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Today’s important articles/news in various newspapers (6th July)

Dear aspirants, following are the links of various articles taken from various newspapers. Click the link to read further. To get notification, follow the blog. Thank you

1. Is India winning the battle against extreme poverty?

India is now a middle-income country. The political, policy and administrative systems have to adjust to the new realities.

  1. India is perhaps no longer home to the highest number of people living in extreme poverty.
  2. Researchers at Brookings Institution say Nigeria had 87 million people living in extreme poverty in May 2018, compared to 73 million in India.
  3. They predict that the Indian number is expected to drop to around 20 million over the next four years.

Poverty – a disguise in India?

  1. The World Bank defines a person as extremely poor if she is living on less than 1.90 international dollars a day, which are adjusted for inflation as well as price differences between countries.
  2. The results of the recently concluded consumer expenditure survey conducted by the National Sample Survey Organisation are used to generate estimates of absolute poverty.
  3. It will show that there are only 50 million Indians now living below the poverty line defined by the Suresh Tendulkar committee, or one in 25.
  4. Poverty numbers have always been a source of heated debate in India and the claims that India is on the verge of winning the battle against extreme poverty sit uneasily with the current concerns about job creation or rural distress.

Comparing with China

  1. China began to score massive wins against extreme poverty at the turn of the century when its per capita income in terms of purchasing power parity (PPP) was around $4,000.
  2. It was thus very likely that India would see a similar result after it reached a similar average income level at the end of the previous decade.
  3. PPP incomes average around $7,000 right now, compared to around $2,500 in the year 2000.
  4. Chinese success has no doubt that rapid economic growth as the main reason why extreme poverty could be rolled back.

What pulled China out of extreme poverty?

  1. The centrality of economic expansion is often lost in the heated ideological debates in India.
  2. But there were also other factors at play—the shift of people to jobs in formal enterprises, investments in human capital, relatively equal land ownership in rural areas, and targeted interventions to help the extremely poor.
  3. These allowed China to pull most of its citizens out of extreme poverty despite rising inequality.

Indian Scenario of Poverty Reduction

  • Poverty Reduction isn’t the only Indicator
  1. It is time to close the tired debate about whether the economic reforms of 1991 have only helped the rich, though empirical proof will not come in the way of grand claims that poverty is actually increasing in India.
  2. Other indicators of well-being such as infant mortality and nutrition have also been improving.
  • Outdated poverty definition in India
  1. India will once again have to redefine what it means by poverty. Poverty lines have to be recalibrated depending on changes in income, consumption patterns and prices.
  2. The usual poverty line used in narratives is 1.90 international dollars a day, but the World Bank has two others—$3.20 per day for middle-income countries and $5.50 per day for rich countries.
  3. India is now a middle-income country, with an estimated per capita income of around $9,000 in purchasing power parity.
  4. Economists suggest that a poverty line of $3.20 translates into ₹75 a day, or 68% higher than the Tendulkar poverty line.
  • Poverty not to be assumed as Hunger only
  1. Third, the Indian political, policy and administrative systems have to adjust to the new realities of the transition to a middle- income country.
  2. Here poverty does not mean living at the edge of hunger but, rather, lack of income to take advantage of the opportunities thrown up by a growing economy.

Way Forward

  1. The focus of government spending should be on the provision of public goods rather than subsidies.
  2. Also, the rate at which economic growth translates into poverty reduction depends on what happens to inequality.
  3. India was battling the threat of widespread famine some five decades ago when even its ability to feed a growing population was questioned. There has been a lot of progress since then.
  4. Even the very possibility of a final victory against the sort of extreme poverty that was common not so long ago is no mean achievement.
  5. Inequality along with poverty needs to be targeted.

2. Allow gambling in sports but regulate it, says law panel

  • The Law Commission of India has submitted a report to the government, saying that since it is impossible to stop illegal gambling, the only viable option left is to regulate gambling in sports.

Recommendations

  • The Commission recommended a classification of ‘proper gambling’ and ‘small gambling.’ Proper gambling would be for the rich who play for high stakes, while small gambling would be for the low-income groups.
  • The panel wanted the government to introduce a cap on the number of gambling transactions for each individual: monthly, half-yearly and annual.
  • Restrictions on the amount should be prescribed while using electronic money facilities such as credit cards, debit cards and net-banking.
  • Gambling websites should not solicit pornography.
  • Transactions between gamblers and operators should be linked to their Aadhaar and PAN cards so that the government could keep an eye on them.
  • According to the Commission, foreign exchange management and foreign direct investment laws and policies should be amended to encourage investment in the casino/online gaming industry.

Advantages

  • The Commission, headed by former Supreme Court judge B.S. Chauhan, recommended cashless gambling in sports as a means to increase revenue and deal a blow to unlawful gambling.
  • The money generated can be used for public welfare measures.
  • For that, the revenue from gambling should be taxable under laws such as the Income Tax Act and the Goods and Services Tax Act.
  • The regulations should protect vulnerable groups, minors and those below the poverty line, those who draw their sustenance from social welfare measures, subsidies and Jan Dhan account-holders from exploitation through gambling.
  • Investment in the casino industry (online gaming) would propel tourism and employment.

Criticism

  • However, one of the members expressed strong dissent in a separate note filed with the government.
  • The dissenting note said the recommendation may lead to an unhealthy and unwarranted discussion.
  • The Law Commission’s report was not comprehensive.
  • A country as poor as India should not allow ‘legalised gambling.’
  • Such a move would leave the poor poorer, and only vested interests want legalisation of gambling.
  • The Commission did not even bother to consider the socio-economic conditions in the country before making such a recommendation.
  • Socio-economic and cultural circumstances of the country are not pragmatic to accept legalised gambling activities as it is still treated as a social stigma.
  • The present condition in the country is not ripe for legalising betting in sports.
  • This would favour the amassing of money clandestinely by a handful of game operators.
  • The policy of the government, in general, is to disallow betting and gambling.
  • The Commission has exceeded the brief given to it by the Supreme Court in 2016.
  • The court had asked the Commission to look into the narrow question of legalising betting in cricket, and not sports as a whole.
  • The reference had come in its judgment in the BCCI case involving illegal betting in IPL cricket matches.

3. Cosmic collision reshaped Milky Way

  • Astronomers have discovered an ancient cosmic collision with an object, dubbed the “Sausage” galaxy, that reshaped the structure of the Milky Way galaxy.
  • The crash was a defining event in the early history of the Milky Way and helped fashion both its inner bulge and its outer halo.
  • Scientists propose that around 8 billion to 10 billion years ago, an unknown dwarf galaxy smashed into the Milky Way.
  • The dwarf did not survive the impact: it quickly fell apart, and the wreckage is now all around us.
  • The collision ripped the dwarf to shreds, leaving its stars moving in very radial orbits that are long and narrow like needles.
  • Researchers used data from the European Space Agency’s Gaia satellite.
  • The paths of the stars from the galactic merger earned them the moniker (name) “the Gaia Sausage”.
  • The Milky Way continues to collide with other galaxies, such as the puny Sagittarius dwarf galaxy.

4. Give legal backing to MSP: panel

  • The government panel, which recommended minimum support prices for kharif crops that were approved by the Cabinet, has also recommended that the Centre bring out a legislation which would give that announcement some legal teeth by giving farmers the right to sell their produce at those prices.

CACP

  • The Commission for Agricultural Costs and Prices is a statutory panel under the Ministry of Agriculture which makes the recommendations for MSPs for 23 kharif and rabi crops.
  • Its suggestions are not binding on the government.
  • In its report titled ‘Price Policy for Kharif Crops for the Marketing Season 2018-19,’ the CACP notes that the procurement mechanism is broken for most crops and for most farmers.

Neglected regions

  • It has been observed that often farmers of remote areas do not have sufficient access to APMCs [Agricultural Produce Market Committees] and their potential market is local ‘haats’ where their produce is sold below MSP.
  • Strong procurement operations need to be expanded to neglected regions, particularly eastern and north eastern regions.

5. HEFA to allot ₹1 lakh crore for education

  1. he Union Cabinet permitted the Higher Education Funding Agency (HEFA) to mobilize ₹1 lakh crore to fund research and academic infrastructure in higher educational institutions by 2022.
  2. The funding will also be available to government-run schools Kendriya Vidyalayas and Jawahar Navodaya Vidyalayas.
  3. This will help build speedier infrastructure of new Kendriya Vidyalayas and Jawahar Navodaya
  4. Indian Institutes of Technology, National Institutes of Technology, Indian Institutes of Science Education and Research, other Central universities and medical colleges will also get funds from the agency.

Funding till date

  1. HEFA was set up last year as a non-banking financing company for mobilizing extra-budgetary resources for building crucial infrastructure in Central higher educational institutions
  2. The Cabinet had approved the creation of the agency in September 2016.
  3. In the existing arrangement, the entire principle portion is repaid by the institution over 10 years, and the interest portion is serviced by the government by providing additional grants to the institution.
  4. So far, funding proposals worth ₹2,016 crore have been approved by the HEFA.
  5. In November 2017, the agency allocated ₹2,066 crore for six higher education institutions — the IITs in Mumbai, Delhi, Chennai, Kharagpur and Kanpur, and the National Institute of Technology, Suratkal — to improve research infrastructure there.

Higher Education Financing Agency (HEFA)

  1. It will be formed as a Special Purpose Vehicle (SPV) within a PSU Bank or the Government-owned-NBFC (Promoter).
  2. HEFA will have an authorized capital of 2,000 crore rupees and the government equity would be 1,000 crore rupees.
  3. The HEFA will also mobilize CSR funds from Corporates/PSUs which will, in turn, be released for promoting research and innovation in these institutions on grant basis.
  4. The principal portion of the loan will be repaid through the ‘internal accruals’ of the institutions earned through the fee receipts, research earnings etc.
  5. All the Centrally Funded Higher Educational Institutions will be eligible to join as members of the HEFA.
  6. For joining as members, the educational institution must agree to escrow a specific amount from their internal accruals for a period of 10 years to the HEFA.

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