Daily PT Capsule Apr 12

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

Here is today’s digest of important newspaper articles!

Today’s digest includes updates on: Lodha Panel, MCR-1, Niti Ayog frameworks, RBI’s PSLC

Supreme Court supports Lodha Panel

Mumbai’s Cricket Club of India petitioned the Supreme Court stating that the recommendations of the Lodha Panel affected Article 19 (1) (c), which enshrines the fundamental right of citizens to form union or associations under the Indian Constitution.

But the Supreme court dismissed the appeal. The  Supreme Court said that as there are no individual citizens, only individual organizations there is no effect on Article 19. Only citizens have rights under Article 19.

Analysis

What is the Lodha Panel? – The Lodha committee was formed on January 22, 2015 by the Supreme Court after the Mudgal committee, appointed as an investigator into the IPL 2013 scandal, submitted its report. It’s purpose included suggesting amendments to the processes followed by the BCCI with a view to preventing sporting frauds and conflict of interests, and also streamline the board’s working to make it more responsive to the expectations of the public at large.

What are its recommendations? – Following are the key recommendations made by the Lodha panel regarding the functioning of BCCI:

1) No BCCI office-bearer can be minister or government servant.

2) No BCCI office-bearer can have more than two consecutive terms.

3) No BCCI office-bearer can hold office for more than 3 terms with the rider that there will be a cooling off after each term.

4)  No BCCI office-bearer can hold two posts at the same same time.

5)  Only one association of each state will be full member and have the right to vote.

6)  Relegation of railways, services and universities as associate members. This makes them lose their voting rights.

7) Separate governing bodies for IPL and BCCI.

8) Limited autonomy for IPL governing council.

9) Constitution and establishment of a players’ association.

Source: TheHindu, Livemint

 

New antibiotic resistant gene – MCR-1

A newly discovered antibiotic resistant gene MCR-1 is creating problems by rendering last line of antibiotic drugs ineffective. The gene’s resistance to colistin, a life-saving medication which has been around for 60 years has been the latest addition to the story of anti-biotic resistance.

The resistance-conferring gene easily transfers between bacteria, benign or otherwise, found in humans, animals or the environment.

First identified in China last November, the gene has since been discovered in livestock, water, meat and vegetables for human consumption in several countries, and in humans infected with E.coli – one of the disease-causing bacteria it targets.

For the first time, mcr-1 has now also been found living in the gut of healthy humans, a conference of the European Society of Clinical Microbiology and Infectious Diseases (ESCMID) reported.

It is (only) a matter of time (before) the dissemination of mcr-1 gene will be prevalent in the clinic, bringing the world closer to an antibiotic crisis.

Analysis

What is colistin? – Colistin is an antibiotic that has been available since 1959 in order to treat infections caused by Gram-negative bacteria — a category including the food-poisoning germs E-coli and Salmonella, as well as Acinetobacter which can cause pneumonia or serious blood and wound infections.

It was abandoned for human use in the 1980s due to high kidney toxicity, but is widely used in livestock farming, especially in China.

As bacteria have started to develop resistance to other, more modern drugs, colistin had to be brought back as a treatment of last resort in hospitals and clinics.

What is anti-biotic resistance? – Antimicrobial resistance (AMR), including antibiotic resistance, is the resistance of a microbe to an antimicrobial medication that used to be effective in treating or preventing an infection caused by that microbe.

Reasons for the widespread use of antibiotics include increasing global availability over time since the 1950s. Also the uncontrolled sale in many low or middle income countries, where they can be obtained over the counter without a prescription, potentially resulting in antibiotics being used when not indicated.

Source: TheHindu

 

New Planning Framework by Niti Ayog soon

NITI Ayog is working on a sector-based medium-term planning framework.  The new planning framework could replace five-year plans, the last of which is set to end in 2016-17.

With the Planning Commission scrapped, the process for formulating a 13th five-year plan government has not been initiated, as a consequence of which the era of five-year plans is set to end in India this year.

This marks a shift to indicative planning which is more on the lines of a market economy. While medium-term growth is dependent on past performance, long-term growth, on the other hand, can only be enhanced by structural reforms and improving the productive capacity of the economy.

The government had  also constituted a committee for proposing a new format of budget statements and accounts. There is a need to move to a cost-centric approach where establishments, schemes and projects are treated as such and revenue-capital distinction will be the basis of expenditure classification as required by the constitutional framework.

Analysis

What is the difference between imperative and indicative planning? – Indicative planning is a form of economic planning implemented by a state in an effort to solve the problem of imperfect information in market and mixed economies in order to increase economic performance. When utilizing indicative planning, the state employs “influence, subsidies, grants, and taxes [to affect the economy], but does not compel.”

On the other hand, under imperative planning all economic activities and resources of the economy operate under the direction of the state. The entire resources of the country are used to the maximum in order to fulfill the targets of the plan. There is no consumers’ sovereignty in such planning. What and how much to produce – such decisions are taken by the managers of firms and factories on the direction of the planning commission or a central planning authority. Since the government policies and decisions are rigid, they cannot be changed easily.

Source: Indian Express, Wikipedia

 

RBI’s new norms for efficient lending practices

The Reserve Bank has issued guidelines for banks on purchase and sale of priority sector lending certificates(PSLC) in its bid to help them meet their PSL requirements. Currently, several small and even large banks find it tough to meet their target and as a last -ditch effort deploy money into Rural Infrastructure Development Fund (RIDF) or disburse loans to some exporter towards the end of the year.

What is the mechanism?

PSLCs will work on the lines of carbon credit trading where a renewable energy company or plant accumulates carbon credit and then sells it to another company, thereby, giving them the right to emit one tonne of carbon dioxide.

According to the RBI, PSLCs will allow market mechanism to drive priority sector lending by leveraging the comparative strength of different banks. It said that while a bank with expertise in lending to small farmers can over-perform and get benefit by selling its over performance through PSLCs, another bank-better at lending to small industry—can buy these certificates while selling PSLCs for micro enterprise loans.

While banks can buy PSLC for overall priority sector target by paying a fee, they can also buy it for achieving sub-targets like agriculture, micro-enterprises and weaker sections. The report also pointed out that there is no transfer of assets associated with the sale of the certificates and thus the underlying credit risk and the funding requirements continue to be retained by the originating entity.

Along with PSLCs, RBI has also widened the definition for the category. While target for banks’ lending to micro enterprises has been progressively increased to 7 per cent by March 2016 and 7.5 percent by March 2017, medium enterprises have been brought within the ambit of priority sector, whereby all loans to medium enterprises in the manufacturing sector and those up to Rs 10 crore in the service sector now qualify for priority sector classification.

Analysis
What will be the benefit of this scheme? –  This mechanism will not only allow banks to efficiently utilise their resources in their strong business domains, but will also go on to help develop a secondary market for trading and provide liquidity for such papers.

Source: The Hindu

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