CPEC

Why in news?

China has rejected accusations that its financial backing for the China Pakistan Economic Corridor (CPEC) was a “debt trap” that could compromise Islamabad’s sovereignty has billed the Gwadar to Kashgar corridor as the flagship of China-led Belt and Road Initiative.

Details

• Mounting a robust defence of its ‘no-strings-attached’ backing for CPEC, China’s visiting Foreign Minister Wang Yi asserted during an Islamabad press conference on Saturday that among the 22 projects within the framework of CPEC, 18 involved investment and aid and only four of them used concessional loan. He stressed that nine of these projects have already been completed and 13 are under construction.
• He also clarified that only $19 billion had been invested in the CPEC, which had generated 70,000 new jobs.
• During the first phase, the CPEC’s focus has been on energy and infrastructure projects. It was now up to the Pakistani side to drive the trajectory of the “next phase” of the undertaking, Mr. Wang said.

About CPEC

• The China–Pakistan Economic Corridor is an all-weather economic corridor comprising a collection of projects currently under construction at a cost of $54 billion.
• CPEC aims to facilitate trade along an overland route that connects Kashgar (Xinjiang Uyghur Autonomous Region, China) and Gwadar (Balochistan, Pakistan), through the construction of a network of highways, railways, optical fiber and pipelines.
• It is considered to be an extension of China’s ambitious One Belt, One Road initiative, and the importance of CPEC to China is reflected by its inclusion as part of China’s 13th five-year development plan.

Rajiv case convicts

Why in news?

A meeting of the Tamil Nadu Cabinet, chaired by Chief Minister Edappadi K. Palaniswami recommended to Governor Banwarilal Purohit that all seven life convicts in the former Prime Minister Rajiv Gandhi assassination case be released under Article 161 of the Constitution.

• The decision followed the Supreme Court’s observation that the Governor shall be at liberty to decide on the remission application of Perarivalan, one of the convicts, “as deemed fit.”
• The convicts — Nalini, T. Suthendraraja alias Santhan, Sriharan alias Murugan (Nalini’s husband), A.G. Perarivalan alias Arivu, Robert Payas, S. Jayakumar alias Jayakumaran, and Ravichandran alias Ravi — have been in jail for over 27 years. Santhan, Murugan, Payas and Jayakumar are Sri Lankan Tamils.
• In April 2018, a Presidential order issued through the Ministry of Home Affairs turned down the State government’s proposal, mooted in February 2014 and March 2016, to release the convicts.
• Earlier, in December 2015 in Union of India v/s V. Sriharan @ Murugan & Others, the court had held that “the expression “consultation” ought to be read as concurrence and primacy must be accorded to the opinion of the Central Government in matters covered under clauses (a), (b) and (c) of Section 435(1) of the Cr.P.C [concerning State government having to act after consultation with the Centre in certain cases, as provided under Code of Criminal Procedure].”

What is the advice of advocate general?

• Governor had “unfettered power” under Article 161 of the Constitution to decide on their release.
• Governor could take an independent view of the matter, notwithstanding the Centre’s rejection of the earlier proposal of the Tamil Nadu government to release the convicts.
• Article 161 deals with the power of the Governor to grant pardons and to suspend, remit or commute sentences in certain cases.

About Article 161

• Article 161 of Constitution of India deals with Power of Governor to grant pardons, etc., and to suspend, remit or commute sentences in certain cases.
• The Governor of a State shall have the power to grant pardons, reprieves, respites or remissions of punishment or to suspend, remit or commute the sentence of any person convicted of any offence against any law relating to a matter to which the executive power of the State extends.

Verdict has inbuilt firewall

• Within the pages of the Supreme Court judgment decriminalising homosexuality contains a safeguard against any attempts by governments, present and future, to enact laws to make homosexuals criminals again.
• The five-judge Constitution Bench led by Chief Justice of Dipak Misra has introduced the “Doctrine of Progressive Realisation of Rights” to guard against future attempts to reintroduce that part of Section 377 of the Indian Penal Code which had made the entire LGBTQ community “unconvicted felons” without the basic rights of a citizen for over a century.
• Using this legal doctrine, Chief Justice Misra has held that once a right is recognised and given to the public, it cannot be taken back by the state at a later date. Once a step is taken forward, there is no going back.
• The doctrine of progressive realisation of rights mandates that the laws of a country should be in consonance with its modern ethos, it should be “sensible” and “easy to apply”.
• “The state has an obligation to take appropriate measures for the progressive realisation of economic, social and cultural rights,” Chief Justice Misra wrote.
• “The ‘doctrine of progressive realisation of rights’, as a natural corollary, gives birth to the doctrine of non-retrogression.
• As per this doctrine, there must not be any regression of rights. The doctrine of non-retrogression sets forth that the State should not take measures or steps that deliberately lead to retrogression on the enjoyment of rights either under the Constitution or otherwise.
• Chief Justice Misra notes that the Supreme Court went wrong in 2013 in the Suresh Koushal judgment, which set aside the brief reprieve offered by the historic Delhi High Court judgment on Section 377 in 2009 and placed the yoke of criminality back on the LGBTQ community.

Finance Ministry to engage with States to shore up GST revenue

Why in news?

Alarmed by a nearly fourfold rise in GST compensation to States for June-July, the Finance Ministry is crafting a strategy to shore up tax revenues and engaging with States to identify issues hindering their collections.

• Finance Secretary Hasmukh Adhia has started meeting GST officers, both from Central and State tax departments, in the State capitals to understand issues plaguing GST collections.
• There has been a spike in the bi-monthly GST compensation paid to the States by the Centre.
• The Centre paid ₹14,930 crore to compensate States for revenue loss incurred in June and July, a nearly four-fold jump compared to the ₹3,899 crore paid for the months of April and May.
• A strategy is to be devised to shore up GST revenues. The amount of compensation to be paid to each State varies every month and there is no set pattern.
• The reason for increased compensation also varied from State to State. For instance, in one of the cases, a State saw a huge outgo on account of VAT refund following a court verdict, the official added.
• A discussion to shore up revenues has already happened with four States — Punjab, Himachal Pradesh, Puducherry and Jammu and Kashmir, while a dialogue with Bihar and Uttarakhand is slated to take place later this month.
• The official said that one of the options being considered is stepping up anti-evasion measures with a focus on top 30 taxpayers.

SEBI norms

Why did SEBI’s new norms spook FPIs?

• In April, the Securities and Exchange Board of India (SEBI) had issued a circular barring Resident Indians (RIs), Non Resident Indians (NRIs), Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs) from managing foreign funds.
• The Asset Managers’ Roundtable of India (AMRI) said the circular had ended up placing a blanket ban on investments through funds managed by overseas citizens of India (OCIs), PIOs, NRIs and warned of a potential outflow of $75 billion from the Indian equity markets over the issue.

What did the circular say?

• It said RIs, NRIs, PIOs and OICs cannot be the beneficial owner (BO) of a fund investing in India.
• A BO is one who directly or indirectly derives the benefits of ownership.
• The threshold for a BO in a partnership firm or trust is 15% and 25% in the case of companies. The threshold is further reduced to 10% if the fund is incorporated in a high-risk nations with a history of money-laundering and terrorism, etc.
• In case no single entity meets these thresholds, then a senior managing official of the FPI is the designated BO.
• NRIs and OCIs can only obtain an FPI licence on condition that they limit their roles to investment advisors and do not invest their money. The regulator had asked Category II and III FPIs to disclose the name and address of the BOs, their tax residency jurisdiction along with percentage shareholding capital or profit ownership in the FPIs.
• Category II FPIs largely include regulated institutions, persons, broad-based funds and university, pension and endowment funds.
• Any single FPI can hold a shareholding limited to 10% in an Indian listed company. If the limit is breached, the BO must either opt to be treated as a Foreign Direct Investor, or divest stake below 10% within five trading sessions of the breach of limit. The order comes into effect by December.

Why FPIs important ?

FPIs have been major investors in the Indian stock market.

What can FPIs do?

• Foreign funds with majority holding of NRIs, PIOs, OCIs and RIs will look for alternative structures, to avoid beneficial ownership breach, or unwind their positions.

What was SEBI’s motive?

• Though the regulator has not explicitly stated the reason, concerns over money-laundering and round tripping may have prompted this directive.

Why are FPIs unhappy?

• Foreign portfolio investors (FPIs) are currently allowed to invest up to 10% in a single listed Indian company. According to SEBI’s circular, their total investment in all the investee companies put together cannot exceed this limit.
• Second, as of now, economic ownership has been the basic criteria for determining the BO of an offshore fund. This means an entity owning a majority stake in a fund is considered a BO. But according to the circular, the regulator asked FPIs to determine ownership based on both shareholding and control.
• Third, SEBI has said that high-risk nations would be subject to more rigorous know your customer (KYC) norms. However, in a positive development for FPIs, a SEBI-appointed panel on Saturday suggested a few amendments to the circular.

What has the panel suggested?

The SEBI-appointed panel has made key suggestions.

• NRIs, OCIs and RIs be allowed to manage foreign funds that invest in India subject to certain holding limits.
• A single NRI, OCI or RI cannot hold more than 25% of the assets under management of the FPI and the aggregate holding of such entities has to be below 50% in the foreign portfolio investment.
• Changes have been suggested regarding identification of senior managing officials of FPIs and for beneficial owners of listed entities.
• Centre has told SEBI that it need not use beneficial owner definition laid down under PMLA.
• SEBI asked to consult Centre to evolve a more objective criteria for defining high-risk jurisdictions.

Heritage tag for 2 irrigation facilities in Telangana

Why in news?

A meeting of the International Executive Council, the highest decision making body of International Commission on Irrigation and Drainage (ICID), at Saskatoon in Canada last month has accepted Telangana government’s nomination of Sadarmatt anicut across river Godavari in Nirmal district and Pedda Cheruvu in Kamareddy district in the ICID Register of Heritage Irrigation Structures.

Sadarmatt anicut

• It was constructed during 1891-92 across Godavari river on the left arm on downstream of Sriram Sagar Project near Medampally village in Nirmal.
• It was built by Nawab Ikbal-ud-Dowla who bore the tile of Vicar-ul-Umrah Bahadur about 50 km downstream of the Sri Ram Sagar Project (SRSP) and is chiefly fed by Sawrnavagu stream.
• The anicut was constructed only for irrigation purpose to provide water to 13,100 acres of land. While major crop being irrigated under Sadarmatt is paddy (contributing 80% of irrigated area), the other crops include maize and turmeric.

Pedda Cheruvu

• The Pedda Cheruvu (big tank in Telugu) was built in 1897 during the rule of Mir Mahaboob Ali Khan, the sixth Nizam of Hyderabad State.
• This tank was taken up under the second round of Mission Kakatiya to be developed as a mini tank bund with an estimated outlay of ₹ 6.6 crore.

About International Commission on Irrigation and Drainage (ICID)

• The ICID is a Technical and Voluntary Not-for-profit, International NGO, dedicated to enhance the world-wide supply of food and fibre for all people by improving water and land management, and the productivity of irrigated and drained lands.
• In recognition of its significant contribution to the programs and objectives of International Year of Peace proclaimed by the UN General Assembly, on 15 September 1987 ICID was designated as a Peace Messenger by the UN Secretary General.
• The ICID By-laws have been enacted its International Executive Council for the due implementation of the provisions of the Constitution of the Commission. It is headquartered in New Delhi.
• ICID has been involved in the global discussions leading to Agenda 21, World Water Vision, World Water Forums etc., which have become the focal point of several of its technical activities.

‘Pondicherry shark’

Why in news?

Researchers recently spotted ‘Pondicherry shark’, an endangered species protected under the provisions of the Wildlife (Protection) Act, in the East Godavari River Estuarine Ecosystem region.

Details

• Known as ‘Pala Sora’ in the local parlance, the Pondicherry Shark is on the verge of extinction even according to the conventional fishermen.
• The International Union for Conservation of Nature (IUCN) has listed the Pondicherry shark as Critically Endangered.
• The shark is among the 25 “most wanted lost” species that are the focus of Global Wildlife Conservation’s “Search for Lost Species” initiative.

Snow leopard

Why in news?

Officials from Himachal State Wildlife Department have spotted snow leopard in Lippa-Asra wildlife sanctuary in Kinnaur district of Himachal Pradesh. This finding indicates that snow leopards are inhabiting new areas.

Details

• In India, their geographical range encompasses a large part of the western Himalayas including the states of Jammu and Kashmir, Himachal Pradesh, Uttarakhand and Sikkim and Arunachal Pradesh in the eastern Himalayas.
• They are listed as Vulnerable on the IUCN Red List of Threatened Species.
• They inhabit alpine and subalpine zones at elevations from 3,000 to 4,500 m (9,800 to 14,800 ft). In the northern range countries, they also occur at lower elevations.
• The snow leopard is the state animal of Uttarakhand and the National Heritage Animal of Pakistan.
• Their habitat extends through twelve countries: Afghanistan, Bhutan, China, India, Kazakhstan, Kyrgyzstan, Mongolia, Nepal, Pakistan, Russia, Tajikistan, and Uzbekistan. China contains as much as 60% of all snow leopard habitat areas.
• The snow leopard, like all big cats, is listed on Appendix I of the Convention on International Trade of Endangered Species (CITES), which makes trading of animal body parts (i.e., fur, bones and meat) illegal in signatory countries. It is also protected by several national laws in its range countries.