Daily PT Capsule Jan 11

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Daily PT Capsule UPSC Civil Services
Daily PT Capsule UPSC Civil Services

CRZ Notification Amendment

CRZ area or Coastal Regulation Zone  includes the water area up to 12 nautical miles in the sea and the entire water area of a tidal water body such as creek, river, estuary, etc. The Ministry of Environment & Forests released the CRZ Notification, 2011 which replaced the CRZ Notification, 1991.

CRZ Notification 2011: The CRZ notification 2011 enshrines that concept of a Coastal Zone Management Plan (CZMP). It will be prepared with the fullest involvement and participation of local communities. It talks about protecting traditional rights of fishermen. As per recommendation of the expert committee headed by Dr. M.S. Swaminathan, that Government should enact a law to protect the traditional rights and interests of fishermen and coastal communities, is under proposal. This law would be somewhat along the lines of the Forest Rights Act, 2006.

The “no development zone” definition has been changed. It is reduced from 200 metres from the high-tide line to 100 meters only. This has been done to meet increased demands of housing of fishing and other traditional coastal communities. The notification does not specify any restrictions on fishing.

CRZ 1 – This is the area between Low Tide Line (LTL) & High Tide Line (HTL), which is ecologically sensitive wherein the geomorphological features play prime role in maintaining the integrity of the Coast.

No new Construction is permitted in CRZ-I, except the projects related to national importance (i.e. Atomic Energy etc.) and other essential national infrastructural services.

CRZ 2 – This is the area which have been developed upto or close to the shore line. The “Developed Area” is referred to as that area within the existing municipal limits or in other existing legally designated urban areas which are substantially built-up and has been provided with drainage, roads, water supply and such infrastructural facilities.

CRZ 3 – This is split-up in two Sub-categories.

  1. a) Areas between 100 Mtrs & 200 Mtrs from HTL :-

The area upto 200 Mtrs from High Tide Line (HTL) on the landward side in case of seafront, and 100 Mtrs along tidal influenced water bodies or width of creek which ever is less, is to be earmarked as “No Development Zone” (NDZ).

  1. b) Areas between 200 Mtrs to 500 Mtrs. from HTL :-

Specific and restricted activities are permitted within this zone as specified in the said Notification and modifications thereof from time to time.

CRZ 4 –  In this zone only the activities impugning on the sea and tidal influenced water bodies will be regulated except for traditional fishing and related activities undertaken by the local communities.

Amendments in the notification: The amendment issued by the Ministry of Environment, Forests and Climate Change (MoEFCC) through an extraordinary gazette notification on December 30, 2015 permits the use of reclaimed land for roads, mass rapid or multimodal transit systems, and the construction and installation of associated public utilities and infrastructure to operate such systems within the CRZ area.

The notification adds that construction of roads would be permitted only on the recommendation of the Coastal Zone Management Authority concerned and the clearance of MoEFCC. It also mandates compensatory afforestation to replace the mangroves cut or destroyed for road construction.

The ministry has taken up this consideration in sync with recommendations of the Shailesh Nayak-headed high-level committee that was constituted to suggest amendments to CRZ.

Analysis

The amendment would permit roads to come up in the CRZ1 region comprising ecologically sensitive areas and classified as a ‘no development zone’.

Our coastal ecosystems provide protection from natural disasters such as floods and tsunamis to the 250 million people who live in our coastal areas. Coastal waters provide a source of primary livelihood to nearly 7 million households. The current notification threatens the fragile ecosystem of the coastal areas and reignites the debate of Environment vs Development.

 

Space Parks

Signaling a greater push towards Make in India  ISRO has conceived two space industry enclaves or parks one for launchers at Sriharikota and a smaller one at an existing Bengaluru spacecraft campus.  This signals increased privatisation of the nation’s space programme over the next five years.

For now, the facilities will be “captive” to drive the future missions of the Indian Space Research Organisation.

First, ISRO wants to groom and engage domestic industry in the launch vehicles area from integrating sub-systems up to assembling, and even launching the PSLV.

Eventually the future consortium will be fully responsible for building and launching the light-lift PSLV rocket.

Currently industries such as Hindustan Aeronautics Ltd, Godrej & Boyce, Larsen & Toubro, MTAR and Walchandnagar Industries produce 80 per cent of the launch vehicle parts and sub-units.

 

These production works are scattered across their respective locations. The launch industry initiative must be close to ISRO’s launch complex, the Satish Dhawan Space Centre, at the 145-sq km Sriharikota range, on the lines of the launch complex of Europe’s Arianespace in French Guiana.

Analysis

The push towards developing space parks could help in strengthening India’s position as a low cost yet highly successful hub for future space missions. With its Antrix program ISRO has launched many successful foreign satellites. The development of space parks could result in greater self sufficiency and development of spin off technologies for the lagging defence sector as well. It could possibly lead to greater indigenization of defence technologies.

 

Tax on Seed Funding

Angel or Seed investment is the initial sum of money that is given to a start-up to pursue a business plan. It is generally of small ticket size and can be given by individual investors. There has been a tax imposed on seed funding that has been hindering the investment flow in the early stage startup sector.

The tax provision in question treats infusion of funds by domestic angel investors as income in the hands of the start-up, making India the only country in the world to penalise local angel investors in such a manner. Senior government officials working on the Start Up India action plan to be unveiled by Prime Minister Narendra Modi on Saturday said the tax is one of the key reasons that 90 per cent of Indian start-ups are financed by foreign venture capital and angel funds.

This tax applies only to domestic investors and thus acts as a disincentive to local funding for start-ups that the government wants to incentivize instead.

The government has decided to scrap a tax on seed funding provided to start-ups by Indian angel investors in the upcoming Union Budget, to help domestic financiers bankroll new entrepreneurial ventures under its Start Up India campaign.

Analysis

By its very definition, angel investing is risky and if a particular investment leads to windfall profits, it must be taxed. But the problem is that tax is levied at the time of investments not at the time of booking profits, so it discourages domestic angel investors who are keen to bet on start-ups as the stock markets are not going anywhere.

Nasscom and the Confederation of Indian Industry have flagged the taxing of angel investments as well as income of high-net worth angels as a major impediment for the government’s drive to create a friendly start-up ecosystem. The CII has pointed out that the tax on investments by angels is particularly unnerving as it could also lead to disputes on the valuation of such investments with tax authorities and scare investors away.

Returns made by domestic individual investors from their start-up investments are taxed at the highest marginal personal tax rate (around 33 per cent), while investments routed through a Mauritius-based fund or by corporates who only need to pay long term capital gains tax of around 10 per cent are taxed much lower. Tax on angel investments is something that can be fixed in the Budget, but the tax on income of individual angel investors could take a longer time to be resolved.

 

Proposed Industrial Relations Bill

Union cabinet is planning to consider a law that will combine three archaic legislations namely the Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946, and the Industrial Disputes Act, 1947, into a single code.

The new bill would make easier for companies to retrench employees and to raise severance pay. In a first, workers affected by retrenchment or factory closure will be re-skilled by employers. A re-skilling fund will be set up, and employers will contribute 30 days’ wage of every retrenched worker immediately before the retrenchment. An employer will need to give compensation to a worker laid off for prolonged illness. At present, organisations can lay off workers on the ground of continued ill-health without giving a one-month notice or compensation, both mandatory in other cases under the Industrial Disputes Act, 1947.

But the compensation for a retrenched worker is proposed to be increased three times to 45 days’ pay for every completed year of work, as against 15 days’ pay at present. It will also tighten norms for establishing unions as no outsider will be allowed to become office-bearer of a union in the organised sector.

The proposed law would put an end to flash strikes as workers in all factories will have to give employers a strike notice of at least two weeks.

At present, only workers in public utilities are required to do so. Go-slows, gheraos, squatting or demonstrations by employees at employers’ house, during conciliation proceedings, will not be allowed.

Analysis

Flexibility in labour laws has been a much sought after change by the industry chambers. With stiff competition from low cost international manufacturing locations like China, South East Aasia Indian companies have been facing difficulty to compete.

On the other side trade unions continue to oppose the proposed law that will allow companies with a staff of 300 to retrench workers without government permission, up from the present requirement of up to 100 workers. With lax implementation of existing laws they fear the loss of security for workers once the new laws kick in.

 

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