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DAILY NEWS ANALYSIS

Monthly DNA

17 May, 2020

88 Min Read

Sikkim’s Statehood Day-Formation of Sikkim

GS-II :

Sikkim’s Statehood Day.

Introduction

The Prime Minister, Shri Narendra Modi has greeted the people of Sikkim on their Statehood Day on April,16th.

Greetings on Sikkim’s Statehood Day. Home to talented and compassionate people, Sikkim has enriched national progress in many sectors. Sikkim’s progress in areas like organic farming have been admired all over.

Formation of Sikkim

On 16 May, 1975, the Himalayan Kingdom of Sikkim became the 22nd state of India, ending the monarchy there.

Background

  • The present erstwhile monarchy in Sikkim started in the year 1642 with the coronation of Phuntsog Namgyal as the Chogyal or king. The king was also a consecrated Buddhist priest.
  • The country was frequently attacked by the Gorkha army of Nepal. Initially, the British establishment in India had good relations with Sikkim. Relations with the British deteriorated and finally in 1861, the British acquired the regions of Darjeeling and the Terai.
  • The Treaty of Tumlong in 1861 made Sikkim a protectorate of the British.
  • After India’s independence in 1947, the guarantees of independence that Sikkim had acquired from the British were transferred to the new Indian government.
  • The then Prime Minister Jawaharlal Nehru gave special protectorate status for Sikkim, which was to be a ‘tributary’ of India. This meant that India had control over Sikkim’s external defence, communications and diplomacy.
  • A semblance of a constitutional government was established under the ruling Chogyal in Sikkim, who was otherwise an absolute monarch.
  • During the Sino-Indian war of 1962, Sikkim was seen as a problematic area for India as skirmishes occurred in the Nathu La pass which connects Sikkim with Tibet.
  • Trouble started brewing in the Himalayan kingdom in 1970 when there were anti-monarchy demonstrations led by the Sikkim National Congress Party.
  • India was worried that China would use this situation and claim the tiny country as part of Tibet.
  • India appointed a Chief Administrator for Sikkim to oversee the political instability there. Indian troops were also placed.
  • The Chogyal Palden Thondup Namgyal himself requested military help from India to quell the uprising against the royalists.
  • The elected Prime Minister of Sikkim Lhendup Dorji was himself an anti-monarchist. He had been elected by the Council of Ministers which was opposed to the continuance of the monarchy in Sikkim.
  • Dorji asked the Indian Parliament to change the status of Sikkim to that of statehood. A referendum was conducted on 14th April, 1975 in which about 97% of the population voted for merger with India.
  • On 26th April, the Indian Parliament approved the constitutional amendment making Sikkim a state of India.
  • The amendment was ratified by the President on 15 May and Sikkim was finally admitted to the Union of India on 16th May 1975 as the country’s 22nd state.
  • Dorji was made the Chief Minister of Sikkim and the monarchy was abolished.

Source: PIB

Draft Space Activities Bill, 2017

GS-II :

Draft Space Activities Bill, 2017

There is an urgent need for a legal environment for orderly performance and growth of space sector not only because of the interest shown by private sector but also because space activities need participation from private sector agencies as well.

Objective

To promote and regulate the space activities of India by encouraging the participation of non-governmental/private sector agencies under the guidance and authorisation of the government through the Department of Space.

Legal Provisions

  • Internationally, the outer space activities are governed by treaties and principles evolved under UN Committee on Peaceful Uses of Outer Space (UNCOPUOS).
  • The Committee on the Peaceful Uses of Outer Space (COPUOS) was set up by the UN General Assembly in 1959 to govern the exploration and use of space for the benefit of all humanity: for peace, security and development.
  • India is also a party to the Outer Space Treaty, 1967.
  • Constitution of India provides for implementation of international treaty obligations, vide Articles 51 and 253.
  • The "space" as a subject is not mentioned in the Union List. However, Parliament retains residuary legislative power in respect of "any matter not enumerated" in any of the three lists.
  • Currently, space activities are regulated by policies like Satellite Communication Policy, 2000 and Remote Sensing Data Policy, 2011.

Background

The lack of independent private participation in space is because of absence of a framework to provide transparency, timelines on licensing, issuance of authorisation and continuous supervision mechanism (in accordance with the Outer Space Treaty), among others.

These issues need to be addressed today to provide a stronger thrust for ‘Make in India’ as well as FDI in space.

Salient Features

  • It will apply to every citizen of India and to all sectors engaged in any space activity in India or outside India.
  • A non-transferable licence shall be provided by the Central Government to any person carrying out commercial space activity.
  • The Central Government will maintain a register of all space objects (any object launched or intended to be launched around the earth) and formulate the appropriate mechanism for licencing, eligibility criteria, and fees for licence.
  • It will provide professional and technical support for commercial space activity and regulate the procedures for conduct and operation of space activity.
  • It will ensure safety requirements and supervise the conduct of every space activity of India and investigate any incident or accident in connection with the operation of a space activity.
  • It will share details about the pricing of products created by space activity and technology with any person or any agency in a prescribed manner.
  • If any person undertakes any commercial space activity without authorisation they shall be punished with imprisonment up to 3 years or fined more than ?1 crore or both.
  • It also has provisions for the protection of IPR created through space activity.

Source: PRS

Model Contract Farming Act, 2018

GS-III : Economic Issues Agriculture

Model Contract Farming Act, 2018

With a view to integrating farmers with bulk purchasers including exporters, agro-industries etc. for better price realization through mitigation of market and price risks to the farmers and ensuring smooth agro raw material supply to the agro-industries, a “Model Contract Farming Act” has been prepared by the Ministry of Agriculture & Farmers Welfare for circulation to the States for its adoption.

Farmer’s producer organizations (FPO’s) have a major role in promoting Contract Farming and Services Contract. On behalf of farmers they can enter into agreement with the sponsor.

Salient features of Model Contract Farming Act, 2018

  • The Act lays special emphasis on protecting the interests of the farmers, considering them as weaker of the two parties entering into a contract.
  • In addition to contract farming, services contracts all along the value chain including pre-production, production and post-production have been included.
  • "Registering and Agreement Recording Committee" or an "Officer" for the purpose at district/block/ taluka level for online registration of sponsor and recording of agreement provided.
  • Contracted produce is to be covered under crop / livestock insurance in operation.
  • Contract framing to be outside the ambit of APMC Act.
  • No permanent structure can be developed on farmers’ land/premises
  • No right, title of interest of the land shall vest in the sponsor.
  • Promotion of Farmer Producer Organization (FPOs) / Farmer Producer Companies (FPCs) to mobilize small and marginal farmers has been provided.
  • FPO/FPC can be a contracting party if so authorized by the farmers.
  • No rights, title ownership or possession to be transferred or alienated or vested in the contract farming sponsor etc.
  • Ensuring buying of entire pre-agreed quantity of one or more of agricultural produce, livestock or its product of contract farming producer as per contract.
  • Contract Farming Facilitation Group (CFFG) for promoting contract farming and services at village / panchayat level provided.
  • Accessible and simple dispute settlement mechanism at the lowest level possible provided for quick disposal of disputes.

It is a promotional and facilitative Act and not regulatory in its structure.

Source: VIKASPEDIA

Aviation sector measures on expected lines

GS-III :

Aviation sector measures on expected lines

Part of: GS-III- Economy Aviation (PT-MAINS-PERSONALITY TEST)

MRO hub plan will help save forex and enable local overhauling of planes

The three key announcements of Union Finance Minister concerning the civil aviation sector have been viewed as those on expected lines, while the announcement on MRO (maintenance, repair and operations) needed more clarity on the tax incentives, industry experts said.

  • MROs,
  • more airports through PPP mode,
  • flexible use of airspace.

Analysis

  • “There is no relief likely [for the airline industry] and medium to long term downsizing of the industry is inevitable unless promoters are able to recapitalise significantly. The industry was not promised anything by the government and they will now have to look within for outcomes.
  • “The move to invite PPP in six more airports will provide AAI the resources to develop smaller airports across the country and popularise the government’s Udaan scheme.”
  • “The plans to make India a global MRO hub will ensure savings of precious foreign exchange and enable Indian airlines to get their aircraft serviced locally,”
  • “Rationalising the MRO tax structure has been a long-pending demand of the industry and it is good to see that happening finally, but more needs to be done to create a level-playing field, attract foreign investment and make it profitable. If only the FM can extend the benefit to cover input tax reduction and waivers at least for exported services, as with other industries, it will become a game changer.”
  • “The biggest upside will be its ability to create new jobs and a strong global value chain with the civil-defence business interface, which remains constrained and under-leveraged,”
  • Airport privatisation in India has a chequered history. Recently, India privatised six airports, all of which were awarded to the Adani Group via competitive bidding. The key concern in airport privatisation here is – in which cities? For an airport to be successfully privatised, it needs to have the kind of volumes necessary to ensure that the entity that wins the bid actually makes money.”
  • “The only cities that could potentially fit the bill are Chennai and Kolkata. However, these cities were on the privatisation block back in 2014, and neither of them could move forward because of local resistance,”

Way Forward

“Post COVID-19, it seems that the state governments in both of these cities are unlikely to allow private parties to take control of these assets. Therefore, if there are no viable cities for which privatisation might be viable, the Government of India’s decision may be difficult to implement,”

“We need to see more details on the tax simplification, which will help in making India an MRO hub. More relief measures for the civil aviation sector to keep it alive post-COVID-19.” “Better infrastructure should make air travel more accessible and there is a huge opportunity in this sector.”

Source: TH

Coronavirus package | Government throws open defence production

GS-III : Economic Issues Economic bailout plan

Coronavirus package - Government throws open defence production

Part of: GS-III- Economy (PT-MAINS-PERSONALITY TEST)

The fourth tranche of stimulus focuses on reforms across the industry, aviation and space.

Steps to indigenous defence production by banning the import of some weapons and platforms while hiking foreign direct investment into the sector were among the highlights of the fourth tranche of the Aatmanirbhar Bharat Abhiyan package, which seemed to focus more on industry reforms than any sort of economic stimulus.

Union Finance Minister also announced measures to introduce commercial mining in the coal sector, liberalise the mineral sector, ease airspace restrictions and encourage private involvement in space and atomic energy projects.

Boost for growth

  • “Many sectors need policy simplification.
  • Once we decongest sectors, we can also provide the necessary boost for growth and employment, noting that structural reforms were the focus of announcements.
  • “These sectors with these reforms are going to be the new horizon for growth and, therefore, we see great potential in more investments which can be drawn with the reforms.
  • More production can be clearly marked, and certainly, it will lead to a lot more employment possibilities,” The measures to boost private participation had to go beyond mere intent.
  • In a bid to enhance self-reliance in defence production, the Centre would notify a list of weapons and platforms that could not be imported, and widen it every year as domestic capacities grew.
  • A separate budget provision for domestic capital procurement would help reduce the defence import bill, she said, adding that indigenisation of imported spare parts would also be given priority.
  • The FDI limit in defence manufacturing under the automatic route will be raised from 49% to 74%.
  • In another major policy change, the Minister announced that Ordnance Factory Boards would be corporatised and eventually listed on the stock market to improve autonomy, efficiency and accountability, emphasising, however, that they would not be privatised.

Criticism

  • “This was less of a stimulus and more of industrial reforms, which could have been announced at any time.
  • They have used this crisis time to utilise the ordinance route or other ways to fast-track industrial reforms, which would have faced resistance otherwise,” said Ernst and Young’s chief policy adviser D.K. Srivastava, who is also a member of the Advisory Council to the 15th Finance Commission.
  • “The sectors covered are of strategic importance but these policies will be rolled out over a 3-6 month period, and any implication for supporting or reviving the economy as it comes out of lockdown is missing,” he said.
  • Mr Srivastava noted that the only direct budgetary cost in this tranche was the 8,100 crore to be provided as a hiked 30% viability gap funding to boost private investment in social sector infrastructure.

Imp Points

  • The government monopoly on coal would be removed with the introduction of commercial mining, allowing any private player to bid for a coal block and sell it in the open market.
  • Earlier, only captive consumers with end-use ownership could bid for coal blocks. Almost 50 blocks will be offered immediately, with no eligibility conditions for bidding, apart from upfront payment with a ceiling.
  • A revenue sharing mechanism instead of the earlier fixed price per tonne will introduce competition, transparency and private sector participation in the market, she said, adding that the private sector would also be allowed to participate in exploration.
  • Coal gasification will be incentivised through rebate in revenue share. Infrastructure development worth ?50,000 crore was promised.
  • The Centre also plans to introduce a seamless, composite exploration-cum-mining-cum-production regime for the mineral sector, with 500 mining blocks to be offered through an open and transparent auction process, including a joint auction of bauxite and coal blocks to enhance the competitiveness of the aluminium industry.
  • The distinction between captive and non-captive mines will be removed to allow the transfer of mining leases and the sale of surplus unused mineral blocks.
  • Power distribution companies in union territories will be privatised.
  • With regard to civil aviation, six more airports are up for auction in a private-public partnership mode, while additional private investment will be invited at 12 airports in a move expected to net 13,000 crores for the Airports Authority of India.
  • Steps will be taken to ease restrictions on Indian airspace, of which only 60% is currently available. This will save flying time and aviation fuel, leading to a 1,000 crores per year benefit for the sector.
  • The tax regime is being rationalised to help make India a global hub for aircraft maintenance, reporting and overhaul.
  • Gov promised to create a level playing field for private players in the space sector, allowing them to use ISRO facilities and participate in future projects on space travel and planetary exploration.
  • Public-private partnerships will also be introduced in the atomic energy sector, to set up a research reactor for the production of medical isotopes and irradiation facilities for food preservation.

Source: TH

How will the COVID-19 relief for MSMEs help?

GS-III : Economic Issues MSME

How will the COVID-19 relief for MSMEs help?

Part of: GS-III- Economy (PT-MAINS-PERSONALITY TEST)

Prime Minister Narendra Modi announced a ?20-lakh crore economic relief package titled Atmanirbhar Bharat Abhiyan. The relief package is being unveiled in tranches from May 13 by Finance Minister Nirmala Sitharaman. The first tranche, aimed at micro, small and medium enterprises (MSMEs), non-banking financial companies (NBFCs) and at some individuals was announced by her on Wednesday.

What are the proposals aimed at offering relief to micro, small and medium enterprises (MSMEs)?

  • The government has proposed to offer collateral-free loans to MSMEs which will be fully guaranteed by the Centre.
  • There will be a principal repayment moratorium for 12 months and the interest rate will be capped and there will be no guarantee fee.
  • All MSMEs with a turnover of up to ?100 crore and with outstanding credit of up to ?25 crore will be eligible to borrow up to 20% of their total outstanding credit as on February 29, 2020.
  • These loans will have a four-year tenure and the scheme will be open until October 31.
  • A total of ?3-lakh crore has been allocated for this.

How will this benefit MSMEs?

  • This will act as initial seed money for these small enterprises hit by zero cash flow due to the national lockdown.
  • This loan will help them buy raw materials, pay initial bills and daily wages to employees. In short, this will be like working capital for cranking up their businesses again.
  • Banks, though flush with funds, have been unwilling to lend to this category of borrowers as they fear that the money will not be repaid.
  • These small businesses have also pledged all their assets already for other loans and do not have any more assets to pledge.
  • It is to break this logjam that the government has said that it will backstop banks up to ?3-lakh crore and said that these loans do not need collaterals.
  • Banks are now expected to be more comfortable in assisting this category of borrowers because the risk is zero (since the loans are guaranteed by the central government).
  • This is the single biggest proposal in the last three tranches of announcements under the Atmanirbhar Bharat Abhiyan and small businesses are expected to benefit from this in a big way.
  • About 45 lakh MSMEs are expected to gain from this proposal.

Are these the only proposals for MSMEs?

No. A partial credit guarantee scheme has been extended to enable promoters of these units to increase their equity.

  • A total of ?20,000 crore will be funnelled through the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) whereby banks will lend money to promoters which can be infused as equity in their businesses.
  • About two lakh stressed MSMEs with non-performing assets (NPAs) are projected to benefit from this.
  • The CGTMSE will offer a partial credit guarantee to banks.
  • There is also a proposal to infuse equity into MSMEs through a Fund of funds system where the government will provide ?10,000 crore as initial corpus of the Fund.
  • This will be leveraged to raise ?50,000 crore which will be used to support MSMEs in desperate need of equity through daughter funds of the main Fund of funds.
  • The aim is to expand size and capacity of the MSMEs with equity and help them get listed on the stock exchanges.

Was not a change in the definition of MSMEs also announced?

Yes, henceforth MSMEs will be defined not based on their investment alone but also on their turnover. The definition has been tweaked and the existing distinction between manufacturing and services units has been eliminated. (PT)

  • a unit with up to ?1 crore investment and ?5 crore turnover will qualify as a micro unit,
  • investment up to ?10 crore and turnover up to ?50 crore will qualify as a small unit,
  • investment up to ?20 crore and turnover up to ?100 crore will qualify as a medium enterprise.

It has been a long-standing demand from industry to hike the investment limits, as with inflation, units often cross the threshold that will bring them benefits. To prevent this, they either run their operations at a reduced level or incorporate multiple units so that turnover is distributed in a way that they remain within the threshold that will give them the benefits. The decision to add turnover criteria to investment is seen as a good decision as there are units that leverage a small capital to post large revenues.

What are the proposals for non-banking financial companies (NBFCs)?

NBFCs, housing finance companies and micro finance institutions are finding it difficult to raise debt capital due to a confidence crisis in the debt markets. The government has, therefore, announced a special liquidity scheme of ?30,000 crore to pick up investment grade debt paper from both primary and secondary markets. Such paper will be fully guaranteed by the government. This is expected to break the low confidence cycle in the market for lending to the above category of borrowers.

In addition, to help low rated finance companies to raise debt, the existing partial credit guarantee scheme has been extended to cover primary market debt paper wherein the first 20% loss will be borne by the government.

A total of ?45,000 crore has been set aside for this Partial Credit Guarantee Scheme 2.0 that will offer liquidity to paper rated AA and below and even unrated paper.

Do electricity distribution companies (discoms) also feature in the first tranche announced?

  • Yes, discoms are in a huge liquidity crisis and unable to pay their dues to electricity generation companies. Their cash flow and revenues have been hit due to low demand from industrial consumers for power during the lockdown.
  • The various State discoms together owe about ?94,000 crore to their suppliers, the generation and transmission companies.
  • The government, through Power Finance Corporation-Rural Electrification Corporation, will infuse liquidity of ?90,000 crore to discoms which will be securitised against their receivables from consumers.
  • The loans given for the purpose of discharging their dues to generation companies will be against a guarantee from the respective State related to the discom.
  • This emergency liquidity infusion will avert a crisis where generation and transmission companies stop supplies to discoms that are in default.

What are the measures for the common man?

  • In March, when the first relief package called the Pradhan Mantri Garib Kalyan Yojana was announced, the government offered to pay the 24% provident fund contribution (employer+employee) for those earning up to ?15,000 a month as salary and working in units that employ less than 100 workers for three months.
  • This has now been extended for another three months up to August.
  • The statutory PF contribution for those employed in the private sector (and not in the category of establishments above) has been reduced to 10% (from 12% now) for the next three months in order to increase liquidity in their hands. This is expected to benefit 4.3 crore people and 6.5 lakh establishments and release a total of ?6,750 crore liquidity.
  • In addition to the above, the rate of tax deducted at source (TDS) and tax collected at source (TCS) has been reduced by 25% for a whole range of receipts. Thus, in payments to contractors, professional fees, rent, interest, commission, brokerage, etc. the TDS will be 25% lower.
  • The TCS paid while buying a car of over ?10 lakh in value and TCS collected in property transactions will also be lower.
  • The lower TDS is not applicable on monthly salaries that employees receive.
  • In the cases where TDS/TCS has been reduced, the tax liability is not reduced. It will be payable while filing return or while paying advance tax.
  • The idea is only to offer immediate cash relief to people. The lower TDS/TCS kicks in right away and will stay until March 31, 2021.

Source: TH

Coal, mineral reforms to help reduce imports

GS-III : Economic Issues Coal policy

Coal, and mineral reforms to help reduce imports

Part of: GS-III- CULTURE (PT-MAINS-PERSONALITY TEST)

The coal sector will get a boost as private parties can now bid for 50 blocks: CARE Ratings

Finance Minister's structural reform measures in the coal and mining sector are expected to give a boost to private investments in the sector and reduce India’s reliance on imports.

Analysis

  • “Our assessment is that if it is implemented at the earliest, these much needed reforms will double these sectors’ contribution to the GDP,”
  • “The introduction of competition, transparency and private sector participation in the coal sector will automatically build transparency of mine valuations, force rigorous mine planning and compliance, and invite investments for enhancing operational efficiency to justify the bids made at the time of mine acquisition.
  • These were much-needed reforms in the mining sector as India is a mineral rich country and any sectoral reforms to attract investments which adds to India’s GDP through this sector and save precious foreign exchange are welcome.”
  • According to CARE Ratings, the coal sector gets a boost as the private sector can now bid at the auctions for 50 blocks, enhancing supplies, reducing imports, which is good for the economy.
  • The government also plans to auction Coal Bed Methane (CBM) blocks.
  • “The Government of India’s big plan to push coal gasification to replace natural gas in the fertiliser sector would help square energy and food security objectives.(PT)
  • However, ammonia produced from coal gasification has a carbon footprint that is 1.8 times higher than that produced from the conventional process using natural gas (PT). This could potentially offset the emissions intensity reductions achieved through investments in renewables.”
  • “Elimination of distinction between captive mines and non-captive will ensure a level playing field for players in the integrated metals space,”

“Removal of distinction between a captive and non-captive mines would mean that transfer of non-captive mines will be permitted subject to compliance with prescribed conditions. This is a huge relaxation and will lead to increased M&A in the mining sector. This will create new opportunities.”

The govt. announced some good reform measures in the mining sector today. Single licensing policy, removal of captive non-captive distinction, revenue sharing model and stamp duty rationalisation have been the demand of the industry for a long time. Similarly, the aluminium industry has been asking for bauxite and coal combined licence, which has been cleared now.”

Source: TH

Human Challenge Studies

GS-III :

Human Challenge Studies

In new guidelines issued on May 6, the World Health Organization has said that well-designed human challenge studies could not only accelerate coronavirus (COVID-19) vaccine development but also make it more likely that the vaccines ultimately deployed will be far more effective.

Note:

In human challenge studies, healthy participants are first administered the candidate vaccine and then deliberately exposed to novel coronavirus.

In conventional clinical trials, healthy participants are administered the candidate vaccine, and the safety and efficacy of the vaccine is assessed through natural infection.

Compare and select

  • The guidelines say that human challenge studies will be “substantially faster” to carry out vaccine field trials as far fewer participants need to be exposed to candidate vaccines to “provide (preliminary) estimates of efficacy and safety”.
  • It says this approach will make it possible to compare the efficacy of multiple vaccine candidates and select the most promising vaccines for larger studies.
  • In addition to accelerating vaccine development, human challenge studies can help validate tests for immunity to the virus, identify correlates of immune protection, and investigate the risks of transmission by infected individuals.

Successes and risks

While human challenge studies are ethically controversial, such studies have been performed safely in tens of thousands of people in the last 50 years and helped accelerate the development of vaccines against typhoid and cholera. Such a study for Zika virus was also conducted.

Guidelines for human challenge studies

1. According to the guidelines, challenge studies would be least risky for young healthy adults aged 18-30 years, as the hospitalisation rates in this age group is about 1% and fatal infection rates around 0.03%.

2. Human challenge studies are to be carried out only in specialised centres where close monitoring and ready access to early supportive treatment for participants, including critical care if required is available.

3. Potential benefits and risks should be assessed, quantified and compared with other feasible study designs, and the expected benefits should be maximised and the risks minimised.

Meanwhile, the U.S. National Institutes of Health is also preparing the ground for human challenge trials for COVID-19 vaccines.

Prof Andrew Pollard, who is leading the trial of the vaccine developed by the team at the University of Oxford’s Jenner Institute told The Guardian that there is “huge interest” in the possibility of challenge trials among those working on coronavirus vaccines. “At the moment, because we don’t have a rescue therapy, we have to approach challenge studies extremely cautiously,” Pollard said.

Issues

1. But a March 27 study in the Morbidity and Mortality Weekly Report found that 20.8% of patients aged 20–44 had severe disease which required hospitalisation, and 4.2% of patients developed critical disease, which required admission to an ICU.

2. But what makes such studies for COVID-19 particularly risky and challenging is the fact that pathogenesis(manner of development of disease) of the disease is poorly understood and there is no approved treatment available in case participants develop the disease.

Ethical framework

Recognizing the uncertainties, risks from SARS-CoV-2 human challenge studies appear comparable to the risks from some other research and activities similar to research.

Meanwhile, NBC News reports that that the multinational testing company SGS and London-based hVIVO are planning human challenge studies. Nearly 20,500 people from 102 countries have already volunteered to participate in such studies.

Source: TH

Street vendor loans an uncharted turf for big banks- Analysis

GS-III :

Street vendor loans an uncharted turf for big banks- Analysis

Part of: GS-III- Economy (PT-MAINS-PERSONALITY TEST)

Commercial banks have no experience extending such loans; small finance banks, MFIs with speedy disbursal could help

The recent announcement by the government to offer loans to street vendors has caught commercial banks of the country off guard. The reason is simple: hardly any such loans were extended by these banks in the past.

Issues and Imp points

  • They have virtually no experience in extending loans of that size and to this sector, who are mostly in the urban clusters.
  • The scheme, which was announced by Finance Minister, proposes bank credit facility for initial working capital up to ?10,000 for each vendor.
  • There was no business for these street vendors for the last 50 days with the nationwide lockdown in place. This scheme will cover urban as well as rural vendors doing business in the adjoining urban areas.
  • Extending a loan of ?10,000 does not excite a mainstream banker.
  • It is expected that 50 lakh street vendors (data collected from state governments) will be benefited under this scheme and a credit of ?5,000 crore would flow to these sector, the finance ministry said adding that use of digital payments and timely repayments will be incentivised through monetary rewards.
  • Only a fraction of these 50 lakh may have a credit history with commercial banks.
  • The question is how to do the credit appraisal for an entity without a credit history.

Suggestions

  • Some bankers suggested the self help group model which are followed to extend loans in the rural areas. Under this model, a group comprising women borrowers mostly,is formed with 10-12 individuals of a neighbourhood in a rural area, where individuals of the group take responsibility for timely repayment by other members.
  • These groups are required to show savings habit, for at least six months, before lending can start.
  • “The problem is that it may not be feasible to form such a group in urban areas as people there are apprehensive to be a guarantor of another borrower in the group,”
  • “Also, there is no time to build savings habit as the vendor requires the loan immediately,” the official added.
  • In such a scenario, the micro-lenders and small finance banks that focus on lending to the urban poor could emerge as the key player to make the scheme a success.
  • SFBs and micro-finance institutions have customers who belong to these community, and have expertise in extending small ticket loans.
  • For the scheme to become acceptable for lenders, certain key aspects should be kept in mind while formulating the scheme, bankers said.
  • “First is about the interest rate. Yes, there is a need for an interest cap for such loans, but that should be linked to the cost of funds.
  • Ideally, it should be linked to the MCLR [marginal cost of funds based lending rate] rather than the government prescribing a particular rate,” said the chief executive of a small finance bank.
  • Another important issue that would determine the success of the scheme is the speed at which the loan is delivered. For that, the first thing is to keep documentation short and simple.

“It should be a one-page document. The purpose of this loan is speed and the convenience at which it is delivered. If you make the borrower run around for a week, he will lose interest. Customer delight is key for the scheme to be a success”.

The other issue is with the credit guarantee part. Loans under this scheme are likely to be under the Mudra scheme. Mudra loans are guaranteed by Credit Guarantee Trust for Micro And Small Enterprises (CGTMSE). According to bankers, it is not easy to get claims for CGTMSE in case there is a default. “So many questions are asked for settling claims. They want to see the loan appraisal report. Everyone is wiser in hindsight…it is easy to say the appraisal was not proper once a loan turns non-performing,”

“Rather than leaving it to be rear ended, CGTMSE should clearly state the claim settlement criteria upfront. They should not dig it up during the time of claim. They should also specify a deadline within which a claim should be paid and if not, then interest should accrue,”

The finance ministry is expected to detail the contours of the scheme in a month.

Source: TH

Herd Immunity-Dangerous assumption

GS-III :

Aiming to achieve herd immunity naturally is ‘dangerous’, WHO warns

Introduction

The World Health Organization has condemned the “dangerous” concept of herd immunity for managing the coronavirus (COVID-19) pandemic.

Dr. Michael Ryan, executive director of the WHO’s health emergencies programme said it was wrong to think that countries can “magically” make their populations immune to novel coronavirus.

Herd immunity

The concept of herd immunity is generally used for calculating how many people will need to be vaccinated in a population in order to protect those who are not vaccinated.

Natural infections in humans because it can lead to a very brutal arithmetic which does not put people, life and suffering at the centre of that equation.

Dangerous assumption

It was mistakenly assumed that as this disease spreads across the world, only the severe cases become apparent while most people would indeed be infected as reflected in sero epidemiology results.

Greater proportion of people getting infected would mean that the pandemic will be over soon and people can go back to normal business.

The WHO director also warned about the dangerous assumption by countries that have had “lax measures and haven’t done anything [that they] will all of a sudden magically reach some herd immunity” by losing a few old people along the way. “This is a really dangerous calculation.

  • But the preliminary results from in sero epidemiology studies are showing the opposite.
  • The proportion of people with significant clinical illnesses is a higher proportion of all those who have been infected.
  • This is because the number of people infected in the total population is probably much lower than WHO has expected.
  • “No one is safe until everyone is safe,” Dr. Ryan added.

Other challenges

  • Achieving herd immunity through natural infections has other challenges.
  • While antibodies (IgG and IgM) against novel coronavirus generally develop in one–three weeks after infection, some people do not seem to develop a humoral immune response, as reflected by detectable antibodies.
  • It is unclear why this happens. Centers for Disease Control and Prevention, U.S., and others say the relationship between antibody response and clinical improvement is still not clear.
  • Though a small study involving just nine patients found a direct correlation between clinical severity and levels of antibody response, “antibody detection and higher titers have not always been found to correlate with clinical improvement in COVID-19”.
  • Also, mild infections can resolve even before detectable antibodies are produced.

Durability of response

  • Also, how long neutralising antibodies against the virus would last is currently not known, though one study found that they persist for up to 40 days from symptom onset.
  • In the case of the 2002 SARS, levels of IgG remained high for nearly four–five months before declining during the next two–three years.
  • For MERS, the antibodies persisted for up to 34 months.
  • Detection of IgG and neutralising antibodies is not synonymous with durable immunity.
  • A small study posted in a preprint server bioRxiv found that four rhesus macaques that were infected with coronavirus and recovered did not get reinfected when exposed to the virus 28 days after the first infection.
  • Whether humans too will exhibit such protection is not known, though no cases have so far been reported of people getting reinfected.
  • The detection of over 220 cases of “reinfection” in South Korea was found to be a case of virus remnants being detected and not reinfection or reactivation.

Reinfections possible

  • Reinfection is mightily possible with at least three of the four coronaviruses which cause common cold.
  • The reasons for this reinfection are not fully known, but evidence suggests that possibilities include both short-lived protective immunity and re-exposure to genetically distinct forms of the same viral strain.
  • But WHO cautions that “there is currently no evidence that people who have recovered from COVID-19 and have antibodies are protected from a second infection”.
  • Infected people may have some level of protection against the virus, but the level and duration of protection is still not known.
  • Antibody tests have been known to produce wrong results as the sensitivity and specificity of these tests is not known. “It is presently premature to use such assays to determine whether individuals are immune to reinfection” they say.

Way ahead

According to them, only well-designed longitudinal studies involving those who have recovered from COVID-19 for recurrent illness can help provide the much-needed information about reinfection and the duration of protection by the antibodies.

Source: TH

Antimicrobial masks manufactured by IISC

GS-III :

IISc develops antimicrobial composite material and testing protocols for PPEs

A team from Indian Institute of Science, Bengaluru (IISc) has developed a three-layered antimicrobial composite material of low-cost for making masks.

And another team, including members from IISc, is involved in testing masks and developing a way of recycling them.

Antimicrobial masks

The mask material consists of three layers.

1. The outermost layer is made of polyester fabric Awith polymeric nanofibre deposited on it to make it water-repellent.

2. The middle layer is also a polyester fabric on both sides of which polymeric nanofibres containing antiviral and antibacterial agents are deposited. This layer inactivates both bacteria and virus when it comes into contact with it.

3. The innermost layer is a comfort layer consisting of cotton fabric.

The middle layer also has positively charged polymer (polycations) which inactivate the microbes that come in contact with this layer.

The material is designed to cut off particles of the size of 0.3 micrometres to about 95% efficiency.

Testing method

Titers of bacteriophage (a virus that kills bacteria) were made, and the mask material was soaked in it for 30-120 minutes. The liquid was then eluted and poured on a bacterial colony where it was incubated for 24 hours.

If the virus remained, they would have seen plaques. Instead they observed a flourishing lawn of bacteria. This indicated that the samples did not contain virus.

Testing masks normally looks for the following parameters

1.particle filtration efficiency,

2.virus and bacterial filtration efficiency,

3.blood penetration,

4.breathing resistance (difficulty in breathing), and

5.how good a fit to the face the mask is.

Physical parameters

According to Akshay Naik of Centre for Nanoscience and Engineering, IISc, right now, their team tests masks for two factors: efficiency of particle filtration and breathing resistance.

For instance, N95 masks are supposed to filter out 95% of particles of size 0.3 micrometre and above.

Can it be re-used

The team is also working on ways to decontaminate the masks and the number of times it can be recycled. However, they are clear that masks, especially the N95, are meant to be used just once, and reusing them after decontamination is really the last option.

Source: TH

SOFIA

GS-III :

SOFIA

SOFIA, the Stratospheric Observatory for Infrared Astronomy, is the largest airborne observatory in the world. It consists of an extensively modified Boeing aircraft carrying a reflecting telescope with an effective diameter of 2.5 meters. The observatory is based at NASA's Armstrong Flight Research Center in Palmdale, California.

Thus SOFIA observes universe in infrared wavelengths to get the expanded views. It is preparing for its campaign for observing Saturn’s giant moon Titan.

Source: TH

Make masks at home with cotton and silk

GS-III :

Make masks at home with cotton and silk

Across the world, the coronavirus (COVID-19) pandemic has forced governments into mandating the use of face masks. The general public has been advised to use cloth masks and not hoard N95 and surgical masks which are reserved for healthcare workers.

Cotton and Chiffon

  • The number and size of particles in air were measured before and after passing through the fabric. One layer of cotton along with two layers of chiffon showed the highest filtration efficiency of 97%.
  • The researchers point out that the tightly woven cotton can act as a mechanical barrier to the aerosols and the chiffon serves as an electrostatic barrier.
  • “As kids, we used to do this experiment where we would rub a comb on our dry hairs to lift small pieces of paper.
  • Electrostatic filtration effectively works on the same principle. Some fabrics such as natural silk and chiffon can hold static charges.
  • When small particles come in close proximity to these fabrics, they are attracted and trapped inside them, thus acting as filters.

Condition

  • However, even a small 1% gap in the mask drastically reduced its efficiency.
  • The importance of a good fit needs to be emphasised. Even for a mask as good as an N95 mask, the filtration efficiency can drop significantly if they are nor properly worn.

Source: TH

National Migrant Information System (NMIS)

GS-III :

National Migrant Information System (NMIS)

  • National Migrant Information System (NMIS) - a central online repository on Migrant Workers - was developed by NDMA to facilitate their seamless movement across States.
  • The government of India has allowed the movement of migrant workers by buses and ‘Shramik’ special trains to enable them to travel to their native places.
  • In order to capture the information regarding the movement of migrants and facilitate the smooth movement of stranded persons across States, National Disaster Management Authority (NDMA) has developed an online Dashboard - National Migrant Information System (NMIS).

Advantages

  • The online portal would maintain a central repository on migrant workers and help in speedy inter-State communication/co-ordination to facilitate their smooth movement to native places.
  • It has additional advantages like contact tracing, which may be useful in overall COVID-19 response work.
  • The key data pertaining to the persons migrating has been standardized for uploading such as name, age, mobile no., originating and destination district, date of travel etc., which States are already collecting.
  • States will be able to visualize how many people are going out from where and how many are reaching destination States.
  • The mobile numbers of people can be used for contact tracing and movement monitoring during COVID-19.

Source: PIB

LiFi

GS-III :

LiFi

Light-fidelity (LiFi) is a technology used for free-space communication using visible and near-visible light. It is similar to Wireless Fidelity (WiFi), a technology for wireless local area network communication using microwaves. Microwaves can pass through walls while transmitting signals whereas visible and near-visible light cannot pass through walls. Thus it makes LiFi signal network more secure.

Scientists have recently added a new layer of security to LiFi. Light bounces off from walls and falls on the receiver. So wall boundaries can be used effectively for reflecting signals so that communication is maintained even without line-of-sight communication between the signal source and receiver. Receiving detectors can receive both direct and reflected signals.

Walls painted with fluorescent and phosphorescent paints absorb and then emit light with marginal loss. The paints continue to emit light even several hours after the original source of light has been switched off. This makes the communication signal more effective and secure.

Source: TH

New Ginger Species

GS-III :

New Ginger Species

Scientists have discovered two new species of Ginger in Manipur and Nagaland. They were found in easternmost districts bordering Myanmar. Both the plants are from the family of Zingiberaceae, to which the commonly found Ginger (Zingiberofficinale) belongs. The species discovered in Nagaland, is an epiphytic plant and grows on tall trees. The species from Manipur was found growing in rock crevices, boulders and humus rich soil in the Shirui Hills.

Source: TH

Night Frogs

GS-III :

Night Frogs

Frogs belongs to the genus Nyctibatrachus are commonly known as night frogs. They are found only in the Western Ghats mountain range. Scientists have recently discovered new night frog “Mewasinghi”, belonging to Nyctibatrachus from Malabar Wildlife Sanctuary, Kozhikode. It is found in a small stream running along the Peruvannamuzhi dam.

It is closely relative to Athirappilly night frog (found south of the Palakkad Gap in Thrissur and Idukki) and the Kempholey night frog (found in the northern Western Ghats of Kerala and Karnataka).

Source: TH

Ant Species in Andaman

GS-III :

Ant Species in Andaman

Scientists have discovered the new species Tetramoriumkrishnani and Tetramoriumjarawa in Havelock Island, a part of the Andaman archipelago.

The ant species are endemic to the Andaman Islands. They dwell in leaf litter in the evergreen forests of the Island.

Source: TH

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