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06 May, 2021

78 Min Read

Maratha quota unconstitutional, violates right to equality, says SC

GS-II : Governance Reservation issue

Maratha quota unconstitutional violates right to equality, says SC

  • The Supreme Court struck down the findings of the Justice M.G. Gaikwad Commission, which led to the enactment of the Maratha quota law, and set aside the Bombay High Court judgment which validated the Maharashtra State Reservation for Socially and Educationally Backward Classes (SEBC) Act of 2018. It declared the Maharashtra law unconstitutional.

Only the Centre is empowered to identify SEBC

  • The Centre alone is empowered to identify Socially and Educationally Backward Classes (SEBC) and include them in the Central List for claiming reservation benefits.
  • “The President (that is the Central government) alone, to the exclusion of all other authorities, is empowered to identify SEBCs and include them in a list to be published under Article 342A (1), which shall be deemed to include SEBCs in relation to each State and Union Territory for the purposes of the Constitution.
  • Justice Bhat said the States could only make suggestions to the President or the statutory commissions concerned for inclusion, exclusion or modification of castes and communities to be included in the List.
  • The Central List is to be the “only list” for the SEBC.
  • Once published, under Article 342A (1), the list can only be amended through a law enacted by Parliament, by virtue of Article 342A (2).
  • In the task of identification of SEBCs, the President shall be guided by the Commission (National Commission for Backward Classes) set up under Article 338B; its advice shall also be sought by the State in regard to policies that might be framed by it.
  • If the commission prepares a report concerning matters of identification, such a report has to be shared with the State government, which is bound to deal with it, in accordance with provisions of Article 338B.
  • However, the final determination culminates in the exercise undertaken by the President (i.e. the Central Government, under Article 342A (1).
  • However, “the President’s prerogative as far as the identification and inclusion of SEBCs in the List would not affect the States’ power to make reservations in favour of particular communities or castes, the quantum of reservations, the nature of benefits and the kind of reservations, and all other matters falling within the ambit of Articles 15 and 16”.

  • The Bench found there was no “exceptional circumstances” or “extraordinary situation” in Maharashtra, which required the State government to break the 50% ceiling limit to bestow quota benefits on the Maratha community.
  • “We have found that no extraordinary circumstances were made out in granting separate reservation for Maratha community by exceeding the 50% ceiling limit of reservation... The Marathas are in the mainstream of the national life. It is not even disputed that Marathas are a politically dominant caste.
  • The High Court, in June 2019, reduced the quantum of reservation for Marathas from the 16% recommended by the Gaikwad Commission to 12% in education and 13% in employment.
  • The Supreme Court concluded that even the reduced percentages were ultra vires.
  • In fact, the Supreme Court held that a separate reservation for the Maratha community violated Articles 14 (right to equality) and 21 (due process of law).
  • Most important, the top court declined to revisit its 1992 Indra Sawhney judgment, which fixed the reservation limit at 50%.
  • The judgment of Indra Sawhney has stood the test of time and has never been doubted by any judgment of this court.
  • The ceiling of 50% with the ‘extraordinary circumstances’ exception, is the just balance — what is termed as the ‘Goldilocks solution’ — i.e. the solution containing the right balance that allows the State sufficient latitude to ensure meaningful affirmative action to those who deserve it and at the same time ensures that the essential content of equality.

Source: TH

Assam Earthquake

GS-I : Physical Geography Earthquake

Assam Earthquake

What is an Earthquake?

  • An earthquake is a natural event which is caused due to release of energy, which generates waves that travel in all directions.
  • The vibrations called seismic waves are generated from earthquakes that travel through the Earth and are recorded on instruments called seismographs.
  • The location below the earth’s surface where the earthquake starts is called the hypocenter, and the location directly above it on the surface of the earth is called the epicentre.

Earthquake zones of India

  • The major reason for the high frequency and intensity of the earthquakes is that the Indian plate is driving into Asia at a rate of approximately 47 mm/year.
  • Geographical statistics of India show that more than 50% of the land is vulnerable to earthquakes.
  • The latest version of the seismic zoning map of India divides India into 4 seismic zones (Zone 2, 3, 4 and 5).

Zones of Seismicity

  • Zone 1: Currently the Division does not include a Zone 1. NO area of India is classed as Zone 1.
  • Zone 2: This region is liable to MSK VI or less and is classified as the Low Damage Risk Zone.
  • Zone 3: This zone is classified as a Moderate Damage Risk Zone which is liable to MSK VII.
  • Zone 4: This zone is called the High Damage Risk Zone and covers areas liable to MSK VIII. Jammu and Kashmir, Ladakh, Himachal Pradesh, Uttarakhand, Sikkim, the parts of Indo-Gangetic plains (North Punjab, Chandigarh, Western Uttar Pradesh, Terai, North Bengal, Sundarbans) and the capital of the country Delhi fall in Zone 4.
  • Zone 5: Zone 5 covers the areas with the highest risks zone that suffers earthquakes of intensity MSK IX or greater. The region of Kashmir, the Western and Central Himalayas, North and Middle Bihar, the North-East Indian region, the Rann of Kutch and the Andaman and Nicobar group of islands fall in this zone.

Himalayan Frontal Thrust (HFT)

  • The Main Frontal Thrust (MFT), also known as the Himalayan Frontal Thrust (HFT) is a geological fault in the Himalayas that defines the boundary between the Indian and Eurasian Plates.
  • The fault is well expressed on the surface and thus could be seen via satellite imagery.
  • It is the youngest and southernmost thrust structure in the Himalayas deformation front. It is a splay branch of the Main Himalayan Thrust (MHT) as the root décollement.
  • It runs parallel to other major splays of the MHT; Main Boundary Thrust (MBT) and Main Central Thrust (MCT).
  • The MFT accommodates almost the entire rate of subduction of the Indian Plate therefore, it is no surprise that numerous earthquakes have occurred along this fault, and is expected to produce very big earthquakes in the future.
  • Many earthquakes associated with the MFT have resulted in visible ground ruptures, as seen in the Bihar earthquake of 1934 and the 1505 magnitude 8.9 earthquake.

Kopili Fault Zone:

  • The Kopili fault zone is a 300 km long and 50 km wide lineament (linear feature) extending from the western part of Manipur up to the tri-junction of Bhutan, Arunachal Pradesh and Assam.
  • The area is seismically very active falling in the highest Seismic Hazard zone V associated with collisional tectonics where the Indian plate subducts beneath the Eurasian Plate.
  • Subduction is a geological process in which one crustal plate is forced below the edge of another.
  • Squeezed between the subduction and collision zones of the Himalayan belt and Sumatran belt, the North East is highly prone to earthquake occurrences.

Reasons for Assam Earthquake

  • According to the National Centre for Seismology (NCS) report, the tremors have been attributed to the Kopili Fault zone closer to Himalayan Frontal Thrust (HFT).
  • NCS is the nodal agency of the Government of India for monitoring earthquake activity in the country. It comes under the Ministry of Earth Sciences.
  • An earthquake of magnitude 6.4 on the Richter scale hit Assam.
  • The primary earthquake had its epicentre at latitude 26.690 N and longitude 92.360 E, about 80 km northeast of Guwahati, and a focal depth of 17 km.
  • The events are located near to Kopili Fault closer to Himalayan Frontal Thrust (HFT).
  • The Kopili Fault is a 300-km northwest-southeast trending fault from the Bhutan Himalaya to the Burmese arc.
  • The fault is a fracture along which the blocks of crust on either side have moved relative to one another parallel to the fracture.
  • The area is seismically very active falling in the highest Seismic Hazard zone V associated with collisional tectonics where the Indian plate sub-ducts beneath the Eurasian Plate the NCS report said.
  • The area is seismically very active falling in the highest Seismic Hazard zone V associated with collisional tectonics where the Indian plate sub-ducts beneath the Eurasian Plate.
  • When an earthquake occurs on one of these faults, the rock on one side of the fault slips with respect to the other. The fault surface can be vertical, horizontal, or at some angle to the surface of the earth.

What is the news?

  • An unfamiliar lineament is among four factors behind frequent earthquakes in northern Assam’s Sonitpur area.
  • A lineament is a linear feature in a landscape dictated by an underlying geological structure such as a fault.
  • According to the Geological Survey of India (GSI), Sonitpur district lies within a tectonically complex triangular area bounded by the east-west trending Atherkhet Fault, the northwest-southeast trending Kopili Fault and a north-south trending lineament.
  • The two faults and the lineament, along with the oblique convergence of the Indian plate, have caused frequent earthquakes.
  • The National Centre of Seismology recorded 29 earthquakes of magnitude varying from 2.6 to 4.7 in Sonitpur after the 6.4 tremblor on April 28 that damaged several buildings, bridges and a river embankment.
  • The last of these 29 earthquakes with Sonitpur as the epicentre was recorded early Wednesday morning. Five more of magnitudes 2.6-3.2 were also recorded in neighbouring districts during this period.
  • Sonitpur was the epicentre of this huge 6.4 earthquake after 33 years because of the tectonic complexity. The Atherkhet and Kopili faults, the north-south lineament and the oblique convergence of the Indian plate is causing repetitive earthquakes.
  • Both the Atherkhet and Kopilli are active but we do not know about the nature of the lineament involved.
  • Atherkhet and Kopili are not the only faults that impact the Sonitpur region. The Siang Fracture, Yemla Fault, Namula Thrust and Canyon Thrust are spread across the northeast and are active along with Main Himalayan Thrust, Main Boundary Thrust, Main Central Thrust and several subsidiary faults.
  • The northeast is demarcated as Seismic Zone V, which indicates a zone with high vulnerability. The Indian plate is moving northeast toward the Eurasian plate in the Himalayan region, their oblique collision and release of stress and strain accumulated in the local tectonic or fault environments lead to earthquakes.
  • He also explained why water was oozing out of the fault in Sonitpur and adjoining affected areas after the April 28 earthquake.
  • This was a result of severe liquefaction [the process of making something liquid] from the unconsolidated substratum [underlying layer of soil/rock].
  • The GSI specialist advised people not to heed earthquake predictions.
  • Unlike a landslip, a surficial process that can be constrained, an earthquake is a process deep inside the earth. But scientists worldwide are trying for a breakthrough. The work to understand the strain localisation of future earthquakes is under progress.

Source: TH

India – Sri Lanka issues

GS-II : International Relations Sri Lanka

India – Sri Lanka issues

  • The tragic death of four fishermen from Tamil Nadu — one of them a Sri Lankan Tamil refugee living in India — allegedly when the Sri Lankan Navy was about to arrest them last week, is yet another instance of the unresolved fisheries conflict in the Palk Bay taking an unacceptable toll of lives.
  • India has lodged a strong protest with the Sri Lankan authorities, who have set up a committee to find a permanent solution to the incursions by Indian fishermen.
  • It was less than a month ago that the two countries resumed discussions through their Joint Working Group on fisheries after a three-year gap. India sought the early release of fishermen arrested in Sri Lankan waters, as well as the boats in Sri Lankan custody.
  • Sri Lanka underscored the need to curb illegal fishing, which adversely affects the livelihood of its war-affected fishermen.
  • When the two sides decided to create a joint working group some years ago, they had agreed that there would be no violence or loss of life in the handling of the fishermen and that a hotline would be established between the respective Coast Guards. It is unfortunate that the hotline is yet to be operationalised, and deaths continue to occur.
  • The humanitarian approach that has been expected to be the cornerstone of the approach to this conflict has not always been discernible.
  • The plan to wean away Tamil Nadu fishermen from the tendency to exploit the remaining fishery resources on the Sri Lankan side by replacing their trawlers with deep sea fishing vessels has not really taken off.
  • Attempts to forge a negotiated settlement through direct talks involving fishermen from both sides have also reached a stalemate.
  • Sri Lanka favours joint patrolling by both countries, and a ban on unsustainable fishing practices by Tamil Nadu fishermen — such as bottom trawling — but the latter want a lengthy phase-out period.
  • Political leaders in Tamil Nadu rarely acknowledge that the State’s fishermen contribute immensely to the problem by crossing territorial waters.
  • Nor is there sufficient recognition that the incursion into Sri Lankan waters is driven by trawler owners who force their poor employees to do so, who then get killed or arrested, leading to the festering conflict.
  • So far there has not been enough political resolve to end this conflict.

What is the solution?

  • A comprehensive solution, one that would severely curtail unauthorised fishing and help in an orderly sharing of and sustainable use of resources by fishermen from both sides, is long overdue.

India – Sri Lanka relationship

Historical relations

  • The relationship between India and Sri Lanka is more than 2,500 years old. It started from the time of the Mauryan Empire when Ashoka sent his son and daughter to Sri Lanka to propagate Buddhism. It continued in Chola Empire when Rajaraja Chola first time started to conquer Sri Lanka or Ceylon and Rajendra Chola (his son) conquered Ceylon.
  • Both countries have a legacy of intellectual, cultural, religious and linguistic interaction.
  • In recent years, significant progress in the implementation of developmental assistance projects has further cemented the bonds of friendship between the two countries.

Geopolitical Significance of Sri Lanka

  • Sri Lanka is located in the geostrategic zone of the Indian zone where all the major powers are converging in the 21st century.
  • It is located at the centre of the geopolitics of the USA through its Pivot towards Asia policy, China through Belt and Road Initiative and Japan through Asia Africa Growth Corridor.
  • China is building state-of-the-art gigantic modern ports all along the Indian Ocean to the south of it, in Gwadar (Pakistan), Chittagong (Bangladesh, Kyauk Peru (Myanmar) and Hambantota (Sri Lanka). China is using Sri Lanka as a tool to encircle India through the Maritime Silk Road Initiative and the erstwhile String of Pearl Strategy.
  • Sri Lanka’s Colombo Port is the 25th busiest container port in the world and the natural deep-water harbour at Trincomalee is the fifth largest natural harbour in the world.

Importance of Sri Lanka for India

  • Sri Lanka is the nearest maritime neighbour of India. Hence in the situation where all the major powers are trying to pluck the low-hanging fruits of the Indian Ocean, the dominance of India in the Indian Ocean region is a must.
  • Sri Lanka is a member of regional groupings like BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) and SAARC in which India plays a leading role.
  • Sri Lanka is important to neutralize efforts of China and OBOR in the Indian Ocean Region.
  • It is also important for cooperation in Terrorism and in the sphere of maritime security and surveillance.
  • Recently, India helped Sri Lanka in providing various medicines for COVID-19 and we are also sending them COVID-19 vaccines as a Confidence Building measure and India’s principle of Vasudeva Kutumbakam.
  • Recently, India has invited leaders of BIMSTEC member countries to attend the swearing-in of Prime Minister Narendra Modi and his council of ministers. This is in line with the government’s focus on its ‘Neighbourhood First’ policy.
  • Sri Lanka is one of India’s largest trading partners among the SAARC countries. India in turn is Sri Lanka’s largest trade partner globally.
  • India is a net exporter to Sri Lanka. India’s exports to Sri Lanka amounted to $5.3 billion in 2015-17 whereas its imports from the country were at $743 million.
  • Trade grew especially after India-Sri Lanka Free Trade Agreement which came into force in March 2000. Sri Lanka was the 1st country to sign FTA with India (Prelims Pointer).

India-Sri Lanka Free Trade Agreement (ISFTA)

  • India-Sri Lanka Free Trade Agreement (ISFTA) was signed in 1998 and entered into force in March 2000.
  • The basic premise in signing the ISFTA was asymmetries between the two economies, local socio-economic sensitivities, safeguard measures to protect domestic interests, and revenue implications so as not to impact high revenue generating tariff lines in the short term.
  • In order to receive ISFTA benefits, the merchandise exported between India and Sri Lanka should comply with the Rules of Origin criteria.
  • The agreement CEPA (Comprehensive Economic Partnership Agreement) which is yet to be signed between the countries, seeks to build on the momentum generated by the FTA and take the two economies beyond trade in goods towards greater integration and impart renewed impetus and synergy to bilateral economic interaction.
  • The investments are in diverse areas including petroleum retail, IT, financial services, real estate, telecommunication, hospitality & tourism, banking and food processing (tea & fruit juices), metal industries, tires, cement, glass manufacturing, and infrastructure development (railway, power, water supply).

  • Tourism also forms an important link between India and Sri Lanka and India is the largest source market for Sri Lankan tourism. In tourism, India is the largest contributor with every fifth tourist being from India.
  • The Cultural Cooperation Agreement signed by the two Governments on 29 November 1977, forms the basis for periodic Cultural Exchange Programmes between the two countries.
  • The People of Indian Origin (PIOs) comprise Sindhis, Borahs, Gujaratis, Memons, Parsis, Malayalis and Telugu-speaking persons who have settled down in Sri Lanka (most of them after partition) and are engaged in various business ventures.
  • India and Sri Lanka conduct joint Military ( 'Mitra Shakti') and Naval exercises (SLINEX). – (Prelims Pointers)
  • India also provides defence training to Sri Lankan forces.
  • A trilateral maritime security cooperation agreement was signed by India, Sri Lanka and the Maldives to improve surveillance, anti-piracy operations and reducing maritime pollution in Indian Ocean Region.

Issues and Conflicts

China angle

  • China’s relationship with Sri Lanka has been a challenge for India for years. In recent years, China has extended billions of dollars of loans to the Sri Lankan government for new infrastructure projects, which is not good for India’s strategic depth in Indian Ocean Region.
  • Sri Lanka also handed over the strategic port of Hambantota, which is expected to play a key role in China’s Belt and Road Initiative, to China on a 99-year lease.
  • China has also supplied arms as well as provide huge loans to Sri Lanka for its development.
  • China also invested sufficiently in the infrastructure of Sri Lanka, which included the building of the Colombo international container terminal by China Harbor Corporation.

Fishermen issue

  • Given the proximity of the territorial waters of both countries, especially in the Palk Straits and the Gulf of Mannar, incidents of straying of fishermen are common.
  • Indian boats have been fishing in the troubled waters for centuries and had a free run of the Bay of Bengal, Palk Bay and the Gulf of Mannar until 1974 and 1976 when treaties were signed between the two countries to demarcate International Maritime Boundary Line (IMBL).
  • However, the treaties failed to factor in the hardship of thousands of traditional fishermen who were forced to restrict themselves to a meagre area in their fishing forays.
  • The small islet of Katchatheevu, hitherto used by them for sorting their catch and drying their nets, fell on the other side of the IMBL.
  • Fishermen often risk their lives and cross the IMBL rather than return empty-handed, but the Sri Lankan Navy is on alert, and has either arrested or destroyed fishing nets and vessels of those who have crossed the line.
  • Both countries have agreed on certain practical arrangements to deal with the issue of bona fide fishermen of either side crossing the International Maritime Boundary Line.
  • Through these arrangements, it has been possible to deal with the issue of the detention of fishermen in a humane manner.
  • India and Sri Lanka have agreed to set up a Joint Working Group (JWG) on Fisheries between the Ministry of Agriculture and Farmers Welfare of India and the Ministry of Fisheries and Aquatic Resources Development of Sri Lanka as the mechanism to help find a permanent solution to the fishermen issue.

However, the relationship between Sri Lanka and India is improving.

  • In order to allay Indian concerns that the Hambantota port will not be used for military purposes, the Sri Lankan government has sought to limit China’s role in running commercial operations at the port while it retains oversight of security operations.
  • The two countries have signed civil nuclear cooperation agreement which is Sri Lanka’s first nuclear partnership with any country.
  • India is also investing in Sri Lanka’s infrastructure development in the Northern and Eastern provinces.
  • India is also planning to build Trincomalee Port to counterweight the Chinese developments at Hambantota Port.

Way Forward

  • As both countries have a democratic setup there is scope for broadening and deepening the ties.
  • Both countries should try to work out a permanent solution to the issue of fishermen through bilateral engagements.
  • A comprehensive Economic Partnership Agreement (CEPA) must be signed to improve the economic cooperation between both countries.
  • India needs to focus more on its traditional and cultural ties to improve relations with Sri Lanka.
  • Starting ferry services between India and Sri Lanka can improve people-to-people linkages.
  • Mutual recognition of each other's concerns and interests can improve the relationship between both countries.

Source: TH

Workers’ income fell by 17% from March to Dec 2020

GS-II : Important reports Important reports

Workers’ income fell by 17% from March to Dec 2020

  • The COVID-19 pandemic has substantially increased informality in employment, leading to a decline in earnings for the majority of workers, and consequent increase in poverty in the country, according to ‘State of Working India 2021: One Year of Covid-19’, a report brought out annually by Azim Premji University’s Centre for Sustainable Employment, Bengaluru.
  • This year’s report, which covers the period March 2020 to December 2020, dwells on the impact of one year of COVID-19 on employment, incomes, inequality and poverty.
  • Regarding employment, the report notes that 100 million jobs were lost nationwide during the April-May 2020 lockdown.
  • Though most of these workers had found employment by June 2020, about 15 million remained out of work.
  • As for income, “for an average household of four members, the monthly per capita income in Oct 2020 (?4,979) was still below its level in Jan 2020 (?5,989),”.
  • The study found that post-lockdown, nearly half of salaried workers had moved into informal work, either as self-employed (30%), casual wage (10%) or informal salaried (9%).
  • The fallback option varied by caste and religion. “General category workers and Hindus were more likely to move into self-employment while marginalised caste workers and Muslims moved into daily wage work,”.
  • Education, health and professional services saw the highest exodus of workers into other sectors, with agriculture, construction and petty trade emerging as the top fallback options.
  • Due to the employment and income losses, the labour share of the GDP fell by 5 percentage points, from 32.5% in the second quarter of 2019-20 to 27% in the second quarter of 2020-21.
  • “Of the decline in income, 90% was due to reduction in earnings, while 10% was due to loss of employment. This means that even though most workers were able to go back to work, they had to settle for lower earnings,”.
  • Monthly earnings of workers fell on an average by 17% during the pandemic, with self-employed and informal salaried workers facing the highest loss of earnings.
  • While the poorest 20% of households lost their entire incomes in April-May 2020, “the richer households suffered losses of less than a quarter of their pre-pandemic incomes.”
  • During the period from March to October 2020, an average household in the bottom 10% lost 15,700, or just over two months’ income.
  • Significantly, the study has found a clear correlation between job losses and the COVID-19 caseload, with States showing higher caseload, such as Uttar Pradesh, Maharashtra, Tamil Nadu, Kerala, and Delhi, “contributing disproportionately to the job losses”.
  • Women and younger workers were more affected by the pandemic-related measures. During the lockdown and in the post-lockdown months, 61% of working men remained employed while 7% lost their job and did not return to work. But in the case of women, only 19% remained employed while 47% suffered a permanent job loss, “not returning to work even by the end of 2020”.
  • With 230 million falling below the national minimum wage threshold of 375 per day during the pandemic, the poverty rate has “increased by 15 percentage points in rural and nearly 20 percentage points in urban areas,” the report said.
  • Households coped with the loss of income by decreasing their food intake, selling assets and borrowing informally from friends, relatives and money-lenders. The report notes that 20% of those surveyed said that their food intake had not improved even six months after the lockdown.
  • These findings are a serious cause for concern in the absence of an inclusive social welfare architecture.
  • Among other ameliorative policy measures, the report calls for extending free rations under the Public Distribution System till the end of 2021, expanding of MGNREGA entitlement to 150 days, and a “Covid hardship allowance” for the 2.5 million Anganwadi and ASHA workers.

Source: TH

RBI announced measures to protect Small businesses, MSMEs to get relief

GS-III : Economic Issues RBI

RBI announced measures to protect Small businesses, and MSMEs to get relief

  • RBI announced measures to protect small and medium businesses and individual borrowers from the adverse impact of the intense second wave of COVID-19 buffeting the country.
  • In an unscheduled address, RBI Governor Shaktikanta Das unveiled a Resolution Framework 2.0 for COVID-related stressed assets of individuals, small businesses and MSMEs and also expressed the central bank’s resolve to do everything at its command to ‘save human lives and restore livelihoods through all means possible’.

Eligibility criteria

  • Considering that the resurgence of the pandemic had made these categories of borrowers most vulnerable, the RBI said those with aggregate exposure of up to ?25 crore, who had not availed restructuring under any of the earlier restructuring frameworks (including under last year’s resolution framework), and whose loans were classified as ‘standard’ as on March 31, 2021, were eligible for restructuring under the proposed framework.
  • In respect of individual borrowers and small businesses who had already availed restructuring under Resolution Framework 1.0, lenders have been permitted to use this window to modify such plans to the extent of increasing the period of moratorium and/or extending the residual tenor up to a total of two years.
  • In respect of small businesses and MSMEs restructured earlier, lending institutions have been permitted as a one-time measure, to review the working capital sanctioned limits, based on a reassessment of the working capital cycle and margins.

Credit support

  • To provide further support to small business units, micro and small industries, and other unorganised sector entities adversely affected during the current wave of the pandemic, the RBI decided to conduct special three-year long-term repo operations (SLTRO) of ?10,000 crore at the repo rate for Small Finance Banks. The SFBs would be able to deploy these funds for fresh lending of up to ?10 lakh per borrower. This facility would be available till October 31.
  • In view of the fresh challenges brought on by the pandemic and to address the emergent liquidity position of smaller MFIs, SFBs are now being permitted to reckon fresh lending to smaller MFIs (with asset size of up to ?500 crore) for onlending to individual borrowers as priority sector lending. This facility will be available up to March 31, 2022.

State governments

  • To enable the State governments to better manage their fiscal situation in terms of their cash flows and market borrowings, maximum number of days of overdraft (OD) in a quarter is being increased from 36 to 50 days and the number of consecutive days of OD from 14 to 21 days, the RBI said.

Source: TH

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