15 April Current Affairs
April 15, 2020
17 April Current Affairs
April 17, 2020
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16 April current Affairs

Crowdfunding

In News:

Recently, a 11­ year old girl from Hyderabad has collected ₹6.2 lakh using crowdfunding to buy food for the less fortunate during the lockdown.

Key Points:

Crowdfunding is a method of raising capital through the collective effort of a large number of individual investors.

This approach taps into the collective efforts of a large pool of individuals, primarily online via social media and crowdfunding platforms and leverages their networks for greater reach and exposure.

Types of Crowdfunding:

The 3 primary types of crowdfunding are donation-based, rewards-based, and equity-based.

  1. a) Donation-Based Crowdfunding: Donation-based crowdfunding is a way to source money for a project by asking a large number of contributors to individually donate a small amount to it. In return, the backers may receive token rewards that increase in prestige as the size of the donation increases. For the smallest sums, however, the funder may receive nothing at all.
  2. b) Rewards-Based Crowdfunding: Rewards-based crowdfunding involves individuals contributing to a business in exchange for a “reward,” typically a form of the product or service which company offers. Even though this method offers backers a reward, it’s still generally considered a subset of donation-based crowdfunding since there is no financial or equity return.
  3. c) Equity-Based Crowdfunding: Unlike the donation-based and rewards-based methods, equity-based crowdfunding allows contributors to become part-owners of the company by trading capital for equity shares. As equity owners, the contributors receive a financial return on their investment and ultimately receive a share of the profits in the form of a dividend or distribution.

Benefits of Crowdfunding:

From tapping into a wider investor pool to enjoying more flexible fundraising options, there are a number of benefits to crowdfunding over traditional methods:

1) Reach – By using a crowdfunding platform, one has access to thousands of accredited investors who can see, interact with, and share the fundraising campaign.

2) Presentation – By creating a crowdfunding campaign, one goes through the invaluable process of looking at the business from the top level—its history, traction, offerings, addressable market, value proposition, with digestible packages.

3) PR & Marketing – From launch to close, one can share and promote the campaign through social media, email newsletters, and other online marketing tactics.

4) Validation of Concept – Presenting the concept or business to the masses affords an excellent opportunity to validate and refine offering.

5) Efficiency – One of the best things about online crowdfunding is its ability to centralize and streamline fundraising efforts.

ASEAN Summit

In News:

Vietnam chaired the Association of Southeast Asian Nations (ASEAN) summit held online. The discussions pertained to the impact of Covid-19 on southeast Asia.

Leaders from China, Japan and South Korea joined the summit.

Key Points :-

ASEAN leaders have warned of the crippling economic cost of Covid-19 and called for trade routes to reopen to protect jobs and food supplies, as well as the stockpiling of medical equipment.

The Covid-19 has ruined the region’s tourism and export-reliant economies.

Vietnam has urged Southeast Asian leaders to set up an emergency fund to tackle the coronavirus.

Existing Fears on the impact of Covid-19 on the Region:

Limited testing in Indonesia has resulted in the lower number of cases — and under 400 deaths — for a country of 260 million.

Health systems from Myanmar to Laos are widely believed to be missing the true scale of infections.

A recent surge in cases in Singapore has raised fears the pandemic could rebound in places which had batted back the initial outbreak.

The Thai economy, the second largest in ASEAN, is expected to shrink by 5.3% in 2020 — a 22-year low — with millions left jobless.

Supreme Court on Free Testing of Covid-19

In News:

The Supreme Court modified its April 8, 2020 order to clarify on free testing for Covid-19.

Key Points:

Private labs would continue to charge the Indian Council of Medical Research (ICMR) rates of up to ₹4,500 for tests from people who can afford to pay.

Free testing for Covid-19 shall continue to be made available to the poor eligible under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana.

Free testing would also be made available to any other category of economically weaker sections of society as notified by the government from time to time.

The Supreme Court directed the Ministry of Health & Family Welfare to identify beneficiaries among the weaker sections of society.

This includes workers belonging to low income groups in the informal sectors and beneficiaries of Direct Benefit Transfer who can be made eligible for free testing.

It also directed the Ministry to issue appropriate guidelines in this regard within a week.

Ayushman Bharat Pradhan Mantri Jan Arogya:

PM-JAY offers a sum insured of Rs.5 lakh per family for secondary care (which doesn’t involve a super specialist) as well as tertiary care (which involves a super specialist).

It is an entitlement-based scheme that targets the beneficiaries as identified by latest Socio-Economic Caste Census (SECC) data.

Once identified by the database, the beneficiary is considered insured and can walk into any empanelled hospital.

The insurance cost is shared by the centre and the state mostly in the ratio of 60:40.

The National Health Agency has been constituted as an autonomous entity under the Society Registration Act, 1860 for effective implementation of PM-JAY in alliance with state governments.

The State Health Agency (SHA) is the apex body of the State Government responsible for the implementation of AB PM-JAY in the State.

Governor right in ordering floor test: Supreme Court

In News:

The Supreme Court has upheld Madhya Pradesh Governor Lalji Tandon’s March decision asking the then Kamal Nath led-Congress government to prove majority by holding a floor test in the Legislative Assembly after the resignation of 22 Congress MLAs.

Observations made by the Court:

In a situation where the governor has reasons to believe that the council of ministers headed by the chief minister has lost the confidence of the House, constitutional propriety requires that the issue be resolved by calling for a floor test.

The governor in calling for a floor test cannot be construed to have acted beyond the bounds of constitutional authority. This means, while directing a trust vote, the Governor should not favour a particular political party.

A Governor’s power to call for a floor test is not restricted only before the inception of a State government immediately after elections, but continues throughout its term.

The Governor’s requirement to have a trust vote does not “short-circuit” any disqualification proceedings pending before the Speaker. A Governor need not wait for the Speaker’s decision on the resignation of rebel MLAs before calling for a trust vote.

What is a “floor test”?

A floor test is the determination on the floor of the House (in this case, the Maharashtra Vidhan Sabha) whether the Chief Minister commands the support of the majority of the MLAs.

This can be done by means of a voice vote, or by recording the vote of each MLA in the House. This determination of majority is done in a sitting of the legislature, for which the legislature has to be convened.

How it takes place?

This voting process happen in the state’s Legislative Assembly or the Lok Sabha at the central level.

Technically, the chief minister of a state is appointed by the Governor. The appointed chief minister usually belongs to the single largest party or the coalition which has the ‘magic number’. The magic number is the total number of seats required to form a government, or stay in power. It is the half-way mark, plus one. In case of a tie, the Speaker casts the deciding vote.

However, at times, a government’s majority can be questioned. The leader of the party claiming majority has to move a vote of confidence.

If some MLAs remain absent or abstain from voting, the majority is counted on the basis of those present and voting. This effectively reduces the strength of the House and in turn brings down the majority-mark.

The voting process can happen orally, with electronic gadgets or a ballot process.

The Governor can also ask the Chief Minister to prove his or her majority in the House if the stability of the government comes into question.

 

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