Commerce ministry provides relaxations in filing compliance report to SEZs

Paper: III

For Prelims: Special Economic Zone.

For Mains: Indian economy and issues resources related to planning and mobilisation of resources.

Context of News:

  • The commerce ministry on March 30th announced certain relaxations in filing compliance reports for units and developers of special economic zones (SEZs) as most of the government offices are closed due to the nationwide lockdown amid the corona virus outbreak.
  • Finance minister also said no punitive action should be taken in cases where any compliance is not met during this period.

What kind of Relaxation is provided in filing compliance report to SEZs?

  • Compliances to which the relaxations will apply include the requirement to file quarterly progress report attested by independent chartered engineers, and filing of annual performance reports by SEZ units.
  • Extension of Letters of Approval (LoAs) will be facilitated for those developers/co-developers who are in the process of developing and operationalising the SEZ; units which are likely to complete their 5-year block for NFE (net foreign exchange) assessment.
  • It also said that if possible, all extensions of LoAs and other compliances may be facilitated through electronic mode.

About Special Economic Zone (SEZ):

  • An SEZ is an enclave within a country that is typically duty-free and has different business and commercial laws chiefly to encourage investment and create employment.
  • Apart from generating employment opportunities and promoting investment, SEZs are created also to better administer these areas, thereby increasing the ease of doing business.
  • SEZs, developed as export hubs, are treated as a foreign territory in terms of customs laws. These zones enjoy certain incentives including a single-window clearance system.
  • SEZs are treated as foreign territory for tax purposes even though they are located within a country’s borders. Supplies into SEZs are exempt from paying GST because they are considered as exports
  • Objectives of the SEZ:
  • Generation of additional economic activity.
  • Promotion of exports of goods and services.
  • Promotion of investment from domestic and foreign sources.
  • Creation of employment opportunities; e) Development of infrastructure facilities.

Reasons for this Decision:

  • Lockdown Impact:
  • In view of the sudden outbreak of the pandemic and the nationwide lockdown, most government offices are closed and a few involved in emergency services are functioning with skeletal staff.
  • The Department of Commerce has therefore decided to provide suitable relaxations on compliances to be met by units/ developers/ co-developers of SEZs

Criticism of Special Economic Zone:

  • Since SEZs offer a wide range of incentives and tax benefits, it is believed that many existing domestic firms may just shift base to SEZs.
  • There is a fear that the promotion of SEZs may be at the cost of fertile agricultural land affecting food security, loss of revenue to the exchequer and cause uneven growth with adverse effects.
  • Apart from food security, water security is also affected because of the diversion of water use for SEZs.
  • SEZs also cause pollution, especially with the release of untreated effluents. There has been a huge destruction of mangrove in Gujarat affecting fisheries and dairy sectors.
  • SEZs have to be promoted but not at the cost of the agricultural sector of the country. It should also not affect the environment adversely.

Way Forward:

  • Looking at the lockdown ,economy is hard hit .Government has taken right step but with this progressive step should come with timely exploration of other possibilities to take export on apex level, if corona virus threat subsidises in coming days.
  • The SEZ’s could drastically improve the economic activity in the country, make the country’s export competitive and globally noticeable, be net foreign exchange earner and provide immense employment opportunity. But this should not be done at the cost of bringing down the agricultural activities, Land grabbing and real estate mafia should be properly regulated so that the common man is not the net sufferer to get the net foreign exchange earner up and running.


The business of breathing

Paper: II

For Mains: Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources.

Context of News:

  • As India is about to enter third stage of fight against corona virus epidemic, India braces for community spread of the novel corona virus and a spike in hospital admissions, the government is seeking to ramp up its capacity of ventilators.
  • A large number of ventilators may potentially be required soon, and the Railways-owned Integral Coach Factory (ICF) has made an attempt to “reverse engineer” the machines. Private sector carmakers with no experience in this line too, have climbed on to the bandwagon.

What are ventilators, and why are they important in the outbreak?

  • Different types of ventilators deliver air in different modes.To make a ventilator, one has to have core knowledge of the clinical aspects of the ventilator and the requirements of the doctors using them. These requirements have to then be converted into engineering components that can achieve the required outputs.
  • Ventilators are a combination of technologies — not only software and electronics, but also pneumatics, as they handle gases. They are also required to adhere to safety standards, and include a mechanism to minimise the risk to the patient in the event the device malfunctions.
  • Based on the mechanism used to deliver the air (flow-delivery mechanism), there are three major classifications for ventilators:
  • Bellow-driven or piston ventilators
  • Turbine ventilators.
  • External compressed air driven ventilators.

Does India have enough ventilators?

  • According to estimates put out by Johns Hopkins University, Center for Disease Dynamics, Economics and Policy, and Princeton University, the demand for ventilators in India is expected to surge to 1 million by July 2020, while the availability is between 30,000 and 50,000. Going by the current rates, more than 400 million Indians are likely to be infected by July. At the peak, 700,000 to 1,200,000 people are likely to need ICU care.
  • This is a situation of India that could foresee. Around 40,000 ventilators are available in the market and 1,500 have been supplied by all vendors in the past fortnight. These are good numbers. But, if we reach a situation like Italy or China, we will need 10 times more. Various company making 30-40 ventilators a month, and can ramp up to 300 a month if local components were available.
  • According to industry sources, only about 10% of ventilators in use in India are manufactured in the country. The pandemic has affected global supply chains, even as demand has surged everywhere.

What does it take to build a ventilator?

  • The main challenge for most manufacturers is that components have to be imported from Europe and China, where the pandemic has restricted production. India does not make even small components like resistors, capacitors and diodes, which we have to import.
  • Ventilator manufacturers across the country indicate their inability to ramp up production in such a short time with export restrictions on medical devices in major supplier countries. The possible solution is to produce basic ventilators using indigenous design and components.
  • Big automobile companies have been urged to help health sector with funds or a proposal for a vendor development department. The government has assured  of faster customs clearances for importing needful components of ventilators. Agreeing that localisation of components and sharing of design can enhance production capacity.

Way Forward:

  • India is fully dependent on import of ventilators, While a patient needs ventilator only in the last stage, those with underlying lung conditions and smokers who get infected with corona virus may require it early. Going by the experience of Italy and the US, we must be prepared for any eventuality.
  • Most ventilators in India are either imported or assembled using imported components. To reduce the number of patients who will need intensive care and ventilators, those severely infected must not be treated alongside people with symptoms in the preliminary stages.
  • It is vital for the government to direct local manufacturers to mass produce ventilators so that we do not face a situation like Italy where people died for want of treatment.

What is being sprayed on migrants, is it safe?

Paper: II

For Mains: Government Policies and Interventions for Development in various sectors and Issues arising out of their Design and Implementation.

Context of News:

  • In a shocking incident, a group of migrant workers, which also included women and children, were ‘disinfected’ by spraying to sanitise these workers.
  • These sanitizing spray contained harmful chemicals like sodium hypochlorite solution. Sodium hypochlorite is commonly used as a bleaching agent, and also to sanitise swimming pools.

Is the chemical safe?

  • As a common bleaching agent, sodium hypochlorite is used for a variety of cleaning and disinfecting purposes. It releases chlorine, which is a disinfectant. The concentration of the chemical in the solution varies according to the purpose it is meant for.
  • Large quantities of chlorine can be harmful. Normal household bleach usually is a 2-10% sodium hypochlorite solution. At a much lower 0.25-0.5%, this chemical is used to treat skin wounds like cuts or scrapes. An even weaker solution (0.05%) is sometimes used as a hand wash.
  • Swallowing hypochlorite or contact with the skin or eyes produces injury to any exposed tissues. Exposure to gases released from hypochlorite may cause burning of the eyes, nose, and throat; cough; and damage to the airway and lungs. Generally, the more serious the exposure, the more severe the symptoms.

Uses of Sodium hypochlorite:

  • Sodium hypochlorite, commonly known as bleach, is most frequently used as a disinfecting agent. It is a broad-spectrum disinfectant that is effective for the disinfection of viruses, bacteria, fungi, and mycobacterium. However, sodium hypochlorite is NOT effective in the disinfection of bacterial spores and prions.
  • Sodium Hypochlorite is the main ingredient in laundry bleach. It is used extensively as a bleaching agent in the textile, detergents, and paper and pulp industries. It is also used as an oxidizing agent for organic products. In the petrochemical industry, sodium hypochlorite is used in petroleum products refining.

Concentration of disinfectant used in the spray in various places:

  • Sodium hypochlorite is used to sanitize places in the districts, including the bus stand where the migrants were given a bathe. The bus station was sanitized because it had seen big crowds of migrants over the past two-three days.
  • In Delhi, officials have said a 1% sodium hypochlorite solution was used in the spray applied on migrant workers’ belongings. The concentration in other places, including those used on buildings or vehicles, is not very clear.
  • A 1% solution can cause damage to the skin of anyone who comes in contact with it. If it gets inside the body, it can cause serious harm to lungs. Sodium hypochlorite is corrosive, and is meant largely to clean hard surfaces. It is not recommended to be used on human beings, certainly not as a spray or shower. Even a 0.05% solution could be very harmful for the eyes.

Way Forward:

  • In the Name of disinfecting these poor and vulnerable migrants is unacceptable. Amid pandemic like this, there can’t be more shameful and lower points than this. It also reminds us of our thinking towards lower strata people. This utter shameful act and those involves in this act should not let walk free easily.
  • Incidents like these should be not be entertained. 21 days lockdown has already hit these low skilled people and incidents like these is just increasing their wound and suffering.