Daily Current Affairs for 21st October 2020

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FDI blooms in COVID 19 gloom


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

Why in news?

Foreign direct investment (FDI) inflows into India in the first five months of 2020-21 have hit a record high, despite a sharp 60% contraction in the first quarter.

Key details

  • Total FDI inflows surged from $11.51 billion between April and June to $35.73 billion by the end of August.
  • Equity FDI more than quadrupled from $6.5 billion between April and June— 16% higher than the first five months of 2019-20. To put that in context, India received about $50 billion in equity FDI in 2019-20.
  • Both, total FDI and equity FDI viewed in isolation, were the highest ever for the five month period, the Commerce and Industry Ministry.
  • The increased FDI is a result of FDI policy reforms, investment facilitation and ease of doing business.
  • Total FDI flows include fresh equity investments as well as re-invested earnings of foreign investors and other forms of investment capital such as debt.

Foreign Direct Investment

  • A foreign direct investment (FDI) is an investment in the form of a controlling ownership in a business in one country by an entity based in another country.
  • It is thus distinguished from a foreign portfolio investment by a notion of direct control.
  • The origin of the investment does not impact the definition, as an FDI: the investment may be made either “inorganically” by buying a company in the target country or “organically” by expanding the operations of an existing business in that country.
  • Foreign direct investment includes “mergers and acquisitions, building new facilities, reinvesting profits earned from overseas operations, and intra company loans“.
  • In a narrow sense, foreign direct investment refers just to building new facility, and a lasting management interest in an enterprise operating in an economy other than that of the investor.


  • A foreign direct investment (FDI) is an investment made by a firm or individual in one country into business interests located in another country.
  • Foreign portfolio investment (FPI) instead refers to investments made in securities and other financial assets issued in another country.
  • Both methods of foreign investment are crucial to global trade and development, however FDI is often considered the preferred mode and is less volatile.

What is the production linked incentive scheme for electronics manufacturers?

  • As a part of the National Policy on Electronics, the IT ministry had on April 1 notified a scheme which would give incentives of 4-6 per cent to electronics companies which manufacture mobile phones and other electronic components such as transistors, diodes, thyristors, resistors, capacitors and nano-electronic components such as micro electromechanical systems.
  • According to the scheme, companies that make mobile phones which sell for Rs 15,000 or more will get an incentive of up to 6 per cent on incremental sales of all such mobile phones made in India.
  • In the same category, companies which are owned by Indian nationals and make such mobile phones, the incentive has been kept at Rs 200 crore for the next four years.
  • The PLI scheme will be active for five years with financial year (FY) 2019-20 considered as the base year for calculation of incentives.
  • This means that all investments and incremental sales registered after FY20 shall be taken into account while computing the incentive to be given to each company.

Govt increases poll spend ceiling by 10%


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

Why in news?

The Law Ministry has increased the ceiling on poll expenditure for Assembly and Lok Sabha elections by 10%. The move follows a recommendation by the Election Commission in view of curbs imposed during the coronavirus [COVID-19] pandemic.

Key details

  • This will help candidates contesting the Bihar Assembly polls as well as those fighting bypolls to 59 Assembly seats across 11 States and one Lok Sabha seat.
  • The ceiling on poll expenditure varies across States, with candidates in Assembly elections in bigger States like Bihar, Uttar Pradesh, and Tamil Nadu now allowed to spend up to ₹30.8 lakhs as against ₹28 lakhs earlier.
  • For a candidate contesting a Lok Sabha poll in these States, the revised ceiling on poll expenditure is now ₹77 lakhs instead of the earlier amount of ₹70 lakhs.
  • Goa, Arunachal Pradesh, Sikkim and a few Union Territories, based on the size of their constituencies and population, have a lower ceiling on poll expenditure. Here while the enhanced ceiling for a Lok Sabha candidate is now ₹59.4 lakhs those contesting an Assembly can spend up to ₹22 lakhs.
  • The last time the expenditure ceiling was enhanced was in 2014 just ahead of the Lok Sabha polls.

Poll spending limit

  • Presently under Rule 90 of the Conduct of Election Rules, 1961, there is a cap on poll spending by Loksabha candidates at ₹70 lakh and by candidates in Assembly elections at ₹28 lakh for most States.
  • The Election Commission of India imposes limits on the expenditure incurred by a candidate, but not political parties, on their election campaign.
  • A candidate can spend between Rs 50 lakh and Rs 70 lakh, depending on the state they are contesting the Lok Sabha election from.
  • For all states, except Arunachal Pradesh, Goa and Sikkim, a candidate can spend a maximum of Rs 70 lakh on canvassing. The cap for Arunachal Pradesh, Goa and Sikkim is Rs 54 lakh. And, it is Rs 70 lakh for Delhi and Rs 54 lakh for other Union territories.
  • For the assembly elections, the ceiling is between Rs 20 lakh and Rs 28 lakh.
  • This includes the money spent by a political party or a supporter towards the candidate’s campaign. But, expenses incurred either by a party or the leader of a party for propagating the party’s programme are not covered.

Separate Account

  • Candidates have to keep a separate account and file the election expenses with the poll watchdog under the law. An incorrect account or expenditure beyond the cap can lead to disqualification for up to three years under Section 10A of the Representation of the People Act, 1951.
  • All registered political parties have to submit a statement of their election expenditure to the election commission within 90 days of the completion of the Lok Sabha elections.
  • And all candidates are required to submit their expenditure statement to the poll panel within 30 days of the completion of the elections.

Political party funding

  • Political parties are funded by contributions from multiple sources.
  • One of the largest sources of funding comes from party members and individual supporters through membership fees, dues, subscriptions and small donations. This type of funding is often referred to as grassroots funding or support.
  • Solicitation of larger donations from wealthy individuals, often referred to as plutocratic funding, is also a common method of securing funds.
  • Parties can also be funded by organizations that share their political views, such as unions, political action committees, or organizations that seek to benefit from the party’s policies.

  • The 2017-18 Union budget speech of former finance minister Arun Jaitley had a rare separate section on ‘Transparency in Electoral Funding’.
  • It announced the National Democratic Alliance (NDA) government’s efforts to promote transparency in political funding, including capping cash donations at ₹2,000.
  • A key measure that drew the most attention, as well as criticism since then, has been ‘electoral bonds’, a new mode of poll financing

WII scientists anxious about potential funding cut


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

Why in news?

A recommendation by the Finance Ministry to divest the Dehradun-based Wildlife Institute of India (WII) of its status as an autonomous body of the Ministry of Environment, Forests and Climate Change has triggered anxiety among scientists at the organisation.

Key details

  • The Finance Ministry moves follows a review by its Expenditure Department of 194 autonomous bodies across 18 Ministries. Of them, 109 bodies must be merged into 26, and government must “disengage” from 23, one which is the WII.
  • In the case of WII, the government will cut funding to the institute by 25% every year, and it could become a ‘Deemed University’ engaged in teaching and research. The Central government could continue to access WII advisory and training services as a “client.”
  • Along with the WII, other autonomous bodies that have been recommended to be disengaged are the Indian Institute of Forest Management, and the Indian Plywood Industries Research and Training Institute.
  • Other Environment Ministry organisations, such as the Salim Ali Centre for Ornithology and Natural History will be subsumed within the activities of the Environment Ministry.
  • Still others, such as the Society of Integrated Coastal Management and the National Centre for Sustainable Coastal Management, will be merged.


  • The Union finance ministry had asked the ministry of environment, forest and climate change (MoEFCC) to reduce financing of five autonomous bodies, including the Wildlife Institute of India (WII) in Dehradun and the Indian Institute of Forest Management (IIFM) in Bhopal over the next three years.
  • In a report on the rationalization of 109 autonomous bodies under Central government ministries, the finance ministry’s department of expenditure recommended that the environment ministry disengage with 23 bodies, merge 109 into 26 bodies and close six to reduce expenditure.
  • The purpose of the report is to make specific and actionable recommendations for rationalisation of autonomous bodies with a view to furthering the aim of ‘minimum government, maximum governance,’ ensuring efficient use of public funds

Wildlife Institute of India (WII)

  • Wildlife Institute of India (WII) is an internationally acclaimed Institution, which offers training program, academic courses and advisory in wildlife research and management.
  • The Institute is actively engaged in research across the breadth of the country on biodiversity related issues.
  • It was established in 1982 in Dehradun with a mandate to train government and non-government personnel, carry out research, and advise on matters of conservation and management of wildlife resources.

Aims and Objectives

  • Build up scientific knowledge on wildlife resources.
  • Train personnel at various levels for conservation and management of wildlife.
  • Carry out research relevant to management including the development of techniques appropriate to Indian conditions.
  • Provide information and advice on specific wildlife management problems.
  • Collaborate with international organizations on wildlife research, management and training.
  • Develop as a regional centre of international importance on wildlife and natural resource conservation.

What is a Deemed university

  • Deemed university, or deemed-to-be-university, is an accreditation awarded to higher educational institutions, conferring the status of a university.
  • It is granted by the Department of Higher Education.
  • An Institution of Higher Education, other than universities, working at a very high standard in specific area of study, can be declared by the Central Government on the advice of the University Grants Commission (UGC), as an Institution ‘Deemed-to-be-university’.
  • Institutions that are ‘deemed-to-be-university’ enjoy the academic status and privileges of a university.

What are Autonomous bodies (ABs)

  • Autonomous bodies (ABs) are a major stakeholder in the government’s functioning as they are engaged in diverse activities, ranging from formulating frameworks for policies, conducting research, and preserving the cultural heritage, etc.
  • Institutes imparting technical, medical and higher education fall in this category. Most of the Autonomous Bodies receive money from the Central Government by way of grants-in-aid (GIA)
  • The apex administrative body of ABs is called governing council or governing body and is chaired by the minister or the secretary of the respective ministry.
  • Besides, the ABs have specialised committees such as the purchase committee, works committee, finance committee, with nominated ministry officials.
  • These ABs are audited by the Comptroller and Auditor General (CAG), and the annual report is presented in the Parliament every year.

Kaleshwaram eco-clearance violates law: NGT


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

Why in news?

The National Green Tribunal (NGT) has held that environmental clearance (EC) to Kaleshwaram Lift Irrigation Project (KLIP) was granted ex post facto, after completion of substantial work, by the Ministry of Environment, Forests and Climate Change (MoEF&CC) “in violation of law”.

Key details

  • It has also observed that accountability needs to be fixed and remedial measures be taken.
  • In the judgment, for a petition, the Principal Bench of NGT asked the Ministry to constitute the expert committee within a month and it may complete its exercise within six months thereafter shouldering the responsibility of monitoring the panel work to the Secretary of MOEF&CC.
  • The petitioner moved the NGT with a contention declare the EC granted to KLIP as invalid since substantial work was done by the State Government, project proponent, prior to filing application with the Ministry for clearance.
  • The NGT Principal Bench suggested that the expert committee could assess the extent of damage caused in going ahead with the project without EC – the period from 2008 to 2017 — and identify the necessary restoration measures.
  • Further, it could look into relief and rehabilitation measures adopted and required to be further adopted, examine effective implementation of environmental management plan (EMP) submitted by the project proponent as also compliance of EC conditions.
  • It is particularly required when the projects are multi-purpose and part of it requires EC, so that such requirement is not defeated on specious plea that the project was partly not covered by the schedule Environmental Impact Assessment (EIA) Notification as has happened in the present case, the NGT observed.

Kaleshwaram project

  • The Kaleshwaram Multipurpose Lift Irrigation Project, the world’s largest irrigation and drinking water system, was inaugurated last year by Telangana Chief Minister K Chandrashekar Rao.
  • It is a multi-purpose irrigation project on the Godavari River in Kaleshwaram, Bhoopalpally, Telangana.
  • It is meant to provide water for drinking and irrigation to nearly 45 lakh acres in 20 of 31 districts of Telangana, apart from Hyderabad and Secunderabad.
  • The project aims at increasing total culturable command area (the sustainable area which can be irrigated after accounting for both upstream and downstream factors) by 1,825,000 acre⋅ft (2,251 hm3) across all 13 districts in addition to stabilizing the existing CCA.
  • The environmental clearance, granted to the project in Karimnagar district on December 22, 2017 by the Ministry of Environment, Forests and Climate Change, was cancelled by the NGT on October 12.

National Green Tribunal

  • The National Green Tribunal was established on 18.10.2010 under the National Green Tribunal Act 2010.
  • It was established for effective and expeditious disposal of cases relating to environmental protection and conservation of forests and other natural resources including enforcement of any legal right relating to environment and giving relief and compensation for damages to persons and property and for matters connected therewith or incidental thereto.
  • It is a specialized body equipped with the necessary expertise to handle environmental disputes involving multi-disciplinary issues.
  • The Tribunal is not be bound by the procedure laid down under the Code of Civil Procedure, 1908, but shall be guided by principles of natural justice.
  • The Tribunal’s dedicated jurisdiction in environmental matters shall provide speedy environmental justice and help reduce the burden of litigation in the higher courts.
  • The Tribunal is mandated to make and endeavour for disposal of applications or appeals finally within 6 months of filing of the same.
  • Initially, the NGT is proposed to be set up at five places of sittings and will follow circuit procedure for making itself more accessible.
  • New Delhi is the Principal Place of Sitting of the Tribunal and Bhopal, Pune, Kolkata and Chennai shall be the other four place of sitting of the Tribunal.

What is Environment Impact Assessment

  • Environmental assessment (EA) is the assessment of the environmental consequences (positive negative) of a plan, policy, program, or actual projects prior to the decision to move forward with the proposed action.
  • In this context, the term “environmental impact assessment” (EIA) is usually used when applied to actual projects by individuals or companies and the term “strategic environmental assessment” (SEA) applies to policies, plans and programmes most often proposed by organs of state.
  • It is a tool of environmental management forming a part of project approval and decision-making.
  • Environmental assessments may be governed by rules of administrative procedure regarding public participation and documentation of decision making, and may be subject to judicial review.

Enivronment Impact Assessment Act 2020

  • Under the Environment (Protection) Act, 1986, India notified its first EIA norms in 1994, setting in place a legal framework for regulating activities that access, utilise, and affect (pollute) natural resources.
  • Every development project has been required to go through the EIA process for obtaining prior environmental clearance ever since.
  • The Ministry of Environment, Forest and Climate Change (MoEF&CC) recently published the draft Environment Impact Assessment (EIA) Notification 2020, with the intention of replacing the existing EIA Notification, 2006 under the Environment (Protection) Act, 1986.
  • The new draft has been proposed with the aim of making processes more transparent and expedient. But in effect, the draft proposes the removal of several activities from the purview of public consultation.
  • The notification envisages two kinds of approval—prior environment clearance (EC) with the approval of expert committees and environmental permission or provision (EP) without the approval of expert committees.
  • One of the main causes of concern is that the draft has exempted almost 40 different projects such as clay and sand extraction or digging wells or foundations of buildings, solar thermal power plants and common effluent treatment plants are exempted from prior EC or prior EP.
  • Several projects such as all B2 projects, irrigation, production of halogens, chemical fertilisers, acids manufacturing, biomedical waste treatment facilities, building construction and area development, elevated roads and flyovers, highways or expressways are exempted from public consultation.

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