Daily Current Affairs for 14th May 2020

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Army Proposes 3-yr voluntary ‘tour of duty’ cites patriotism, unemployment.

Paper: General Studies-III: Technology, Economic Development, Bio diversity, Environment, Security and Disaster Management

Sub-topic:  Defence & Various Security forces

Why in News:

Army Chief General M.M. Naravane said that a long discussion on recruiting civilians in the force on the internship of 3 years is going on.

Key Points:

  • The idea came up when army officials came to know about the desire of youths in colleges and universities that they are eager to witness the life of an army not as a career option but for a short period.
  • The proposed model called ToD (Tour of Duty) will be implemented on a trial basis for officers and other ranks in the army for a limited number of vacancies in its initial phase.
  • The vacancies may increase if the model is found to be successful. Further, the officials mentioned that the army will benefit by getting younger manpower and the society will benefit by getting people who are disciplined and have assimilated the spirit of the army.
  • However, the proposal is under discussion and if approved there will be no dilution of criteria in selection.

Advantage of implementing the proposed model

  • The overall cost of training, pay, allowances and other factors are approximately 6.83 Crore of a Short Service Commission Officer (SSC) it is even 50 to 60 percent further for those who opt for Permanent Commission.
  • Whereas, the cost for those who will be employed under ToD will be 80 to 85 Lakh only.
  • Savings will be used in the modernization of the armed force.
  • Later on, these trained personnel after completing their service of 3 years under the ToD scheme will work under other various jobs.
  • The nation will be benefited from trained, diligent, disciplined, and committed men and women.
    The army will be benefited by getting younger manpower who are interested and eager to serve the army.

Way Ahead:

At present, the Army recruits young people under short service commission for an initial tenure of 10 years which is extendable up to 14 years. With this move, The Army would gain significant financial benefit from the ToD scheme as it will save a huge amount of money on gratuity, severance packages, leave encashment and pension.

Major stimulus package for MSMEs

Paper:  General Studies-III: Technology, Economic Development, Bio diversity, Environment, Security and Disaster Management

Sub-topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

Why in News:

₹3 lakh crore collateral free loan scheme for businesses, especially micro, small and medium enterprises (MSMEs), as part of a ₹20 lakh crore economic stimulus package to deal with the COVID19 pandemic.

Key Points:

  • For salaried workers and taxpayers, an extended deadline for income tax returns for financial year 2019-20, with the due date pushed to November 30, 2020.
  • The rates of tax deduction at source (TDS) and tax collection at source (TCS) have been cut by 25% for the next year.
  • Statutory provident fund (PF) payments have been reduced from 12% to 10% for both employers and employees for the next three months.
  • Apart from MSMEs, other stressed business sectors which got attention were non-banking finance companies (NBFCs), power distribution companies, contractors and the real estate industry.
  • This is the first tranche of the Atmanirbhar Bharat Abhiyan announced by Prime Minister Narendra Modi as an ₹20 lakh crore economic package.
  • Package includes the Pradhan Mantri Garib Kalyan Yojana, meant to support the poorest and most vulnerable communities during the pandemic, as well as several measures taken by the Reserve Bank of India to improve liquidity.


  • Expert analyze that measures announced amounted to ₹5.94 lakh crore, which include both liquidity financing measures and credit guarantees, although the direct fiscal cost to the government in the current financial year may only be ₹16,500 crore.
  • MSMEs will get the bulk of the funding.
  • The ₹3 lakh crore emergency credit line will ensure that 45 lakh units will have access to working capital to resume business activity and safeguard jobs.
  • For two lakh MSMEs which are stressed or considered non-performing assets, the Centre will facilitate provision of ₹20,000 crore as subordinate debt.
  • A ₹50,000 crore equity infusion is also planned, through an MSME fund of funds with a corpus of ₹10,000 crore.
  • The definition of an MSME is being expanded to allow for higher investment limits and the introduction of turnover-based criteria.
  • In a bid to fulfil the vision of a self-reliant or “atmanirbhar” India, global tenders will not be allowed for government procurement up to ₹200 crore.

New Definition of MSMEs:

Additional Information:

Definitions of Micro, Small & Medium Enterprises In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Micro, Small and Medium Enterprises (MSME) are classified in two Classes:

  1. Manufacturing Enterprises– Enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and regulation) Act, 1951) or employing plant and machinery in the process of value addition to the final product having a distinct name or character or use. The Manufacturing Enterprise are defined in terms of investment in Plant & Machinery.
  2. Service Enterprises: -The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.

The Ministry of Small-Scale Industries and Agro and Rural Industries was created in October 1999.

In September 2001, the ministry was split into the Ministry of Small-Scale Industries and the Ministry of Agro and Rural Industries. The President of India amended the Government of India (Allocation of Business) Rules, 1961, under the notification dated 9 May 2007. Pursuant to this amendment, they were merged into a single ministry.

The ministry was tasked with the promotion of micro and small enterprises. The Small Industries Development Organisation was under the control of the ministry, as was the National Small Industries Corporation Limited public sector undertaking).

The Small Industries Development Organisation was established in 1954 on the basis of the recommendations of the Ford Foundation. It has over 60 offices and 21 autonomous bodies under its management. These autonomous bodies include Tool Rooms, Training Institutions and Project-cum-Process Development Centers.

Services provided include:

  • Facilities for testing, toolmenting, training for entrepreneurship development
  • Preparation of project and product profiles
  • Technical and managerial consultancy
  • Assistance for exports
  • Pollution and energy audits

It also provides economic information services and advises Government in policy formulation for the promotion and development of SSIs. The field offices also work as effective links between the Central and State Governments.

Way Ahead:

Liquidity & credit guarantees for banks & NBFCs will help remove hesitation in lending. Friction-free implementation of these measures can slowly convert adversity to advantage. With the core focus on self-reliance as propagated, a slew of measures announced for infusing liquidity into the hands of corporates and individuals and for easing compliances to spur the stalled business activities in the country.

₹3,100 crore from PM CARES allocated for COVID19 relief

Syllabus Linkage:  General Studies- II: Governance, Constitution, Polity, Social Justice and International relations.

Sub-Topic: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources.

Why in News:

The Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund, better known as PM CARES, will allocate ₹3,100 crore to COVID-19 relief, including funds for ventilators, migrant workers and vaccine development.

Key Points:

  • The PM CARES Fund Trust has decided to spend ₹2,000 crore to buy 50,000 Indian-made ventilators, which will be provided to government-run hospitals designated for COVID-19 treatment in all the States and Union Territories.
  • Another ₹1,000 crore will be used to support the States’ welfare measures for migrant workers, and will help provide accommodation, food, medical treatment and transport. The money will be released to the district administration through the State Disaster Relief Commissioners.
  • PM CARES will give ₹100 crore to support those in the Indian academia, start-ups and industry who are working on designing and developing a vaccine against COVID-19. The money will be spent under the supervision of the Principal Scientific Adviser.

What Is PM CARES fund?

  • The PM CARES Fund Trust, which decides the allocations, is headed by the Prime Minister.
  • The Prime Minister is the ex-officio Chairman of the PM CARES Fund. Government of India, Ministry of Defence, Ministry of Home Affairs and the Ministry of Finance are ex-officio Trustees of the PM CARES Fund.
  • The Chairperson of the Board of Trustees i.e. the Prime Minister shall have the power to nominate 3 trustees to the Board of Trustees who shall be eminent persons in the field of research, science, health, social work, public administration, law and philanthropy. Any person appointed a Trustee shall act in a pro bono capacity.
  • The fund was set up in March 2019, in the wake of of COVID-19 pandemic.
  • The fund does not get any budgetary support and consists entirely of voluntary contributions from individuals or organizations.
  • Donations to PM CARES Fund by the individuals would qualify for 100% tax exemption under 80G of the Income Tax Act, 1961.
  • Donations to PM CARES Fund by the organisations would qualify to be counted as Corporate Social Responsibility (CSR) activity expenditure under the Companies Act, 2013.
  • A separate account for receiving donations from foreign countries has been opened. This enables PM CARES Fund to accept donations and contributions from individuals and organizations based in foreign countries. Foreign donations in the PM CARES Fund would also get exemption under the Foreign Contribution and Regulation Act (FCRA).

Nepal can let India use link road: Oli

Paper: General Studies- II: Governance, Constitution, Polity, Social Justice and International relations.

Sub-Topic: India and its neighborhood- relations

Why in News:

  • Nepal expressed regret after the Defence Minister inaugurated the link road that will cut travelling time to the Tibetan plateau and the Kailash Mansarovar.
  • In this background, Nepal’s Prime Minister has proposed a solution to the ongoing border tension between India and Nepal.

Key Points:

  • Prime Minister of Nepal said that he was against India’s unilateral actions in the region but agreed that a solution can be found that will preserve Nepal’s territorial integrity and sovereignty.
  • He said that they can allow India to use the link road to the Lipulekh Pass as part of an agreement, but will not surrender the Kalapani territory on which India has been carrying out construction.
  • Nepal has objected to the road as Lipulekh, through which the link passes, is considered by Nepal as part of its own territory.
  • Nepal disputes India’s claims over the Kalapani region located in the state of Uttarakhand.
  • It maintains that the territories to the east of Mahakali river are a part of its domain, as agreed in the Treaty of Sugauli of 1816 between the East India Company and the King of Nepal.

Kalapani dispute?

  • Kalapani is a 372-sq km area at the China-Nepal-India tri-junction.
  • India claims Kalapani as a part of Uttarakhand while Nepal depicts the area in its map.
  • The border dispute flared up again recently after India released its new political map following the reorganization of J&K showing the area as its own.
  • According to the Sugauli treaty signed between Nepal and British India in 1816, the Mahakali riverthat runs through the Kalapani area is the boundary between the two countries.
  • However, British surveyors subsequently showed the origin of the river, which has many tributaries, at different places.
  • While Nepal claims that the river, west of the disputed territory is the main river and so Kalapani falls in its territory, India claims a different origin and includes the area in its territory.
  • Strategically, Lipulekh pass in Kalapani serves as an important vantage point for India to keep an eye on Chinese movements.
  • Since 1962, Kalapani has been manned by the Indi-Tibetan Border Police (ITBP).

Way Ahead:

India needs to continue to understand that there is another opportunity to rewrite bilateral and geopolitical history.India needs to also realize the new reality that its monopoly over geopolitics in Nepal is over, and there is another relationship that Nepal is nurturing.While China does not have people-to-people interactions with Nepal on a par with India, it has an open avenue for India to retain its strategic importance.

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