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The Reserve Bank of India’s annual report for 2017-18 reveals that 99.3% of currency notes that were demonetised at midnight on November 8, 2016 have returned to the banking system.
What does the figure suggest?
- The figures suggest demonetisation policy, which likely wiped at least 1% from the country’s GDP and cost at least 1.5m jobs, failed to wipe significant hordes of unaccounted wealth from the Indian economy
- The 99.3% is only marginally higher than its provisional estimate last year that over 99%. This clearly indicates that the government’s ultimate objective of demonetisation could not be fulfilled.
- The hope that a large chunk of unaccounted money would not return to the system was belied. As a result, the plan to transfer the arising surplus from the RBI to the Centre has no chance of being effective.
- The demonetisation exercise failed to address the problem of black money in the economy.
- The move was portrayed as a necessary shock therapy to knock out the corrupt rich. But, since there was logistical deficiency and difficulty in penalising those who converted black money into legal tender, demonetisation worked as an unintended amnesty scheme.
Benefits from the demonetisation activity:
- The number of income tax returns filed has surged a little over the trend growth rate. However, this could have been achieved by other policy measures.
- It has helped India move faster towards a digital economy. It will result in India actually skipping the branch phase of banking.
- Cashless modes of payment have become more common, but financial savings in the form of currency have also risen, suggesting that people still value cash.
What is the problem that still persists?
- Transactions with Rs. 2,000 notes in the absence of Rs. 1,000 notes are difficult as it is a departure from the currency denomination principle.
- Denomination Principle: every note should be twice or two and a half times its preceding denomination.
- The government must not disown its biggest reform attempt or try to sidestep parliamentary scrutiny of the outcomes of demonetisation. Instead, it could focus on fixing the problems that people still face.
- True, there have been a few benefits from the demonetisation activity. But it was not worth the slowdown in growth, the damage to informal sector supply chains, and job losses in sectors such as construction that were the defensive walls of employment creation for the unskilled.
- Not all policy choices work out and accepting mistakes or planning flaws helps strengthen governance processes. For example, learning from the previous government’s mistakes, a cleaner auction process for natural resources has been worked out.
- The larger lesson to be learnt is that sudden shocks to the economy don’t always yield intended policy objectives.
- In August 2018, the Union Cabinet approved the policy to permit exploration and exploitation of unconventional hydrocarbons such as Shale oil/gas, Coal Bed Methane (CBM) etc in contract areas that were primarily allocated for extracting conventional hydrocarbons.
- It was decided that it will be carried out under the existing Production Sharing Contracts (PSCs), CBM contracts and Nomination fields to encourage the existing Contractors in the licensed/leased area to unlock the potential of unconventional hydrocarbons in the existing acreages.
Extraction of Unconventional Hydro carbons (Hydraulic Fracturing):
- Unlike conventional hydrocarbons that can be sponged out of permeable rocks easily, shale gas is trapped under low permeable rocks.
- A mixture of ‘pressurised water, chemicals, and sand’ (shale fluid) is required to break low permeable rocks in order to unlock the shale gas reserves.
- The process requires around 5 to 9 million litres of water per extraction activity, posing a daunting challenge to India’s fresh water resources.
- A recent study from Duke University observes that from 2011 through 2016, the water use per well in the U.S. increased up to 770% resulting in some shale wells consuming up to 42 million litres of water per well. The study further conveys that over a period of time, the usage of water dramatically increases for extracting the same amount of shale gas from a well.
- The importance of clarity in water usage and the place of shale gas extraction in India is linked directly with water requirements of priority sectors like agriculture.
- The overall volume of fracture fluid is 5 to 10 times that of conventional hydraulic fracturing and the fracturing activities are likely to deplete water sources
- The guideline by Directorate General of Hydrocarbons (DGH) states that these challenges will be dealt while granting environmental clearances as per the Environment Impact Assessment (EIA) process. The EIA process, however, does not differentiate between conventional and unconventional hydrocarbons.
- Sensing the regulatory gap, the DGH in its guideline proposes five new terms of reference relating to water issues in the fracking process that a project proponent must explain while applying for the environmental clearance.
- However, these five reference points are not clearly expressed to resolve the water-specific issues posed by the fracking activities.
- Despite acknowledging the enormity of water requirement for fracking activities, the DGH guideline fails to give a general estimate of water requirement per unit of shale gas over the lifetime of a shale well.
- The flowback water causes pollution.
- Water cycle in a typical fracking process is different than other conventional hydrocarbon production activities.
- When shale fluid is injected underground at high pressure to fracture the rock, 5-50% (depending on the local geology) of the fluid returns to the surface, known as ‘flowback water’.
- Return flows continue as oil and gas is pumped from the well. The flowback water is usually methane-contaminated, and therefore it poses different recycling and leakage issues than usual wastewater.
- The Duke University study says, in the U.S., the flowback and produced water volumes generated within the first year of shale production increased up to 1,440% from 2011 through 2016.
- The DGH guideline again touches upon the exclusive nature of the flowback water but neither proposes any substantive treatment method nor recognises the increase in flowback water during repeated extraction of shale gas from a well over a period of time.
- Shale rocks are usually adjacent to rocks containing useable/ drinking water known as ‘aquifers’.
- As noted by U.S. Environmental Protection Agency in 2017, while fracking, the shale fluid could possibly penetrate aquifers leading to methane poisoning of groundwater used for drinking and irrigational purposes.
- Several researches conclude that such contamination can be controlled, if not avoided, provided a project proponent maintains a distance of 600 m between the aquifers and shale gas fracture zones.
- Acknowledging this complexity and the myriad structures of aquifers in India, the DGH guideline states that a project proponent must “design and construct wells with proper barriers to isolate and protect groundwater”, but misses out on broadly describing the nature or properties of a barrier that can be considered ‘proper’ to isolate and protect the groundwater.
- The Ministry of Environment, Forest and Climate Change (MoEFCC), which generally releases sector-specific manual for environment clearance, is yet to come out with a manual specific to fracking activities.
- Indian households and irrigation thrive on groundwater.
- Implementation of the fracking processes without a consultative thought through process, especially on ‘water usage policy’, may result in larger issues including water stress, contamination of groundwater, and related health hazards.
- But as the process stands today, we are missing an opportunity to comprehensively regulate the fracking process for a sustainable shale gas exploration in India.
- As a first step, A sector-specific environment impact assessment manual on exploration and production is needed.
On the Juvenile Justice Amendment Bill of 2018
It has been observed that there is an inordinate delay in issuing adoption orders by the courts due to the heavy workload.
- An affidavit filed by the National Commission for Protection of Child Rights shows that of 203 special adoption agencies audited, merely eight deserved positive reviews.
- As of July 20, 2018, there are 629 cases for adoption pending in various courts across the country.
- Due to delay in the issuing of adoption orders by the courts, children continue to stay in childcare institutions, even after getting a family.
Juvenile Justice Act of 2015:
- The Juvenile Justice Act of 2015 introduces comprehensive provisions for children in conflict with the law and children in need of care and protection.
- It was enacted keeping in view the standards prescribed in the Convention on the Rights of the Child, the United Nations Millennium Rules for the Administration of Juvenile Justice, 1985 (the Beijing Rules), the United Nations Rules for the Protection of Juveniles Deprived of their Liberty (1990), the Hague Convention on Protection of Children and Co-operation in respect of Inter-country Adoption (1993) and other related international instruments.
- Chapter 8 of this Act deals with adoption. The Act provides for the adoption of children by prospective adoptive parents from India and abroad. On the acceptance of the child by prospective adoptive parents, a specialised adoption agency files an application in a civil court to obtain the adoption order. The adoption order issued by the court establishes that the child belongs to the adoptive parents.
- The Act says “adoption shall be resorted to for ensuring right to family for the orphaned, abandoned and surrendered children.”
- Further, it states that the adoption is final on the issuance of the adoption order by the court concerned.
- It also provides that “the adoption proceedings shall be held in camera and the case shall be disposed of by the court within a period of two months from the date of filing the adoption.”
Juvenile Justice Amendment Bill of 2018:
- The Juvenile Justice (Care and Protection of Children) Amendment Bill, 2018, was introduced in Lok Sabha by the Minister of Women and Child Development on August 6, 2018.
- The Bill amends the Juvenile Justice (Care and Protection of Children) Act, 2015. The Bill seeks to make certain changes to the provisions related to the adoption of children.
- In the best interest of the child, it proposes to amend the Juvenile Justice Act to empower the District Magistrate, instead of the court, to issue adoption orders. This would ensure timely processing of adoption cases and provide orphaned, abandoned and surrendered children with familial care and protection.
- In cases where a person living abroad intends to adopt a child from his relative in India, he is required to obtain an adoption order from the court. In such cases, the Bill replaces the court and empowers the District Magistrate to issue adoption orders.
An expert committee report on faulty hip prosthetics sold by a subsidiary of the U.S. firm Johnson & Johnson has revealed incriminating details about its negligence in dealing with Indian patients. It indicated that the company has suppressed key facts on the harmful effects of the company’s “faulty” hip replacement systems, withdrawn globally after complications required many patients to undergo revision surgery.
How is hip replacement done?
The hip joint consists of a ball and a socket, which are covered with cartilage and surrounded by a lubricating membrane to protect against wear. In total hip replacement, all components are replaced with prosthetic components. While a metal stem is placed into the hollow centre of the thighbone (femur), the prosthetic ball, socket and cartilage can be made of strong plastic, metal or ceramics. The commonest hip implants are metal on polythene, and ceramic on polythene.
What is the issue with the current system?
- The hip replacement that was being used are metal on metal, with cobalt, chromium and molybdenum as major constituents. Called ASR (Articular Surface Replacement) XL Acetabular System and ASR Hip Resurfacing System, these were being manufactured and sold for several years by Deputy International Limited (DePuy), UK, a subsidiary of Johnson & Johnson. Metal was being used as it reported a lower rate of wear and a wide range of motion.
- When the prosthetic ball and socket rub against each other, it causes wear. If the implant is metal on metal, this can sometimes releases metallic debris into the bloodstream. This can lead to complications, sometimes requiring revision surgery.
To what extent has it happened in India?
- The company got the licence to import the device in 2006 to India
- By the time it was recalled worldwide, an estimated 4,700 ASR implants had been done in the country.
- Amid concerns worldwide, the Health Ministry set up an expert committee in 2017 to examine issues arising out of faulty ASR implants in India. The committee reviewed action taken by the company to replace faulty ASR implants, and reviewed compensation provided to those who had suffered.
Findings of the Committee:
- More than 3,600 of the 4,700 patients could not be traced. The committee sent letters to 101, of whom 22 responded.
- The committee concluded that not only did patients undergo revision after first surgery, but in some cases, more than one revision surgeries have been performed.
- Some of the patients had reported that they had to undergo excoriating pain during all these and more particularly after the implant.
- Many patients reported general fatigue or local issues such pseudo tumour, pain walking, metallosis (increase in Cobalt and Chromium levels, Asthenozoospermia (reduced sperm motility), cyst in kidney, claudication pain.
- Some of them informed that they are still having difficulty in carrying out their routine activities and are confined to bed.
- The cost of revision surgery was reimbursed either by the company or the insurance firms.
Recommendations of the Committee:
- The company should be made liable to pay at least Rs 20 lakh to each patient with such complications, and the reimbursement programme be extended until August 2025.
- A central expert committee and a regional expert committee should be constituted by the Ministry for evaluation of patients’ claims in respect of disability and suffering caused due to use of faulty ASR.
- The regional committee will determine whether there is permanent disability, and whether such disability has affected or will affect the patient’s earning capacity, and then submit its report to the central expert committee.
- The central expert committee will determine the quantum of compensation. The patient should be given compensation on the basis of suffering on “account of monetary loss due to wages and other loss” and percentage of disability.
- It has recommended that the maximum amount be at par with the maximum granted for clinical trial-related death and permanent disability as per rules and guidelines of the Drug Controller General of India.
- Provisions for compensation should be included in Medical Device Rules if any serious adverse event or death is caused due to the sole use of a medical device.
- Health assessment of patients should be reported once a year till 2025 and compliance report periodically.
- An independent registry should be established for tracking usage of high-risk medical devices.
How have other countries addressed issues relating to ASR?
- Australia, which had approved the product in 2004, was the first to take regulatory action against it.
- In 2007 the System was associated with a higher-than-average replacement rate.
- In 2009, ASR was removed from the Australian market, By 2016, ASR had the highest revision rate for any hip implant used in Australia.
- In the US, in 2014 found that the ASR had the highest all-cause revision among resurfacing brands.
- It recommended continued clinical surveillance and laboratory monitoring of patients.
- The learning is the importance of a materio-vigilance programme to track adverse events of medical devices. India established one in 2015.
- But if a programme along the lines of Australia’s National Joint Replacement Registry had existed in 2006, perhaps Indian patients would have received help sooner.
- Even today, eight years after the recall, the Indian government seems to be still deliberating on the issue. With an unknown number of implant recipients still unaware that they could have received a faulty device, time for deliberation is past. The authorities must show that when private corporations fail to protect patient interests, they will be held accountable.
- The Law Commission of India recommended holding of simultaneous elections to the Lok Sabha and the State Assemblies to save public money.
- The Commission, in draft recommendations, said simultaneous polls would help the government of the day focus on “developmental activities rather than in electioneering.”
- The exercise would also stop the drain on the administrative set-up and security forces.
- Simultaneous elections would further ensure better implementation of government policies on time.
- The Commission said the draft recommendations were published as the issue was of magnitude.
- This draft is a product of a balanced view taken by the Commission after receiving public suggestions in favour and against simultaneous polls.
- The Commission said simultaneous polls should be achieved by introducing “bare minimum” constitutional amendments and with the ratification of the States.
- As one of the options, the Commission recommends that elections to 12 State Assemblies and one Union Territory (with legislature) can be synchronised with the general elections in 2019.
- Simultaneous polls can be achieved if there is “political will” and if the States “agree voluntarily.”
- It said elections to the Assemblies of five States are due with the elections to the Lok Sabha and therefore already stand synchronised.
- It suggests amending the Constitution to realise this objective.
- The commission, headed by former Supreme Court judge Justice B.S. Chauhan, says opinions and suggestions should come in by May 8, 2018.
- The commission says simultaneous elections were held in the country during the first two decades after Independence up to 1967.
- Dissolution of certain Assemblies in 1968 and 1969 followed by the dissolution of the Lok Sabha led to the “disruption of the conduct of simultaneous elections.”
- The panel refers to a January 2017 working paper of the NITI Aayog on simultaneous elections.
- The white paper contains a series of “possible recommendations” of the commission.
- The first among these is that “simultaneous elections may be restored in the nation by amending the Constitution, Representation of the People Act of 1951 and the Rules of Procedure of the Lok Sabha and Assemblies.”
- It recommends that in 2019, the election could be held in phases.
- In the first phase, it says, elections to the legislatures which are scheduled to go for polls synchronous with the Lok Sabha in 2019 could be held together.
- The rest of the States could go to elections in proximity with the Lok Sabha elections of 2024.
- Citing no-confidence motion and premature dissolution of House as major roadblocks to simultaneous elections, the commission says the parties which introduce the no-confidence motion should simultaneously give a suggestion for an alternative government.
- It even suggests the relaxation of the “rigours” of the anti-defection law in the Tenth Schedule to prevent a stalemate in the Lok Sabha or Assemblies in case of a hung Parliament or Assembly.
- The panel says that in case of mid-term elections, the new Lok Sabha or Assembly would only serve the remainder of the term of the previous Lok Sabha/Assembly and not a fresh term of five years.
- The commission says the Centre should get the Constitutional amendments, if agreed upon, to be ratified by all the States so as to avoid any challenge to them.
- It also says that the Prime Minister/Chief Minister should be “elected” to lead by the full House like the Lok Sabha Speaker.
- Sedition — Whoever, by words, either spoken or written, or by signs, or by visible representation, or otherwise, brings or attempts to bring into hatred or contempt, or excites or attempts to excite disaffection towards, the Government established by law in India, shall be punished with 1imprisonment for life, to which fine may be added, or with imprisonment which may extend to three years, to which fine may be added, or with fine.
- The expression “disaffection” includes disloyalty and all feelings of enmity.
- Comments expressing disapprobation of the measures of the Government with a view to obtain their alteration by lawful means, without exciting or attempting to excite hatred, contempt or disaffection, do not constitute an offence under this section.
- Comments expressing disapprobation of the administrative or other action of the Government without exciting or attempting to excite hatred, contempt or disaffection, do not constitute an offence under this section.
- Punishment—Imprisonment for life and fine, or imprisonment for 3 years and fine, or fine—Cognizable—Non-bailable—Triable by Court of Session—Non- compoundable.
- The offence of sedition under section 124A is the doing of certain acts which would bring the Government established by law in India into hatred or contempt, or create disaffection against it.
Views of Law Commission
- Dissent and criticism of the government are essential ingredients of a robust public debate in a vibrant democracy, the Law Commission of India said.
- The Commission, which is the Centre’s topmost advisory body on laws, headed by former Supreme Court judge, Justice B.S. Chauhan, published a consultation paper recommending that it is time to re-think or even repeal the provision of sedition (Section 124A) from the Indian Penal Code.
Right to free speech
- The Commission has invited public opinion on the prospect of either redefining or doing away with Section 124A in the “largest democracy of the world, considering that right to free speech and expression is an essential ingredient of democracy.”
- Why should India retain sedition when the British, who introduced sedition to oppress Indians, have themselves abolished the law in their country, the Commission asked. Sedition attracts imprisonment from three years to life.
- The Commission said an “expression of frustration over the state of affairs cannot be treated as sedition.”
- The consultation paper was published a day after the Supreme Court lashed out at the government, saying dissent is the safety valve of democracy, while hearing a petition challenging the pan-India crackdown and arrests of five activists.
- For merely expressing a thought that is not in consonance with the policy of the government of the day, a person should not be charged under the Section
- If the country is not open to positive criticism, there lies little difference between the pre- and post-independence eras.
- Right to criticise one’s own history and the right to offend are rights protected under free speech. While it is essential to protect national integrity, it should not be misused as a tool to curb free speech, the Commission said in its consultation paper.
- In a democracy, singing from the same songbook is not a benchmark of patriotism. People should be at liberty to show their affection towards their country in their own way, the Commission said.
- It said every restriction on free speech and expression must be carefully scrutinised to avoid unwarranted restrictions.
- But the Commission has also posed the query that if contempt of court invites penal action, should “contempt of government” also attract punishment.
- The Commission asks whether it would be “worthwhile” to rename Section 124A and find a “suitable substitute” for the term ‘sedition’.
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