DAILY CURRENT AFFAIRS IAS | UPSC Prelims and Mains Exam – 7th October 2023

Syllabus

• Prelims –DEFENSE

Context: The second edition of the Indian Navy’s Naval Innovation and Indigenization Seminar, Swavlamban 2.0, took place in Delhi recently.

Background:-

• The event will unveil the Autonomous Weaponized Boat Swarms for the Indian Navy.

About Swavlamban 2.0:-

• Date: 4th and 5th October 2023.
• Venue: New Delhi.
• Maiden edition of the seminar: July 2022.
• Naming: the term”Swavlamban” signifies self-reliance or self-sufficiency in Hindi.
• “Swavlamban 2.0” is an updated indigenization roadmap aimed at fostering self-reliance in technological capabilities. (Military Exercises)
• Objective: to showcase the Navy’s achievements in developing new technologies and outline the course for future developments.
• It is the Naval Innovation & Indigenisation Organisation’s (NIIO) annual seminar.
• Niche technologies are being progressed across the spectrum, including:-
  • Blue-green lasers for underwater application
  • Autonomous weaponised swarms and
  • Underwater swarm drones
  • Multiple firefighting aid
  • Introduction of Artificial Intelligence (Al) for various uses
  • Development of an ultra-endurance small drone for maritime missions.
• 75 prototypes of these will be showcased during “Swavlamban-2023”.
• This will include a live demo of a few promising technologies.

Historic Background:-

• The Hon’ble Prime Minister launched the 75 challenges for the start-ups/ MSMEs as a part of the ‘SPRINT’ initiative.
• The ‘SPRINT Challenges’, are aimed at giving a boost to the usage of indigenous technology in the Indian Navy, and the Navy is committed to developing at least 75 technologies/ products as part of the ‘Azadi ka Amrit Mahotsav’.
• SPRINT is a collaborative initiative being undertaken in conjunction with the Defence Innovation Organisation (DIO) and stands for Supporting Pole-Vaulting in R&D through Innovations for Defence Excellence (iDEX), NIIO and Technology Development Acceleration Cell (TDAC).

Significance:-

• It aims to reduce dependence on foreign technologies and promote domestic innovation.
• It aligns with efforts to involve Micro, Small, and Medium Enterprises (MSMEs) and start-ups in developing futuristic technologies that meet global standards at a more economical cost.

MUST READ: New Naval Ensign (flag) for the Indian Navy

SOURCE: FINANCIAL EXPRESS

PREVIOUS YEAR QUESTIONS

Q.1) With reference to Home Guards, consider the following statements: (2023)

1. Home Guards are raised under the Home Guards Act and Rules of the Central Government.
2. The role of the Home Guards is to serve as an auxiliary force to the police in the maintenance of internal security.
3. To prevent infiltration on the international border/ coastal areas, the Border Wing Home Guards Battalions have been raised in some states.

How many of the above statements are correct?

1. Only one
2. Only two
3. All three
4. None

Q.2) Recently, India signed a deal known as ‘Action Plan for Prioritization and Implementation of Cooperation Areas in the Nuclear Field’ with which of the following countries? (2019)

1. Japan
2. Russia
3. The United Kingdom
4. The United States of America

Syllabus

• Prelims –ECONOMY

Context: The Union Finance Minister Nirmala Sitharaman will chair the 52nd GST Council meeting in New Delhi recently.

About GST Council:-

• The GST Council is a constitutional body established under Article 279A of the Indian Constitution.
• It is a joint forum of the Centre and the states to discuss issues relating to GST.
• GST is one of the biggest indirect tax reforms in the country.
• It has subsumed indirect taxes like excise duty, Value Added Tax (VAT), service tax, luxury tax, etc.
• The 101st Amendment Act of 2016 (122nd Amendment Bill), paved the way for the implementation of GST.

Salient features of GST Council:-

• Article 279-A: gives the President the authority to appoint a GST Council by executive order.
• Members: The members of the Council include the Union Finance Minister (chairperson), and the Union Minister of State (Finance) from various states.
• Chairperson: The GST Council is chaired by the Union Finance Minister.
• Functions:-
• As per Article 279, is meant to make recommendations to the Union and the states on important issues related to GST.
• These include the goods and services that may be subjected or exempted from GST and model GST Laws.
• It also decides on various rate slabs of GST.

MUST READ: GST- Five years on

SOURCE: AIR

PREVIOUS YEAR QUESTIONS

Q.1) Which of the following situations best reflects “Indirect Transfers” often talked about in media recently with reference to India? (2022)

1. An Indian company investing in a foreign enterprise and paying taxes to the foreign country on the profits arising out of its investment
2. A foreign company investing in India and paying taxes to the country based on the profits arising out of its investment
3. An Indian company purchases tangible assets in a foreign country and sells such assets after their value increases and transfers the proceeds to India
4. A foreign company transfers shares and such shares derive their substantial value from assets located in India

 Q.2) What is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’? (2017)

1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.
2. It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its foreign exchange reserves.
3. It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future.

Select the correct answer using the code given below:

1. 1 only
2. 2 and 3 only
3. 1 and 3 only
4. 1, 2 and 3

Syllabus

• Prelims –Medieval History

Context: As per recent announcements, Chhatrapati Shivaji Maharaj’s ‘wagh nakh’ will be brought back to Maharashtra from a London museum.

About the story of Shivaji’s Wagah Nakh:-

• The wagh nakh is a medieval claw-like dagger, designed to either fit over the knuckles or be concealed under the palm.
• It literally means ‘tiger claws’.
• It was used across the Indian subcontinent.
• The weapon consisted of four or five curved blades affixed to a glove or a bar of some kind.
• It was a weapon used for personal defense or stealth attack, and could easily slice through skin and flesh.
• The most famous use of the wagh nakh in history comes from the story of Afzal Khan’s killing by
• Shivaji used to be a former vassal of the Adil Shahis but by the 1650s, he had become increasingly assertive, taking forts across the Konkan, and bringing under control large swathes of Adil Shahi territory.
• Given Afzal Khan’s success in the south, he sent the Sultan, with a mighty army, to subdue the Maratha icon.
• Khan marched into the Konkan and demanded a meeting with Shivaji.
• In the meeting, Khan, in the guise of embracing him, attempted to stab the Maratha leader.
• But Shivaji was protected by his armour and retaliated: the wagh nakh ripped out Khan’s guts.
• Khan would eventually be beheaded by one of Shivaji’s men and in the battle that followed, Shivaji’s army came out as victor.

About Chhatrapati Shivaji Maharaj:-

• Birth: 1630.
• Death:1680.
• Shivaji was the founder of the Maratha Kingdom.
• He was born to Shahaji Bhonsle, a Maratha general who held the jagirs of Pune and Supe under the Bijapur Sultanate and Jijabai.
• He was crowned as the king of the Marathas on 6th June 1674, at Raigad.
• He took on the titles of Chhatrapati, Shakakarta, Kshatriya Kulavantas, and Haindava Dharmodhhaarak.
• He was known as the Father of the Indian Navy.
• He was the first to realize the importance of having a naval force, and therefore he strategically established a navy and forts at the coastline to defend the Konkan side of Maharashtra.
• He was a secular ruler, accommodating of all religions.
• He had numerous Muslim soldiers in his army.
• Shivaji was a dependable supporter of women and their honour.
• He had a council of ministers (Asht Pradhan) to advise him on the matters of the state but he was not bound by it.
• He was called the ‘Mountain Rat’ and was widely known for his guerrilla warfare tactics.

Important Battles by Shivaji:-

• Battle of Pratapgad, 1659: Fought at the fort of Pratapgad, between the forces of the Maratha king Chhatrapati Shivaji Maharaj and the Adilshahi general Afzal Khan.
• Battle of Pavan Khind, 1660: Fought at a mountain pass in the vicinity of Fort Vishalgad, between the Maratha Sardar Baji Prabhu Deshpande and Siddi Masud of Adilshahi.
• Sacking of Surat, 1664: Fought near the city of Surat, Gujarat, between Chhatrapati Shivaji Maharaj and Inayat Khan, a Mughal captain.
• Battle of Purandar, 1665: fought between the Mughal Empire and Maratha Empire.
• Battle of Sinhagad, 1670: Fought on the fort of Sinhagad near the city of Pune, Maharashtra between Tanaji Malusare, a commander of Maratha ruler Shivaji Maharaj, and Udaybhan Rathod, fortkeeper under Jai Singh I who was a Mughal Army Chief.
• Battle of Kalyan, 1682-83: Bahadur Khan of the Mughal Empire defeated the Maratha army and took over Kalyan.
• Battle of Sangamner, 1679: Fought between the Mughal Empire and Maratha Empire.
• This was the last battle in which the Maratha King Shivaji fought.

MUST READ: The Sword of Chhatrapati Shivaji Maharaj

SOURCE: THE INDIAN EXPRESS

PREVIOUS YEAR QUESTIONS

Q.1) With reference to medieval India, which one of the following is the correct sequence in ascending order in terms of size? (2021)

1. Paragana – Sarkar – Suba
2. Sarkar – Paragana – Suba
3. Suba – Sarkar – Paragana
4. Paragana – Suba – Sarkar

Q.2) Consider the following events in the history of India: (2020)

1. Rise of Pratiharas under King Bhoja
2. Establishment of Pallava power under Mahendravarman – I
3. Establishment of Chola power by Parantaka – I
4. The Pala dynasty founded by Gopala

What is the correct chronological order of the above events, starting from the earliest time?

1. 2-1-4-3
2. 3-1-4-2
3. 2-4-1-3
4. 3-4-1-2

Syllabus

• Prelims –ENVIRONMENT AND ECOLOGY

Context: The government is preparing an inventory of land use and other activities adjacent to the Kolleru Wildlife Sanctuary.

Background:-

• The Wildlife Division of the Andhra Pradesh Forest Department is all set to prepare an inventory of land use and other activities adjacent to the Kolleru Wildlife Sanctuary for declaring it an eco-sensitive zone (ESZ) for the conservation of the Kolleru Lake ecosystem.

About Kolleru Wildlife Sanctuary:-

• Location: Andhra Pradesh.
• Area: approximately 308 square kilometers.
• Kolleru Bird Sanctuary is a significant wetland and bird sanctuary located in the state.
• It is situated between the Krishna and Godavari river basins.
  • Krishna River
  • Source: It originates near Mahabaleshwar (Satara) in Maharashtra.
  • It is the second biggest river in peninsular India after the Godavari River.
  • The Godavari river:-
  • Source: Godavari River rises from Trimbakeshwar near Nasik in Maharashtra.
  • It is the largest Peninsular river system.
  • It is also called the Dakshin Ganga.
• It is centered around Kolleru Lake, which is the main water body within the sanctuary.
• Kolleru Lake, was first officially acknowledged for its ecological significance in 1953.
• It is a critical habitat for both resident and migratory birds.
• It serves as a wintering ground for thousands who visit from various parts of the world.
  • Migratory birds: flamingos, pelicans, storks, herons, ibises, and many more.
  • Resident birds: storks and spot-billed pelicans also inhabit the area year-round.
• Bird Sanctuary Status: in 1999, Kolleru received formal recognition as a Bird Sanctuary under India’s Wild Life Protection Act of 1972.
• Ramsar Site: In 2002, Kolleru Lake was designated as a Ramsar Wetland of International Importance under the Ramsar Convention.
• Important Bird Area (IBA): It regularly supports more than 50,000 waterfowl, due to which it was selected as an Important Bird Area (IBA).
• Flora: water hyacinth, water lilies, duckweed, and various types of algae, grasses, shrubs, tamarind, neem, palm trees, etc.
• Fauna: Indian mongoose and Indian jackal, lizards, Indian pythons, Indian Golden Gecko etc.

MUST READ: Atapaka Bird Sanctuary

SOURCE: THE HINDU

PREVIOUS YEAR QUESTIONS

Q.1) Consider the following statements: (2023)

1. In India, the Biodiversity Management Committees are key to the realization of the objectives
2. of the Nagoya Protocol.
3. The Biodiversity Management Committees have important functions in determining access and benefit sharing, including the power to levy collection fees on the access of biological resources within its jurisdiction.

Which of the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Q.2) Recently, there was a proposal to translocate some of the lions from their natural habitat in Gujarat to which one of the following sites? (2017)

1. Corbett National Park
2. Kuno Palpur Wildlife Sanctuary
3. Mudumalai Wildlife Sanctuary
4. Sariska National Park

Syllabus

• Prelims –ENVIRONMENT AND ECOLOGY

Context: Recent studies show that two of five amphibians are threatened with extinction due to climate change.

Key Highlights of the report:-

• Habitat loss, diseases, and climate change are majorly deteriorating the status of vertebrates.
• Climate change is the new driver pushing the amphibian population towards extinction.
• Climate change was the primary threat for only 1 percent of amphibian species whose conservation status in the International Union for Conservation of Nature (IUCN) Red List of Threatened Species worsened between 1980 and 2004.
• But since then, it has emerged as the primary threat for 39 percent of species.
• Two of every five amphibians were threatened with extinction.
• Amphibians were also found to be particularly vulnerable, with 7 percent of the species being globally threatened – the highest for any species.
• The status of amphibians, according to the latest Red List, continues to be deteriorating globally, especially for salamanders of which three of every five species are threatened.
• Disease and habitat loss drove 91 percent of status deteriorations between 1980 and 2004.
• The highest concentration of threatened species was mapped to be located in India’s Western Ghats, Sri Lanka, Madagascar, Caribbean islands, tropical Andes, Mesoamerica, and the mountains and forests of western Cameroon and eastern Nigeria. (Wildlife Institute of India (WII))
• Other geographic locations of high concentrations included the Atlantic Forest biome of southern Brazil, central and southern China, and the southern Annamite Mountains of Vietnam.
• The second most threatened group of vertebrates included cycads which faced 69 percent threat.
• Sharks and rays faced 37.4 percent threat, conifers faced 34 percent, reef-building corals 33.4 percent, mammals 26.5 percent, and reptiles 21.4 percent.
• Dragonflies, birds, and cone snails faced 16 percent, 12.9 percent, and 6.5 percent threats respectively.

About Amphibians:-

• Amphibians come in a range of sizes.
• The smallest is a frog known as Paedophryne amanuensis from New Guinea, which is the size of a housefly.
• The largest is the Chinese Giant Salamander which can grow to six feet in length and weigh 140 pounds.
• They are Ectothermic (cold-blooded).
• They live on both land and water.
• They are Vertebrates.
• They can smell, see, and hear.
• They have 4 legs except for some salamanders and caecilians.
• They have teeth but swallow their prey whole.
• They have lungs and permeable skin.
• They are carnivorous.

MUST READ: Jerdon’s narrow-mouthed frog (Uperodon montanus)

SOURCE: DOWN TO EARTH

PREVIOUS YEAR QUESTIONS

Q.1) Which one of the following makes a tool with a stick to scrape insects from a hole in a tree or a log of wood? (2023)

1. Fishing cat
2. Orangutan
3. Otter
4. Sloth bear

Q.2) Which of the following is not a bird? (2022)

1. Golden Mahseer
2. Indian Nightjar
3. Spoonbill
4. White Ibis

Syllabus

• Prelims –ENVIRONMENT AND ECOLOGY

Context: Recent studies show that Invasive plant species threaten 66% of India’s natural systems.

Key Highlights of the study:-

• Western Ghats, South Eastern Ghats & and Central Indian Highlands among widely and densely invaded regions.
• More than half of India’s natural systems are threatened by invasive plant species.
• About 66 percent of the country’s natural systems are threatened with invasive species.
• The study estimated that loss due to biological invasions would cost the Indian economy up to $182.6 billion.
• A total of 53 percent of plots recorded at least one of the 11 high-concern invasive plants that invaded 72 percent which is 254,880 sq kilometers of land.
• High concern invasive plants were recorded in 22 per cent natural areas.
• It is predicted to potentially threaten 66 percent of natural areas.
• Nilgiri Biosphere Reserve in Western Ghats was one of the largest impacted hotspot areas due to an invasion dominated by Lantana camara, Prosopis juliflora, and Chromolaena odorata.
• Besides, Southern Eastern Ghats were found to host the most densely invaded landscapes with maximum vegetation of Prosopis juliflora and Lantana camara.

About Invasive plant species:-

• An invasive species is an organism that is not indigenous, or native, to a particular area and causes harm.
• The Convention on Biological Diversity (CBD) defines it as “an alien species whose introduction and spread threaten ecosystems, habitats, or species with socio-cultural, economic and environmental harm and harm to human health”.
• They are capable of causing the extinction of native plants and animals.
• They are responsible for reducing biodiversity, competing with native organisms for limited resources, and altering habitats.
• They can be introduced to an area by ship ballast water, accidental release, and most often, by people.

Common features of invasive exotics include:-

• The ability to reproduce both asexually and sexually
• Fast growth
• Rapid reproduction
• High dispersal ability
• Tolerance of a wide range of environmental conditions
• Ability to live off of a wide range of food types

Riska and Threats:-

• They have a direct impact on human health.
• They have potential threats to livestock health.
• Biological invasions are a major threat to global food security and livelihoods, with developing countries being the most susceptible.
• The biological invasion could lead to changes to fire regimes, disease transmission to native species, forest loss, reduction in water flows, and habitat transformation, among others.
• They are the most common threat to amphibians, reptiles, and mammals on The IUCN Red List

MUST READ: Expansion of the Invasive Plants

SOURCE: DOWN TO EARTH

PREVIOUS YEAR QUESTIONS

Q.1) Consider the following statements: (2017)

1. In tropical regions, Zika virus disease is transmitted by ‘the same mosquito that transmits dengue.
2. Sexual transmission of Zika virus disease is possible

Which of the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Q.2) The H1N1 virus is sometimes mentioned in the news with reference to which one of the following diseases? (2015)

1. AIDS
2. Bird flu
3. Dengue
4. Swine flu

Syllabus

• Mains – GS 1 (Society) and GS 2 (Governance)

Context: Maharashtra Chief Minister Office took over the coordination and control of a year-long women empowerment mission amid political tussle within the ruling party.

• The programme called “Mukhyamantri Mahila Sashaktikaran Abhiyan” (Chief Minister Women Empowerment Mission) was initially to be run by the Women and Child Welfare Department in a bid to promote women empowerment.

About Women empowerment:

• Empowerment is the process of obtaining basic opportunities for marginalized people, either directly by those people, or through the help of non-marginalized others who share their own access to these opportunities.
• Empowerment of women signifies harnessing women power by promoting their tremendous potential and encouraging them to work towards attaining a dignified and satisfying way of life through confidence and competence.
• In the last few decades, the concept of women empowerment has changed from welfare to equity approach by which the powerless gain control over their lives and resources to overcome external barriers and gain internal qualities such as self-awareness and self-confidence.
• In India, where population maintain equal ratio of males and females the emergence of women entrepreneurs have great relevance and importance otherwise it will be amounting to neglecting 50 per cent of the entrepreneurial talent of the country.

Significance of women empowerment:

• Encourages gender equality: Challenging traditional gender roles allows women to make choices about their lives, including family planning.
  • Encouraging communities to support women’s empowerment can create an environment conducive to population control.
• Financial autonomy: When women have control over their finances, they can make informed decisions about family planning.
• Employment opportunities: Access to stable jobs allows women to delay marriage and childbirth, reducing fertility rates.
• Literacy and awareness: Educated women are more likely to understand the importance of family planning and make informed choices.
  • Higher education often leads to later marriages, resulting in fewer children.
• Family planning services: Access to contraceptives and reproductive health services enables women to control their fertility.
  • Improved maternal health reduces infant mortality, leading to smaller family sizes.
• Marriage and divorce laws: Fair legal frameworks empower women to make decisions about their relationships and family size.
• Property rights: Secure property rights give women the confidence to make long-term family planning decisions.

Challenges associated with women empowerment:

• Social Pressure: Women often face societal pressure, fearing stigma from their communities when they engage in paid work, which might be seen as a sign of their husband’s inability to provide for the family, traditionally the main breadwinner role.
• Conservative Attitudes: There is a growing trend in conservative beliefs that dictate a woman’s primary place as being within the home and kitchen.
  • Stepping outside these socially approved boundaries is sometimes met with backlash.
• Informalization of Work: In the past few decades, there has been a significant decline in agricultural jobs, without a corresponding increase in rural non-farm employment opportunities.
  • This has resulted in many women moving into sporadic and often short-term informal and casual work.
• Unrecognized Women’s Work: A substantial portion of women’s work, particularly in family enterprises like farming, livestock, small shops, and handmade product sales, is not officially recognized as “work.”
  • This leads to their exclusion from labor force statistics.
• Inadequate Social Security: Even women who are part of the workforce often work in roles that fall outside the purview of labor laws and social security protections, including the recently enacted Social Security Code.
  • This disproportionately affects women in self-employment and informal jobs, comprising over 90% of the female workforce.
• Land Ownership Disparities: Land ownership in agriculture is primarily in the names of men, excluding women from being recognized as farmers, despite their significant involvement in agricultural work.
  • This prevents women from accessing various beneficial programs, including priority sector loans and income support cash transfers.

Some of the schemes taken by the Government to encourage and empower women:

• Beti Bachao Beti Padhao: Aim to address the declining Child Sex Ratio.
• PM Matru Vandana Yojana (PMMVY): Provides Cash incentives for improved health and nutrition to Pregnant and nursing mothers.
• Scheme for Adolescent Girls: Aims at girls in the age group 11-18, to empower and improve their social status through nutrition, life skills, home skills and vocational training.
• Rashtriya Mahila Kosh (RMK): To provide micro-credit to poor women for various livelihood support and income-generating activities at concessional terms.
• Swadhar Greh: To provide relief and rehabilitation to destitute women and women in distress.
• Ujjawala: A comprehensive Scheme for the prevention of trafficking and for rescue, rehabilitation, reintegration and repatriation of victims of trafficking for commercial sexual exploitation.
• One-Stop Centre (OSC) and Women Helpline (WH) are being implemented to facilitate access to an integrated range of services including medical aid, police assistance, legal aid/ case management, psychosocial counselling and temporary support services to women affected by violence.
• Gender Budgeting Scheme is being implemented as a tool for mainstreaming gender perspective at various stages of planning, budgeting, implementation, impact assessment and revisiting of policy/programme objectives and allocations.
• Protection of Women from Domestic Violence Act 2005
• Dowry Prohibition Act, 1961
• Pradhan Mantri Mudra Yojana
• Prime Minister’s Employment Generation Programme (PMEGP)
• Pradhan Mantri Ujjwala Yojna (PMUY): Aims to safeguard the health of women by providing them with clean cooking fuel and also from drudgery of collecting firewood.
• The Mahatma Gandhi National Rural Employment Guarantee Act, 2005 (MGNREGA) mandates that at least one third of the jobs generated under the scheme (MGNREGS) should be given to women.
• The National Education Policy (NEP), 2020 prioritises gender equity and envisions ensuring equitable access to quality education to all students, with a special emphasis on Socially and Economically Disadvantaged Groups (SEDGs).

Way Forward:

Yatra Nari Astu Pujyante, Ramante Tatra Devaata (The God reside in places where women is worshipped). This statement is proof that in Vedic period, Women are worthy of worship. Women should be respected”.

When we empower the women in a family, we empower the entire house-hold. When we support women’s education, we ensure that the entire family is educated. When we facilitate her good health, we help keep the entire family healthy. When we secure her future, we secure the future of the entire home.

Source:   Indian Express

Syllabus

• Mains – GS 2 (Governance) and GS 3 (Economy)

Context: Recently, the Ministry of Corporate Affairs issued a notification stating that certain provisions of the Insolvency and Bankruptcy Code (IBC) will no longer apply to aircraft, their engines, airframes, and helicopters.

Highlights of the changes:

• The provisions of sub-section (1) of section 14 of the Insolvency and Bankruptcy Code, 2016 , which imposes a moratorium on assets of a company undergoing insolvency ,shall not apply to transactions, arrangements or agreements, under the Cape Town Convention and the protocol, relating to aircraft, aircraft engines, airframes and helicopters.
  • It is a global treaty that guarantees the rights of lessors to repossess leased high-value equipment such as aircraft, engines, and helicopters in case of payment defaults.
  • It was adopted at a conference in Cape Town in November 2001 under the International Civil Aviation Organisation (ICAO) and the International Institute for the Unification of Private Law (UNIDROIT).
• It is expected to have a significant impact on the aviation industry in India, making it easier to recover assets especially aircraft and engines even when an airline goes through insolvency.

About Insolvency and Bankruptcy Code (IBC):

• In 2016, at a time when India’s Non-Performing Assets and debt defaults were piling up, the Insolvency and Bankruptcy Code (IBC) code was introduced to overhaul the corporate distress resolution regime in India and consolidate previously available laws to create a time-bound mechanism.
• Insolvency resolution in India took 4.3 years on an average compared to countries such as UK and USA took 1 year and 1.5 years, respectively.
• The Bankruptcy Legislative Reforms Committee under the leadership of TK Viswanathan projected the IBC.
• Insolvency and Bankruptcy Code 2016 was implemented through an act of Parliament.
• The law was necessitated due to huge pile-up of non-performing loans of banks and delay in debt resolution.

Significance of IBC code:

• Post the implementation of IBC, as per the World Bank’s report, India’s rank in resolving insolvency went from 136 in 2017 to 52 in 2020.
• Addressing NPA problem: The IBC was instrumental in reviving India’s insolvency regime and successfully addressing the looming threat of Nonperforming assets (NPAs).
• Credit discipline: Ease of credit flow is necessary for attainment of Ease of doing business and economic growth.
  • Under the IBC regime, Rs. 2.5-lakh crore has been brought back into the banking system as a result of resolution of insolvencies.

Advantages of IBC code:

• Speedy and Timely resolution of insolvency process: The process of resolution is carried out in a time-bound manner, the business is transferred as an ongoing concern to the resolution applicant.
  • It ensures nil loss to the economy due to stoppage of production or under-utilization of resources, and minimum loss of employment, revenues to government, local ecosystem and ancillary industries.
• Certainty and clean title: When insolvency is resolved through the Code, there is a certainty in the settlement of liabilities and ownership of assets.
  • Since all liabilities including government dues are settled, the resolution applicant is vested with a clean and litigation-free business and assets, etc.
• Prevents fraudulent activities by debtors: Since the ownership and control of the business entity, its assets and business activities stand transferred from the debtor to an insolvency professional as soon as an application is admitted by the adjudicating authority, the debtor is pre-empted from indulging in any activity to defraud the creditors.
• Relief for bona fide debtors: Prior to the IBC, the liabilities that remained unpaid after proceedings continued to haunt the debtors for the rest of their lives.
  • However, resolution through the Code guarantees final settlement of all liabilities, thus freeing the bona fide debtors from debt traps and government liabilities.

Challenges for the IBC:

• Lack of proper resolution: As per the IBBI data of 3400 cases in the last six years, more than 50% of the cases ended in liquidation while only 14% cases found a proper resolution.
• Huge delays in resolution: The amended IBC act made the total timeline for completion of the resolution process to 330 days from the earlier 180­ day deadline (with a permitted 90­ day extension).
  • However, in FY22, it took 772 days to resolve cases involving companies owing more than Rs. 1,000 crore.
• Haircuts: It means the debt foregone by the lender as a share of the outstanding claim.
  • The Parliamentary Standing Committee on Finance in 2021 noted an average haircut of 80% by the creditors in more than 70% of the cases in the 5 years of the IBC.
  • As per The Hindu Data Team, almost 33 of 85 companies with more than Rs. 1,000 crore debt had been given haircuts above 90% by the lenders.
  • For example, the Videocon Group was given a haircut of 95.3% by the creditors.
• Lack of digitisation: It has led to the delays beyond the prescribed statutory limits in the insolvency resolution process.
• Overburdening of courts: As the number of NCLTs and NCLATs are limited, they are weighed down by a deluge of applications, naturally impeding the timely conclusion of proceedings.
  • Thus it is time to double the number of benches of both the NCLT and NCLAT.
• Lack of coordination between parties involved: Time and again, a lack of coordination between the parties in the process (creditors, stakeholders) is encountered which delays and stymies the insolvency proceedings.

Way Forward:

As the Parliamentary Standing Committee suggested, the timeline of not more than 30 days to admit the insolvency application and transfer control of the company to a resolution process after filing. The Insolvency and Bankruptcy Board of India (IBBI) also suggested that haircuts not be looked at as the difference between the creditor’s claims and the actual amount realized. But the difference between what the company offers while entering IBC and the value realized.

It is important for the key stakeholders to make their best endeavours to ensure that the power of the IBC does not diminish. The goal must be to fill the voids that are discovered and move towards a more complex legal system over time.

Source:   TH

Q1) Consider the following pairs:

How many of the above pairs are correctly matched?

1. Only one
2. Only two
3. All three
4. None

Q2) Consider the following statements

Statement-I:

Shivaji Maharaj took on the titles of Shakakarta and Haindava Dharmodhhaarak.

Statement-II:

Battle of Sangamner, 1679 was the first battle in which the Maratha King Shivaji fought.

Which one of the following is correct in respect of the above statements?

1. Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I
2. Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I
3. Statement-I is correct but Statement II is incorrect
4. Statement-I is incorrect but Statement II is correct

Q3) With reference to the GST Council, consider the following statements:

1. It is a statutory and not a constitutional body.
2. It gives recommendations on important issues related to GST exclusively to the Union Government.
3. It can decide various rate slabs of GST.

How many of the statements given above is/are correct?

1. 3 only
2. 1, 2 and 3 only
3. 1 and 3 only
4. 2 only

Mains Practice Questions

Q.1) Critically analyse the progress made in resolving stressed assets since the enactment of Insolvency and Bankruptcy Code (IBC). (250 words)

Q.2) Though women in post-Independent India have excelled in various fields, the social attitude towards women and feminist movement has been patriarchal.” Apart from women education and women empowerment schemes, what interventions can help change this milieu? (250 Words)

Comment the answers to the above questions in the comment section below!!

ANSWERS FOR ’  7th October 2023 – Daily Practice MCQs’ will be updated along with tomorrow’s Daily Current Affairs.st

Q.1) – b

Q.2) – d

Q.3) – c