Daily Current Affairs for 7th August 2021

GS PAPER I

Major Dhyan Chand Khel Ratna award

Why in news

The most honour award in sports, Rajiv Gandhi Khel Ratna Award, has now been renamed as ‘Major Dhyan Chand Khel Ratna Award’.

Major Dhyan Chand

• Major Dhyan Chand was the first champion of hockey, considered a wizard or magician of the game.
• He was the chief protagonist as India won three consecutive Olympic hockey gold medals, Amsterdam 1928, Los Angeles 1932, and Berlin 1936.
• He was born on 29^th August, 1905. This day celebrated as ‘National Sports Day’ with the President giving away the Arjuna Awards and the other honours.

Rajiv Gandhi Khel Ratna Award

• The Khel Ratna award was instituted in 1991-1992.
• The first recipient of the award was Chess legend Viswanathan Anand.
• Among the other winners were Leander Paes, Sachin Tendulkar, Dhanraj Pillay, Pullela Gopichand, Abhinav Bindra, Anju Bobby George, Mary Kom and Rani Rampal in 2020.
• As of 2020, the award comprises a medallion, a certificate, and a cash prize of ₹25 lakh.

Other awards related to sports

• Maulana Abul Kalam Azad Trophy: It is awarded by the President of India each year to a university which has all round best performance in sports at Inter-University, National and International competitions.
• Arjuna Award: The Arjuna Awards are given by the Ministry of Youth Affairs and Sports, government of India to recognize outstanding achievement in National sports. Instituted in 1961, the award carries a cash prize of Rs 500,000, a bronze statue of Arjuna and a scroll.
• Dronacharya Award: Dronacharya Award is given to coaches as recognition for their contribution to a particular sport or for their role in an athlete’s rise to the top.
• Rashtriya Khel Protsahan Puruskar: Award given for promotion and development of sports in the country.

GS PAPER II

Right to use mother’s surname

Why in News

Recently, the Delhi High Court observed that every child has a right to use their mother’s surname and the father does not own the child to dictate that she should use only his surname.

Key Points

• During the course of hearing, the counsel appearing on behalf of the petitioner father however insisted on the use of his name in the documents as his name in the documents as his daughter’s surname and not the mother’s.
• During the hearing, the man’s counsel submitted that his daughter is minor and cannot decide on such issues on her own and that the child’s surname was changed by his estranged wife.
• He claimed that the change in name will make it difficult to avail insurance claims from the insurance firm as the policy was taken in the name of the girl with her father’s surname.
• The court, which declined to allow the plea, disposed of the petition with a liberty to the man to approach his daughter’s school to show his name as the father.

GS PAPER II

India, Sri Lanka and Maldives on security

Why in News

India, Sri Lanka and the Maldives have agreed to work on “four pillars” of security cooperation, covering areas of marine security, human trafficking, counter­terrorism, and cyber security, in a recent virtual meeting of top security officials of the three countries.

Key Points

• The Deputy National Security Adviser level meeting was hosted online by Sri Lanka
• The discussion comes nine months after National Security Adviser visited Colombo for deliberations with Secretary to Sri Lanka’s Ministry of Defence and Defence Ministry of Maldives, in which the three countries agreed to expand the scope of intelligence sharing.
• Their meeting marked the revival of NSA­level trilateral talks on maritime security in the Indian Ocean Region after a gap of six years.
• Following up on that, the Deputy NSA­level meeting identified “four pillars” of cooperation in Marine Safety and Security, Terrorism and Radicalisation, Trafficking and Organised Crime, and Cyber security.
• The ‘Colombo Security Conclave’ among the three neighbouring countries seeks to “further promote” maritime security in the Indian Ocean Region, and was initiated by President of Sri Lanka in 2011.
• The initiative, grounded in military and security collaboration, assumes significance in the region, in the wake of the current geostrategic dynamic that India shares with Sri Lanka and the Maldives.

Engagement with Quad

• On the other hand, the Maldives’s engagement with members of the India United States­Japan­Australia grouping, known as the ‘Quad’, has been growing over the last year, especially in the area of defence cooperation.
• The Ibrahim Mohamed Solih government signed a ‘Framework for a Defence and Security Relationship’ agreement with the United States last year, an initiative that India welcomed.
• In November 2020, the Maldives received a Japanese grant of $7.6 million for the Maldivian Coast Guard and a Maritime Rescue and Coordination Center.
• Meanwhile, Male’s foreign policy choices are increasingly being challenged by sections, mostly opposition groups, wary of “Indian boots on the ground”.

GS PAPER II & III

Taxation Laws (Amendment) Bill, 2021

Why in News

Recently, Taxation Laws (Amendment) Bill, 2021 has been passed in the Lok Sabha.

Key Points

• The ‘Taxation Laws (Amendment) Bill, 2021′ buries a controversial tax law that put Centre in an ugly legal spat with companies like Cairn and UK’s telecom giant Vodafone.
• The ‘Taxation Laws (Amendment) Bill, 2021′ aims to refund Rs 8,100 crore collected in a 2012 retrospective tax law on indirect transfer of Indian assets prior to May 28, 2012.
• “The Bill proposes to amend the Income-tax Act, 1961 so as to provide that no tax demand shall be raised in future on the basis of the said retrospective amendment for any indirect transfer of Indian assets if the transaction was undertaken before 28th May, 2012.
• The new Bill seeks to nullify tax demands raised in 17 disputes, subject to riders. Conditions for dropping the tax claims include withdrawal of pending litigation and dropping of claim for cost, damages, interest, etc., by the disputing party.
• For amicable settlement of disputes, the government will also refund amount paid in these cases without any interest.

Retrospective Tax

• A retrospective tax is a tax imposed on a transaction or deal that was conducted in the past.
• It was introduced in a 2012 amendment to the Finance Act, which enabled imposition of retrospective tax on deals executed after 1962 involving transfer of shares in a foreign entity which had assets in India.
• Ideally, retrospective tax is to make adjustments when policies in the past and the present are so vastly different that tax paid before under the old policy could be said to have been less.
• Retrospective tax could correct that situation by charging tax under the existing policy.
• Not only India, but many other countries like the US, UK, Australia, Netherlands, Belgium, Canada, and Italy have retrospectively taxed firms.

Need to remove ‘Retrospective Tax’

• In 2007, Vodafone acquired Hutch for an $11 billion deal through an overseas holding company.
• India sent a notice to the UK telecom company saying it should have withheld tax on the purchase and sought Rs 11,218 crore, later added Rs 7,900 crore in penalties.
• Vodafone challenged the notice in Supreme Court and subsequently, the judgment favoured the company.
• The government then amended the tax law retrospectively, providing a legal framework for the government’s demand. It involved the sales or transfer of shares taking place outside India but the underlying assets were located in India.
• This nullify a verdict of the Supreme Court, which had held that Vodafone could not be taxed for a purchase of a 67 percent stake in Hutchison Whampoa for $11 billion in 2007.
• Now, the country stands at a juncture when quick recovery of the economy after the COVID-19 pandemic is the need of the hour and foreign investment has an important role to play in promoting faster economic growth and employment.
• So, this bill was tabled in the Parliament.

Significance of Taxation Laws (Amendment) Bill, 2021

• By introducing this bill, it will end long-pending disputes with foreign firms such as Vodafone Plc., Carine Energy, etc.
• This bill is investors friendly and also brings to an end messy litigation and arbitration, especially with Cairn, which has seen the company staking claim to India’s overseas assets.

GS PAPER III

RBI Monetary Policy

Why in News

The RBI decided to keep Monetary Policy remain unchanged and maintain status quo by keeping interest rates unchanged.

Key Points

• Currently, the repo rate is 4% and reverse repo rate is 3.35%.
• The policy stance continues to be “accommodative”. The MPC has retained its GDP growth projection of 9.5 percent for FY22.
• The panel has also raised the inflation target for fiscal 2001-22 but maintained the growth forecast at 9.5%.

Inflation target hiked

• The RBI panel has hiked the inflation target for fiscal 2021-22 to 5.7% from 5.1% projected earlier.
• With crude oil prices at elevated levels, a calibrated reduction of the indirect tax component of pump prices by the Centre and states can help to substantially lessen cost pressures.
• CPI inflation is now projected at 5.9% in Q2, 5.3% in Q3 and 5.8% in Q4 of 2021-22, with risks broadly balanced. Retail inflation for Q1 of 2022-23 is projected at 5.1%.

RBI Monetary Policy

• Monetary policy is the macroeconomic policy laid down by the central bank.
• It involves management of money supply and interest rate and is the demand side economic policy used by the government of a country to achieve macroeconomic objectives like inflation, consumption, growth and liquidity.
• It aimed at managing the quantity of money in order to meet the requirements of different sectors of the economy and to increase the pace of economic growth.
• The RBI implements the monetary policy through open market operations, bank rate policy, reserve system, credit control policy, moral persuasion and through many other instruments.
• Using any of these instruments will lead to changes in the interest rate, or the money supply in the economy.
• Monetary policy can be expansionary and contractionary in nature. Increasing money supply and reducing interest rates indicate an expansionary policy. The reverse of this is a contractionary monetary policy.

Reserve Bank of India

• The Reserve Bank of India (RBI) is the central bank of India, established on 1^st April, 1935, under the Reserve Bank of India Act.
• The Reserve Bank of India uses monetary policy to create financial stability in India, and it is charged with regulating the country’s currency and credit systems.
• The main purpose of the RBI is to conduct consolidated supervision of the financial sector in India, which is made up of commercial banks, financial institutions, and non-banking finance firms.