Compound Interest Waiver on Moratorium Loans

What is Compound Interest Waiver Scheme?

• Under this, the government will grant eligible borrowers ex-gratia payment of the difference between the compound interest and simple interest for the six-month moratorium period.
• Ex-gratia payment is the money which is paid due to moral obligation and not due to legal obligation.
• Simple interest is levied only on the principal amount of a loan or deposit. In contrast, compound interest is levied on the principal amount and the interest that accumulates on it in every period.

Eligibility:

• The scheme shall be applicable for loans availed by Micro, Small and Medium Enterprises (MSMEs) as well as loans to retail customers for education, housing, consumer durables, automobiles, provided a borrower has an aggregate outstanding loan of Rs. 2 crore or less, from all such loans.
• Credit card dues have also been included in the scheme’s ambit.
• The loan interest waiver payment shall be admissible, irrespective of whether the borrower had availed the moratorium partly, fully, or not at all.
• However, this would only be permitted for loan accounts that had not been reported as Non-Performing Assets (NPAs) as on 29th February 2020.
• A loan is recorded as a non-performing asset or NPA, 90 days after repayments become overdue.

What is the news?

• Recently, the Government of India announced the scheme for the waiver of compound interest that was payable by the borrower who had opted for a loan moratorium between 1st March 2020, and 31st August 2020.
• The Reserve Bank of India (RBI) in March 2020 offered a three-month moratorium on loans, enabling borrowers to defer repayments on EMIs and other loans. This was later extended by another three months, till 31st August 2020.
• The loan moratorium, and waiver of compound interest, was aimed at providing borrowers relief amid the economic impact of the Covid-19 pandemic.

Impact:

• The amount saved through loan interest waivers will be very small. This is because only the interest that would have been charged on the interest of the original loan during the six months moratorium period is waived off.
• In other words, the loan repayment will continue and one will still need to pay the simple interest that would have been paid if not opted for the loan moratorium.
• It is only the compounding interest that goes off.

Implementation:

• Lenders have been asked to set up a grievance redressal mechanism for eligible borrowers under the scheme by 30th October 2020.
• A mechanism has also been put in place for lenders to claim the amount back from the government. Lenders have to submit claims for reimbursement by 15th December 2020 through a special cell set up in the State Bank of India (SBI).

2 New Ramsar Wetlands added: Now the total is 39

Ramsar Convention or Convention on Wetlands of International Importance

• It is an intergovernmental treaty for the conservation and wise use of wetlands and their resources.
• It was adopted on 2 Feb 1971 (Thus World Wetlands Day) in the Iranian city of Ramsar (Caspian Sea) and came into force in 1975. (WNBSR also in 1971)
• It is the only global environmental system treaty that deals with a particular ecosystem.
• Criteria for Wetlands of International Importance

1. If it has a unique, rare example of natural wetland type.
2. If it supports vulnerable, endangered or critically endangered species or threatened ecological communities.
3. If it supports plant or animal species important for maintaining the biodiversity of a region.
4. If it regularly supports > 20000 waterbirds or 1% of individuals in 1 species or subspecies of waterbird.
5. If it supports a significant proportion of indigenous fish subspecies; if it is an importance source of food for fishes, spawning ground, nursery and migration path.
6. It is an important source of food and water resource, increased possibilities for recreation and eco-tourism, imporved scenic and educational values.

• Chillika lake was designated the first Ramsite in India in 1981. Sundarbans = largest Ramsar site.

Sundarbans declared as the Ramsar Wetland:

1. Sundarbans = 10000 sq km 60% in Bangladesh. It covers ~ 43% of the Mangrove forests of India.
2. It is the largest tidal halophytic mangrove forest in the world.
3. It is located in the delta region of Padma, Meghna and Brahmaputra river basins.
4. West Bengal has 2 Wetlands now = East Kolkata Wetlands & Sundarbans (which has now become the largest Ramsar Site in India).
5. The Sundarbans was made a UNESCO World Heritage Site in 1987.
6. They are the only mangrove habitat which supports a significant population of Royal Bengal Tigers, and they have unique aquatic hunting skills.
7. It is home to critically endangered northern river terrapin (Batuga, Basaka), the endangered Irrawaddy dolphin, and the endangered fishing cat. It also has Chital Deer, Crocodile & Snakes.
8. It met 4 out of 9 criteria of Ramsar: the presence of rare species and threatened ecological communities, biological diversity, significant and representative fish and fish spawning ground and migration path.
9. The part of the Sundarban delta, which lies in Bangladesh, was accorded the status of a Ramsar site in 1992.

10 more wetlands were added to the Ramsar wetland. Now there are 37 in total.

• Nandur Madhameshwar (1st in Maharashtra);
• Keshopura, Miani, Beas Conservation, Nangal in Punjab;
• Nawabganj, Parvati, Agra, Saman, Samaspur, Sandi, Sarsai Nawar in UP.
• UP has the maximum in number.
• Lakshadweep has the largest % of Wetlands followed by AN. Gujarat has the highest % Statewise.

2 more Ramsar sites added: Now the total Ramsar sites in India is 39

• Kabartal Wetland (Bihar) and Asan Conservation Reserve (Uttrakhand) have been designated as Ramsar sites, making them ‘Wetlands of International Importance.

Kabartal Wetland:

• Also known as Kanwar Jheel, it covers 2,620 hectares of the Indo-Gangetic plains in the Begusarai district of Bihar.
• It acts as a vital flood buffer for the region besides providing livelihood opportunities to local communities.
• Significant biodiversity is present, with 165 plant species and 394 animal species recorded, including 221 bird species. It is also a valuable site for fish biodiversity with over 50 species documented.
• It is an important stopover along the Central Asian Flyway, with 58 migratory waterbirds using it to rest and refuel.
• Five critically endangered species inhabit the site, including three vultures – the red-headed vulture (Sarcogyps calvus), white-rumped vulture (Gyps bengalensis) and Indian vulture (Gyps indicus) – and two waterbirds, the sociable lapwing (Vanellus gregarius) and Baer’s pochard (Aythya baeri).
• Major threats to the Site include water management activities such as drainage, water abstraction, damming and canalization.

Asan Conservation Reserve:

• ACR is a 444-hectare stretch of the Asan River running down to its confluence with the Yamuna River in the Dehradun district of Uttarakhand. It is Uttarakhand's first Ramsar Site.
• The damming of the River by the Asan Barrage in 1967 resulted in siltation above the dam wall, which helped to create some of the Site’s bird-friendly habitats.
• These habitats support 330 species of birds including the critically endangered red-headed vulture (Sarcogyps calvus), white-rumped vulture (Gyps bengalensis) and Baer’s pochard (Aythya baeri).
• Other non-avian species present include 49 fish species, one of these being the endangered Putitora mahseer (Tor putitora). Fish use the site for feeding, migration and spawning.

Montreux Record

1. It is a register of wetlands maintained as a part of Ramsar Sites where changes in the ecological character have occurred or are occurring as a result of technological developments, pollution or human influence.
2. 2 Sites from India included in this are Keoladeo National Park, Rajasthan and Loktak Lake, Manipur.

National Wetland Inventory and Assessment:

• The 1st scientific national inventory of wetlands in India was carried out by the Space Applications Center (ISRO), Ahmedabad at the behest of MoEF.
• Lakshadweep has the largest % of Wetlands (96.12%) followed by A&N. Gujarat has the highest % (statewise).

National Wetland Conservation Programme (NWCP), 1985-86

• Under this programme, 115 wetlands have been identified which needs urgent conservation.

Objective of NWCP

• To prevent further degradation and ensuing wise use for the benefit of local communities and conservation of biodiversity.
• To provide financial assistance for conservation of priority wetlands and monitor implementation of programme.
• To prepare an inventory of the Indian wetlands.
• Since Land Resources belong to State, State Govt or UT are esponsible for management of wetlands and implementation

Wetlands International

1. It is a global organization that works to sustain and restore wetlands and their resources for people and biodiversity. It is an independent, not-for-profit organization supported by Govt and NGOs.
2. It does not fund. It was founded in 1937 as an International Wildfowl Enquiry. Not under UN.
3. Asian Waterbird Census (AWC) across Asia and Australia is coordinated by Wetlands International and Bombay Natural History Society (BNHS).

CSIR-CMERI’s Municipal Solid Waste Processing Facility

Recently, the Council of Scientific and Industrial Research’s Central Mechanical Engineering Research Institute (CSIR-CMERI) has developed a Municipal Solid Waste (MSW) Processing Facility (Decentralised Solid Waste Management Plant) to solve the problem of waste management in India.

MSW Processing Facility:

• It is developed following the Solid Waste Management (SWM) Rules 2016 prescribed by the Ministry of Environment, Forests and Climate Change.
• It has been developed with the potential to scientifically manage solid waste including Covid-19 wastes.
• The facility is equipped with special disinfection capabilities to help break the Covid-19 chain through UV-C lights and hot-air convection methods.
• The plant is self-sufficient in terms of energy requirement through the installation of roof-mounted solar panels, which can also feed the surplus energy supply onto a mini-grid.

Objectives:

• To unburden the common households from the segregation responsibilities through advanced segregation techniques.
• To achieve decentralised decimation of solid wastes.
• To help create value-added end-products from abundantly available redundant stuff such as dry leaves, dry grass, etc.

Mechanism:

The mechanised segregation system segregates solid waste into metallic waste (metal body, metal container, etc.), biodegradable waste (foods, vegetables, fruits, grass, etc.), non-biodegradable waste (plastics, packaging material, pouches, bottles etc.) and inert wastes (glass, stones etc.).

Significance:

• It opens up the opportunities to realise the dream of generating 100 GW of Solar Power by 2022 and a city with a "Zero-Waste and Zero-Landfill Ecology".
• It may become a source of job creation through both process engagement and manufacturing, which can help support the Micro Small Enterprises (MSEs) and various start-ups across the nation.

Challenges in Waste Management:

• With an ever-increasing population and rapid pace of urbanisation, India faces a huge challenge of waste management.
• The volume of waste is projected to rise from the present 62 million tonnes to about 150 million tonnes by 2030.
• The ineffective processing of MSW also is the root cause of many diseases as the dumped landfills transform into contamination hubs for pathogens, bacteria and viruses.
• The most commonly used process "composting" also does not yield impactful economic returns for the entrepreneurs.
• Indiscriminate dumping of garbage at the current rate without appropriate scientific treatment would impose a huge requirement of landfill areas per year.
• Studies suggest that the MSW generated in India mostly consists of a large fraction of organic wastes and their unscientific disposal produces greenhouse gas (GHG) emissions and other air pollutants like methane (CH4).
• It requires more land space and labour, pasteurisation for effective disinfection and restricted utilisation due to the presence of heavy metals.
• During the rainy season, managing it becomes difficult due to the presence of excessive moisture.

Various Waste Disposal Methods

Bio-degradable Waste Disposal:

• The bio-degradable component of the waste is decomposed in an anaerobic environment popularly known as bio-gasification.
• In this process, biogas is liberated through the conversion of organic matter and the biogas can be used as fuel for cooking or can also be utilised in a gas engine for the generation of electricity.
• The residual slurry from the biogas plant is converted to compost in a natural process known as vermicomposting by introducing earthworms. The vermicompost is utilised in organic farming.

Biomass Waste Disposal:

• Biomass waste such as dry leaves, dead branches, dry grass etc. is disposed of by first shredding it to a suitable size followed by mixing it with the slurry of the biogas digester.
• This mixture is the feedstock for briquette (compressed block of coal dust or other combustible material), which is utilised as fuel for cooking and in gasifier for production of syngas (or synthesis gas), utilised in a gas engine for electricity generation.
• Syngas is a fuel gas mixture consisting primarily of hydrogen, carbon monoxide, and very often some carbon dioxide.

Polymer Waste Disposal:

• The polymer waste consisting of plastics is being disposed of through pyrolysis, in which the polymer waste is heated to a temperature of 400-600°C in an anaerobic environment in presence of a suitable catalyst.
• The volatile matter from the polymer waste comes out as a result of heating which on condensation gives pyrolysis oil.
• The non-condensed syngas and crude pyrolysis oil after purification are reused for heating purposes and it helps in obtaining self-sustainability.
• The solid residue known as char is mixed with the biogas slurry for the production of briquette.

Sanitary Waste Disposal:

• The sanitary items including masks, sanitary napkins, diapers etc. are disposed off utilising high-temperature plasma gasification.
• The plasma gasification process uses electricity to generate a high-temperature plasma arc (above 3000°C) inside the plasma reactor which converts the waste into syngas and the residual ash can be mixed with cement for the preparation of recycled bricks.
• However, this technology is not economically viable as energy requirements for waste treatment using this technology is very high.

SOP for Adoption of Integrity Pact Amended: CVC

Central Vigilance Commission

• CVC is the apex vigilance institution, free of control from any executive authority, monitoring all vigilance activity under the Central Government and advising various authorities in Central Government organizations in planning, executing, reviewing and reforming their vigilance work.
• It is an independent body and is only responsible to the Parliament.
• It was set up by the Government in February 1964 on the recommendations of the Committee on Prevention of Corruption, headed by K. Santhanam.

• The Parliament enacted Central Vigilance Commission Act, 2003 (CVC Act) conferring statutory status on the CVC.

What is the news?

• Recently, the Central Vigilance Commission (CVC) has amended the Standard Operating Procedure (SOP) on the adoption of the “Integrity Pact” in government organisations for procurement activities.
• The latest order revises the SOP issued in January 2017.
• The CVC also restricted the maximum tenure of Integrity External Monitors (IEMs) to three years in an organisation.

Integrity Pact

• An integrity Pact is a vigilance tool that envisages an agreement between the prospective vendors/bidders and the buyer, committing both the parties not to exercise any corrupt influence on any aspect of the contract.
• The pact also ensures transparency, equity and competitiveness in public procurement.

Integrity External Monitors

• The IEMs independently and objectively review the documents to determine if the parties have complied with their obligations under the pact.
• They may submit a report to the chief executive of the organisation concerned or directly to the Chief Vigilance Officer (CVO) and the CVC if they find serious irregularities attracting the Prevention of Corruption Act, 1988 provisions.

Features

Choice of IEM:

Earlier Provision

• Under the 2017 order, the officials who had retired from positions of the level of Additional Secretary to the Central government and above, or equivalent pay scale, were eligible for the PSUs, board level officers in Schedule 'A' companies, PSBs, insurance companies and financial institutions.
• Officers of the Armed Forces who had retired from the rank equivalent to Lieutenant-General and above were considered for appointment.

Amended Provision

• : It states that the choice of IEM should be restricted to officials from the government and Public Sector Undertakings (PSUs) who have retired from positions of the level of Secretary to the Central Government or of the equivalent pay scale.
• The officials who retired as Chairman and Managing Directors (CMDs) of PSUs — Schedule 'A' companies and CMD/Managing Director and Chief Executive Officer levels in the Public Sector Banks (PSBs), insurance companies and financial institutions — should be at least of the level of Additional Secretary or its equivalent.
• Officers of the Armed Forces who have retired from the rank equivalent of General may also be considered for appointment.
• Preference would be given to persons who have worked in any other sector, other than their own, or have worked as Chief Vigilance Officer (CVO) in any organization.

Appointment as IEM:

• Earlier Provision: Under the 2017 order, the panel could include those already in the panel maintained by the CVC, or they could propose names of other suitable persons.
• Amended Provision: It states that for appointment as IEM, the Ministry, department or organisation concerned has to forward a panel of suitable persons to the CVC, of those persons who are in the panel maintained by the CVC.

Tenure:

• Earlier Provision: The 2017 order stated that the initial tenure of IEM would be three years which could be extended for another term of two years on a request received by the CVC from the organisation concerned
• Amended Provision: It states that the IEM will be appointed for a period of three years in an organisation.