Daily Current Affairs for UPSC CSE
- Private Sector Bank Reforms
- Study on Radicalisation
- Arria Formula
- Moratorium on Banks
- Kala Azar
- PUSA Decomposer
- Facts for Prelims
1 . Private Sector Bank Reforms
Context : An Internal Working Group (IWG) of the Reserve Bank of India (RBI) has recommended raising the cap on promoters’ stake in private sector banks to 26% in the long run (15 years). The holding is currently mandated at 15% of the paid-up voting equity share capital of the bank.
- The IWG was constituted to review the extant ownership guidelines and corporate structure for private sector banks in India.
- The terms of reference of included review of the eligibility criteria for individuals/ entities to apply for banking license; examination of preferred corporate structure for banks and harmonisation of norms; review of norms for long-term shareholding in banks by the promoters and other shareholders.
Recommendation given by IWG
- According to IWG large corporate or industrial houses should be allowed as promoters of banks only after necessary amendments to the Banking Regulation Act, 1949 (to prevent connected lending and exposures between the banks and other financial and non-financial group entities); and strengthening of the supervisory mechanism for large conglomerates, including consolidated supervision.
- Well-run non-banking financial companies (NBFCs), with an asset size of ₹50,000 crore and above, including those owned by a corporate house, may be considered for conversion into banks subject to completion of 10 years of operations, meeting due diligence criteria and compliance with additional specified conditions
- Non-promoter shareholding uniform cap of 15% of the paid-up voting equity share capital of the bank for all types of shareholders was suggested
- The panel also recommended that for Payments Banks intending to convert to a Small Finance Bank (SFB), their track record of three years should be considered sufficient and Small Finance Banks and Payments Banks may be listed within ‘6 years from the date of reaching net worth equivalent to prevalent entry capital requirement prescribed for universal banks’ or ‘10 years from the date of commencement of operations’, whichever is earlier.
- The IWG also suggested that the minimum initial capital requirement for licensing new banks be enhanced from ₹500 crore to ₹1,000 crore for universal banks, and be raised to ₹300 crore from ₹200 crore for SFBs.
- The group also suggested that the RBI take steps to ensure harmonisation and uniformity in different licensing guidelines, to the extent possible.
- Non-operative financial holding company (NOFHC) should continue to be the preferred structure for all new licenses to be issued for universal banks. However, it should be mandatory only in cases where the individual promoters, promoting entities or converting entities have other group entities
2 . Study on Radicalisation
Context : The Ministry of Home Affairs (MHA) has, for the first time, approved a research study on “status of radicalisation in India.”
- The United Nations’ 26th report of the Analytical Support and Sanctions Monitoring Team concerning the IS (Islamic State), al-Qaeda and associated individuals and entities had pointed out “significant numbers” of the IS and al-Qaeda members in Kerala and Karnataka.
- The report said, “One member State reported that the ISIL Indian affiliate (Hind Wilayah), which was announced on May 10, 2019, has between 180 and 200 members”.
About the Study
- The study would attempt to legally define “radicalisation” and suggest amendments to the Unlawful Activities (Prevention) Act (UAPA).
- Two topics – “Status of Radicalization in India: An Exploratory Study of Prevention and Remedies” and “Functioning and Impact of Open Prisons on Rehabilitation of Prisoners” were shortlisted by the MHA
- G.S. Bajpai, Director of the Centre for Criminology and Victimology, National Law University (NLU), Delhi, will conduct the research on radicalisation.
Details of the Study
- The study will be religion-neutral and will go by facts and the reported cases.
- Study would take a year to conclude as it required field visit and interviews with people.
- Radicalisation is yet to be defined legally, this leads to misuse by the police. It should be defined and necessary amendments made to the UAPA.
- It will help in addressing Radicalisation in a systematic manner and a policy can be devised by the Centre as in India, people are sensitive about religion
- Aggressive policing measures could be counter-productive as the youth who were radicalised were “misguided” and not the culprits and y sending young men behind the bars will not solve the purpose, right thinking people in the community will have to be mobilised.
3 . Arria Formula
Context : India has told the United Nations Security Council (UNSC) that it calls for an “immediate comprehensive ceasefire” in Afghanistan, while welcoming all opportunities to bring peace to the country. India’s position was articulated by its Permanent Representative to the United Nations, T.S. Tirumurti, at a UNSC meeting on Friday, convened under the Arria Formula.
About Arria Formula
- The “Arria-formula meetings are like the informal consultations of the whole of the Security Council, they are not envisaged in the Charter of the United Nations or the Security Council’s provisional rules of procedure.
- Under Article 30 of the Charter, however, the Council is the master of its own procedure and has the latitude to determine its own practices.
Conduct of the meeting
- The “Arria-formula meetings” are very informal, confidential gatherings which enable Security Council members to have a frank and private exchange of views, within a flexible procedural framework, with persons whom the inviting member or members of the Council (who also act as the facilitators or convenors) believe it would be beneficial to hear and/or to whom they may wish to convey a message. They provide interested Council members an opportunity to engage in a direct dialogue with high representatives of Governments and international organizations — often at the latter’s request — as well as non-State parties, on matters with which they are concerned and which fall within the purview of responsibility of the Security Council.
- The process is named after Ambassador Diego Arria of Venezuela, who, as the representative of Venezuela on the Council (1992-1993), initiated the practice in 1992. Although Ambassador Arria, as the then President of the Security Council, had himself convened in 1992 as an “Arria-formula meeting”, the recent practice suggests a preference for such initiatives to be taken by members of the Council other than the President.
- The convening member is also chairing such meetings.
Difference between Arria-formula meetings and consultations
- The “Arria-formula meetings” differ from the consultations of the whole of the Council in the following respects:
- Such informal gatherings do not constitute an activity of the Council and are convened at the initiative of a member or members of the Council. Participation in such meetings is for individual members to decide upon and there have been instances when some members chose not to attend.
- They are held in a Conference Room, and not in the Security Council Consultation Room.
- The convenor issues a written invitation to the other fourteen members, indicating the place, date and time of the “Arria-formula meeting”, as well as the name of the party to be heard, by a fax from his/her Mission rather than by notification from the Secretariat.
- They are not announced in the daily Journal of the United Nations.
- Unless so invited, members of the Secretariat are not expected to attend, except for interpreters and a Conference Officer.
4 . Moratorium on Banks
Context : On November 17, the Centre, acting on the recommendation of the Reserve Bank of India (RBI), imposed a moratorium on Lakshmi Vilas Bank (LVB) for a period of 30 days.
- The 94-year-old bank, based in Karur, Tamil Nadu, has been struggling with losses for three years. As its financial position deteriorated, the regulator placed it under the Prompt Corrective Action (PCA) framework, which restricts certain operations depending on the severity of financial stress.
- After allowing time for the bank to find investors to shore up its capital, the RBI has appointed an administrator for the bank and mooted a merger with the Indian subsidiary of the Singapore-based DBS Bank. Similar moratoria were placed in the recent past on other lenders too, including Yes Bank and Punjab and Maharashtra Co-operative Bank.
What is a moratorium?
- The RBI, the regulatory body overseeing the country’s financial system, has the power to ask the government to have a moratorium placed on a bank’s operations for a specified period of time. Under such a moratorium, depositors will not be able to withdraw funds at will. Usually, there is a ceiling that limits the amount of money that can be withdrawn by the bank’s customers.
- In the case of LVB, depositors cannot withdraw more than ₹25,000 during the one-month moratorium period. In most cases, the regulator allows for funds of a larger quantum to be withdrawn in case of an urgent requirement, such as medical emergencies, but only after the depositor provides the required proof.
- Often, the moratorium is lifted even before the originally stipulated deadline is reached. For instance, Yes Bank, which went into a spiral while unsuccessfully trying to find an investor, was placed on a one-month moratorium starting March 5, with a cap of ₹50,000 on withdrawals. With investors led by State Bank of India (SBI) infusing ₹10,000 crore into Yes Bank, the moratorium was lifted on March 18.
When does it come into play?
- Usually, the RBI steps in if it judges that a bank’s net worth is fast eroding and it may reach a state where it may not be able to repay its depositors. When a bank’s assets (mainly the value of loans given to borrowers) decline below the level of liabilities (deposits), it is in danger of failing to meet its obligations to depositors.
- After banks were nationalised in 1969, the RBI sought to always intervene to protect depositors’ interests and prevent commercial banks from failing. In 2004, it nudged State-owned Oriental Bank of Commerce(OBC) to take over the troubled private lender Global Trust Bank (GTB). As in the case of LVB, GTB was given time to find a suitor for a merger. When it failed to come up with any names, but proposed infusion of foreign capital, the RBI refused permission and instead insisted on the merger with OBC.
How does a moratorium prevent a ‘run’ on the bank?
- A moratorium primarily helps prevent what is known as a ‘run’ on a bank, by clamping down on rapid outflow of funds by wary depositors, who seek to take their money out in fear of the bank’s imminent collapse. Temporarily, it does affect depositors who may have placed, for example, their retirement with the bank, or creditors who are owed funds by the bank but are struggling with the collection.
- A moratorium gives both the regulator and the acquirer time to first take stock of the actual financial situation at the troubled bank. It allows for a realistic estimation of assets and liabilities, and for the regulator to facilitate capital infusion, should it find that necessary. Singapore’s DBS bank has promised to infuse ₹2,500 crore into the merged entity, once it takes over LVB.
- A key objective of a moratorium is to protect the interests of depositors. Even if they are temporarily handicapped by facing restricted access to their funds, there is a high probability that the bank would soon return to normal functioning once a bailout is arranged.
5 . Kala Azar
Context : In a recent paper published in PLOS Neglected Tropical Diseases a team from Rajendra Memorial Research Institute of Medical Sciences (ICMR), tells the success story of how they eliminated the disease from Vaishali, a district in Bihar where the disease is highly endemic
About Kala Azar
- Kala-azar is a slow progressing indigenous disease caused by a protozoan parasite of genus Leishmania
- In India Leishmania donovani is the only parasite causing this disease
- The parasite primarily infects reticuloendothelial system and may be found in abundance in bone marrow, spleen and liver.
- Post Kala-azar Dermal Leishmaniasis (PKDL) is a condition when Leishmania donovani invades skin cells, resides and develops there and manifests as dermal leisions. Some of the kala-azar cases manifests PKDL after a few years of treatment. Recently it is believed that PKDL may appear without passing through visceral stage. However, adequate data is yet to be generated on course of PKDL manifestation
Transmission of Kala Azar
- Kala-azar is a vector borne disease
- Sandfly of genus Phlebotomus argentipes are the only known vectors of kala-azar in India
- Indian Kala-azar has a unique epidemiological feature of being Anthroponotic; human is the only known reservoir of infection
- Female sandflies pick up parasite (Amastigote or LD bodies)while feeding on an infected human host.
- Parasite undergo morphological change to become flagellate (Promastigote or Leptomonad), development and multiplication in the gut of sandflies and move to mouthparts
- Healthy human hosts get infection when an infective sandfly vector bites them
Kala-azar Vector in India
- There is only one sandfly vector of Kala-azar in India Phlebotomus aregentipes
- Sandflies are small insects, about one fourth of a mosquito. The length of a snadfly body ranges from 1.5 to 3.5 mm.
- Adult is a small fuzzy, delicately proportionate fly with erect large wings. The entire body including wings is heavily clothed with long hairs.
- Life cycle consists of egg, four instages of larvae, pupa and adult. The whole cycle takes more than a month, however, duration depends on temperature and other ecological conditions
- They prefer high relative humidity, warm temperature, high subsoil water and abundance of vegetation.
- Sandflies breed in favourable micro-climatic conditions in places with high organic matter that serve as food for larvae
- These are ecologically sensitive insects, fragile and cannot withstand desiccation
Kala-azar Control Efforts in India
- An organized centrally sponsored Control Programme launched in endemic areas in 1990-91
- Government of India provided kala-azar medicines, insecticides and technical support and the State governments implemented the programme through primary health care system and district/zonal and State malaria control organizations and provided other costs involved in strategy implementation
How it was eliminated in Vaishali district of Bihar
- Campaigns, measures : Their programme included mapping of the case distribution, early case detection and chemical-based vector control. Carried out community awareness campaigns. Hospital staff and medical doctors in these regions were also trained
- Once a person is diagnosed with VL, indoor residual spraying was done at his house and at the neighbouring houses within 500 metres. Though the disease is not contagious, the infected sand fly may be present in the area and the chemical spray will help kill them. Nearly 2,500 ASHA workers and 1,000 field workers were also trained.
- Monitoring disease : A strong supervision and monitoring system is required. GIS-based mapping, and case data management and spatial visualisation system are required for the proper implementation of control strategies. Routine monitoring is needed to identify if the Kala-azar vector has developed resistance to insecticides. “Also frequent monitoring of active cases – track, test, and treat strategy – in the hotspot region is very important at the current stage.”
6 . PUSA Decomposer
Context : The Government of Delhi has recently come up with a viable solution to handle this problem of stubble burning, thanks to its collaboration with the Indian Agricultural Research Institute (IARI) at Pusa, in the city. Called ‘Pusa Decomposer’,
About Pusa Decomposer
- Pusa Decomposers are set of capsules, which are dissolved in water containing jaggery, chickpea flour and a set of about eight types of microorganisms (fungi), essential to quicken the decomposition of the stubble.
- This is then fermented for three-to-four days, and the liquid so obtained is ready to be sprayed in the farmers’ field in order to decompose the left over biomass.
- According to the developers four such capsules are enough to make 25 litres, which can be used to decompose the crop residue per hectare of the field. Thereby, the stubble gets converted into manure in the field.
- The Pusa decomposer has been successful in solving the problem, and appears to pave the way for large scale applications across the country.
- Food grains produced using the Pusa Decomposer qualify as organic farming, since it involves no growth hormones, antibiotics, no genetically modified organisms, and no leaching of surface water or ground water.
- The traditional method has been ‘slash and burn’ (as we too have been doing in our wheat farming). But a farmer called Jongue in Mozambique in East Africa did not burn his corn farm, but let the corn stalks rot. In one part of his farm, rather than slash and burn, he mixed tomatoes and peanuts in the field to rot. Then he let the mice in the field eat up this stuff – a natural way of removing the rotting material. (If the mouse population became too large, he brought in cats to restrict the mice!) He also tried planting sorghum with success. This was what one may call organic farming. The yield and the quality were good enough to sell the corn or sorghum in the market.
- His organic farming was based on the use of mice as the source of the necessary molecular ingredients such as fungi, and no other additives.
- In a way, the Pusa Decomposer, with its jaggery, chickpea flour and naturally occurring fungi is the modern day Jongue approach!
- As field trials in the Delhi, Haryana region have been found successful, Pusa Decomposer should be tried in areas of Northeast India where ‘slash and burn’ (locally called ‘jhum’) is still followed (in Tripura, Arunachal Pradesh and Meghalaya, for instance), IARI might try and introduce it there as well. It will also improve the AQI in the region (Agartala in Tripura is ‘moderate’ to ‘unhealthy’, currently).
7 . Bio-terrorism
Context : Parliamentary Standing Committee on Health has published a report, “The Outbreak of Pandemic COVID-19 And its Management.” According to the report formulating effective laws to counter bio-terrorism is one of the important lessons to be learnt from the COVID-19 pandemic. The committee, headed by Samajwadi Party MP Ramgopal Yadav, submitted its report to the Rajya Sabha Chairman on Saturday.
- Bioterrorism is the use of bacteria, viruses, or germs to purposely harm large quantities of people or communities.
- These “weapons” are spread through air, water, or food sources.
- Bioterrorism is rare and is used to threaten people, governments, and countries.
Key Observation of the committee
- The adverse effects of the COVID-19 pandemic have taught the lesson on the importance of controlling biological agents and the need for strategic partnerships among different nations. The committee, therefore, feels that the present time is the most appropriate for the government to formulate effective laws to counter bio-terrorism
- This conclusion is based on the deliberations that the committee had with the Department of Health and Family Welfare, which submitted a seven-point action plan that is needed to ensure security against biological weapons.
- These include “strengthening disease surveillance, including at animal-human interface, training and capacity building for management of public health emergencies arising from use of bio-weapons and strengthening research and surveillance activities related to development of diagnostics, vaccines and drugs”.
- The report has suggested that the Health Ministry should engage with agencies and actively participate in ongoing international treaties.
- Among other things, the report said low testing and shoddy contact tracing were responsible for the spike in cases.
- “The committee strongly recommends the Ministry to conduct more research and work towards training and capacity building for management of public health emergencies arising from the use of bio-weapons,” the report said.
8 . Facts for Prelims
- Bhutan was the second country to accept the RuPay card after Singapore.
United Nations Population Award
- Each year, the Committee for the United Nations Population Award honours an individual and/or institution in recognition of outstanding contributions to population and reproductive health questions and to their solutions.
- The Award was established by the General Assembly in 1981, in resolution 36/201, and was first presented in 1983. It consists of a gold medal, a diploma and a monetary prize.
- In a first for the Himalayan Kingdom, Bhutan’s Queen Mother Gyalyum Sangay Choden Wangchuck has been awarded the United Nations Population Award in the individual category for 2020 for her work on sexual health and ending gender violence.
- The awardee in the organisational category is HelpAge India that works on elder care.
- Only two Indians have been awarded in the past four decades since the award was established in 1981: former Prime Minister Indira Gandhi in 1983 and industrialist-philanthropist J.R.D.Tata in 1992.
- Tarantulas are large, hairy spiders which are mostly nocturnal.
- Tarantulas were also thought to be colour blind. Now, researchers from Yale-NUS College and Carnegie Mellon University have found that tarantulas can indeed see in colour, and vibrant blue colours may be used to attract mates. The green colour might help them hide among the leaves (Proceedings of the Royal Society B).
- The team reconstructed the colours of tarantula ancestors across 110 million years and found that they could have been mostly blue in colour.
- They noted that the blue colour did not correlate with any common defence mechanisms, showing the colour did not evolve to deter predators but to woo a potential mate.