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What to Read in Indian Express for UPSC Exam

18May
2023

Credit card spend in forex to come under LRS, and taxed 20% (Page no. 3) (GS Paper 3, Economy)

The Central Government, in consultation with the Reserve Bank of India, in a late night notification amended rules under the Foreign Exchange Management Act, bringing in international credit card spends outside India under the Liberalised Remittance Scheme (LRS).

As a consequence, the spending by international credit cards will also attract a higher rate of Tax Collected at Source (TCS) at 20 per cent effective July 1.

The notification brings transactions through credit cards outside India under the ambit of the LRS with immediate effect, which enables the higher levy of TCS, as announced in the Budget for 2022-23, from July 1.

This is expected to help track high-value overseas transactions and will not apply on the payments for purchase of foreign goods/services from India.

Prior to this, the usage of an international credit card to make payments towards meeting expenses during a trip abroad was not covered under the LRS.

The spendings through international credit cards were excluded from LRS by way of Rule 7 of the Foreign Exchange Management (Current Account Transaction) Rules, 2000. With the latest notification, Rule 7 has now been omitted, paving way for the inclusion of such spendings under LRS.

“It is strictly for transactions under Schedule III (of the FEM rules) and not for payments for purchase of foreign goods/services. This demand had come from the domestic travel industry,” a finance ministry official said.

 

Govt & Politics

Nutrient Based Subsidy for Kharif 2023 gets Cabinet nod (Page no. 9)

(GS Paper 3, Agriculture)

The Centre approved Nutrient Based Subsidy (NBS) rates for Nitrogen (N), Phosphorous (P), Potash (K) and Sulphur (S) for the 2023 kharif season.

The Union Cabinet, which met under the chairmanship of Prime Minister Narendra Modi, approved a proposal of the Department of Fertilisers for revision of the NBS rates for Kharif Season (April-September) 2023. The Cabinet also approved revision of the NBS rates for Rabi Season 2022-23 (January-March, 2023).

Briefing on Cabinet decisions, Fertilisers Minister Mansukh Mandaviya said, “The Cabinet has taken an important decision regarding fertiliser subsidy”.

During kharif season 2023, Rs 70,000 crore will be spent for urea subsidy and Rs 38,000 crore for DAP subsidy, taking the total fertiliser subsidy to Rs 1.08 lakh crore during the kharif season, Mandaviya said.

Mandaviya informed that the rate of subsidy has been fixed at Rs 76 per kg for N, Rs 41 per kg for P, Rs 15 per kg for K, and Rs 2.8 per kg for Sulphur for the 2023 kharif season.

The NBS rates for kharif 2022 stood at Rs 91.96 per kg for N, Rs 72.74 per kg for P, Rs 25.31 per kg for K, and Rs 6.94 per kg for Sulphur.

For Rabi season 2022-23, the NBS rates stood at Rs 98 per kg for N, Rs 66.93 per kg for P, Rs 23.65 per kg for K, and Rs 6.12 per kg for Sulphur.

 

Ideas Page

A new pension pact (Page no. 13)

(GS Paper 2, Polity and Governance)

The issue of government employees’ pension has become a serious political issue. Five states have already announced a reversion from the New Pension Scheme (NPS) to the defined-benefit (DB) Old Pension Scheme (OPS), and some more may be waiting to do so.

In an acknowledgement of the importance of the issue, the Government of India has constituted a committee to “improve” the NPS.

The contributory NPS was adopted in 2004 by the central and state governments in India following the global trend, across public and private sectors. Thanks to a combination of ageing populations and fiscal strains, a pay-as-you-go (PAYG) DB pension was becoming unsustainable.

The latest examples are France and Spain, where efforts to address fiscal unsustainability by raising retirement age and increasing contributions from younger workers respectively have sparked massive public protests.

Under the NPS, the employee contributes 10 per cent and the government 10-14 per cent of the salary to a pension fund. The fund invests in securities, therefore its returns are market-linked.

At retirement, pensioners must buy a fixed annuity from the market, whose value depends on the accumulated corpus and expected future returns.

 

The best medicine (Page no. 13)

(GS Paper 2, Health)

In January 2020, 12 children in Jammu died after consuming contaminated medicine manufactured by Digital Vision, a firm in Himachal Pradesh.

The medicine was found to contain diethylene glycol, which led to kidney poisoning. Digital Vision’s products had been red-flagged on 19 occasions by various state and central drug laboratories.

After the incident, Himachal’s state regulator found quality control failures in its site inspection of the manufacturer’s facilities.

Yet, six months later, a two-year-old from Himachal Pradesh died after consuming Cofset cough syrup, another product manufactured by Digital Vision.

In March 2021, another product, Nycup syrup, was found to have lower levels of the active ingredient by testing agencies. But regulatory action was limited, with the regulator finding it challenging to build a case against the manufacturer. India has close to 36 drug regulators. Yet, such incidents continue to happen.

India is proud of its pharmaceuticals industry. India is the largest manufacturer of generic medicines globally and its exports impact the lives of the global poor daily.

The rise of this industry was not easy — entrepreneurs struggled to achieve scale, while being hampered by regulations in many export markets and defamatory tales of how Indian drugs are ineffective or worse, harmful.

The industry is one of India’s true success stories — one of the few examples of competitive manufacturing. However, quality concerns persist — recently, 48 drugs have failed to meet quality standards.

Three per cent of all drugs in routine use — for hypertension, allergies and bacterial infections — were found to be substandard by regulatory inspectors.

 

Explained

The artificial sweetener story (Page no. 18)

(GS Paper 2, Health)

The World Health Organisation on Monday (May 15) recommended against using artificial sweeteners to achieve weight loss and prevent lifestyle diseases such as diabetes. The report emphasised that while there was a need to cut intake of sugar, it should not be replaced by artificial sweeteners.

Artificial sweeteners provide the sweet taste with very little to no calories. Many diabetics use the sweeteners in their tea and coffee, but there is a growing market for packaged foods and beverages using these sweeteners to offer low-calorie options.

WHO suggests that non-sugar sweeteners (NSS) not be used as a means of achieving weight control or reducing the risk of non-communicable diseases,” was the highlight of 90-page report based on nearly 283 studies.

While there could be some weight-loss and reduction in Body Mass Index in the short term as the artificial sweeteners bring down the calories consumed, but in the long run they have been linked to weight gain, the WHO report said.

The sweeteners have also linked to an increased risk of Type-2 diabetes, cardiovascular diseases, and mortality in the long run. Some low certainty data also linked the use of such artificial sweeteners to bladder cancer and preterm birth when consumed by pregnant women.

The meta-analysis found that higher intake of NSS was associated with a 23% increase in the risk of type-2 diabetes when consumed in the form of beverages and 34% when added to foods.

Higher intake of these sweeteners was also linked with 32% increase in the risk of cardio-vascular disease – including a 19% increase in risk for stroke – and 13% increase in the risk for hypertension.

 

Economy

Centre approves revised PLI scheme with Rs 17,000 cr outlay (Page no. 19)

(GS Paper 3, Economy)

The Union Cabinet cleared a revised production linked incentive (PLI) scheme for IT hardware with an outlay of Rs 17,000 crore, more than doubling the budget for the scheme that was first cleared in 2021.

The scheme will be implemented from July 1, with a cap on maximum incentives available to participating companies.

The first version of the scheme was a laggard with only two companies – Dell and Bhagwati – managing to meet first year’s (FY22) targets, and the industry calling for a renewed scheme with an increased budgetary outlay.

Union Minister of Electronics and IT Ashwini Vaishnaw said that the renewed scheme could attract big global IT hardware manufacturers to shift their production base to India and give a boost to local production of laptops, servers and personal computers among others.

The tenure of the new scheme has been fixed for six years and the Centre is expecting an investment of over Rs 2,430 crore as part of it.

The expected incremental production value could touch Rs 3.35 lakh crore, and the scheme could generate 75,000 direct jobs – in total, the employment figure could touch 2 lakh when accounted for indirect jobs.

Investments made by eligible companies in contract manufacturers and for attaining exclusive arrangements with component manufacturers will also be considered under the scheme.

 

DoT’s AI-based facial recognition tool: how it works (Page no. 19)

(GS Paper 3, Science and Technology)                        

The Department of Telecommunications (DoT) has developed an artificial-intelligence-based facial recognition tool that it claims has the capability of running checks on subscriber databases of telecom operators to deduce whether it contains multiple connections associated with the same person.

The DoT claims the tool — called Artificial Intelligence and Facial Recognition powered Solution for Telecom SIM Subscriber Verification (ASTR) — can potentially bring down cyber frauds by detecting and blocking possible fraudulent mobile connections.

In 2012, DoT had issued an order to all telecom operators that they would have to share their subscriber database including users’ pictures with the department.

These images constitute the core database on which authorities are running their facial recognition algorithm using ASTR. The ASTR project was conceptualised and designed between April 2021 and July 2021 by the DoT’s unit in Haryana.

A pilot project was launched in Haryana’s Mewat region to test ASTR’s feasibility. It is understood that before the ASTR pilot project, there were approximately 16.69 lakh SIMs in Mewat, of which close to 5 lakh SIMs across all telecom operators were detected to be fraudulent.