS) 2017, which uses 150 parameters to judge 23 cities, has placed Pune at the top and Bengaluru at the bottom of the rankings.
While Pune scored 5.1 out of a maximum score of 10, Bengaluru got just 3. But Indian cities lagged behind global cities like New York and London, which scored 8.8.
The survey, carried out by the NGO Janaagraha Centre for Citizenship and Democracy, was released.
It broadly looks at urban planning and design, capacity and resources of Urban Local Bodies, the degree of empowerment of the civic body, and processes for transparency and citizen participation.
Cities such as Surat and Ahmedabad moved up the rankings by 12 and seven positions respectively from 2016.
Bhubaneshwar moved up by six spots, while Chennai dropped by 11 places. Bengaluru was down seven places.
While financial management has improved in some cities, there has been little progress in devolution of powers to civic bodies.
Just three out of the 23 cities enacted town planning legislations since economic liberalisation in 1991, while the rest rely on laws enacted nearly six decades ago.
Consequently, notes the report, local bodies suffer from fragmented governance. On average, Indian cities score 4.9 on this parameter.
Their municipal commissioners had an average tenure of only 10 months. On the other hand, London, where the mayor is elected for five years and has far-reaching powers, scores 9.8.
Only in Mumbai and Pune does the elected local body determine urban planning. In the remaining cities, it is ‘parastatal’ bodies which are not directly accountable to the electorate that call the shots, stated the report.

Environmental nod for Neutrino project

The India-based Neutrino Observatory (INO) project has got a fresh lease of life with the Ministry of Environment and Forests (MoEF) taking it up as a special case and granting it environmental clearance to set up the lab in Bodi West hills.
MoEF’s Expert Appraisal Committee (Infra 2), after detailed deliberations on the proposal and submissions by the project proponent, recommended this at its meeting on March 5.
According to the minutes of the meeting available in the public domain, the EAC was given to understand that though the proposals were not within its scope, the Ministry wanted it to consider this as a special case.
The panel was informed that there was no scope for radioactivity and leaching of water and these have been explained to the courts.
One is the consent to establish and operate to be obtained from the Tamil Nadu Pollution Control Board (TNPCB). In the past, INO project proponents had complained that the TNPCB had been sitting on the file for years without taking any action when Jayalalithaa was Chief Minister (2011-16).
Also, the INO team has to obtain the necessary forest and National Board for Wild Life clearances as per law. The Mathikettan Shola National Park in Idukki district, Kerala, is situated within five km from the project site.
When the project was considered by the Tamil Nadu State Expert Appraisal Committee in November 2017 (after Jayalalithaa’s death), it said that the proposed site forms part of the catchment area of various streams that contribute to the Vaigai watershed.
Therefore, Tamil Nadu was of the opinion that the proposal could not be appraised under category B of item 8(a) ‘Building and construction projects of the Schedule to the EIA notification 2006’, as it involved many technical features other than mere construction.
Considering the national importance of the proposal, the MoEF decided to take the proposal at the Central level as a special case — a category 8(a) project — and granted environmental clearance with 17 conditions.

Don’t sell land leases to other industries, Assam warns Tea estates

The Assam government warned tea estates against selling land leased out to them, but said planters may be allowed to diversify by using such land for other industries.
There had been reports of major tea estates and small tea growers selling leased land. Officials said about 20% of 3,07,080 hectares of land under tea plantation had been leased out by the government over the years.
Replying to a question by BJP legislator SanjoyKishan in the Assembly, State Industry Minister Chandra Mohan Patowary said the government would consider proposals from planters to set up other industries on such land.
Other BJP legislators demanded a probe into the allegations that tea estates had been selling land illegally. Speaker HitendraNathGoswami too sought steps to protect the tea industry, which has been under pressure from increasing input costs and falling prices.
Illegal sale of land was one of the factors why the government had last year toyed with the idea of de-leasing an acre of land in each of 792 registered tea estates for setting up schools. Another factor was the estate management’s indifference to a request for land to set up high schools for tea plantation workers.
Tea estate owners were unhappy with the State government for not heeding their plea to increase the lease period to 10 years from one year now.

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::INTERNATIONAL::

High level contacts Cut with Russia: UK

British Prime Minister Theresa May said that her government will suspend all high-level bilateral contacts with Russia over the poisoning of Sergei Skripal, the former Russian double agent.
No Ministers or members of the Royal Family will attend the Summer World Cup in Russia, Ms. May told the House of Commons.
The government has also decided to expel 23 Russian diplomats and withdraw an invitation to Russian Foreign Minister Sergei Lavrov to visit the country. The diplomats to be expelled were identified as “undeclared intelligence officers”.
Ms. May’s announcement came ahead of an urgent session of the UN Security Council to be held at Britain’s behest to discuss the poisoning.
The comments also came after a deadline, set by Britain for an “explanation” from Russia as to why Novichok — a military-grade nerve agent developed by Russia — had come to be used in the Salisbury poisoning, passed.
Earlier this week Ms. May told the House it was “highly likely” that the Russian state was involved in the poisonings.
The Russian Embassy in London condemned the decision to expel its diplomats as a “hostile action” that was “total unacceptable, unjustified and shortsighted”.
India’s position is understood to be that while it strongly condemns the action on British soil, it hopes that the issue is dealt with through dialogue between Britain and Russia.
Using existing powers, checks would also increase on private flights, customs and freight, and Russian assets could be frozen if there was evidence that they could be used to threaten the life or property of U.K. nationals or residents.
However, Ms. May did not refer to questions about the future of RT U.K. Earlier this week, regulator Ofcom said it would reconsider the status RT’s licence, because ANO TV Novosti, the holder of its licence, was financed from a budget of Russia.
Russia has also warned that it would take retaliatory action against the operation of British media in Russia if action against RT were taken in Britain.

::ECONOMY::

India will see 7.3% Growth in FY19: WB

The World Bank forecasts India’s economic growth will accelerate to 7.3% in 2018-19, from 6.7% in the current financial year, before gathering momentum to a 7.5% pace in 2019-20.
The Central Statistics Office has projected GDP growth for the 12 months ending March 31, at 6.6%.
“The key takeaways about the Indian economy are that it is steadily growing, and it is growth where volatility has significantly decreased,” Junaid Ahmed, World Bank Country Director of India, said.
“Growth is not being led by any single factor, and is instead being driven by a number of factors such as exports, consumption, and investment.”
“Another highlight is the resilience,” he said. “Despite shocks such as the implementation of the Goods and Services Tax, and demonetisation, the growth path is back on trend.”
The bank’s India Development Update divides India’s economic growth history into four segments.
The first is from 1970 to 1990, when the economy maintained an average growth rate of 4.4%.
This subsequently accelerated in the 1991-2003 period to an average of 5.4%. Thereafter, growth accelerated sharply for a short period from 2004 to 2008, where it averaged 8.8%, which then slowed down to a “still impressive” average of 7.1% in the 2009-17 period.
“If we were to ask what it could take to reach a sustainable 8% growth trajectory, then our only example would be to look at the 2004-08 period,” Ms. Gupta said.
“Durable revival in private investments and exports would be crucial for India achieving a sustained high growth of 8% and above.”
The report highlights several challenges facing the Indian economy that need prioritised attention.
These include the poor state of private sector investments which need to be enhanced through measures “that assure a favourable investment climate while reducing policy uncertainty”.
“Reviving bank credit to support growth is critically important,” the bank noted.
“Implementation of the new Insolvency and Bankruptcy Code is an important step towards improving credit behaviour.
However, the policy may take time to be effective in cleaning the balance sheets,” the bank said.

Urea subsidy scheme to continue till 2020

The Cabinet approved the proposal by the Department of Fertilizers to continue the ongoing Urea Subsidy Scheme from 2017 to 2020.
The estimated cost of this would be Rs. 1,64,935 crore, the government said. “The continuation of the urea subsidy scheme will ensure that adequate quantity of urea is made available to the farmers at statutory controlled price,” the government said in a release.
The DBT mechanism would entail 100% of the payment going to fertiliser companies on the sale of fertilisers to farmers at subsidised rates.

Inflation based upon WPI reached seven months low

Inflation based on wholesale prices eased to a seven-month low of 2.48% in February on cheaper food articles, including vegetables.
On the basis of Wholesale Price Index (WPI), inflation was 2.84% in January and 5.51% in February 2017. WPI inflation at 2.48% in February is the lowest in seven months. The previous low level was recorded in July at 1.88%.
According to government data, inflation in food articles slowed to 0.88% in February from 3% in the preceding month.
Inflation in vegetables softened with annual inflation at 15.26% as against 40.77%in January. While the rate of price rise in onion slowed, it increased in the case of another kitchen essential, potato.

::OTHERS::

Stephen Hawking dies

Stephen W. Hawking, the Cambridge University physicist and best-selling author who roamed the cosmos from a wheelchair, pondering the nature of gravity and the origin of the universe and becoming an emblem of human determination and curiosity, has died at his home in Cambridge, England. He was 76.
His death was confirmed by a spokesman for Cambridge University.
“Not since Albert Einstein has a scientist so captured the public imagination and endeared himself to tens of millions of people around the world,” MichioKaku, a professor of theoretical physics at the City University of New York, said.
Hawking did that largely through his book A Brief History of Time: From the Big Bang to Black Holes , published in 1988. It has sold over 10 million copies.
The 2014 film about his life, The Theory of Everything , was nominated for several Academy Awards, and Eddie Redmayne, who played Hawking, won the best-actor Oscar.
Scientifically, Hawking will be best remembered for a discovery so strange that it might be expressed in the form of a Zen koan: When is a black hole not black? When it explodes.
What is equally amazing is that he had a career at all.
As a graduate student in 1963, he learned he had amyotrophic lateral sclerosis, a neuromuscular wasting disease also known as Lou Gehrig’s disease.He was given only a few years to live.