Welfare schemes for drought hit states
The Supreme court questioned Centre on the state of implementation of its welfare schemes like MGNREGA, National Food Security and mid-day meal in 12 drought-hit States across the country.
A bench of Justices M.B. Lokur and R.K. Agrawal asked the Union Agriculture Secretary to meet with his counterparts in the affected States and discuss criteria for declaration of drought and steps taken to alleviate hunger in these States. It was hearing a PIL which alleged that parts of States like Maharashtra, Uttar Pradesh, Karnataka, Madhya Pradesh, Andhra Pradesh, Telangana, Gujarat, Odisha, Jharkhand, Bihar, Haryana and Chattisgarh have been hit by drought and the authorities were not providing adequate relief.
Analysis
As per the IMD glossary, an all India drought year is defined as, “when the rainfall deficiency is more than 10% and when 20 to 40% of the country is under drought conditions, then the year is termed as all India drought year.†In a major departure, the India Meteorological Department (IMD) will now stop use of the term ‘drought’ to describe poor rainfall recorded across parts of the country and replace it with the terms ‘deficient year’ and ‘large deficient year’.
The central government had taken many measures in the wake of drought.
1) Allocation of additional days of work under MGNREGA to households in drought affected areas: The Government has decided to provide an additional 50 days of unskilled manual work in the financial year over and above the 100 days assured to job card holders in such rural areas where drought or natural calamities has been notified.
2) Diesel Subsidy Scheme for farmers in affected areas
3) Implementation of additional fodder development programme
4) Flexible allocation under RKVY and other centrally sponsored schemes: States have   been advised to keep aside about 5 to 10% of fund allocated under Rashtriya Krishi Vikas Yojana (RKVY) for undertaking appropriate interventions, if the situation so warrants, to minimize the advance impact of an aberrant monsoon on the agriculture sector.
5) Providing relief from the National Disaster Response Fund and State Disaster Response Fund.
Source: TheHindu, PIB
India – EU talks on FTA
India and the European Union on Monday held a stock-taking meeting on “outstanding issues†— including duty cut on automobiles and wines/spirits as well as easier temporary movement of skilled professionals — which had stalled talks on the proposed bilateral free trade agreement (FTA).
The FTA talks were launched in 2007 and around 16 rounds of negotiations were held till 2013. Though after that, no negotiations have been held, India has moved ahead on many issues (that were demanded by the EU) such as permitting 49 per cent FDI in insurance, 100 per cent FDI in telecom and easing of foreign investments norms in the banking sector.
The main demands of the EU included duty cuts on automobiles, wines and spirits, while India’s demands included data security status, easier temporary movement of skilled professionals, seamless intra-corporate movement, real market access in terms of sanitary and phytosanitary (norms related with plants and animals) and technical barriers to trade measures adopted in EU.
Analysis
In the case of India, the proposed FTA with EU is the most ambitious bilateral pact as it covers higher levels of commitments in trade in industrial goods and agricultural products, services and investment liberalisation, intellectual property rights and government procurement. In comparison, India’s existing FTAs are far narrower in scope. The India-EU FTA would cover 1.7 billion people, almost 20 percent of the world population, and therefore the potential impacts (both positive and negative) would be far reaching than other agreements signed by India.
EUs gains – India is resisting demands from the EU to drastically cut tariffs on automobiles, wines and spirits, and dairy products. The EU is seeking greater market access in the services sector such as banking, retail trade, telecommunications, legal and accounting services. In the banking sector, for instance, EU is seeking removal of barriers to market access (commercial presence, cross-border supply and consumption) and grant of national treatment commitments.
The European firms and service providers are interested in the opening up of government procurement markets but India has only committed transparency in the conduct of government procurement processes.
A stringent intellectual property rights regime is another contentious issue as New Delhi has apparently not accepted TRIPS-plus provisions sought by Brussels. Besides, India is reluctant to include labour and environment standards under the proposed agreement.
India’s gains – Under this FTA, India is largely expecting gains in the services, especially IT and ITeS. India is seeking a significant relaxation for the movement of its skilled professionals (for short-term assignments) within the 28-nation bloc. This would enable Indian IT and ITeS industry to move professionals freely from one country to another within the EU. Currently the EU does not offer a work permit with validity for the entire EU. India is also seeking 50000 extra working visas a year for its citizens but the EU is unlikely to accept this demand due to higher youth unemployment rate, which reached 23 percent in 2013.
In addition, New Delhi wants the EU to recognize India as a “data secure†nation which would immensely help the country’s IT industry to gain greater access to the European markets. But the EU is unlikely to accept this demand.
Domestically, the Indian government will find it difficult to sell this agreement as a win-win deal and in the best interest of farmers, workers and producers. One cannot deny the fact that the larger gains from lowering tariffs on agricultural and industrial goods will be made by Europe due to higher import duties imposed by India. While Indian products are unlikely to gain much by further reduction of import duties by EU. In the case of cars, for instance, India’s import duty range from 60 to 100 percent while the EU charges a flat rate of 10 percent on imported cars.
In addition, this FTA would have profound implications on local employment and manufacturing in India. The cheaper import of agricultural and manufactured goods due to lowering of import tariffs will negatively affect several labour intensive sectors. Unlike Europe, 93 percent of India’s workforce is employed by unorganised sector with abysmally low wages and no social security.
Source: GlobalResearch
Minimum Import Price(MIP) for steel
The Centre is yet to take a decision on fixing a minimum import price (MIP) for steel as it is examining the arguments of both steel producers, who want the restriction, and downstream sectors that use steel which want low-cost imports to continue, Commerce Secretary Rita Teaotia has said.
The Secretary pointed out that India’s peak import of steel this year has been 15 per cent of total domestic steel consumption against 9 per cent in previous years.
“Despite the increase in steel imports, 85 per cent of demand is still being met domestically,” she said.
The Centre has imposed a 20 per cent safeguard duty on steel imports till March 2016.
The Steel Ministry has reportedly written to the Prime Minister’s Office (PMO) pointing out that it was not enough to protect the industry against cheap imports and a MIP had to be put in place.
Analysis
The MIP is defined as equivalent to the weighted average global price of a product and the non-injury price arrived at during the course of safeguard and anti-dumping proceedings.
Sections 3 and 5 of the Foreign Trade (Development & Regulation) Act and Section 11 of the Customs Act enable notification of such a threshold price.
The department of commerce would, however, exempt exporters of products from the MIP norm if imports were being used for manufacturing export products. To prevent misuse of this, the department is mulling a mandatory export obligation within six months, besides refund of actual value and MIP.
India was among the few countries where demand for steel products was rising but the companies were in losses. Domestic demand is expected to rise by 7.3 per cent this year but industry is in downturn because of predatory pricing by Korean, Japanese and Chinese companies. According to World Steel Association data, global steel demand this year is minus 1.7 per cent. In China, it is minus 3.5 per cent, South Korea is minus 1.3 per cent and Japan is minus 5.4 per cent.
The government had earlier imposed a provisional safeguard duty of 20 per cent on hot-rolled coils.
Source: Business Standard
