Kurukshetra IAS Academy Blogs

1.‘Don’t declare LS election schedule till SBI disclosure’

Days after the State Bank of India (SBI) sought an extension from the Supreme Court to submit data on electoral bonds, a group of former civil servants on Saturday asked the Election Commission (EC) not to announce the schedule for Lok Sabha polls till the bank shares the information as mandated by the top court.

The former bureaucrats, under the banner of the Constitutional Conduct Group (CCG), said that SBI should give the electoral bonds data much before the announcement of the general election.

The Supreme Court had on February 15 scrapped the electoral bonds scheme. It had also directed SBI to furnish data regarding the electoral bonds to the Election Commission by March 6. The public sector bank had on March 4 moved the Supreme Court seeking an extension of time till June 30 to disclose the details of the bonds.

The CCG, which said that it had no affiliation with any political party but believes in impartiality, neutrality and commitment to the Constitution, noted with dismay that it took the SBI 17 days to inform the Supreme Court on March 4 that they are not in a position to collate the data by March 6.

“For India’s largest bank with 48 crore accounts and boasting high levels of digitisation, a pathetic excuse has been proffered that records were kept manually and hence the extension sought,” it said in a letter to Chief Election Commissioner Rajiv Kumar and Election Commissioner Arun Goel.

‘Shielding the govt.’

The CCG quoted a letter by Thomas Franco, former general secretary of the All India Banking Officers’ Confederation, which pointed out that SBI had asked the government in June 2018 for a sum of more than ₹60 lakh for development of IT systems for the electoral bonds scheme.

The SBI denying this information and indicating that it would not be available before the general election seems to indicate that the bank is shielding the government in power from any criticism, the letter said.

2.Navy demonstrates twin-carrier operations

The first edition of the Naval Commanders’ Conference of 2024 concluded on Friday. The first part of the conference was held at sea on board aircraft carrier INS Vikramaditya on March 5 during which the Navy showcased its “twin-carrier operations” with MiG-29K fighter jets taking off simultaneously from both INS Vikramaditya and INS Vikrant, and then landing cross deck. The operations were witnessed by Defence Minister Rajnath Singh and Chief of Defence Staff Gen. Anil Chauhan.

The remainder of the conference was held in New Delhi.

The twin-carrier operations also demonstrate that the first indigenous aircraft carrier, INS Vikrant, has been fully integrated into the operational cycle. The twin operations were followed by a sail by several warships of the Navy.

The conference happened amid the high operational tempo of the Navy with developments in the Red Sea and renewed piracy attempts in the Gulf of Aden.

Mr. Singh underscored the leadership role expected of the Indian Navy towards ensuring peace and prosperity in the Indian Ocean Region.

The proceedings at New Delhi on March 7 and 8 included a review of major operational, material, infrastructure, logistics and personnel-related initiatives, the Navy said.

3.What are the hurdles to fair global trade?

The story so far:

The World Trade Organization (WTO) held its 13th Ministerial Conference (MC13) at Abu Dhabi in the UAE between February 26 and March 2, which was attended by 166 member countries. At the conclusion of the meeting, a ministerial declaration was adopted that set out a forward-looking, reform agenda for the 30-year-old organisation, which is tasked with overseeing global trade regulations and facilitating smooth cross-border flow of goods, services, investment and people. The members resolved “to preserve and strengthen the ability of the multilateral trading system, with the WTO at its core, to provide meaningful impetus to respond to current trade challenges, take advantage of available opportunities, and ensure the WTO’s proper functioning”.

What are some key decisions?

The ministers took a number of decisions, including renewing the commitment to have a fully and well-functioning dispute settlement system by 2024 and to improve use of the special and differential treatment (S&DT) provisions for developing and least developed countries (LDCs).

Some of the biggest challenges to the multilateral trading order have come from an increasingly vocal movement across different countries, particularly in developed economies, that seeks to turn inwards and move away from a globalised and relatively harmonised-tariffs approach to world trade. This has come even as the ongoing conflicts in various parts of the world, combined with the sanctions that some states have applied on others over these conflicts, threaten supply chains and the smooth flow of goods and services worldwide. The relative levels of development among the richer nations and the LDCs have also focussed attention on the need to ensure norms do not adopt a ‘one-size-fits-all’ approach.

How did India approach the deliberations?

A central focus of the Indian delegation headed by Union Commerce Minister Piyush Goyal was to try and find resolution on a key concern for India and several other developing economies pertaining to the public stockholding (PSH) programme, which is at the heart of ensuring food security in their countries. The PSH is a vital policy tool for the Indian government to procure crops such as rice and wheat from farmers at minimum support price (MSP), and subsequently store and distribute the foodgrains to the poor. The MSP is normally higher than the prevailing market rates and the government supplies the cereals at a low price to ensure food security for the country’s more than 800 million beneficiaries. However, under WTO norms, a member nation’s food subsidy bill should not exceed 10% of the value of production based on the reference price of 1986-88. Developed nations contend that these kinds of programmes distort global trade in foodgrains, especially by either potentially pushing up or depressing global grain prices.

Some of the other key concerns are related to the fisheries sector and a moratorium on customs duties on e-commerce trade. India, as a low subsidiser of the fisheries sector, had mooted that developing countries be allowed to give subsidies to their poor fishermen to catch fish within the nation’s exclusive economic zones (EEZs), or up to 200 nautical miles from the shore. It also proposed rich countries needed to stop providing any kind of subsidies for fishing that their nation’s industrialised vessels may carry out in the high seas beyond the EEZs, at least for the next 25 years.

And on e-commerce, India along with several developing nations has been consistently seeking an end to the moratorium in place since 1998 on their ability to levy customs duties on cross-border e-commerce. India has argued that this undermines its ability to generate revenue from a rapidly burgeoning area of global trade.

What were the outcomes at MC13?

On the agriculture front, as the WTO’s Director General Ngozi Okonjo-Iweala acknowledged in her closing speech, this was the first time that there has been a text. “This has been in the works for the past two decades plus. At MC12 we couldn’t even agree on a text. Even though there are challenges, for the first time we have a text,” she observed. Also, on the fisheries front, a consensus accord now appears close to reaching fruition by mid-year.

However, disappointingly for India, the exemption from customs duties for e-commerce will now carry on for at least two more years.

4.India to gain higher investments from FTA pact with EFTA

The free trade agreement will showcase India’s commitment to trade liberalisation, when the world is turning protectionist, says GTRI

India’s gains from the proposed free trade agreement with the European Free Trade Association (EFTA) countries, to be signed on Sunday, will have to mostly flow from the $100-billion investment and one million jobs promised by the bloc over 15 years, as goods exports may gain minimally due to insignificant existing tariffs, research body Global Trade Research Initiative (GTRI) indicated in a report.

New Delhi convinced the EFTA countries, which include Switzerland, Iceland, Norway and Liechtenstein, to weave in commitments on minimum investment flow and job creation keeping in mind that the existing goods tariffs in the bloc are already zero or very low, an official told businessline.

Trade with Swiss

This is especially true for Switzerland, which accounted for $1.38 billion of the total $1.87 billion of Indian exports to the EFTA in CY2023.

“Since 98% of India’s exports to Switzerland are industrial goods already entering at zero tariffs, they won’t benefit from the FTA,” observed Ajay Srivastava, co-founder, GTRI. “India’s agricultural exports are minimal and unlikely to increase significantly due to strict quality standards and non-tariff barriers,” Mr. Srivastava pointed out in the report.

The signing ceremony of the proposed pact in New Delhi on March 10, officially called the India-EFTA Trade and Economic Partnership Agreement (TEPA), is likely to include trade ministers of some EFTA countries as well, such as Norway, apart from Commerce & Industry Minister Piyush Goyal.

Low scope for access

The low scope for increasing market access for goods in EFTA could be of concern as India had a trade deficit of $18.58 billion with the bloc in CY23, with its imports at $20.45 billion. Of this, gold and other precious metals, stones and coins, all imported from Switzerland, accounted for $16.7 billion. Gold, making up 80% of India’s imports from Switzerland, is a critical factor, GTRI said.

‘Little competition’

The JV areas that the countries have short-listed, where investments are to be made, mostly do not have competition from India, the official said, speaking on the condition of anonymity.

“EFTA has agreed to the condition of investments being made in India because they are getting market access,” the official noted. “Also, they are not our competitors in the identified sectors. For instance, in India, most medical devices are imported from China. The pact will lead to diversification of imports, which is absolutely necessary,” the official added.

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