Daily Current Affairs for 30th December 2020

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INCOIS launches ‘Digital Ocean’


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

Why in News?

Union Minister for Science and Technology Harshvardhan on Monday launched the ‘Digital Ocean’ platform of Indian National Centre for Oceanic Information Services (INCOIS) here as a one stop-solution for all data related needs of a wide range of users, including research institutions, operational agencies, strategic users, academic community, maritime industry, and the public.


  • Digital Ocean platform can be banked upon to provide oceanographic data that will enhance the understanding of the oceans.
  • It is expected to improve and enhance ocean data acquisition and management as it possesses a set of applications that present heterogeneous oceanographic data with geospatial technology.
  • The platform will be key to the sustainable management of our oceans and expanding India’s ‘Blue Economy’ initiatives.
    • The Blue Economy is the “sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of the ocean ecosystem.”
  • The platform will also pave way for an online interactive web-based environment for data integration, 3D and 4D data visualization, data analysis to assess the evolution of oceanographic features obtained from multiple sources like on-site monitoring devices, remote sensing and model data.

What is INCOIS?

  • The mission of the Indian National Centre for Ocean Information Services is to provide ocean data, information and advisory services to society, industry, government and scientific community through sustained ocean observations, and constant improvements through systematic and focused research in information management and ocean modelling.
  • The ocean information and advisory services include
    • Potential Fishing Zone (PFZ) advisories,
    • Ocean State Forecast (OSF),
    • high wave alerts,
    • tsunami early warnings,
    • storm surge and oil-spill advisories, among others,
    • state-of-the-art technologies and tools to get real-time information on oceanographic and marine meteorological data.

Policy roll-back may dent banks’ health’


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

Why in news?

  • The Reserve Bank of India (RBI) in its Report on Trend and Progress of Banking in India has said that in the event of a policy rollback in the following year may hurt the balance-sheet of banks and non-banks.

Key Details:

  • The impact of COVID-19 pandemic on Indian economy made RBI permit moratorium on payment of instalments of term loans due between March 1, and May 31, which was further extended till August 31 by lending institutions.


  • The pandemic and the ensuing lockdown threw the economy off rails, sectors across the economy came to a standstill.
  • The suspension of business activities meant that the finances of banks and non-banks were stuck in a logjam.
  • To alleviate the impact of COVID-19, the RBI allowed lending institutions to grant a moratorium on payment of instalments of term loans.
  • The RBI report has stated that as per the data received up to the end of August suggests that borrowers accounting for about 40% of outstanding loans in the financial system (i.e banks and NBFCs) has taken shelter under the moratorium.
  • The data on gross non-performing assets (GNPA) of banks are yet to reflect the stress, concealed under the asset quality standstill with attendant financial stability implications.

Impact of the moratorium

  • A sample of banks was subjected to an analysis of published quarterly results which indicated that their GNPA ratios would have been higher, in the range of 0.10% to 0.66%, at end-September 2020 had it not been for the moratorium.
  • Banks’ gross non-performing assets ratio declined to 8.2% in March from 9.1% a year earlier, and to 7.5% at end-September.
  • The COVID-19 provisioning and ploughing back of dividends would help shield their balance sheets from emanating stress to a certain extent.

Futuristic steps.

  • The report hinted that a further recapitalization for adhering to regulatory standards and also for aiding growth would require adjustment of the common equity tier I (CET I) ratio for the banking system.
    • Common Equity Tier 1 (CET1) is a component of Tier 1 Capital, and it encompasses ordinary shares and retained earnings.
  • The report also revealed that the government had set aside ₹20,000 crores in the first supplementary demands for grants for capital infusion in public sector banks (PSBs) and they may take the option of raising resources from the market as an optimal capital raising strategy.

Non-Banking Financial Companies

  • The concerns regarding the profitability of NBFCs was flagged by the report. The profitability of NBFCs may be subdued in near future because of the loan impairment and lower credit demand. It was revealed that due to the moratorium extended and asset classification standstill, asset quality shored up.
  • However, it was noted that many NBFCs had made additional provisioning as per the expected credit loss norm; and bolstered their capital position by ploughing back dividends.


The RBI in its Report on Trend and Progress of Banking in India has called for a careful approach in handling the finances of the banks and the NBFCs, especially when the economy is showing signs of a slow recovery.

‘India can build on rural push, federalism, consumer base’


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

Why in News?

  • MNREGA, transfer payments helped spur demand says former Reserve Bank of India Governor Subbarao.

Key Details:

  • The COVID-19 and the lockdown that followed left a trail of economic devastation in most countries, India can potentially base its recovery on three positive aspects —
    • a push in the rural economy,
    • stronger federalism and
    • a huge consumption base.

A brief assessment

  • He is of the opinion that the challenge ahead of the Central government is to ensure economic growth and that growth is inclusive, with lower-income households too enjoying the benefits.
  • He also cited how the scaling up of MNREGA provided a lifeline and the frontloaded transfer payments to women, pensioners and farmers have helped revive demand in the economy.
  • The FCI (Food Corporation of India) which is often criticized for its inefficiency in procurement and wastage during storage, conducted brisk procurement as a part of government’s extended food security guarantee programme, this helped augment farmers’ incomes.
  • Mr Subbarao said India’s federalism has withstood the test of vigorous democracy though there were tensions between the Centre and the States on issues such as GST compensation.
  • He underlined the importance of increasing the consumption and said that in a setting like this, any increase in income of the bottom half will quickly turn into consumption spurring output, in turn.
  • He seemed to concur with economists who believed that the Indian economy was already in bad shape before the pandemic outbreak and the lockdown only made it worse.
  • The much talked about ‘V’ shaped recovery in growth rate should be taken with a pinch of salt.


  • The damage caused by the pandemic is there to be seen with contraction in growth for two successive quarters and also the fact that the Indian economy was already showing signs of slowdown prior to the coronavirus breakout, thus India must try to build on rural push, federalism, the consumer base for a quicker recovery.

The broken bonds of democracy


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

Why in news?

  • The ruling of the Central Information Commission has brought into focus the shortcomings of the Electoral Bond Scheme which facilitates political funding.

Key Details:

  • The CIC order upholding the State Bank of India’s claims of not having to release data for public disclosure under the Right To Information Act has exposed the opaqueness of the scheme.
  • The CIC has effectively turned its back on those seeking transparency in political funding, leaving no choice but to appeal to the apex court.

Electoral Bond Scheme

  • The Union budget in 2017 had a full section on reforms in political funding.
  • The budget introduced the Electoral Bond Scheme to check rampant “under-the-table cash transactions”.
  • The key motive behind EBS was to fight the infusion of black money. However, with controversial features like anonymity for donors and the corresponding removal of 7.5% limits for corporate donations.
  • This scheme has come under criticism from regional parties, civil society organisations, legal experts etc.

An illegal scheme

  • The scheme creates banking instruments for the donation of funds to political parties facilitated by the SBI.
  • It hides the identity of the donors along with the amount of donation. In effect, the scheme is opaque, promotes arbitrariness and is therefore deemed illegal.
  • The scheme helps in forming an unholy nexus between political parties and corporate donors
  • The scheme promotes and protects undisclosed quid pro quo arrangements between donors, who are likely to be corporates, and political parties
  • It is often said that the best practices of electoral democracy will revolve around transparency and accountability but this scheme endangers it.
  • The Supreme Court in the case People’s Union for Civil Liberties v. Union of India (2003), held that the fundamental right of a voter to secure information about the candidates who are contesting the election was implicit under freedom of speech and expression.
  • Therefore, the Electoral Bond Scheme is repugnant to the SC order in PUCL case.]

The CIC ruling

  • The CIC while adjudicating an appeal ruled that the State Bank of India (SBI) was under no legal compulsion to reveal any details about donors and donees relating to electoral bonds under the Right to Information (RTI) Act.
  • In doing so, CIC has relied on two grounds provided under Section 8 of the RTI Act, which exempts disclosure of information:
    1. that the information sought has been held in fiduciary capacity and
    2. that there was no public interest involved in the application.
  • Both these grounds can be challenged, an exemption provided under Section 8 should be read only in a very narrow sense.
  • Section 8(2) directs that when public interest takes precedence over any harm to protected interests, the information sought for may be accessed. Therefore, there are legally valid grounds to override the CIC ruling.
  • The public interest with regards to the EBS is very objective, taking the earlier order of CIC as a precedent which deemed political parties to be public authorities under the RTI Act.
  • The funds received by parties from donors would naturally be of interest to voters in order to understand their financing and functioning.
  • Donations by corporate entities would also be of interest to their shareholders and potential shareholders. Therefore, the failure of the CIC in appreciating the present issue as one of high public importance and resorting to technical objections defeats the objects of the RTI Act itself.

The final arbiter

  • The CIC order has effectively barred any requests for information under the Electoral Bond Scheme, leaving one with no other option but to seek the Supreme Court.
  • There is no other recourse but for the Supreme Court to determine the law with regard to the scheme and the interpretation of the CIC.
  • The Election Commission too has argued for in its counter-affidavit filed before the Supreme Court in 2017, n argued the case for declaration of donation received by political parties and also details about expenditure. ECI also stated that public disclosure of information is quintessential for better transparency and accountability in the election process

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