Daily News Analysis:-

‘Falling recovery, delay in resolution dent IBC’s success’

Source The Hindu https://epaper.thehindu.com/reader

GS3 Economy

Why in News?

• Falling recovery rates from 43% to 32% between March 2019 and September 2023, and an increase in the average resolution time from 324 to 653 days versus the stipulated 330 days have emerged as impediments to the success of the Insolvency and Bankruptcy Code (IBC), according to a report by CRISIL Rating.

What is IBC (Insolvency and Bankruptcy Code)?

• The Insolvency and Bankruptcy Code, 2016 (IBC) is India’s bankruptcy law, which aims to unify the existing framework by establishing a single insolvency and bankruptcy law.
• Insolvency is a condition in which a debtor is unable to pay his/her debts.
• Bankruptcy is a legal process that involves an insolvent person or company that is unable to pay its debts.
• It establishes clearer and faster insolvency procedures to assist creditors, such as banks, in recovering debts and avoiding bad loans, which are a major drag on the economy.
• It is an all-encompassing insolvency code that applies to all businesses, partnerships, and individuals (other than financial firms).

Objectives Insolvency and Bankruptcy Code (IBC)

• To make Insolvency and bankruptcy proceedings in India simpler and faster.
• To safeguard the interests of creditors, including firm stakeholders.
• To resurrect the business in a timely manner.
• To encourage people to start businesses. To provide creditors with the required relief and, as a result, enhance the credit supply in the economy.

Insolvency and Bankruptcy Code, 2016: Highlights

Limitations of IBC

■ Limited judicial bench strength and delays in identification and acknowledgement of default are limiting IBC’s success: CRISIL

■ CRISIL says the IBC, since its inception in 2016, has improved credit culture in India by resolving stressed assets

■ Creditors realize 32% of the admitted claims under IBC as compared with 5-20% recovery under other mechanisms

■ The ratings agency adds that bad-loan cases are getting sorted before reaching the IBC’s gates due to the deterrence effect.

Advantages of IBC

• Faster Resolution: As of December 2020, over 86 percent of current bankruptcy resolution processes had passed the 270-day mark. The PPIR (Pre-packaged insolvency resolution process procedure), on the other hand, is limited to a maximum of 120 days. Furthermore, the stakeholders have only 90 days to submit a settlement plan before the NCLT.
• Greater Debtor Autonomy: In the event of pre-packs, the present management retains authority. A resolution professional, on the other hand, assumes control of the debtor as a representative of financial creditors. For the debtor, this leads to a cost-effective and value maximizing solution.
• Prevents errant promoters from abusing the system: The PPIR offers financial creditors strong consent rights. For example, before submitting a resolution plan, it must have approval from at least 66 percent of financial creditors. This prohibits financial creditors from abusing the system.
• A fair resolution: The amendment ensures that both debtors and creditors have a role in the resolution process. This is a departure from the previous strategy. Because the IBC 2016 places an overabundance of emphasis on creditors in the settlement.
• Prevents job losses: PPIR reduces the likelihood of liquidation. As a result, company continuity is ensured, and worker layoffs are reduced.

Centre exempts CERT­In from purview of RTI Act

Source The Hindu https://epaper.thehindu.com/reader

GS2, Governance

Why in News?

• The Union government has added the Computer Emergency Response Team (CERT­In) among a list of organizations that are exempted from the ambit of the Right to Information Act (RTI).

What is the CERTIn?

• The CERT­In is the national nodal agency for responding to computer security incidents as and when they occur.
• Objectives of CERTIn -One of its primary objectives is enhancing “security awareness among common citizens”.
• It functions under the Ministry of Electronics and Information Technology.

Which Organizations are exempted in the RTI  Act?

• There are 26 other intelligence and security organizations established by the Union government such as the Intelligence Bureau, Research and Analysis Wing, Directorate of Enforcement, National Technical Research Organisation that are exempt under RTI.
• The RTI Act, enacted in 2005, said the legislation shall not apply to intelligence and security organizations specified in the Second Schedule, “provided that the information pertaining to the allegations of corruption and human rights violations shall not be excluded.”

What is Right to Information (RTI)?

• It is a Fundamental Right guaranteed to the citizens of India.
•  It was introduced by the Right to Information Act, 2005 which seeks to mandate disclosure of information by the government bodies. Under this act, any person can make such requests to public bodies, and the concerned authorities will have to respond with the information.

Importance of RTI Act

• It defends the Constitution’s fundamental rights to life and personal liberty under Article 21 and to freedom of speech and expression under Article 19(1)(a).
• Public authorities are those designated by the RTI Act of 2005.
• A quasi-judicial role is played by the Public Information Officer (PIO) or the First Appellate Authority in the public authorities, who decide on applications and appeals, respectively.

https://www.livemint.com/politics/policy/lok-sabha-passes-amendment-to-rti-act-opposition-slams-government-1563806101483.html

Challenges associated with RTI Importance of RTI:

• Lack of awareness among people: Awareness about RTI is still very low. Awareness level is low, especially among the disadvantaged communities such as women rural population, OBC/SC/ST population. Irrelevant RTIs being Filed: The quantity of pointless or otherwise inappropriate requests is an often used justification by bureaucrats for their unprofessional attitude.
• Status of Information Commissioners was lowered in RTI Act 2019- this has hindered independence of information commissioners. In 2019, the Union Government reduced the fixed tenure from 5 years to 3 years.
• Various issues in State Information Commissions: Vacancies are not filled; Some continue without chiefs Administrative Challenges Another report mentions that one fourth of information commissioner posts are vacant and there are only 5% (only 8) women information commissioners in the country.
• Threat to Citizens filing RTI :According to CHRI commonwealth Human Rights Initiatives 99 RTI Activists have lost their life .

Need for Climate-Smart Agriculture in India

Source The Hindu https://epaper.thehindu.com/reader

GS3, Agriculture

Background

• The two most important issues facing humanity in the 21st century are climate change and food insecurity. Some of the ongoing effects of climate change, such as heat waves, flash floods, droughts, and cyclones, are negatively influencing lives and livelihoods.
• The world’s southern continents are reportedly experiencing severe drought due to climate change, which negatively impacts agricultural production and farmers’ livelihoods. Both population expansion and dietary changes are contributing to an increase in the demand for food.

What is Climate-smart Agriculture?

According to FAO Climate-smart agriculture (CSA) is an approach that helps guide actions to transform agri-food systems towards green and climate resilient practices. CSA supports reaching internationally agreed goals such as the SDGs and the Paris Agreement.

Objectives

• It aims to tackle three main objectives: sustainably increasing agricultural productivity and incomes; adapting and building resilience to climate change; and reducing and/or removing greenhouse gas emissions, where possible.

Dimensions of Climate-­Smart Practices

•  Include water­smart, weather­smart, energy­smart, and carbon-smart practices. They improve productivity, deal with land degradation, and improve soil health.

https://kairifm.com/farmers-receive-training-on-implementing-climate-smart-procedures-in-agricultural-production/

Roadblocks in the Agriculture Sector As a result of Climate Change:

• Extreme weather events are one of the ongoing effects of climate change that affect people’s lives and livelihoods.
• Severe droughts have a detrimental impact on farmers’ well-being and agricultural productivity, and they are linked to climate change.
• Increased food demand is a result of dietary changes and population growth, which puts further strain on the agriculture industry.
• Climate change is making traditional farming practices less productive, so techniques need to be reevaluated.

The Future Impacts of Climate Change on Agricultural Productivity

• Decrease in crop yield -In India, crop yield decline owing to climate change (between 2010 and 2039) could be as high as 9%.
• Threat to food security -The United Nations’ Sustainable Development Goals aim to end hunger and enhance environmental management; CSA’s foundation is in achieving these goals through sustainable agriculture and rural development. The National Action Plan on Climate Change emphasizes the role of climate resilient agriculture in India’s adaptation measures.

How can Climate Smart Agriculture be Achieved?

• Community supported agriculture -There has been a worldwide uptick in community supported agriculture efforts. These efforts are made in an attempt to create agricultural systems that are both resilient and environmentally friendly.
• Improvements in agroforestry, sustainable water management, and precision agriculture are all concrete examples of CSA ideas in action, and they are not limited by any one country. CSA promotes crop diversification, increases water efficiency, and integrates drought resistant crop types, all of which help lessen the disruptive effects of climate change.
• The importance of CSA lies in its ability to increase agricultural output while maintaining ecological stability. This correlation is not only a desired consequence but rather essential for long term food security and sustainable resource usage in a warming planet.

Significance of Climate Smart Agriculture

• Protection of biodiversity as a whole -The increasing popularity of CSA is a promising indicator for the future of biodiversity conservation. CSA’s ecosystem based approach and different crop varieties help cropland and wild regions coexist together. This collaborative effort helps to safeguard native plant species, keep pollinator populations stable, and mitigate the effects of habitat degradation.
• Lower GHG emissions -The agricultural sector also produces a large amount of GHGs. The sector’s share in GHG’s emissions in 2018 was 17%. Therefore, CSA implementation is crucial for lowering GHG emissions and protecting biodiversity.
• Double farmers income -The majority of Indian farmers are small or marginal. Therefore, CSA can play a significant role in helping them increase their profits.
• Hence,CSA substantially contributes to climate adaptation, mitigation, and food security.

Case studies on Climate Smart Agriculture

• Studies from different climate­smart techniques used in India show that they improve agricultural production, make agriculture sustainable and reliable, and reduce GHG emissions.
• One study from the northwest Indo­Gangetic Plain for wheat production shows that site specific no­-tillage is advantageous for fertilizer management and can boost yield, nutrient use efficiency, and profitability while lowering GHG emissions.

Government and Private Sector initiatives for Climate Smart Agriculture

• The National Adaptation Fund for Climate Change, National Innovation on Climate Resilient Agriculture, Soil Health Mission, Pradhan Mantri Krishi Sinchayee Yojana, Paramparagat Krishi Vikas Yojana, Biotech­KISAN, and Climate Smart Village are a few examples of government initiatives in India focusing on CSA.
• Various public and private sector entities such as farmer producer organizations and NGOs are also working towards the adoption of CSA.

Way Forward for Climate Smart Agriculture

• In order to combat climate change and sustainably boost agricultural output and revenue, a radical reform of the agriculture industry is required.
• Programs such as the Soil Health Card Scheme use precision nutrient management to optimize agricultural methods. The concept of precision farming is still somewhat novel in India. While certain private companies offer services, the scope of these initiatives is extremely limited.
• Fulfilling Paris agreement goals -It aids in enhancing farmland carbon storage. The Paris Agreement goal of limiting global warming by reducing GHG emissions is tied directly to the success of the CSA. India meets its international obligations and contributes to the global fight against climate change.
• However, the most challenging aspect of dealing with global warming is to create localized responses. Therefore, investing in capacity building programmes and providing practical CSA tools and knowledge is essential.

PM sets in motion process for Madiga sub-categorisation

Source The Hindu https://epaper.thehindu.com/reader

GS2, Governance

Why in News?

• Ways ahead of the Assembly election in Telangana, Prime Minister Narendra Modi on Friday set in motion the process of setting up a committee that will go into the issue of subcategorization of the Madiga community within the Scheduled Castes, a long pending demand.

Who are Madiga community?

• The Madiga community constitutes at least 50% of the total Scheduled Castes in Telangana. The 2011 census puts the total SCs at a little over 15% of the population of the State.
• For years, the Madiga community has said that the benefits of reservation under the SC category have been cornered by the Mala community, with the Madigas being left out.

What is Sub-categorisation of castes?

• The idea is to create sub-categories within the larger group of SC for the purpose of reservation.
• In the last two decades, multiple States like Punjab, Bihar, and Tamil Nadu have tried to bring in reservation laws at the State level in a bid to sub-categorise SCs and decide on a separate quantum of reservation for these subcategories within the umbrella of Scheduled Castes.
• However, all plans are held up in courts as the Supreme Court forms its larger Constitution Bench to decide the matter
• For SCs the debate arises out of the perception that only a few affluent communities among them have got the benefit of reservations.
• The argument for creating sub-categories within SC is that it would ensure “equitable distribution” of representation among all SC communities.

How is the sub-categorisation done?

• A Constitutional amendment could be brought in to facilitate this amendment to Article 341 of the Constitution of India to allow for it.
• But both the National Commission for Scheduled Castes (NCSC) and the National Commission for Scheduled Tribes (NCST) had opined that a constitutional amendment was not necessary.
• They said that Article 16(4) of the Constitution already provided for States to create special laws for any backward classes it felt was under-represented.

What have been the arguments for sub categorisation of SCs?

• From the Justice Raju Commission to the National Commission, the principal argument for sub-categorisation of SCs has been the graded inequalities among SC communities.
• The thrust of it has been that even among the marginalized, there are communities that have lesser access to basic facilities.
• As a result, the relatively more forward communities among them have managed to avail benefits consistently while crowding the more backward ones out.
• The solution, therefore, is to sub-categorise the communities and provide separate reservation to the more backward communities within the reservation meant for SCs.
• However, on the other hand, both the SC and ST Commissions have noted that allotting separate reservations within the categories would not really address the root cause of the problem.
• In an internal note prepared by the NCST, it had explained that the most backward SCs are lagging so far behind forward SC communities that a separate quota would not help.
• It said that the idea was to ensure representation at all levels.
• But given the disparity, even if posts were reserved at higher levels, these most backward SCs would not have enough candidates to be considered for it in the first place. Both the NCSC and the NCST had thus recommended that existing schemes and government benefits should first reach these sections before any sub-categorisation.