Current Affairs 2 July 2021 – IAS Current Affairs

Current Affairs 2 July 2021 focuses on Prelims-Mains perspective. Major events are :

Financial Stability Report By RBI

Source : Indian Express
Indian Economy

What is discuss under Financial Stability Report By RBI ?

1. About the Order
2. How it helps

Why in News ?

The Reserve Bank of India (RBI) released the 23rd issue of its Financial Stability Report (FSR).

Key Facts

• Gross non-performing asset (GNPA) ratio
  • India’s Scheduled Commercial Banks (SCBs) may climb by the end of the current fiscal year to as much as 11.2%

    

    under a severe stress scenario, from 7.48% in March 2021.

  • However, have sufficient capital, both at the aggregate and individual level, even under stress.
  • For private banks and foreign banks, the transition of the NPA ratio from baseline to severe stress is from 5.82 per cent to 6.04 per cent to 6.46 per cent, and from 4.90 per cent to 5.35 per cent to 5.97 per cent.
  • This shows there are incipient signs of stress in the micro, small and medium enterprises (MSMEs) and retail segments.
• Capital to risk-weighted assets ratio (CRAR)
  • Increased to 16.03% and the provisioning coverage ratio (PCR) stood at 68.86% in March 2021.
  • Banks respond to credit demand in a recovering economy, they will need to reinforce their capital and liquidity positions to fortify themselves against potential balance sheet stress
• Impact of second wave of COVID-19
  • Dented economic activity, but monetary, regulatory and fiscal policy measures have helped curtail the solvency risk of financial entities, stabilise markets, and maintain financial stability,
  • Write-offs as a percentage of GNPA at the beginning of the year, fell sharply as compared to 2019-20, except for private banks.

Ordinance Prohibiting Strikes By Defence Services

Source : Economic Times
Security Forces

What is discuss under Ordinance Prohibiting Strikes By Defence Services ?

1. Essential Defence Services Ordinance 2021
2. Right to form associations or unions 

Why in News ?

The government came out with an ordinance prohibiting any agitation and strike by anyone engaged in the essential defence services. 

Key Facts

• The Essential Defence Services Ordinance 2021 comes in the backdrop of the announcement by major federations of the Ordnance Factory Board (OFB) to go on indefinite strike from the later part of next month in protest against the government’s decision to corporatise the OFB.
• Details of Notification
  • Employees involved in the production of defence equipment, services and operation or maintenance of any

    

    industrial establishment connected with the military as well as those employed in repair and maintenance of defence products will come under the purview of the ordinance.

  • Any person, who commences a strike which is illegal under this Ordinance or goes or remains on, or otherwise takes part in, any such strike, shall be punishable with imprisonment for a term which may extend to one year or with fine which may extend to Rs 10,000 or both.
  • Anyone instigating or inciting others to take part in a strike declared illegal under the Ordinance shall also be punishable with imprisonment for a term which may extend up to two years besides prescribed fines.
• Background
  • Government recently approved long-pending proposal to restructure Ordnance Factory Board that operates 41 ammunition and military equipment production facilities into seven state-owned corporate entities.
  • This aims to improve its accountability, efficiency and competitiveness.
  • There will be no change in service conditions of nearly 70,000 employees of the organisation and that the decision is driven by efforts to boost India’s defence manufacturing sector.
• Ordinance will extend to the whole country services linked to the production of goods or equipment required for any purpose connected with defence will come under its purview.

Ordinance Prohibiting Strikes By Defence Services & Right to form associations or unions 

• Right to form associations or unions  is not available to every Indian.
• Article 33 of the Constitution gives Parliament the power to modify the fundamental rights of the members of the
  • Armed Forces
  • Intelligence services
  • Those employed in the telecommunication systems
• It is for ensuring the proper discharge of their duties and for the maintenance of discipline among them.
• The legislations governing the Armed Forces and central police forces restrict the members fundamental right to form a trade union, to attend or address any political demonstration and to communicate with the press.
• The state governments, too, have restricted these fundamental rights of police personnel.
• Instances across the globe
  • Many European countries permit military personnel to form associations to deal collectively with matters affecting their living and working conditions.
  • Trade unionism is an integral part of the Dutch military.
  • South Africa, the General Regulation of 1999 provides for organisational rights of military trade unions.
  • They have limited freedom of speech and do not have the right to strike.

India Joins OECD/G20 Inclusive Framework Tax Deal

Source : PIB
International Relation

What is discuss under India Joins OECD/G20 Inclusive Framework Tax Deal ?

1. Key Facts
2. India’s Stand

Why in News ?

Majority of the members OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (including India) adopted a high-level statement containing an outline of a consensus solution to address the tax challenges arising from the digitalisation of the economy.

Key Facts

• The proposed solution consists of two components

  

  1. About reallocation of additional share of profit to the market jurisdictions.
  2. Consisting of minimum tax and subject to tax rules.
• The principles underlying the solution vindicates India’s stand for a greater share of profits for the markets, consideration of demand side factors in profit allocation, the need to seriously address the issue of cross border profit shifting and need for subject to tax rule to stop treaty shopping.
• What is India’s Stand ?
  • India is in favour of a consensus solution which is simple to implement and simple to comply.
  • At the same time, the solution should result in allocation of meaningful and sustainable revenue to market jurisdictions, particularly for developing and emerging economies.
  • India will continue to be constructively engaged for reaching a consensus based ready to implement solution with Pillar one and Pillar two as a package by October and contribute positively for the advancement of the international tax agenda.

Freight Smart Cities Initiative

Source : Indian Express
Logistics Infrastructure

What we discuss under Freight Smart Cities Initiative ?

1. Need for Freight Smart Cities Initiative
2. How it plans ?

Why in News ?

Commerce Ministry’s Logistics Division unveils plans for Freight Smart Cities, also launches portal and handbook with 14 key measures to enhance urban freight systems.

• The concept of Freight Smart Cities to improve the efficiency of urban freight and create an opportunity for reduction in the logistics costs.

Key Facts

• Need for Freight Smart Cities Initiative
  • With growing urbanisation, requirements of rapid economic growth including e-commerce and associated first and last mile freight movements increasing congestion, noise and sound pollution in the Indian cities is a menace affecting both public health and local economies.
  • The Logistics Division under the Ministry of Commerce and Industry has decided to work in a planned manner to improve the city freight movement.
  • Demand for urban freight is expected to grow by 140 per cent over the next 10 years.
  • Freight movement in Indian cities is currently responsible for 50 per cent of total logistics costs in India’s growing e-commerce supply chains.
  • Improving city logistics would also enable efficient freight movement and bring down the logistics costs boosting all sectors of the economy.
• Launched the website on Freight Smart Cities.
• Also released a handbook outlining 14 measures that can be taken to improve urban freight. 
• 14 measures presented in the handbook represent high-leverage areas for cities to improve their economic competitiveness and reduce congestion and pollution.

How it plans ?

• State Governments to identify ten cities to be developed as Smart Cities.

  

• Also to set up institutional mechanism for the same involving the Government as well as Private stakeholders like Logistics services providers, users and citizens.
• The States/City Governments to focus on the quick-wins like developing peri-urban freight centres, night-time deliveries, developing truck routes, using Intelligent Transportation Systems & modern technologies, Promoting electrification of urban freight , Parcel delivery terminals etc.
• City-level logistics committees would be formed.
• These committees would have related government departments and agencies at the local level, state and from the reacted central ministries and agencies.
• These would also include private sector from the logistics services and also users of logistics services.
• These committees would co-create City Logistics Plans to implement performance improvement measures locally.
• On the Freight smart city initiatives, the Logistics Division is working closely with GIZ (Germany) under Indo-German Development Cooperation, Rocky Mountain Institute (RMI) and RMI India.
• A challenge is expected to be announced to encourage the participation of cities in this initiative.

International Migrant Workers Report By ILO

Source : ILO
Human Resource

What is discuss under International Migrant Workers Report By ILO ?

1. Details in the Report
2. International Labour Standards on Migrant workers

Why in News ?

New report by International Labour Organization (ILO) Global Estimates on International Migrant Workers : Results and Methodology released recently.

• It shows that in 2019 international migrant workers constituted nearly five per cent of the global labour force.
• This making them an integral part of the world economy.

Key Facts

• The number of international migrant workers globally has risen to 169 million.

  

• The share of youth migrant workers (aged 15-24) has also increased, by almost 2 per cent, or 3.2 million, since 2017.
• Related risk
  • Many migrant workers are often in temporary informal or unprotected jobs.
  • This expose them to a greater risk of insecurity, layoffs and worsening working conditions.
  • The COVID-19 crisis has intensified these vulnerabilities particularly for women migrant workers and have limited access to social protection and fewer options for support services.
• Majority of migrant workers
  • Two-thirds of international migrant workers are concentrated in high-income countries.
  • Of the 169 million international migrant workers, 63.8 million (37.7 per cent) are in Europe and Central Asia.
  • 43.3 million (25.6 per cent) are in the Americas.
  • Arab States, and Asia and the Pacific each host about 24 million migrant workers, which, in total, correspond to 28.5 per cent of all migrant workers.
  • In Africa there are 13.7 million migrant workers, representing 8.1 per cent of the total.
  • Majority of workers 99 million are men, while 70 million are women.
• Women Issue
  • Women face more socio-economic obstacles as migrant workers.
  • They are more likely to migrate as accompanying family members for reasons other than finding work.
  • They can experience gender discrimination in employment and may lack networks.
• Youth representation in the work force
  • Share of youth among international migrant workers has increased, from 8.3 per cent in 2017 to 10.0 per cent in 2019.
  • This increase is likely to be related to high youth unemployment rates in many developing countries.
  • The large majority of migrant workers (86.5 per cent) remain prime-age adults (aged 25–64).
• Sector wise status
  • Majority delivering essential jobs in critical sectors like health care, transportation, services, agriculture and food processing.
  • 66.2 per cent of migrant workers are in services, 26.7 per cent in industry and 7.1 per cent in agriculture.
  • Men migrant workers are more present in industry.

International Labour Standards on Migrant workers

ILO standards on migration provide tools for both countries of origin and of destination to manage migration flows and ensure adequate protection for this vulnerable category of workers.

• Migration for Employment Convention
  • Ratifying states to facilitate international migration for employment by establishing and maintaining a free assistance and information service for migrant workers.
  • Also taking measures against misleading propaganda relating to emigration and immigration.
  • Includes provisions on appropriate medical services for migrant workers and the transfer of earnings and savings. 
  • States should porovide at par in respect to a number of matters, including conditions of employment, freedom of association and social security.
• Migrant Workers (Supplementary Provisions) Convention
  • Measures to combat illegal migration while at the same time setting forth the general obligation to respect the basic human rights of all migrant workers.
  • Extends the scope of equality between legally resident migrant workers and national workers.
  • It is to ensure equality of opportunity and treatment in respect of employment and occupation, social security, trade union and cultural rights, and individual and collective freedoms for persons.

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