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7th January Current Affairs

Collective Security Treaty Organisation

(GS-II: Bilateral, Regional and Global Groupings and agreements involving India)

In News:

The Collective Security Treaty Organisation (CSTO) has dispatched troops to help quell mounting unrest in Kazakhstan as the police said dozens were killed trying to storm government buildings.

What’s happening in Kazakhstan?

Long seen as one the most stable of the ex-Soviet republics of Central Asia, energy-rich Kazakhstan is facing its biggest crisis in decades after days of protests over rising fuel prices escalated into widespread unrest.

About Collective Security Treaty Organization:

It is an intergovernmental military alliance (six countries) that came into effect in 2002.

Its’ origin can be traced to the Collective Security Treaty, 1992 (Tashkent Treaty).

The headquarter is located in the Russian capital of Moscow.

The objectives of the CSTO is to strengthen peace, international and regional security including cybersecurity and stability, the protection on a collective basis of the independence, territorial integrity and sovereignty of the member states.

Composition:

Current CSTO members are Armenia, Belarus, Kazakhstan, Kyrgyzstan, the Russian Federation and Tajikistan.

What the membership entails?

CSTO membership means that member states are barred from joining other military alliances, limiting, for example, their relationship with NATO.

Most importantly, membership presumes certain key security assurances – the most significant of which is deterring military aggression by third countries.

In the CSTO, aggression against one signatory is perceived as aggression against all.

It however remains unclear whether this feature works in practice.

Use of drones

(GS-III: Science and technology, use of technology)

In News:

The Ministry of Civil Aviation (MoCA) has sent a note on use of drones across various sectors to different ministries at the centre.

Where all can drones be effectively utilised?

Ministry of Home Affairs: For surveillance, situational analysis, crime control, VVIP security, disaster management, etc.

Ministry of Defence: Drones for combat, communication in remote areas, counter-drone solutions, etc.

Ministry of Health and Family Welfare: Delivery of medicines, collection of samples from remote or epidemic/pandemic-affected areas.

The Petroleum and Natural Gas, and Power Ministries: For real-time surveillance of assets and transmission lines, theft prevention, visual inspection/maintenance, construction planning and management, etc. Environment, Forests and Climate Change Ministry: Anti-poaching actions, monitoring of forests and wildlife, pollution assessment, and evidence gathering.

Ministry of Information and Broadcasting: For high-quality videography of events and difficult-to-reach-places at a fraction of the cost and approvals required. This move would also facilitate low altitude shooting without noise, and prevent dust pollution and risk of accidents.

Other areas: To undertake disaster management, incidence response, inspection/maintenance works and project monitoring.

Significance:

Drones offered tremendous benefits to almost every sector of the economy, including but not limited to, national defence, agriculture, law enforcement, and mapping, among others.

Drone management in India:

The Union government had on September 15 approved a production-linked incentive (PLI) scheme for drones and drone components with an allocation of Rs 120 crore spread over three financial years.

The ministry had on August 25 notified the Drone Rules, 2021 that eased the regulation of drone operations in India by reducing the number of forms that need to be filled to operate them from 25 to five and decreasing the types of fees charged from the operator from 72 to four.

Need for stricter rules and regulations:

Recently, Drones were used for the first time to drop explosive devices, triggering blasts inside the Air Force Station’s technical area in Jammu.

Over the past two years, drones have been deployed regularly by Pakistan-based outfits to smuggle arms, ammunition and drugs into Indian territory.

According to government figures, 167 drone sightings were recorded along the border with Pakistan in 2019, and in 2020, there were 77 such sightings.

With the rapid proliferation of drone technology and exponential growth of its global market in recent years, the possibility of a drone attack cannot be ruled out even in the safest cities in the world.

Drones are becoming security threats particularly in conflict zones where non-state actors are active and have easy access to the technology.

Foreign Contribution (Regulation) Act, 2010 Registation for NGOs

(GS-II: Role of NGOs)

In News:

Among the 6,000 NGOs that did not have their FCRA registration renewed by the Ministry of Home Affairs (MHA) recently are also included the Tirumala Tirupati Devasthanams (TTD), the Ramakrishna Mission, and Shirdi’s Shri Saibaba Sansthan Trust (SSST).

Background:

The registration of thousands of NGOs was up for renewal in 2020-21. The Ministry had declined to renew the FCRA registration of 179 NGOs, while 5,789 associations did not apply for a renewal before the December 31 deadline.

After the exercise, the number of active FCRA-registered NGOs is down from 22,762 to 16,907.

How FCRA regulates NGO funding?

FCRA regulates foreign donations and ensures that such contributions do not adversely affect the internal security of the country.

The Act, first enacted in 1976 was amended in the year 2010 and then 2020.

Section 5 of the Foreign Contribution (Regulation) Act, 2010 gives the Union government “unchecked and unbridled powers” to declare an organisation as being one of political nature and deny it access to funds from sources abroad.

FCRA is implemented by the Ministry of Home Affairs.

Applicability:

The provisions of the Act apply to the territory of India, to citizens of India who may be outside India and to companies or their branches outside India that are registered or incorporated in India.

The entities covered by the Act include an individual, a Hindu undivided family, an association, or a registered company.

Prior Reference Category under the Act:

It implies that to donate to such an NGO, a foreign donor has to take prior clearance from the Ministry of Home Affairs.

Latest 2020 amendments and criticisms associated:

The amendments mandated that registered NGOs open a designated account in the main branch of the State Bank of India in the Capital in which the foreign contributions to their various causes would exclusively land.

The petitioners have argued that this measure would be cumbersome for NGOs operating in rural India and far away from the Capital.

What Is A Foreign Contribution Under FCRA?

“Foreign contribution” under FCRA covers any “donation, delivery or transfer made by any foreign source of any article” as long as it is not given as a gift for personal use, or if its market value in India at the time it was made is “not more than such sum as may be specified from time to time by the Central government”.

Exceptions:

Any currency, or security can fall under the ambit of the Act though it excludes any money received “by way of fee or towards cost in lieu of goods or services rendered by such person in the ordinary course of his business, trade or commerce whether within India or outside India”.

Neither are donations made by Non-Resident Indians (NRIs) considered to be “foreign contribution” although a donation from a person of Indian origin who has assumed foreign nationality is treated as as “foreign contribution”.

Who Cannot Receive Foreign Contribution?

A host of entities are barred from receiving foreign funds, including election candidates, those connected with a registered newspaper, judges, government servants or employees of any entity controlled or owned by the government and members of any legislature. Political parties and their office bearers, too, are prohibited from receiving foreign funds.

Domestic Systemically Important Banks (D-SIBs)

(GS-III: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment)

In News:

Reserve Bank of India has released its list of Domestic Systemically Important Banks (D-SIBs) in 2021.

It has identified the state-owned lender State Bank Of India and the private lenders ICICI Bank and HDFC Bank as systemically important banks, which are perceived as banks, ‘too big to fail’.

What are D-SIBs?

The system of D-SIBs was adopted in the aftermath of the 2008 financial crisis where the collapse of many systematically important banks across various regions further fueled the financial downturn.

D-SIBs are important for the country’s economy. In events of distress, the government supports such banks and if such a bank fails, it would lead to disruption of the country’s overall economy.

RBI finalizes such banks after considering factors like size, complexity, lack of substitutability and interconnectedness of the banks, state reports.

How are D-SIBs determined?

Since 2015, the RBI has been releasing the list of all D-SIBs. They are classified into five buckets, according to their importance to the national economy.

In order to be listed as a D-SIB, a bank needs to have assets that exceed 2 percent of the national GDP. The banks are then further classified on the level of their importance across the five buckets.

What regulations do these banks need to follow?

Due to their economic and national importance, the banks need to maintain a higher share of risk-weighted assets as tier-I equity. SBI, since it is placed in bucket three of D-SIBs, has to maintain Additional Common Equity Tier 1 (CET1) at 0.60 percent of its Risk-Weighted Assets (RWAs).

Need for:

Should such a bank fail, there would be significant disruption to the essential services they provide to the banking system and the overall economy.

The too-big-to-fail tag also indicates that in case of distress, the government is expected to support these banks.

Due to this perception, these banks enjoy certain advantages in funding. It also means that these banks have a different set of policy measures regarding systemic risks and moral hazard issues.