Daily Current Affairs : 1/1/2019

Topics Covered

1. RBI Reserves
2. National Register of Citizens
3. Citizenship Amendment Bill 2018
4. Monuments of National Importance
5. Armed Forces Special Powers Act
6. New Chief Information Commissioner
7. Indian Medical Council (Amendment) Bill,

1 . RBI Reserves

Context : Analysis of the balance sheets of the central banks of 10 comparable economies shows that the RBI’s reserves as a percentage of its balance sheet is among the highest, a report by consultancy firm Quantum Advisors found.

How does RBI builds its Reserves

• First Source – RBI earns income from : –

1. Interest on government bonds held for conducting open market operations
2. Fees from government’s market borrowing programme
3. Income from investment in foreign currency assets.

• Second source is earnings retained after giving dividends to government.
• Third source is revaluation of foreign assets and gold 

Why does a central bank need capital?

• Central banks that have foreign assets need capital to absorb potential losses.The RBI’s foreign assets are worth Rs 26.4 lakh crore, up from 23.7 lakh crore in FY17.
• RBI needs capital to shield the economy from monetary and financial shocks.
• In case of unstable governments, monetary authorities carry a bigger burden. A Central bank would need more capital in such a situation.
• Central bank needs reserves to perform functions such as price and exchange stability.
• Reserves give independence to a central bank. Low capital will force central bank to turn to government in time of need. This will give government influence over the central bank. 

Global norms on transfer to government

• The US Federal Reserves transfers surplus beyond a threshold. This is decided by provisions of the Federal Reserve Act and Consumer Protection Act.
• In June this year, the Bank of England and Her Majesty’s Treasury or HM Treasury (the equivalent of India’s Finance Ministry) signed a MoU on a capital framework and on distributing its surplus. It provides a robust and transparent system that ensures the credibility of the bank’s policy action in even the most stressed environment, and reflects the new way in which the bank provides liquidity. At the heart of the capital framework is a risk-based capital target reflecting forward-looking risks to the balance sheet over the next five years.
• Its level is determined by evaluating the loss impact of severe plausible stress scenarios, which are to be reviewed annually and discussed with the Treasury.

How government could gain

• If the RBI does not set aside more in funds, the government going ahead will get more from RBI every year as dividend.
• In case RBI liquidates reserves deemed excess, the current government gets one-time big cash inflow from the RBI as it sells some of its assets. However, the legality of this liquidation is not clear yet. 

How much Reserve Ration does other countries keep

Must Read : Understanding RBI’s Balance sheet

2 . National Register of Citizens

Context : About 30 lakh of the 40.07 lakh people left out of the final draft of the updated National Register of Citizens (NRC) published five months ago have applied again for inclusion during the claims and objections round that ended on Monday.

Background (A detailed current Affairs Analysis on NRC will be published soon)

• The National Register of Citizens (NRC) is the register containing names of Indian citizens. The only time that a National Register of Citizens (NRC) was prepared was in 1951 when after conduct of the Census of 1951, the NRC was prepared by recording particulars of all the persons enumerated during that Census.
• The NRC will be now updated to include the names of those persons (or their descendants) who appear in the NRC, 1951, or in any of the Electoral Rolls up to the midnight of 24th March, 1971 or in any one of the other admissible documents issued upto mid-night of 24th March, 1971, which would prove their presence in Assam or in any part of India on or before 24th March, 1971.
• All the names appearing in the NRC, 1951, or any of the Electoral Rolls up to the midnight of 24th March, 1971 together are called Legacy Data.
• Thus, there will be two requirements for inclusion in updated NRC – 1.) existence of a person’s name in the pre-1971 period & 2.) proving linkage with that person.
• For getting their names included in the updated NRC, citizens shall have to submit Applications Forms (family-wise). Application Forms received by Govt shall be verified and based on the results of verification of particulars submitted by the citizens in their Application Forms, the updated NRC shall be prepared.
• However, to afford another opportunity to the applicants before publication of the final NRC, a draft NRC shall be published after verification of the Application Forms and the citizens given chance to submit claims, objections, corrections etc. After verification of all such claims and objections, the final NRC would be published.

Current Status of NRC Assam

• A draft NRC was published in August and now applicants who do not find their names in the Complete Draft NRC have another chance to submit their Claims for inclusion of their names in the Final NRC.

Infographics

3 . Citizenship Amendment Bill 2018

Context : The Joint Parliamentary Committee on the Citizenship Amendment Bill 2016, which proposes citizenship to persecuted minorities barring Muslims from Pakistan, Afghanistan and Bangladesh, is likely to table its report on January 7 on the penultimate day of the winter session of Parliament as the panel on Monday cleared the report rejecting all amendments moved by the Opposition

About the Bill

• The Bill amends the Citizenship Act, 1955 to make illegal migrants who are Hindus, Sikhs, Buddhists, Jains, Parsis and Christians from Afghanistan, Bangladesh and Pakistan, eligible for citizenship.
   
• Under the Act, one of the requirements for citizenship by naturalisation is that the applicant must have resided in India during the last 12 months, and for 11 of the previous 14 years.  The Bill relaxes this 11 year requirement to six years for persons belonging to the same six religions and three countries. 
   
• The Bill provides that the registration of Overseas Citizen of India (OCI) cardholders may be cancelled if they violate any law.

Key Issues and Analysis

• The Bill makes illegal migrants eligible for citizenship on the basis of religion.  This may violate Article 14 of the Constitution which guarantees right to equality. 
   
• The Bill allows cancellation of OCI registration for violation of any law.  This is a wide ground that may cover a range of violations, including minor offences (eg. parking in a no parking zone).
• There has been a strong resistance to the Bill in Assam as it would pave the way for giving citizenship, mostly to illegal Hindu migrants from Bangladesh, who came to Assam after March 1971, in violation of the agreement in the Assam Accord of 1985

4 . Monuments of National Importance

Context : The 125-year-old Old High Court Building in Nagpur, Maharashtra, and two Mughal-era monuments in Agra — Haveli of Agha Khan and Hathi Khana — are among the six monuments declared protected and of national importance by the Archaeological Survey of India (ASI) in 2018.

What is Monuments of National Importance

A monument or a site is declared to be of National Importance by the Archaeological Survey of India provided it meets the following requirements:

• The monument or archaeological site is not less than 100 years old.
• It has special historical, archaeological or artistic interest, making it worthy of declaration as of national importance.
• It qualifies under specified provisions of definition of the Ancient Monuments and Archaeological Sites and Remains Act, 1958.
• The interested public do not have major objections to such declaration.
• The authenticity and integrity of the ancient monument or archaeological site and remains have not been damaged.
• It is free from major encumbrances.

The central government maintains national monuments, while the state government maintains state monuments.

New Monuments of national importance in the list

• The ancient Neemrana Baori in Rajasthan’s Alwar district
• The Group of Temples at Ranipur Jharail in Odisha’s Bolangir
• The Vishnu Temple in Kotali, Pithoragarh district, Uttarkhand
• High Court Building in Nagpur, Maharashtra,
• Haveli of Agha Khan, Agra
• Hathi Khana, Agra

5 . Armed Forces Special Powers Act

Context : The entire State of Nagaland has been declared ‘disturbed area’ for six more months, till June-end, under the controversial AFSPA, which empowers security forces to conduct operations anywhere and arrest anyone without any prior notice.A

What does the AFSPA mean?

• AFSPA gives armed forces the power to maintain public order in “disturbed areas”.
• They have the authority to prohibit a gathering of five or more persons in an area, can use force or even open fire after giving due warning if they feel a person is in contravention of the law.
• If reasonable suspicion exists, the army can also arrest a person without a warrant; enter or search a premises without a warrant; and ban the possession of firearms.
• Any person arrested or taken into custody may be handed over to the officer in charge of the nearest police station along with a report detailing the circumstances that led to the arrest.

What is a disturbed area and who has the power to declare it?

• A disturbed area is one which is declared by notification under Section 3 of the AFSPA. An area can be disturbed due to differences or disputes between members of different religious, racial, language or regional groups or castes or communities.
• The Central Government, or the Governor of the State or administrator of the Union Territory can declare the whole or part of the State or Union Territory as a disturbed area.
• A suitable notification would have to be made in the Official Gazette. As per Section 3 , it can be invoked in places where “the use of armed forces in aid of the civil power is necessary”.
• The Ministry of Home Affairs would usually enforce this Act where necessary, but there have been exceptions where the Centre decided to forego its power and leave the decision to the State governments.

What’s the origin of AFSPA?

• The Act came into force in the context of increasing violence in the Northeastern States decades ago, which the State governments found difficult to control. The Armed Forces (Special Powers) Bill was passed by both the Houses of Parliament and it was approved by the President on September 11, 1958. It became known as the Armed Forces Special Powers Act, 1958.

Currently AFSPA is applicable in following states:–

• Jammu & Kashmir
• Assam
• Nagaland
• Manipur (except Imphal Municipal Area)
• Three districts of Arunachal Pradesh and its eight police station areas bordering Assam 

6 . New Chief Information Commissioner

• The government has appointed Sudhir Bhargava the new Chief Information Commissioner. Four new members have also been appointed to the Central Information Commission (CIC), taking its strength to seven. Four vacancies still remain.
• The CIC is the highest appeal body under the Right to Information Act.

7 . Indian Medical Commission (Amendment) Bill

Context : The Lok Sabha passed the Indian Medical Council (Amendment) Bill, which would allow a panel of eminent professionals to run the Medical Council of India (MCI).

•  It amends the Indian Medical Council Act, 1956 and replaces the Indian Medical Council (Amendment) Ordinance, 2018.  The Act sets up the Medical Council of India (MCI) which regulates medical education and practice. 
   
• Supersession of the MCI: The 1956 Act provides for supersession of the MCI and its reconstitution within a period of three years.  The Bill amends this provision to provide for the supersession of the MCI for a period of one year.  In the interim period, the central government will constitute a Board of Governors, which will exercise the powers of the MCI. 
   
• The Act provides for the Board of Governors to consist of up to seven members including persons of eminence in medical education, appointed by the central government. The Bill amends this provision to allow for eminent administrators to be selected in the Board.  Further, the Bill provides for the Board of Governors to be assisted by a Secretary General appointed by the central government.