GS PAPER: II

Supreme Court upholds repeal of J&K’s special status

Why in the news?

• Recently a constitution bench led by chief justice of India D.Y Chandrachud upheld the power of president to abrogate special status of Jammu and Kashmir under article 370 leading to reorganization of the full-fledged state to two union territories and removal of the privileges.

Supreme Court’s verdict on Article 370 in nutshell:

• President’s order (CO 273) abrogating the special status of Jammu and Kashmir upheld.
• Article 370 is a temporary provision.
• J&K retained no sovereignty.
• CO 272 (which changed the definition of ‘J&K Constituent Assembly’ as ‘J&K Legislative Assembly’) is invalid. But this is of no consequence since the Court held that the President can declare 370 inoperative even without any recommendation of J&K Constituent Assembly.
• Court did not decide whether the conversion of J&K as State was invalid since Union undertook to restore the statehood to J&K as soon as possible. Court upholds the creation of Ladakh UT.
• Court directs that elections to the J&K Assembly be held by September 30, 2024.
• Justice Kaul recommends that a Truth and Reconciliatory Commission be set up to investigate and report on the human rights violations by both State and non-State actors carried out in Kashmir valley since 1980s.

SC directs restoration of Statehood to J&K

• The court directed for the Union to restore the statehood of J&K as soon as possible but left the issue of the reorginazation of J&K into Union Territory (UT) open. Further, the reorganisation of Ladakh as UT was upheld.
• “The power of the President under Article 370(3) to issue a notification that Article 370 ceases to exist subsists even after the dissolution of the J&K Constituent Assembly,” the top judge said, adding that the recommendation of the Constituent Assembly was not binding on the President. He added that the J&K Constituent Assembly was intended to be a temporary body.
• When the constituent assembly ceased to exist, the special condition for which Article 370 was introduced ceased to exist but the situation in the state remained and thus the article continued.
• The Apex Court had reserved the judgment in the matter on September 5, 2023 after hearing it for sixteen long days. It may be recalled that the petitioners in the matter had also challenged the J&K Reorganization Act which bifurcated the State into Union Territories of J&K and Ladakh.

GS PAPER – III

COP28 draft agreement drops phase-out of fossil fuels

Why in the news?

• According to a draft of key climate document by 2025, all countries must have in place a detailed plan to adapt to the current and future impacts of climate change in their countries, and must demonstrate progress in implementing such A draft agreement from the UN’s COP28 climate summit has dropped references to the phase-out of fossil fuels, triggering a backlash from countries that accuse Saudi Arabia and other petro states of thwarting efforts to tackle global warming.

About the document

• The document, which will have to be agreed on by almost 200 countries at the summit in Dubai, sets out a range of actions that countries “could” take to cut greenhouse gas emissions to net zero by 2050.
• This includes reducing “consumption and production of fossil fuels, in a just, orderly and equitable manner so as to achieve net zero [carbon emissions] by, before, or around 2050 in keeping with the science”.
• But a large number of countries are hoping the final text will go further by striking a landmark agreement to phase out fossil fuels, rather than just presenting the choice to cut their consumption and production.
• The draft text, published by the UN climate body, faces fierce opposition from countries in the EU and small island states, as well as the UK.

COP28 draft agreement: Actions optional

• Triple renewable energy capacity globally and double the global average annual rate of energy efficiency improvements by 2030.
• Rapid phase down of unabated coal and limits on permitting new and unabated coal power generation Accelerated efforts globally towards net zero emissions energy systems, using zero and low carbon fuels well before or by around mid-century.
• Accelerating zero and low emissions technologies, including renewables, nuclear, abatement and removal technologies, including such as carbon capture and utilisation and storage, and low carbon hydrogen production, to enhance efforts in substitution of unabated fossil fuels .
• Reducing both consumption and production of fossil fuels, in a just, orderly and equitable manner, so as to achieve net zero by, before, or around 2050 in keeping with the science.
• Accelerating and substantially reducing non-CO₂ emissions, including, in particular, methane emissions globally by 2030.
• Accelerating emissions reductions from road transport through a range of pathways, including development of infrastructure and rapid deployment of zero and low-emission vehicles.
• Phase out of inefficient fossil fuel subsidies that encourage wasteful consumption and do not address energy poverty or just transitions, as soon as possible.

GS PAPER – III

Fiscal outlook for States seen favourable

Why in news?

• According to an RBI report the overall fiscal outlook for States remains favourable in FY24, with adequate fiscal space for undertaking higher capital expenditure, in view of the resilient domestic economic activity and their consolidation efforts.

• On the revenue side, even though the growth in tax revenue during H1 (April-September) 2023-24 at 14.6 per cent is marginally lower than the budgeted 17.9 per cent, it is expected to improve during H2 (October-March) 2023-24 due to a favourable base and continued robust GST collection.

Revenue expenditure

• On the expenditure side, growth in revenue expenditure during the year so far (H1:2023-24) at 8.9 per cent is much lower than the full-year budget estimate of 18 per cent and provides space for undertaking higher capex, while persevering with fiscal consolidation.
• The debt-GDP ratio of States peaked at 31 per cent at end-March 2021 and declined to 27.5 per cent by end-March 2023, supported by fiscal consolidation. At the individual level, the debt-GDP ratio for some States remains high.
• At a disaggregated level, the debt to GDP ratio could exceed 25 per cent (average of debt-GDP ratio from 2015-16 to 2019-20) as at end-March 2024 (BE) for 25 States/ UTs.

Reversion of OPS

• The officials said reversion to the old pension scheme (OPS) by a few States and some States budgeting for fiscal deficit exceeding 4 per cent of GSDP (gross state domestic product) in FY24 pose challenges to fiscal sustainability over the medium term and need to be addressed.
• The report highlighted that around 79 per cent of SGS (State government securities) will mature during next 10 years, implying higher rollover risk for State governments.
• The officials suggested that own tax revenue to GSDP ratio of the States, which has stagnated around 6-7 per cent in the last decade, can be enhanced by the introduction of new taxes, rationalisation in the rates and bases of existing taxes, and improvement in tax administration and collection.

Tax mop-up

• In direct tax collections, they underscored that the States can raise more revenues through higher stamp duty and registration fees, as pointed out by the Fifteenth Finance Commission (FC -XV).
• The report noted that among indirect taxes, States Goods and Services Tax (SGST) collections, which account for more than 40 per cent of own tax revenue, have improved in recent years. In this context, a reduction in the number of slabs, along with adjustments in rates, can improve efficiency and collection.
• The officials observed that there is also significant scope for mobilising resources through non-tax revenues, which have remained around 1 per cent of GDP in the last 10 years and pale in comparison to a ratio of 10 per cent or more in countries such as Singapore, Egypt and Iran.
• The most important non-tax revenue sources are: (i) lease/sale of natural resources, like minerals; (ii) user charges on economic/social services provided by the government such as irrigation, electricity, health, education, forestry and wildlife; (iii) lotteries; and (iv) interest receipts from loans extended to entities like public sector undertakings (PSUs) and local bodies.

GS PAPER – II

Mohan Yadav as new CM of Madhya Pradesh

Why in news?

• In a surprise move, the Bharatiya Janata Party elected former education minister and three-time MLA Mohan Yadav the new chief minister of Madhya Pradesh, spelling the end of the Shivraj Singh Chouhan era in the state.

About Mohan Yadav political carrier

• He is a three-time MLA from Ujjain South and a prominent leader of OBCs, who account for more than 48 per cent of the state’s population.
• He first became a minister in 2020 when the BJP came back to power following the collapse of the Congress government led by Kamal Nath.
• He began his political career as joint secretary of Madhav Science College Ujjain in 1982 and was later elected as its president in 1984. Yadav holds a doctorate (PhD) besides LLB and MBA degrees.
• Yadav has been associated with the RSS since his young days and from 1993 to 1995, he was its functionary in Ujjain city, said an office-bearer of the Hindutva organisation.
• Elected as an MLA for the first time in 2013 from Ujjain South, Yadav served as chairman of the Madhya Pradesh Tourism Development Corporation (MPTDC) from 2011-13. He was re-elected from the seat in 2018 and again in 2023.
• Yadav, the higher education minister in the Shivraj Singh Chouhan government, defeated his nearest rival, Congress candidate Chetan Yadav, by margin of 12,941 votes in the November 17 polls.
• In 2021, Yadav had announced to include the lessons of Hindu epic Ramcharitmanas as an elective (optional) course under the philosophy subject for first-year students of graduation (BA).
• He had also moved a proposal to rename the Hindi nomenclature of the vice-chancellor’s post in state universities from ‘kulpati’ to ‘kulguru’.
• Yadav is the first leader to become chief minister from the temple town of Ujjain where Prime Minister Narendra Modi had dedicated the newly-constructed Mahakal Lok corridor last year.