Tag: Union Government Releases ₹1.73 lakh Crore to States for Tax Devolution

UPSC DAILY CURRENT AFFAIRS (11TH JANUARY, 2025) Union Government Releases ₹1.73 lakh Crore to States for Tax Devolution Syllabus: GS2/ Polity, Centre-State Relations, GS3/Economy Context The Centre released tax devolution of ₹1.73 lakh crore to the state governments to accelerate capital expenditure and finance welfare activities. About A higher amount is being devolved this month to enable states to accelerate capital spending and finance their development and welfare-related expenditures. Uttar Pradesh, Uttarakhand and Bihar have received the largest shares of funds. What is Tax devolution? Tax devolution refers to the distribution of tax revenues between the central government and the state governments. Objective: To promote fiscal federalism, strengthen the financial autonomy of state governments, and empower them to meet the needs of their respective populations. Article 280 of the Indian Constitution mandates the creation of the Finance Commission, which determines the formula for devolution of taxes. The central government collects taxes (like income tax, GST, etc.) and a portion is shared with the states based on the Finance Commission’s recommendations. Formula Used: States’ share is decided by a formula meant to incentivize demographic performance and each states effort to mobilize its own tax revenue. The formula also takes into account geographic area, forest cover and the state’s per capita income. The Centre also aids States through additional grants for certain schemes that are jointly funded by the Centre and the States. Constitutional Provisions Related to Centre State Financial Relations– Articles 202 to 206 deal with the financial administration of states, including provisions related to their budget, expenditure, borrowing, and taxation powers.– Articles 268 to 272 outline the distribution of revenues between the Union and the states.– Article 280 provides for the establishment of a Finance Commission every five years (or as specified by the President).– Article 282 allows the Union government to provide financial assistance to states for any public purpose. Current Share of the States Recommendations of the 14th FC: It hiked the tax devolution to states to 42% from 32%, and also added a new provision of revenue deficit grants to states facing any resource gap. The 15th finance commission, under the chairmanship of N K Singh has revised tax devolution and brought it down to 41% from 42%. So the current tax devolution to states stands at 41% till 2026. The 90:10 rule is still applicable to the northeastern and hill states, although there is no special status category. All the other states receive Central funding in a 60:40 ratio, 60% being the Central government’s contribution and 40% states. Concerns of the States Demand for more funds: States argue they should receive more funds than recommended by the Finance Commission. States argue that they have greater responsibilities, including education, healthcare, and policing services. Disparities Among States: Developed States like Karnataka and Tamil Nadu feel they receive less money from the Centre than they contribute in taxes. In other words, it is argued that more developed States with better governance are being penalized by the Centre to help States with poor governance. Divisible Pool Concerns: Cesses and surcharges, which are not shared with the States, can constitute up to 28% of the Centre’s tax revenues, leading to revenue losses for States. Criticism of the Finance Commission: Critics believe the Finance Commission may not be fully independent due to the Centre’s role in appointing its members, leading to potential political influence. Way Ahead GST and Cooperative Federalism: Strengthening the Goods and Services Tax (GST) framework for smoother tax collection and distribution between the center and states, ensuring a fairer tax system for all regions. Improved Tax Administration: Modernizing state tax administration and improving compliance. Fiscal Equalization: Ensuring a balanced devolution of resources, considering the economic disparities among states, so that poorer states receive more support. Capacity Building: Strengthening the financial management and capacity of states to better utilize devolved funds for development. Implications of China’s Mega-Dam Project Syllabus: GS2/ International Relations Context China has approved the construction of the world’s largest hydropower project on the Yarlung Tsangpo (or Zangbo) river in Tibet. About The 60 GW capacity project was included in China’s 14th Five-Year Plan (2020) and approved in 2024. The dam will be built at the Great Bend, where the river takes a U-turn, in the Medog county of the Tibetan Autonomous Region. The $137-billion hydropower project is expected to generate around 300 billion kilowatt-hours of electricity annually — potentially three times more energy than the Three Gorges Dam. China has previously constructed significant dams like the Three Gorges Dam (Yangtze) and Zangmu Dam (Yarlung Zangbo). In the project, India and Bhutan are middle riparian countries, while Bangladesh is the lowermost riparian nation. The main river does not flow through Bhutan, but 96% of the country’s area is within the basin. Yarlung Tsangpo ( Zangbo) river– It originates in Tibet, and enters Arunachal Pradesh, where it is known as the Siang. – In Assam, it is joined by tributaries such as Dibang and Lohit, and is called the Brahmaputra. – The river then enters Bangladesh, and makes its way to the Bay of Bengal. Impact of the Project Hydrological Impact: Altered water flow patterns have probability to increase flooding during monsoons and water scarcity in dry seasons, affecting downstream nations like India and Bangladesh. Ecological Risks: Threat to biodiversity and river ecosystems, including aquatic species and wetlands. Seismic and Structural Risks: The Brahmaputra basin is seismically active, as evidenced by the 1950 Assam-Tibet earthquake. A mega-dam in this zone could trigger disasters like dam collapse and floods due to structural failure. Geopolitical Tensions: Control over water resources may heighten tensions between China and lower riparian countries (India, Bhutan, Bangladesh). Disaster Vulnerability: Increased risk of Glacial Lake Outburst Floods (GLOFs), as seen in the 2023 Sikkim floods. Coordination Mechanism for Cooperation There is an umbrella Memorandum of Understanding on cooperation on transboundary rivers, and two separate MoUs on the Brahmaputra and Sutlej. The Brahmaputra MoU, renewable every five years, lapsed in 2023. The umbrella MoU was signed in 2013, and has no expiry date. China and India have the Expert Level Mechanism (ELM) since 2006 for hydrological data sharing, but lack a comprehensive treaty. None of the riparian nations (China, India, Bhutan, Bangladesh) are signatories to the UN Convention on the Law of the Non-navigational Uses of International Watercourses (1997). Way Ahead Strengthen diplomatic dialogue: Between China, India, Bhutan, and Bangladesh for transparent water-sharing agreements. Institutional Mechanism: Establish a permanent transboundary river management authority for data-sharing on water flow, dam operations, and disaster forecasting. Disaster Preparedness: Enhance regional cooperation for disaster management, including shared resources for relief efforts. Same Sex Marriage: SC Rejects Review of Judgment Syllabus: GS1/Social Empowerment; GS2/Government Policies & Interventions Context Recently, a five-judge Bench of the Supreme Court rejected petitions seeking a review of a judgment which refused to legalise same-sex marriage in India. Background The Supreme Court of India, in October 2023, ruled and acknowledged the discrimination faced by same-sex couples & emphasized that such a decision should be made by Parliament, which is better suited to debate and legislate on this complex social issue. Same-Sex Marriage It is the practice of marriage between two men or between two women. It has been regulated through law, religion, and custom in most countries of the world. India does not recognise registered marriage or civil unions for same-sex couples. Though, same-sex couples can attain equal rights and benefits as a live-in couple as per a Supreme Court of India judgement in 2022 under part of Article 21 (the right to life). Special Marriage Act, 1954: It provides a civil marriage for couples who cannot marry under their personal law. However, the Supreme Court of India (in 2023) ruled that the Special Marriage Act (SMA) of 1954 does not apply to same-sex marriages: The court unanimously agreed that there is no fundamental right to marry. The court ruled that the Special Marriage Act, 1954 cannot be amended to include same-sex marriages. The court ruled that same-sex couples cannot form civil unions or adopt. Arguments in Favour of Same-Sex Marriage in India Equality and Non-Discrimination: Advocates argue that denying same-sex couples the right to marry is a form of discrimination that violates the principles of equality enshrined in the Indian Constitution. Legal recognition of same-sex marriage would affirm the dignity and rights of LGBTQIA+ individuals. Legal and Social Benefits: Marriage provides numerous legal and social benefits, including inheritance rights, tax benefits, and social security. Recognizing same-sex marriages would ensure that LGBTQIA+ couples have access to these benefits, promoting their well-being and security. Improving Mental Health: Legal recognition of same-sex marriages can improve the mental health of LGBTQIA+ individuals by reducing stigma and promoting social acceptance. International Precedents: Many countries have legalized same-sex marriage, setting a global precedent for equality. India, as a progressive democracy, could align itself with these international standards by recognizing same-sex marriages. Global Position on Same Sex Marriages– The Netherlands was the first country in 2001 to legalise same-sex marriage by amending civil marriage law. 1. According to the Council of Foreign Relations, same sex marriages are legal in at least 30 countries, including the United States, Australia, Canada and France.– Many countries first recognised same-sex civil unions as the escalatory step to recognise homosexual marriage.– Most countries in North and South America and Europe have legalised same sex marriage. Arguments Against Same-Sex Marriage in India Cultural and Religious Beliefs: Opponents argue that same-sex marriage is contrary to traditional Indian cultural and religious values. They believe that marriage should be between a man and a woman, as per the customs and beliefs of many communities. Legislative Domain: The Supreme Court of India has ruled that the legalization of same-sex marriage falls within the legislative domain, not the judiciary. It means that any change in the law should come from Parliament, reflecting the will of the people. Social Readiness: Some argue that Indian society is not yet ready to accept same-sex marriages. They believe that legalizing same-sex marriage could lead to social unrest and backlash from conservative sections of society. Alternative Legal Recognition: Instead of marriage, some suggest that civil unions or domestic partnerships could provide legal recognition and rights to same-sex couples without altering the traditional definition of marriage. Review Petition in the Supreme Court of India– It is a legal remedy available to a party who seeks to challenge a judgment or order passed by the Supreme Court.– It is filed under Article 137 of the Constitution of India, which grants the Supreme Court the power to review its own judgments or orders.1. This power is however subject to the Rules made by the Supreme Court (under Article 145), as well as the provisions of any law enacted by Parliament.Grounds for Filing:1. An error apparent on the face of the record;2. Discovery of new and important information;3. Any other sufficient reason.– Who can file: Anyone aggrieved by a ruling can file a review petition, not just parties to the case.– Time Limit: Must be filed within 30 days from the date of the judgment or order sought to be reviewed.– Procedure: Review petitions are always heard by the same Bench that delivered the original judgment.1. If judges on the original Bench have retired, the Chief Justice will use his/her discretion to replace them.– Outcome: The Supreme Court may either accept or reject the review petition.1. If accepted, the court may modify, reverse, or affirm its original judgment or order. Implications of Dismissal of the Review Petitions It means that same-sex couples in India will continue to lack legal recognition for their relationships. The court’s decision underscores the need for legislative action to address the rights and recognition of same-sex couples. Until then, the LGBTQIA+ community remains dependent on the government’s policy and legislative wisdom. Right to Food and the Struggle with the PDS Syllabus: GS2/ Governance, GS3/ Economy Context The Right to Food in India faces challenges due to inefficiencies in the Public Distribution System (PDS), hindering equitable access to essential food grains. Status of Food Security in India India has been ranked 105th out of 127 countries in the Global Hunger Index (GHI) 2024, placing it in the “serious” category for hunger levels. The State of Food Security and Nutrition in the World 2023 report highlights that approximately 224 million people in India experienced moderate or severe food insecurity in 2021-2022. Recognition of the Right to food– The right to food is recognized in the Universal Declaration on Human Rights and the International Covenant on Economic, Social and Cultural Rights (ICESCR).– In India, the right to food was recognised as a fundamental right Article 21 of the Constitution in the case, People’s Union of Civil Liberties vs Union of India. What is a PDS System? The Public Distribution System (PDS) is a food security system in India that distributes food and other items to the poor at subsidized prices. The PDS is a joint responsibility of the central and state governments. The central government, through the Food Corporation of India (FCI), procures, stores, transports, and allocates food grains to the states. State governments manage the system at the ground level, including allocating food within the state, identifying eligible families, and issuing ration cards. Challenges with the PDS System Diversion of Food Grains: A significant portion of food grains is leaked during transportation or diverted to the black market. Exclusion Due to Biometric Verification: Many individuals lose access to monthly rations as their names are removed from PDS rolls after biometric mismatches during Aadhaar-based verification. Corruption at Fair Price Shops (FPS), such as under-weighing food grains, selling poor-quality goods, or charging higher prices, undermines the system’s effectiveness. Inadequate warehousing facilities lead to spoilage and wastage of food grains. Reforms and Modernization Efforts National Food Security Act, 2013: Enacted to provide legal entitlement to subsidized food grains to two-thirds of India’s population. Ensures the coverage of 75% of rural and 50% of urban population. The Targeted Public Distribution System (Control) Order of 2015 was issued by the Ministry of Consumer Affairs, Food and Public Distribution. It established responsibilities for the Centre and States, and set up a grievance redressal mechanism. Digital Ration Cards: The introduction of digital ration cards and Aadhaar-based biometric authentication aims to eliminate fake and duplicate ration cards. Direct Benefit Transfer (DBT): In some regions, DBT has been implemented, where money is transferred directly to the bank accounts of beneficiaries instead of providing food grains. End-to-End Computerization: The PDS system is being computerized to improve transparency, minimize leakages, and make distribution more efficient. Food Safety and Quality Monitoring: Various measures have been taken to improve the quality control of food grains provided under the PDS. Way Ahead Infrastructure Expansion: Strengthen storage and transportation facilities to support the growing scale of operations. Technological Integration: Leverage artificial intelligence and blockchain for real-time tracking and reducing inefficiencies. Implement social audits and public grievance redressal mechanisms to hold PDS stakeholders accountable and address issues like corruption and leakages. Wildfires in California Syllabus: GS3/Environment, Conservation In News The US declared an emergency in Los Angeles as the wildfire spread to nearly 3000 acres. What are Wildfires? A wildfire is an unplanned fire that burns in a natural area such as a forest, grassland, or prairie. Wildfires are triggered by both natural events which include lightning and volcanic eruption etc and human activity which includes unattended campfires, discarded cigarettes, arson, slash-and-burn farming. Factors causing wildfires Anthropogenic Activities: Increased development near forested areas, also known as the Wildland-Urban Interface (WUI), heightens fire risks from human activities. Careless actions, such as Illegal campfires or bonfires or use of fireworks during dry conditions. Also, loss of forests reduces natural fire barriers and heightens fire risk. Dry Winter: Southern California experiences negligible rainfall from October onwards, leading to extremely dry vegetation prone to burning. Santa Ana Winds: They are common in California in this season, but this year, they are unusually strong. Thus, once a fire started in the prevailing dry conditions, the strong winds made the flames get bigger and spread faster. Climate Change: Longer and more intense dry seasons increase vegetation stress due to lack of moisture, exacerbating fire risks. Impacts of Wildfires Toxic Pollutants: Wildfire smoke contains harmful pollutants like PM2.5, NO₂, ozone, and aromatic hydrocarbons. These pollutants cause respiratory and heart issues, especially in vulnerable populations. Climate Change Intensification: Wildfires release large amounts of CO₂ and methane, contributing to global warming. Social & Economic Losses: Destruction of property, infrastructure, and businesses. Communities prone to wildfire areas are often forced to evacuate, losing homes and livelihoods. Soil and Land Degradation: Destruction of soil organisms and loss of organic matter. Increased soil erosion, leading to loss of fertile land. Way Forward Enhanced Monitoring and Early Warning Systems: Expanding satellite technology and GIS tools to improve early detection and monitoring of fires in real time. Ex: The Forest Survey of India developed VAN AGNI, a portal that provides alerts and real-time data on forest fires. Global Collaboration and Knowledge Sharing: Strengthening international cooperation to share data, research, and best practices in wildfire prevention and response. Forming partnerships between governments, NGOs, and private sectors for coordinated efforts in fire management. Addressing Climate Change: Implementing policies to combat climate change and reduce global temperatures, which contribute to prolonged fire seasons. Focusing on carbon sequestration strategies, such as forest conservation and reforestation, to mitigate the long-term impacts of wildfires. Forest Fires in India– India witnesses around 50,000 to 60,000 forest fire incidents annually, particularly during the dry season (March to June).– The fires are mainly concentrated in states like Odisha, Chhattisgarh, Madhya Pradesh, Uttarakhand, and Himachal Pradesh.– Dry deciduous forests are most prone to severe fires.1. Evergreen, semi-evergreen, and montane temperate forests are less prone to fires.– Fire-Prone Forest Areas: Over 36% of India’s forest cover is prone to frequent fires.1. 4% of forest cover is extremely prone, and 6% is very highly fire-prone.2. 54.40% of India’s forests are exposed to occasional fires.Growth in Organic Farming Sector of India

Tag: Union Government Releases ₹1.73 lakh Crore to States for Tax Devolution

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