Daily Currentaffairs: 16 Oct 2020

Tables of contents

1.Corporatisation of the Ordnance Factory Board (OFB)

2.India's stand on Nagomo-Karabakh Conflict 

3.Centre should borrow to fund states’ GST loss 

4.India Energy Modelling Forum (IEMF)

5.Tech for Tribals Initiative

6.FELUDA Paper Strip Test for Coronavirus

7.Blue Flag Certification

8.Hydrogen Fuel Cell Electric Hybrid Car

1.Corporatisation of the Ordnance Factory Board (OFB)

Recently, the Centre’s move to corporatise the Ordnance Factory Board (OFB) has been strongly opposed by the federations of the workers from 41 ordnance factories and allied units across the country.

About Ordnance Factory Board (OFB)

• The OFB is an umbrella body for the ordnance factories and related institutions and is currently a subordinate office of the Ministry of Defence.

• The organisation dates back over 200 years and is headquartered in Kolkata.

• It is a conglomerate of 41 factories, nine training Institutes, three regional marketing centres and five regional controllers of safety.

• It provides a major chunk of the weapon, ammunition and supplies for Indian armed forces, paramilitary forces and police forces.

• The products of OFB include civilian and military-grade arms and ammunition, explosives, propellants and chemicals for missiles systems, military vehicles, armoured vehicles, optical devices, parachutes, support equipment, troop clothing and general store items.

Need for Corporatisation of the Ordnance Factory Board (OFB)

• The committees on Defence reforms set by the governments between 2000 and 2015 have recommended the corporatisation of OFB.

• • T.K.A. Nair Committee, Dr. Vijay Kelkar Committee, Raman Puri Committee and the Shekatkar Committee have recommended corporatisation of the OFB.

• The lack of addressing the quality issues with serious delays of OFB affects the preparedness or forcing the Army to look elsewhere.

• The present structure showcase several issues such as monopoly supply, quality issues, high cost of incidentals and overheads, lack of innovation and low productivity.

Significance of Corporatisation of the Ordnance Factory Board (OFB)

• The corporatisation will result in the conversion of the OFB into one or more 100 per cent government-owned entities under the Companies Act, 2013 like other public sector undertakings.

• The proposed transformation of OFB from a government department to a public sector corporate entity will have such as:

  • improvement of efficiency,

  • reducing import dependency for arms and ammunition,

  • enhanced combat efficiency of the armed forces,

  • ensuring customer satisfaction and

  • greater penetration in defence export market

• The corporatised ordnance factories can form strategic alliances with Indian and overseas companies to develop new products and carve out a niche in the international armament industry.

Argument against Corporatisation of the Ordnance Factory Board (OFB)

• Corporatisation leading to privatisation: The main apprehension of the employees is that corporatisation would eventually lead to privatisation.

• Unable to survive market environment for defence: The corporate entities would not be able to survive the unique market environment of defence products that has very unstable demand and supply dynamics.

• It poses a risk to national security in case of the growth of private players in the event of possible failure of the proposed OFB corporatisation, resulting in disinvestment and even closure.

• The ordnance factories cannot be run on a commercial basis since a 'war reserve' has to be kept at par with the armed forces to maintain capacity to take care of surge in demands in a war-like situation.

Viewpoint of the Union government on Corporatisation of the Ordnance Factory Board (OFB)

• The notion of corporatisation was listed as one of the 167 ‘transformative ideas’ to be implemented in the first 100 days of the Narendra Modi government’s second term. 

• The Union Finance has announced the decision of Corporatisation of OFB for ‘improving autonomy, accountability and efficiency in ordnance suppliers’.

• The government has constituted an Empowered Group of Ministers (EGoM) for Corporatisation, under the chairmanship of Defence Minister to oversee and guide the transition support and redeployment plan of employees while safeguarding their wages and retirement benefits.

Source: The Indian Express

2.India's stand on Nagomo-Karabakh Conflict

Recently, Delhi has taken a principled position in the conflict between Armenia and Azerbaijan and supported moves for its peaceful resolution.

About Nagomo-Karabakh Conflict

• The conflict can be traced back to the pre-Soviet era when the region was at the meeting point of Ottoman, Russian and the Persian empires.

• The genesis of the conflict is in the flawed creation of an Armenian Christian majority autonomous region, Nagorno-Karabakh, on the territory of a Muslim majority Azerbaijan.

• Once Azerbaijan and Armenia became Soviet Republics in 1921, Moscow gave Nagorno-Karabakh to Azerbaijan but offered autonomy to the contested region.

• In 1988, the national assembly voted to dissolve the region’s autonomous status and join Armenia but Baku suppressed such calls.

• It is a three decade-old unresolved ethno territorial conflict between Armenia and Azerbaijan.

India's position in South Caucasus

• India does not have a publicly articulated policy for the South Caucasus, unlike “Neighbourhood First”, “Act East” or “Central Asia Connect”.

• The region has remained on the periphery of its foreign policy radar and there is visible asymmetry in India’s relations with Armenia, Azerbaijan and Georgia.

India-Armenia

• Armenia is the only country in the region with which India has a friendship and cooperation Treaty which would prohibit India from providing military or any other assistance to Azerbaijan in case Azerbaijan’s offensive in Nagorno-Karabakh spills over to the territory of Armenia.

• Armenia has extends its unequivocal support to India on Kashmir issue whereas Azerbaijan not only supports but also promotes Pakistan’s narrative on this issue.

India-Azerbaijan

• In the case of Azerbaijan, ONGC/OVL have made relatively small investments in an oilfield project in Azerbaijan and GAIL is exploring the possibilities of cooperation in LNG.

• Azerbaijan falls on the International North South Transport Corridor route, connecting India with Russia through Central Asia and can also connect India with Turkey.

India's stand on Nagomo-Karabakh Conflict

• In the initial stages of the conflict in 1993, India had endorsed the concept of respect for territorial integrity.

• Currently, India’s emphasis has been on a peaceful resolution of the conflict through diplomatic negotiations.

• India has every reason not to support Azerbaijan’s territorial integrity as Azerbaijan has shown scant regard for India’s territorial integrity violated by Pakistan in Jammu and Kashmir.

• It is difficult for India to publicly endorse Nagorno-Karabakh’s right for self-determination in view of the possible repercussions it can have repercussions for India as its adversaries may misuse it not only by making erroneous connections with Kashmir but also re-ignite secessionist movement in certain parts of India.

• India has adopted a balanced and neutral stance and made a politically correct statement in which it has expressed its concern, called for restraint and immediate cessation of hostilities and resolution of the conflict peacefully through diplomatic negotiations.

• India has also expressed its support for the OSCE Minsk Group’s continued efforts towards peaceful resolution, implying that India is not in favour of involvement of any other entity, including Turkey.

Source: The Indian Express

3.Centre should borrow to fund states’ GST loss

Amid the coronavirus pandemic, the experts have argued that the Centre should borrow to fund states’ GST loss in order to build the future of Centre-State relations.

Background

• The creation of the GST Council in 2017 to levy GST was hailed as a great example of cooperative federalism.

• The states had agreed to join in the reform even as it involved sacrificing their fiscal autonomy.

• The states wanted a firm assurance from the Centre because the GST reform was concerned with their Central Sales Tax compensation experience.

• The compensation to the states shall be paid for 5 years in full within the stipulated period of 5 years and, in case the amount in the GST compensation fund falls short of the compensation payable in any bi-monthly period, the GST Council shall decide the mode of raising additional resources.

Issues between Centre and States on GST Compensation

• The issue of GST compensation and the way the entire episode has been managed smacks of gaming and strategy in a period of crisis which does not augur well for the future of the Union-state relationship.

  • The payment of compensation has plunged the Union-state relationship to a new low.

• The presentation of the two options without any discussion in the council and mandating that states choose one of the options within a week was not in the spirit in which the compensation was promised.

• The non-recognition of Centre's commitment will make states wary of any future reforms involving an agreement with the Centre.

• The continuous selective press statements by “officials” and “sources” to pressurise the states into accepting one or the other option does not infuse confidence.

• The Union Finance Ministry stated that the GST Council does not have jurisdiction over borrowing and borrowing is an individual state and Centre’s decision under Article 293 of the Constitution.

Options provided by the Union Government on GST Compensation

• In August 2020, the Union government had presented the states with two options on the issue of compensating states for the loss of their GST revenues.

• The Centre had estimated the states’ total loss of GST revenue at Rs 3 lakh crore, of which, Rs 65,000 crore was expected to accrue from the compensation cess.

  • The first option was to provide states a special window to borrow Rs 97,000 crore from the RBI, which was later revised to Rs 1.1 lakh crore.

  • In the second option, the entire shortfall of Rs 2.35 lakh crore could be borrowed from the market and the states would have to bear the interest costs, but the repayments would be adjusted against future collections of the cess.

Measures for GST Compensation to States

• It is the Centre’s commitment to find the compensation mechanism and borrowing is one of the options which must be discussed in the GST Council.

• The relative fiscal strength of the Centre and the states and as the interest rate of the Centre’s borrowing is lower than that of the states, the Centre should take the responsibility to borrow.

• The argument for central responsibility gets strengthened when it is considered that it wanted to appropriate the excess collections of cess into the Consolidated Fund of India (CFI).

• In the original GST Act, the central government could appropriate 50% of the unutilized amount in the compensation fund at the end of five years and the remaining 50% would be distributed to the states.

Source: The Indian Express

4.India Energy Modelling Forum (IEMF)

Recently, NITI Aayog has released the governing structure of the India Energy Modelling Forum (IEMF).

About India Energy Modelling Forum (IEMF)

• It is a joint initiative of NITI Aayog and United States Agency for International Development (USAID) under the US–India Strategic Energy Partnership.

• It is the part of the Sustainable Growth pillar of the US–India Strategic Energy Partnership (SEP).

• The IEMF aims to engage Indian researchers, knowledge partners, think tanks and national and international government agencies and departments for modelling and long-term energy planning.

• The governing structure of IEMF will consist of an inter-ministerial and a steering committee.

• The inter-ministerial committee will be convened by NITI Aayog and headed by its CEO and comprise senior officials from various ministries.

  • The inter-ministerial committee will review the studies/modelling activities and provide directions and new areas of research.

• The steering committee will comprise representatives of the ministries, Industry Associations (FICCI and CII), Academia (IIT Bombay, Ahmedabad, and Delhi) and Policy research organizations, think tanks and funding agencies.

  • The steering committee will shortlist policy issues to be taken up for study and might form various taskforces depending on the specific studies/modelling exercises to be carried out.

Source: PIB

5.Tech for Tribals Initiative

Recently, the Ministry of Tribal Affairs has announced that it will launch the 'Tech for Tribals Initiative'.

About Tech for Tribals Initiative

• It will be a joint initiative of TRIFED, Chhattisgarh MFP Federation and IIT-Kanpur.

• The TRIFED has collaborated with MSME through its ESDP scheme for providing skill upgrading and entrepreneurial capacity building support to the Van Dhan tribal beneficiaries to establish their sustainable enterprise.

• It aims at the holistic development of tribals with a focus on entrepreneurship development, soft skills, IT, and business development through SHGs operating through Van Dhan Kendras (VDVKs).

• Under this initiative, TRIFED has tied up reputed national institutions such as IIT, Kanpur; Art of Living, Bangalore; TISS, Mumbai; KISS, Bhubaneswar; Vivekananda Kendra, Tamil Nadu and SRIJAN, Rajasthan, for conducting Vandhan-ESDP Training Programs.

• It is a unique program to make tribals of India “Aatmanirbhar”, focusing to bridge the gap between tribal entrepreneurs and urban markets.

Source: PIB

6.FELUDA Paper Strip Test for Coronavirus

Recently, the Union Minister of Health & Family Welfare has said that the rollout of the FELUDA paper strip test for coronavirus is expected in the next few weeks.

About FELUDA

• FELUDA is an acronym for FNCAS9 Editor-Limited Uniform Detection Assay.

• It uses CRISPR-Cas technology for the detection of genes specific to SARS-CoV-2 virus.

• In this method, a protein called FnCas9 and a guide RNA (gRNA) which helps in recognising the viral genes is used.

• The FELUDA mix is prepared by incubating the dead FnCas9 protein, guide RNA and the amplified viral DNA.

  • A protein called Streptavidin on the test line captures this gold nanoparticle bound-FELUDA complex.

• With FELUDA, the need for technical expertise is minimal and no requirement of expensive equipment, making it an easy to perform, point of care test.

• The ‘Feluda’ test uses cutting-edge CRISPR technology for detection of the genomic sequence of the novel coronavirus.

• The FELUDA is also reportedly the world’s first diagnostic test to deploy a specially adapted Cas9 protein to successfully detect the virus.

Source: The Hindu

7.Blue Flag Certification

Recently, eight beaches in India have been awarded the coveted ‘Blue Flag’ certification by United Nations Environment Programme (UNEP), United Nations World Tourism Organization (UNWTO), Foundation for Environmental Education (FEE) and International Union for Conservation of Nature (IUCN).

• The beaches selected for the certification are: Kappad (Kerala), Shivrajpur (Gujarat), Ghoghla (Diu), Kasarkod and Padubidri (Karnataka), Rushikonda (Andhra Pradesh), Golden (Odisha) and Radhanagar (Andaman & Nicobar Islands).

About Blue Flag Certification

• The ‘Blue Flag’ is a certification that can be obtained by a beach, marina, or sustainable boating tourism operator, and serves as an eco-label.

• The certification is awarded by the Denmark-based non-profit Foundation for Environmental Education (FEE).

  • The FEE sets stringent environmental, educational, safety-related and access-related criteria that applicants must meet and maintain.

• It is awarded annually to beaches and marinas in FEE member countries.

• It was started in France in 1985 and in areas out of Europe in 2001.

• The programme promotes sustainable development in freshwater and marine areas through four main criteria i.e. water quality, environmental management, environmental education and safety.

• India is the only country that has received the Blue Flag certification in 2 years' time.

  • Japan, South Korea and UAE are the only other Asian nations that have been conferred with a couple of Blue Flag beaches in a time frame of about 5 to 6 years.

• India is now in the league of 50 'Blue Flag' countries.

Source: The Indian Express

8.Hydrogen Fuel Cell Electric Hybrid Car

Recently, India’s first Hydrogen Fuel Cell (HFC) electric hybrid car has successfully completed its maiden test run in Pune, Maharashtra.

About Hydrogen Fuel Cell (HFC) Electric Hybrid Car

• It is an indigenous technology developed as a collaborative effort between the National Chemical Laboratory (NCL), Pune and Central Electro Chemical Research Institute (CECRI), Karaikudi along with KPIT, Pune.

• The technology has the potential to reduce dependence on petrol and diesel once introduced in markets which imply that fewer polluting emissions due to fuel combustion from vehicles.

• In the HFC technology, hydrogen gas from the on-board gas cylinder interacts with the Membrane Electrode Assembly (MEA) from the anode side to produce protons and electrons.

  • The protons, after passing through the proton exchange membrane, interact with oxygen from the local air available on the cathode side to produce water.

  • The electrons flow through the outside circuit and produce electricity.

• Unlike vehicles running on fossil fuels, which emit polluting gases like carbon monoxide, sulphur dioxide and nitrogen dioxide, the only by-product in HFC technology is water.

Why Hydrogen Fuel Cell Electric Hybrid Car is needed?

• The direct combustion of fuel for transportation accounts for over half of greenhouse gas emissions and a significant fraction of air pollutant emissions.

• The emissions of greenhouse and air pollutants from fuels will grow over the next century because of the growing demand.

• The fuel cell vehicles, using hydrogen, can potentially offer lower emissions than other alternative and possibility to use different primary fuel option.

Source: The Indian Express

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