Daily Current Affairs: 21st December 2021

Topics covered

1. The Jammu and Kashmir Delimitation Commission
2. PANEX-21
3. Derivatives
4. Fugitive Economic Offender Act
5. Facts for Prelims
6. Places in News

1. The Jammu and Kashmir Delimitation Commission report

Context: The Jammu and Kashmir Delimitation Commission proposed to increase six seats for the Jammu division and one for the Kashmir division, besides reserving 16 seats for the Scheduled Castes (SC) and the Scheduled Tribes in the Union Territory, triggering sharp reactions from the regional parties.

About the commission

• The commission was headed by former Supreme Court judge Ranjana Desai.
• It has five Lok Sabha members from Jammu and Kashmir as associate members and the chief election commissioner Sushil Chandra as an ex-officio member.
• As per the J&K Reorganisation Act, 2019, the number of assembly seats in UT of J&K are to be raised from 107 to 114 through fresh delimitation, a task entrusted to the Delimitation Commission.

Highlights of the report

• The Draft Paper of the Delimitation Commission has proposed seven additional Assembly seats for Jammu and Kashmir — six in Jammu division and one in Kashmir valley.
• With the proposed addition, the total Assembly constituencies in Jammu and Kashmir has risen to 90 — in Jammu, the number of seats has gone up to 43 from 37, and in Kashmir, by one seat to 47.
• For the first time, the commission proposed reserving nine seats for Scheduled Tribes (STs) on the basis of population. Seven seats are proposed for the Scheduled Caste (SC) community.
• An additional 24 seats are proposed to be reserved for Pakistan-occupied Kashmir (PoK).
• Of the seven additional Assembly constituencies in the Union Territory one each has been proposed in the districts of Kathua, Samba, Rajouri, Reasi, Doda and Kishtwar in Jammu division, and Kupwara in the Kashmir valley.
• In a statement, the Commission said it has proposed carving out an additional constituency in some districts to balance the representation for geographical areas with inadequate communication and lack of public conveniences given their excessive remoteness or inhospitable conditions on the international border.

What is Delimitation?

• Delimitation is the act of redrawing boundaries of Lok Sabha and Assembly seats to represent changes in population. In this process, the number of seats allocated to a state may also change.
• The objective is to provide equal representation for equal population segments, and a fair division of geographical areas, so that no political party has an advantage. The Delimitation Commission’s orders cannot be questioned before any court.

Delimitation Commission

• Under Article 82 of the Constitution, the Parliament by law enacts a Delimitation Act after every census.
• After coming into force commencement of the Act, the Central Government constitutes a Delimitation Commission.
• This Delimitation Commission demarcates the boundaries of the Parliamentary Constituencies as per provisions of the Delimitation Act.
• The Delimitation Commission in India is a high power body whose orders have the force of law and cannot be called in question before any court.
• These orders come into force on a date to be specified by the President of India in this behalf.
• The copies of its orders are laid before the House of the People and the State Legislative Assembly concerned, but no modifications are permissible therein by them.

How often has delimitation been done?

• Delimitation is done on the basis of the preceding Census. The first such exercise in 1950-51 was carried out by the President, with the help of the Election Commission.
• Following the Delimitation Commission Act in 1952, all such exercises have been conducted by Delimitation Commissions — set up in 1952, 1963, 1973 and 2002.
• There was no delimitation after the 1981 and 1991 Censuses. This was a fallout of the provision that the ratio between the number of Lok Sabha seats in a state and the population of the state is, as far as practicable, the same for all states. Although unintended, this meant that states that took little interest in population control could end up with more seats in Parliament, while the southern states that promoted family planning could end up with fewer seats. Amid these concerns, the Constitution was amended in 1976 to suspend delimitation until 2001.
• Another amendment extended the freeze on the number of seats until 2026, by when the country was projected to achieve a uniform population growth rate. So, the last delimitation exercise between July 2002 and March 31, 2008, based on the 2001 Census, only readjusted boundaries of existing Lok Sabha and Assembly seats and reworked the number of reserved seats.

2. PANEX-21

Context: Chief of the Army Staff General Manoj Mukund Naravane inaugurated event of PANEX-21, a disaster management exercise of the multilateral grouping Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).

About PANEX-21

• PANEX-21, a multi-national – multi-agency exercise being organised at Pune from 20-22 Dec 2021 with a focused aim to foster common and develop capabilities in Disaster Management aspects for the BIMSTEC nations.
• The exercise, is being attended by delegates and subject matter experts from India, Bangladesh, Nepal, Bhutan, Myanmar, Sri Lanka and Thailand.
• PANEX-21 will brain storm various aspects related to conduct of effective humanitarian assistance and disaster relief operations during a natural disaster in the background of a pandemic. 
• The structure of PANEX-21 as a multi agency exercise including representation of experts from the Armed Forces, National Disaster Relief Force and other stake holders, will be aimed at battling the challenges of disaster management in the backdrop of a pandemic.  
• Furthermore, the member states shall promote their best practices and also recommend the evolution of BIMSTEC joint response mechanism for Disaster Management.

About BIMSTEC

• The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is a regional organization comprising seven Member States lying in the littoral and adjacent areas of the Bay of Bengal constituting a contiguous regional unity.
• It is headquartered in Dhaka.
• This sub-regional organization came into being on 6 June 1997 through the Bangkok Declaration.
• It constitutes seven Member States:
  • five deriving from South Asia, including Bangladesh, Bhutan, India, Nepal, Sri Lanka,
  • two from Southeast Asia, including Myanmar and Thailand.
• Initially, the economic bloc was formed with four Member States with the acronym ‘BIST-EC’ (Bangladesh, India, Sri Lanka and Thailand Economic Cooperation).
• Following the inclusion of Myanmar on 22 December 1997 during a special Ministerial Meeting in Bangkok, the Group was renamed ‘BIMST-EC’ (Bangladesh, India, Myanmar, Sri Lanka and Thailand Economic Cooperation).
• With the admission of Nepal and Bhutan at the 6th Ministerial Meeting (February 2004, Thailand), the name of the grouping was changed to ‘Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation’ (BIMSTEC).
• The BIMSTEC region is home to around 1.5 billion people which constitute around 22% of the global population with a combined gross domestic product (GDP) of 2.7 trillion economy.
• In the last five years, BIMSTEC Member States have been able to sustain an average 6.5% economic growth trajectory despite global financial meltdown.

Areas of Cooperation

• BIMSTEC has identified 14 priority areas where a member country takes lead.
• India is lead country for Transport & Communication, Tourism, Environment & Disaster Management and Counter Terrorism & Transnational Crime.
• The objective of building such an alliance was to harness shared and accelerated growth through mutual cooperation in different areas of common interests by mitigating the onslaught of globalization and by utilizing regional resources and geographical advantages.
• Unlike many other regional groupings, BIMSTEC is a sector-driven cooperative organization. Starting with six sectors—including trade, technology, energy, transport, tourism and fisheries—for sectoral cooperation in the late 1997, it expanded to embrace nine more sectors—including agriculture, public health, poverty alleviation, counter-terrorism, environment, culture, people to people contact and climate change—in 2008.

Disaster Management and BIMSTEC

• In the Eighth Ministerial Meeting of BIMSTEC, it was decided to include ‘Environment and Disaster Management’ as one of the organisation’s priority area of concerns.
• India offered to lead in 2006; the proposal was readily accepted by the organisation.
• India also proposed the creation of the Weather and Climate Centre, which would collaborate with other relevant regional institutions such as the South Asian Association for Regional Cooperation (SAARC) Metrological Research Centre (SMRC) and the Asian Disaster Preparedness Centre (ADPC).

INDIA and BIMSTEC

• For India, BIMSTEC may be helpful in achieving two major goals of national development as well as fulfilling its strategic aspiration to cater to the wider concept of the ‘Indo-Pacific’ and an Indian Ocean community.
• It is a natural platform to fulfil India’s key foreign policy priorities of ‘Neighbourhood First’ and ‘Act East.’

3. Derivatives

Context: The Securities and Exchange Board of India (SEBI) banned the derivative trade of seven agriculture commodities on the future’s platform of National Commodities and Derivatives Exchange (NCDEX) for a year.

About the issue

• SEBI has banned derivative contracts trade in chana, wheat, paddy (non-basmati), soyabean and its derivatives, mustard seed and its derivatives, crude palm oil and moong for a year with immediate effect.
• No new contract shall be launched till further orders.
• In respect of running contracts, no new position will be allowed to be taken.
• Only squaring up of position will be allowed.
• SEBI had earlier banned chana and mustard seed derivative trade on August 16 and October 8 respectively.

Purpose

• It is to rein in rising prices of essential commodities, which are fuelling inflation. India is the world’s biggest importer of vegetable oil and this measure will make it difficult for edible oil importers and traders to transact business since they use Indian exchanges to hedge their risk.
• It is believed that speculators have a role in jacking up prices and this needed to be discouraged to curb inflation and support growth as the economy is recovering from COVID-19 impact.
• The suspension of trading in these commodities follows a communication from the Department of Economic Affairs, which is closely monitoring price movements.

What are Derivatives?

• Derivative contracts are between two or more parties where the derivative value is based upon an underlying asset, in this case agri commodities.
• The prices of the derivatives are established by the price fluctuations of the underlying assets. Derivatives can be traded on an exchange or over the counter (OTC).
• Derivatives trading takes place when traders speculate on the future price of an asset through buying or selling of derivative contracts to maximise profit, as compared to buying the underlying asset outright.
• Traders also use derivatives for hedging to minimise risk against an existing position. With derivatives, traders can go short and make profit from falling asset prices. They also use derivatives to hedge against any existing long positions. The ultimate objective is to profit. This is viewed as a deterrent to bring in price discipline in the market.

Futures

• They are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price.
• The buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration
• Underlying assets include physical commodities or other financial instruments. 
• Futures contracts detail the quantity of the underlying asset and are standardized to facilitate trading on a futures exchange.
• Futures can be used for hedging or trade speculation.

National Commodities and Derivatives Exchange (NCDEX)

• National Commodity & Derivatives Exchange Limited (NCDEX) (NCDEX/the Exchange) is a leading agricultural commodity exchange in India, with a market share of 78.0%, 81.5%, 79.9% and 78.1% in the agricultural commodity segments, based on average daily turnover (by value) for the six month period ended September 30, 2019, Fiscal 2019, Fiscal 2018 and Fiscal 2017, respectively.
• With effect from September 28, 2015, the Exchange became a deemed recognized stock exchange under the Securities Contracts (Regulation) Act, 1956
• NCDEX is regulated by Securities and Exchange Board of India (SEBI).

4. Fugitive Economic Offender Act

Context: Union Finance Minister Nirmala Sitharaman on Monday informed the Lok Sabha that banks have recovered ₹13,109.17 crore by selling the assets of fugitives like Vijay Mallya, Nirav Modi and Mehul Choksi.

Background

• The Act was introduced to deter fugitive economic of­fenders from evading the process of law in India by staying outside the jurisdic­tion of Indian courts.
• Nirav Modi is the second person to be declared a fugi­tive economic off ender, un­der the Fugitive Eco­nomic Off enders Act, after liquor baron Vijay Mallya.

About Fugitive Economic Offender Act

• The Act allows for a person to be declared as a fugitive economic offender (FEO) if:
  • An arrest warrant has been issued against him for any specified offences where the value involved is over Rs 100 crore
  • He has left the country and refuses to return to face prosecution.     
• To declare a person an FEO, an application will be filed in a Special Court (designated under the Prevention of Money-Laundering Act, 2002) containing details of the properties to be confiscated, and any information about the person’s whereabouts.  The Special Court will require the person to appear at a specified place at least six weeks from issue of notice.  Proceedings will be terminated if the person appears. 
• The Act allows authorities to provisionally attach properties of an accused, while the application is pending before the Special Court. 
• Upon declaration as an FEO, properties of a person may be confiscated and vested in the central government, free of encumbrances (rights and claims in the property).  Further, the FEO or any company associated with him may be barred from filing or defending civil claims.   

5. Facts for Prelims

MCA21 portal

• MCA21 is an e-Governance initiative of Ministry of Corporate Affairs (MCA), Government of India that enables an easy and secure access of the MCA services to the corporate entities, professionals and citizens of India.
• The MCA21 application is designed to fully automate all processes related to the proactive enforcement and compliance of the legal requirements under the Companies Act, 1956, New Companies Act, 2013 and Limited Liability Partnership Act, 2008. This will help the business community to meet their statutory obligations.
• The MCA21 application offers the following.
  • Enables the business community to register a company and file statutory documents quickly and easily.
  • Provides easy access of public documents
  • Helps faster and effective resolution of public grievances
  • Helps registration and verification of charges easily
  • Ensures proactive and effective compliance with relevant laws and corporate governance
  • Enables the MCA employees to deliver best of breed services

6. Places in News

Kondavali Buddhist site

•  Kondavali Buddhist site is located in Gollaprolu mandal of East Godavari district.

Note : Election Laws (Amendment) Bill, 2021, Marriage age Bill already Covered earlier