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UPSC Daily Current Affairs : 04-June-2020

Topic Covered :

  1. Several strategic objectives at play in India-China border stand-off

  2. SC refuses to entertain PIL that wanted ‘India’ replaced with ‘Bharat’

  3. FRBM framework will need to be updated, says former CEA Arvind Subramanian

  4. Govt. to boost infrastructure in areas along China border 

  5. Cabinet nod for agri marketing reforms

  6. Need new stimulus of ₹10 lakh cr. - Economists



Why in news?

  • There is a larger dynamic at work in the India-China confrontation in Ladakh, one where India faces a pushback for trying to use the communist giant’s new post-Covid vulnerabilities to reduce its ability to flex muscle on the regional and global stage. 


  • The Chinese intrusions across the Line of Actual Control (LAC) in east Ladakh reflect “salami tactics” it has used to expand territorial and strategic space, not the least looking to wear down an opponent psychologically. 

  • It may also be a recognition that India is seeking to rework an equation that has allowed China to use the unsettled border and Pakistan to keep India off balance. 

  • It is a repercussion of India pitching itself as a welcoming destination to investors looking to leave China and being a part of a global effort to seek an investigation into the origin of coronavirus.

  • The Indian resolve to stand its ground in east Ladakh clearly indicates that China will need to ultimately pull back. This may need some trade-offs, but India's position is clear enough — China can use the element of surprise to get into Indian territory, but there will be no give or acceptance of a unilateral reordering of the LAC. 

Source : TOI ( )


Why in news?

  • The Supreme Court on Wednesday refused to entertain a Public Interest Litigations that wanted ‘India’ to be replaced with ‘Bharat’ as the name of the country, saying it was already there in the Constitution.


  • “We can’t do that. India is already called Bharat in the Constitution,” a Bench led by Chief Justice of India SA Bobde told petitioner’s counsel Ashwin Vaish.

  • Vaish argued that ‘India’ was derived from Greek word ‘Indica’ and it the name didn’t originate in the country. Renaming it to Bharat will help the country get over its colonial past, he said on behalf of petitioner Namaha.

  • At present, Article 1 of the Constitution states, “India, that is Bharat, shall be a Union of States.”

Source : Tribune India ( )


Why in news?

  • Former chief economic adviser Arvind Subramanian on Wednesday said the FRBM Act will probably have to be revised by the end of the year as India will witness a sharp decline in GDP growth due to the COVID-19 crisis. 


  • Subramanian further said while labour reforms were necessary, the way they have been done by some states have undermined basic protections to workers, especially in light of the migrant crisis. 

  • It is going to be a very very difficult economic year. We should brace ourselves for a sharp decline in GDP growth. 

  • We should also brace ourselves for the fact that India's deficit almost certainly will be double digit.

  • Talking about India's current macroeconomic situation amid the COVID-19 pandemic, he said the Fiscal Responsibility and Budget Management (FRBM) Act and terms of reference of the 15th Finance Commission will probably have to be revised and updated. 

  • The FRBM Act of 2003 seeks to reduce the country's fiscal deficit through financial discipline. 

  • Due to the Rs 20 lakh crore economic package announced by the government to mitigate the impact of the COVID-19 pandemic, India's debt-to-GDP will rise to 85 per cent. 

  • The former CEA also said the pandemic and the lockdown have made the case for Universal Basic Income (UBI) stronger. 

  • He also said the Insolvency and Bankruptcy Code (IBC) needs some modifications as due to the coronavirus-induced lockdown many firms will go bankrupt. 

  • The former CEA also termed the Centre's decision to allow states to borrow 200 basis points more than their fiscal deficit ceiling as an 'IMF-like programme'. 

Source : Economic Times ( )


Why in news?

  • To ramp up infrastructure along the China border, the Ministry of Home Affairs (MHA) has decided to spend 10% funds of a Centrally sponsored scheme only on projects in Ladakh, Arunachal Pradesh, Himachal Pradesh, Uttarakhand and Sikkim.


  • The Border Area Development Programme (BADP) has been allocated ₹784 crore in the 2020-21 fiscal and the money is distributed to the border States and Union Territories depending on various criteria such as the length of the international border and population.

  • In 2019-20, ₹825 crore was granted for the scheme.

  • Construction of roads, bridges, culverts, primary schools, health infrastructure, playfields, irrigation works, mini-stadiums, indoor courts for basketball, badminton and table tennis can be undertaken within 10 km of the border.

  • The creation of infrastructure “would help integrate these areas with the hinterland, create a positive perception of care by the country and encourage people to stay on in the border areas leading to safe and secure borders”, the MHA said.

Source : Hindu ( )


Why in news?

  • The Union Cabinet has approved an amendment to the 65-year-old Essential Commodities Act, removing cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. The amendment will be made effective immediately via an ordinance, according to the Agriculture Ministry.


  • The Cabinet also approved ordinances to remove restrictions on farmers selling their produce outside notified market yards, as well as to facilitate contract farming and allow farmers to engage in direct marketing

  • All these measures were promised in the Aatmanirbhar package announced by Finance Minister Nirmala Sitharaman last month.

  • The amendment to the ECA, which has been under discussion for more than a decade, will deregulate the production, storage, movement and distribution of these food commodities. 

  • By removing the private sector’s fears of “excessive regulatory interference,” the Centre hopes to increase private and foreign investment, especially in cold storage facilities and the modernisation of the food supply chain

  • Adequate processing and storage facilities will reduce wastage and increase income for farmers of perishable commodities.

  • To protect consumers, the amendment allows regulation during war, famine, extraordinary price rise and natural calamity, while providing exemptions for exporters and processors at such times as well.

  • The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020 aims to open up agricultural marketing outside notified mandis for farmers, and also remove barriers to inter-State trade.

  •  While both agriculture and markets are State subjects, the Centre is counting on the fact that trade and commerce in foodstuffs is part of the concurrent list to push through its ordinance.

  • Industry sources suggest that 60% of agricultural trade already takes place outside the mandis through unregulated sales. By legalising and facilitating such sales, the Centre hopes that farmers will benefit, rather than middlemen.

  • It is aimed at facilitating contract farming, where a private buyer contracts to purchase a crop at a certain price at the beginning of a season, transferring the risk of market unpredictability from the farmer to the corporate sponsor. 

  • farmers groups have expressed concern that corporates will benefit more than small farmers from such direct marketing measures, and wish to see the specific provisions of the ordinance before welcoming it.

Source : Hindu ( )


Why in news?

  • The Centre needs to announce a ₹10 lakh crore fiscal stimulus package providing universal food ration and cash transfers for 80% of households in order to revive the economy at this time, the Heterodox Economists Collective has urged.


  • Employment guarantees must be expanded for both rural and urban workers at a time of soaring joblessness.

  • Funding such a package would require suspension of fiscal deficit targets, which could impact the country’s credit rating. 

  • Presenting an analysis of the government’s ₹20 lakh crore Atmanirbhar package on Wednesday, the Heterodox Economists Collective observed that the fiscal component amounted to only ₹3 lakh crore, which includes already announced budgetary measures. 

  • The measures announced for MSMEs would only benefit larger players within that segment, they said, adding that provisions for higher liquidity may not increase actual credit offtake.

  • Minimum support prices for farmers had not kept pace with inflation, while real wages were being suppressed.

  • In order to mitigate the crisis, the public distribution system must be universalised, with free cereals, pulses and cooking oil provided to all for the next six months

  •  It proposed cash payments of ₹15,000 to the bottom 80% of households as compensation for lost incomes during the 75 days lockdown.

Source : Hindu ( )

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