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  • 08-06-2021

E-booklet on 20 MoD reforms in 2020 (GS Paper 3 Defence) 

Context

Recently raksha Mantri released an E-booklet titled '20 Reforms in 2020', highlighting the major reforms undertaken by Ministry of Defence (MoD) in 2020.

Chief of Defence Staff & Department of Military Affairs

The appointment of India’s first Chief of Defence Staff (CDS) and creation of Department of Military Affairs (DMA) were among the major decisions taken by the Government. 

The post of CDS was created to increase efficiency & coordination among the Armed Forces and reduce duplication, while DMA was established to ensure improved civil-military integration. 

General Bipin Rawat was appointed as the first CDS who also fulfils the responsibilities of Secretary, DMA.

AatmaNirbharta in Defence

To promote ‘Make in India’ in defence sector, a list of 101 defence items was notified in August 2020, while Defence Acquisition Procedure 2020 was unveiled in September 2020. Rs 52,000 crore budget was earmarked for indigenously made defence equipment in 2020-21. 

Corporatisation of Ordnance Factory Board (OFB) was approved in May 2020 for greater efficiency and productivity. 

There was an unprecedented push towards new technology developments within India. Bharat Electronics Limited (BEL) developed a ventilator in record time to meet Covid-19 requirements in May 2020.

In November 2020, Quick Reaction Surface to Air Missile, indigenously designed & developed DRDO, hit bullseye at medium range and medium height, while indigenously built Pinaka rocket system cleared test of 45-60 km range.

Increased Defence Exports

The increased partnership with the private sector has led to a substantial rise in defence exports. 

The value of total defence exports rose from Rs 1,941 crore in 2014-15 to Rs 9,116 crore in 2019-20. 

Also, for the first time, India figured in the list of defence equipment exporting nations, as the exports expanded to more than 84 countries.

Modernisation & increased transparency in Defence Acquisition

In highest-ever thrust towards modernisation in last 10 years, there was 10 per cent budget increase in 2020-21 over the previous year. 

Policy reforms for increased transparency included launch of new Defence Acquisition Procedure in September 2020 and revision of DRDO Procurement Manual in October 2020. 

To encourage start-ups, a provision was introduced for procurement as Buy Indian-IDDM, while leasing for non-mission critical requirements was introduced for the first time.

Defence Acquisitions

First five Rafale fighter aircraft arrived in India in July 2020 and several more since then, adding firepower to the arsenal of the Indian Air Force. 

Despite the COVID-19 challenge, the aircraft were delivered timely and inducted into IAF.

Reforming Defence R&D

To promote innovation by young minds, five Young Scientists Laboratories of DRDO were launched in 2020 in Bengaluru, Mumbai, Chennai, Kolkata and Hyderabad. 

DRDO has joined hands with the private sector in design & development and identified 108 Systems & Subsystems for the industry to design, develop and manufacture.

Digital Transformation

For the first time, several organisations of Ministry of Defence went digital. 

Directorate General Quality Assurance (DGQA) started online Pre-Delivery inspection in May 2020 to address security threats, while Armed Forces Tribunal began digital hearing for the first time in August 2020. 

Defence Estates, Canteen Stores Department, services in Cantonment, MoD Pension and National Cadet Corps (NCC) also went online providing faster and transparent services.

Strengthening border infrastructure

Reforms of processes and workflows within Border Roads Organisation (BRO) enabled it to achieve targets ahead of schedule, in some instances.  

World’s longest Atal tunnel above 10,000 feet, at Rohtang on the Leh-Manali Highway was inaugurated by Prime Minister Shri Narendra Modi in October 2020. 

It provides all weather connectivity to the northern borders. 

Zojila pass, situated on the Srinagar-Kargil-Leh National Highway, was opened almost a month ahead of schedule in April 2020.

Stree Shakti in Armed Forces

In 2020, Ministry of Defence took some historic decisions to increase participation of women in the Armed Forces. 

Ten streams of Indian Army were opened for giving Permanent Commission to Short Service Commission (SSC) Women officers, while women pilots of Indian Navy were operationalised for the first time. 

All Sainik Schools were thrown open for girl students from academic session 2020-21.

Reforms in NCC

Expanding the reach of NCC to remote locations was a major announcement made by Prime Minister Shri Narendra Modi from the ramparts of Red Fort on Independence Day on August 15, 2020. 

More than 1,075 schools/colleges in border and coastal areas were identified and the enrolment began in November 2020. 

In another decision, it was decided to give preference to NCC cadets in employment in Central Armed Police Forces from May 2020. 

Youth Exchange Programme Allowance for NCC cadets was increased from Rs 100 per day to Rs 750 and the number of countries was increased from 10 to 15.

Aid to civil administration during COVID-19

Ministry of Defence and the Armed Forces have mobilised resources to aid the civil administration in fight against COVID-19. 

Armed Forces Medical Services (AFMS) provided all emergency support to tide over the situation. 

They have mobilised doctors, health professionals and set up Quarantine facilities at several locations across the country. 

DRDO has set up several hospitals to treat COVID patients across the states, passed on technology expertise to manufacture ventilators, oxygen plants, medicines, test kits and PPE kits to private sector for mass production.

Help beyond boundaries

The Armed Forces extended a helping hand to the countries in distress. 

Indian Navy mounted eight relief missions during 2020-21. 

Besides evacuating stranded Indians from Iran, Sri Lanka and Maldives under Vande Bharat Mission, Indian Naval ships provided Covid-19 medical relief, including medicines and doctors, to five countries. 

INS Airavat provided 270 MT foodaid to Sudan, Djibouti and Eritreastruck by natural calamities. 

The Indian Coast Guard led the rescue operation to save Sri Lanka coast of its biggest oil spill. 

Indian Air Force carried out over 800 relief missions during 2020-21.

Source: PIB

E-booklet on 20 MoD reforms in 2020

 

Swachh Bharat Mission Grameen - Phase 2 (GS Paper 3 Environment)

Context

Recently the Minister of State for Jal Shakti reviewed the progress of the Swachh Bharat Mission – Grameen (SBM-G) under the Department of Drinking water and Sanitation. 

The Mission has been making steady progress amidst the grave challenges posed by the ongoing COVID-19 Pandemic. 

The department, working against time and amidst the strict regulations that were imposed owing to the pandemic, promptly released the scheme guidelines in May 2020 and compiled manuals, brochures, advisories to support capacity and implementation at State level. 

Swachh Bharat Mission Grameen - Phase 2 

The phase -2 of SBM was announced by Prime Minister in February, 2020 i.e. just preceding the first COVID wave in India. 

The phase -1 concluded in October 2019 with grand declaration of the Nation as Open Defecation Free. 

The Phase -2 emphasizes upon the sustainability of achievements under phase -1 and to provide adequate facilities for Solid/Liquid & plastic waste management in rural India.

Despite facing several bottlenecks, the officials have been able to motivate and encourage States to prepare and submit annual implementation plans worth Rs 40,705 Crores. 

The same have been approved by the NSSC- National Scheme Sanctioning Committee. 

It is encouraging to note that within a short span of time, 1.1 Lakh villages have reported Solid and liquid waste management (SWM/LWM) works. 

Around 2.41 lac villages have reported Minimal litter and stagnant waste water. 

1249 villages have declared themselves as ODF plus, 53,066 community compost pits & 10.4 lacs household level SLWM assets have been constructed. 

Villages have also reported drainage works close to 1.60 lacs.

The targets for the year 2021-22 include construction of 51,05,534 IHHLs, SWM projects in 2,07,945 villages, grey water management in 1,82,517 villages, Plastic waste Management units in 2,458 blocks and 386 GOBAR-Dhan projects.

Swachh Bharat Mission Grameen Phase-1

The rural sanitation coverage in the country at the time of launch of SBM (G) on 2nd October, 2014 was reported as 38.7%.

More than 10 crore individual toilets have been constructed since the launch of the mission; as a result, rural areas in all the States have declared themselves ODF as on 2nd October, 2019.

Source: PIB

Swachh Bharat Mission Grameen - Phase 2

 

World Food Safety Day (GS Paper 2 Health)

Context

Union Minister for Health and Family Welfare virtually attended the Word Food Safety Day celebrations on 7th June 2021 organized by Food Safety and Standards Authority of India (FSSAI). 

Aim

The day is celebrated worldwide to draw attention and inspire action to help prevent, detect and manage foodborne risks, contributing to food security, human health, economic prosperity, agriculture, market access, tourism and sustainable development.

Theme 

This year’s World Food Safety Day theme – ‘Safe Food for a healthy tomorrow’, highlights that the production and consumption of safe food has immediate and long-term benefits for people, the planet and the economy.

Key Points

The World Health Organization (WHO) and the Food and Agriculture Organization of the United Nations (FAO) jointly facilitate the observance of World Food Safety Day, in collaboration with Member States and other relevant organizations. 

This international day is an opportunity to strengthen efforts to ensure that the food we eat is safe, mainstream food safety in the public agenda and reduce the burden of foodborne diseases globally.

The call to action for all key stakeholders on this year's World Food Safety Day is to ensure that the food we eat is safe and nutritious.

Food safety must be integrated along the entire food chain, from farm to table, with the three sectors — government, industry and consumers — with all the three sharing equal responsibility. 

It is also necessary that food safety forms an essential component of health-based nutrition policies and nutrition education. 

We aim to inspire action to help prevent, detect and manage foodborne risk and by doing so we shall be contributing towards food security, human health, economic prosperity, market access and sustainable development.

As food chains become longer, complex and globalized, contamination of food leading to food borne diseases is a growing concern, costing us almost 15 billion USD annually. By 2030, food borne diseases are expected to rise to 150 to 177 million annually.

With the resurgence of COVID-19 across the globe, there is a sharpened focus on safe food, nutrition, immunity and sustainability. 

It has become all the more important to focus on preventive healthcare as it minimizes the burden of diseases and helps in tackling the rising burden of diet-related diseases such as diabetes, hypertension, obesity and malnutrition.

Improving food safety requires sustained investments in several areas, from stronger regulations, to better laboratories for testing of food, more stringent enforcement of the regulations at the ground level, and surveillance along with training and capacity building of food handlers. 

The government’s flagship initiative ‘Eat Right India’ needs to be turned into a national movement in order to transform the food ecosystem of the country by ensuring safe, healthy and sustainable food for everyone.

Source: PIB

World Food Safety Day

 

What the G7 corporate tax deal means for India (Editorial GS Paper 2 International Institutions)

Context

Advanced economies making up the G7 grouping have reached a “historic” deal on taxing multinational companies. 

Finance ministers meeting in London agreed to counter tax avoidance through measures to make companies pay in the countries where they do business. 

They also agreed in principle to ratify a global minimum corporate tax rate to counter the possibility of countries undercutting each other to attract investments. 

The deal announced Saturday involving the US, the UK, Germany, France, Canada, Italy and Japan, is likely to be put before a G20 meeting in July.

What are the decisions taken?

The first decision that has been ratified is to force multinationals to pay taxes where they operate. 

The second decision in the agreement commits states to a global minimum corporate tax rate of 15% to avoid countries undercutting each other. 

The agreement will now be discussed in detail at a meeting of G20 financial ministers and central bank governors in July.

Why the minimum rate?

The decision to ratify a 15% floor rate follows from a declaration of war on low-tax jurisdictions around the globe announced by US Treasury Secretary Janet Yellen, who had urged the world’s 20 advanced nations to move in the direction of adopting a minimum global corporate income tax in April. 

The move to put a minimum rate in place attempted to reverse a “30-year race to the bottom” in which countries have resorted to slashing corporate tax rates to attract multinational corporations.

The US proposal had proposed a higher 21 per cent minimum corporate tax rate, coupled with cancelling exemptions on income from countries that do not legislate a minimum tax to discourage the shifting of multinational operations and profits overseas. 

One of the reasons the US pushed for this is purely domestic. 

It aims to somewhat offset any disadvantages that might arise from the Biden administration’s proposed increase in the US corporate tax rate. 

The proposed increase to 28% from 21% would partially reverse the previous Trump administration’s cut in tax rates on companies from 35% to 21% by way of a 2017 tax legislation. 

More importantly, the US proposal includes an increase to the minimum tax that was included in the Trump administration’s tax legislation, from 10.5% to 21% — the benchmark minimum corporate tax rate that Yellen has propounded for other G20 countries. This increase comes at a time when the pandemic is costing governments across the world.

A global pact on this issue, as enunciated by Yellen, works well for the US government at this time. 

The same holds true for most other countries in western Europe, even as some low-tax European jurisdictions such as the Netherlands, Ireland and Luxembourg and some in the Caribbean rely largely on tax rate arbitrage to attract MNCs.

The proposal also has some degree of support from the IMF. While China is not likely to have a serious objection with the US call, an area of concern for Beijing would be the impact of such a tax stipulation on Hong Kong — the seventh-largest tax haven in the world and the largest in Asia, according to a study published earlier this year by the advocacy body Tax Justice Network. 

Plus, China’s frayed relationship with the US could be a deterrent in negotiations on a global tax deal.

Who are the targets?

Apart from low-tax jurisdictions, the proposal for a minimum corporate tax are tailored to address the low effective rates of tax shelled out by some of the world’s biggest corporations, including digital giants such as Apple, Alphabet and Facebook, as well as major corporations such as Nike and Starbucks. 

These companies typically rely on complex webs of subsidiaries to hoover profits out of major markets into low-tax countries such as Ireland or Caribbean nations such as the British Virgin Islands or the Bahamas, or to central American nations such as Panama.

The US Treasury loses nearly $50 billion a year to tax cheats, according to the Tax Justice Network report, with Germany and France also among the top losers. 

India’s annual tax loss due to corporate tax abuse is estimated at over $10 billion, according to the report.

What are the problems with the plan?

Apart from the challenges of getting all major nations on the same page, especially since this impinges on the right of the sovereign to decide a nation’s tax policy, the proposal has other pitfalls. 

A global minimum rate would essentially take away a tool that countries use to push policies that suit them. 

For instance, in the backdrop of the pandemic, IMF and World Bank data suggest that developing countries with less ability to offer mega stimulus packages may experience a longer economic hangover than developed nations. 

A lower tax rate is a tool they can use to alternatively push economic activity. Also, a global minimum tax rate will do little to tackle tax evasion.

Where does India stand?

In a bid to revive investment activity, Finance Minister Nirmala Sitharaman on September 21, 2019 announced a sharp cut in corporate taxes for domestic companies to 22% and for new domestic manufacturing companies to 15%. 

The Taxation Laws (Amendment) Act, 2019 resulted in the insertion of a section (115BAA) to the Income-Tax Act, 1961 to provide for the concessional tax rate of 22% for existing domestic companies subject to certain conditions including that they do not avail of any specified incentive or deductions. 

Also, existing domestic companies opting for the concessional taxation regime will not be required to pay any Minimum Alternate Tax.

This, along with other measures, was estimated to cost the exchequer Rs 1.45 lakh crore annually. 

The cuts effectively brought India’s headline corporate tax rate broadly at par with the average 23% rate in Asian countries. 

China and South Korea have a tax rate of 25% each, while Malaysia is at 24%, Vietnam at 20%, Thailand at 20% and Singapore at 17%. 

The effective tax rate, inclusive of surcharge and cess, for Indian domestic companies is around 25.17%.

Source: Indian Express

What the G7 corporate tax deal means for India