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16th December Current Affairs

Special status for Bihar

(GS-II: Government policies and interventions for development in various sectors and issues arising out of their design and implementation)

In News:

Nitish Kumar has again raised his nearly 15-year-old demand for the status of special category state (SCS) for Bihar. Nitish has been seeking SCS for Bihar since at least 2007.

Bihar’s development vis-a-vis other states:

The latest report of the NITI Aayog puts Bihar among the bottom states in terms of growth rate and human development indices.

Bihar’s annual per capita income of Rs 50,735 lags the national figure of Rs 1,34,432 by a significant distance.

According to the report, 51.91 per cent of the state’s population — the highest in the country — lives below the poverty line.

Bihar is also doing badly in terms of school dropouts, child malnourishment, maternal health, and infant mortality.

What is Special Category Status?

There is no provision of SCS in the Constitution; the Central government extends financial assistance to states that are at a comparative disadvantage against others.

This classification was done on the recommendations of the Fifth Finance Commission in 1969.

It was based on the Gadgil formula. The parameters for SCS were:

  • Hilly Terrain;
  • Low Population Density And/Or Sizeable Share of Tribal Population;
  • Strategic Location along Borders With Neighbouring Countries;
  • Economic and Infrastructure Backwardness; and
  • Nonviable Nature of State finances.

Some prominent guidelines for getting SCS status:

Must be economically backward with poor infrastructure.

The states must be located in hilly and challenging terrain.

They should have low population density and significant tribal population.

Should be strategically situated along the borders of neighboring countries.

Who grants SCS status?

Special Category Status for plan assistance was granted in the past by the National Development Council to the States that are characterized by a number of features necessitating special consideration.

Now, it is done by the central government.


Besides tax breaks and other benefits, the State with SCS will get 90% of all the expenditure on Centrally sponsored schemes as Central grant. The rest of the 10% will also be given as a loan at zero percent interest.

Concerns associated:

Considering special status to any new State will result in demands from other States and dilute the benefits further. It is also not economically beneficial for States to seek special status as the benefits under the current dispensation are minimal. Therefore, States facing special problems will be better off seeking a special package.

Present scenario:

The 14th Finance Commission has done away with the ‘special category status’ for states, except for the Northeastern and three hill states.

Instead, it suggested that the resource gap of each state be filled through ‘tax devolution’, urging the Centre to increase the states’ share of tax revenues from 32% to 42%, which has been implemented since 2015.

RBI introduces prompt corrective action framework for NBFCs

(GS-III: Inclusive growth and issues arising out of it)

In News:

The Reserve Bank of India (RBI) has introduced the prompt corrective action (PCA) framework for non-banking financial companies (NBFCs).


The PCA framework for NBFCs will come into effect on October 1,2022 on the basis of their financial position on or after March 31.

What is PCA framework?

The objective of the framework is to enable supervisory intervention at the appropriate time and require the supervised entity to initiate and implement remedial measures in a timely manner, to restore its financial health.


The framework will be applicable to all deposit-taking non-banking financial companies (NBFCs), all non-deposit taking NBFCs in the middle, upper and top layers including investment and credit companies, core investment companies, infrastructure debt funds, infrastructure finance companies and microfinance institutions.

However, it has excluded NBFCs not accepting/not intending to accept public funds, primary dealers and housing finance companies along with government-owned ones.

Indicators based on which PCA will be invoked for NBFC:

The central bank will track three indicators — capital to risk-weighted assets ratio (CRAR), Tier I ratio and net non-performing assets (NNPAs) including non-performing investments (NPIs).

In the case of core investment companies (CICs), the RBI will track adjusted net worth/aggregate risk-weighted assets, leverage ratio and NNPAs, including NPIs.

A breach in any of the three risk thresholds under the above-mentioned indicators could result in invocation of PCA.

Need for:

The PCA Framework for NBFCs has been brought after four big finance firms — IL&FS, DHFL, SREI and Reliance Capital — which collected public funds through fixed deposits and non-convertible debentures collapsed in the last three years despite the tight monitoring in the financial sector. They collectively owe over Rs 1 lakh crore to investors.

What will happen once the PCA is invoked for an NBFC?

Based on the risk threshold, the RBI may prescribe mandatory corrective actions such as restriction on dividend distribution/remittance of profits, requiring promoters /shareholders to infuse equity and reducing leverage.

The RBI can also restrict the issuance of guarantees or take other contingent liabilities on behalf of group companies(only for CICs).

Further, the central bank may also restrict branch expansion, impose curbs on capital expenditure other than for technological up-gradation within board-approved limits and restrict/ directly reduce variable operating costs.

Durga Puja inscribed on UNESCO’s ‘Intangible Cultural Heritage’ list

(GS-I: Indian art and culture)

In News:

The Intergovernmental Committee for the Safeguarding of the Intangible Cultural Heritage has inscribed ‘Durga Puja in Kolkata’ on the Representative List of the Intangible Cultural Heritage of Humanity.

In total, 14 Intangible Cultural Heritage elements from India have now been inscribed on UNESCO’s Representative List.


This inscription will offer encouragement to the local communities that celebrate Durga Puja, including all the traditional craftspeople, designers, artists, and organizers of large-scale cultural events, as well as tourists and visitors who partake in the inclusive festivity that is Durga Puja.

About Durga Puja:

Durga Puja is a five-day festival which begins on the fifth night of the nine-day Navratri festival and ends on the tenth day, which is Dashami. During this time, people collectively worship and invoke Goddess Durga, who is regarded as the feminine energy of the cosmos, also known as ‘Shakti’.

Though originating in West Bengal, which has the largest Bengali community in the country, the festival is celebrated in many other parts of India, and also the world.

Many regard it as an emotion more than a festival.

It is a classic fusion of religion and culture.

What is Intangible Cultural Heritage?

UNESCO says, Intangible Cultural Heritage includes traditions or living expressions inherited from our ancestors and passed on to our descendants, such as oral traditions, performing arts, social practices, rituals, festive events, knowledge and practices concerning nature and the universe or the knowledge and skills to produce traditional crafts.

UNESCO established its Lists of Intangible Cultural Heritage with the aim of ensuring better protection of important intangible cultural heritages worldwide and the awareness of their significance.

The list was established in 2008 when the 2003 Convention for the Safeguarding of the Intangible Cultural Heritage took effect.

As of 2010 the programme compiles two lists:

The longer, Representative List of the Intangible Cultural Heritage of Humanity, comprises cultural “practices and expressions [that] help demonstrate the diversity of this heritage and raise awareness about its importance.”

The shorter, List of Intangible Cultural Heritage in Need of Urgent Safeguarding, is composed of those cultural elements that concerned communities and countries consider to require urgent measures to keep them alive.

Salar Masud-Raja Suhaldev battle

(GS-I: Indian History- important events and personalities)

In News:

Speaking at the inaugural event of the Kashi Vishwanath Dham Corridor in Varanasi, PM Modi referred to the battle between Salar Masud and Raja Suhaldev.

Who was Salar Masud?

Salar Masud was also known as Ghazi Mian. He acquired popularity as a warrior in the 12th century.

He was the nephew of the 11th century Turkik invader, Mahmud of Ghazni.

His tomb at Bahraich in Uttar Pradesh stands as a place of pilgrimage for a large number of Muslims as well as Hindus.

He accompanied Mahmud in all his campaigns, including the celebrated expedition to Somnath in Kathiawar. It was Masud who supposedly persuaded his uncle to demolish the famous idol of Somnath – a deed repeatedly glorified as a great feat in Persian poetry.

The most comprehensive source of information about Ghazi Mian is the Mirat-e-Masaud (Mirror of Masaud), a 17th century Persian hagiography written by Abdur Rahman Chisti, a Sufi saint of the Chisti order.

Mughal emperor Akbar is known to have made a land grant in 1571 CE for the sake of maintaining Ghazi Miyan’s shrine.

Salar Masud and Raja Suhaldev:

It is a mix of history and myth.

As per the records, at Bahraich, in the course of a battle in 1034 CE Masud and a local king by the name Suhaldev came face to face.

During the battle, Masud was wounded by an arrow and succumbed.

Since he died fulfilling his duties as a warrior, he became a martyr and earned the honorary nickname ‘Ghazi Miyan’ or master warrior for faith.

Raja Suhaldev:

Suhaldev is believed to have been the eldest son of the king of the Bhar community, from which emerged the Pasi community, a Dalit caste group of the region.

Popular history of the region identifies him by several names including Suhaldev, Sakardev, Sahardev, and Suhildev. In contemporary print culture, however, he is referred to as Raja Suhaldev.

Controversy surrounding these personalities:

Few people who worshipped Ghazi Mian, perceive Suhaldev as the king of a local tribe, a tyrant and oppressor of the people he ruled over, most of whom were Muslims.

However, he is also being given a warring identity and projected as a saviour who fought against a foreign invader (Ghazi Mian) who tried to despoil Hindu- or synonymously Indian- religion and culture.

Today, celebrations are being carried out in memory of Maharaja Suhaldev:

In February 2016, then BJP president Amit Shah hailed Suhaldev as a national hero and unveiled his statue at Bahraich.

The Indian Railways started the Suhaldev Express from Ghazipur.

In 2017 the Uttar Pradesh government announced its plans to install a statue of Suhaldev at Lucknow.