DAILY NEWS ANALYSIS

Syllabus subtopic: Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources.

Prelims and Mains focus: about the report and its key findings; India’s performance

News: A Future for the World’s Children? report was recently released by a Commission of more than 40 child and adolescent health experts from around the world. The Commission was convened by the World Health Organization (WHO), UNICEF and The Lancet.

India specific findings

• In the report assessing the capacity of 180 countries, India stands 77th (sustainability index) and is at 131st position on a ranking that measures the best chance at survival and well-being for children.

• The report says although India has improved in health and sanitation, it has to increase its spending on health.

Global findings

• No single country is adequately protecting children’s health, their environment and their future.

• The report finds that the health and future of every child and adolescent worldwide is under immediate threat from ecological degradation, climate change and exploitative marketing practices that push heavily processed fast food, sugary drinks, alcohol and tobacco at them.

• The report shows that children in Norway, the Republic of Korea and the Netherlands have the best chance at survival and well-being, while children in the Central African Republic, Chad, Somalia, Niger and Mali face the worst odds.

• It also cautions that globally, the number of children and adolescents who are obese has increased from 11 million in 1975 to 124 million in 2016 — an 11-fold increase.

• The only countries on track to beat the CO2 emission targets by 2030, while also performing fairly (within the top 70) on child flourishing measures are: Albania, Armenia, Grenada, Jordan, Moldova, Sri Lanka, Tunisia, Uruguay and Vietnam.

• Despite improvements in child and adolescent health over the past 20 years, progress has stalled and is set to reverse. An estimated 250 million children under five in low- and middle-income countries are at risk of not reaching their developmental potential. Moreover, every child worldwide now faces existential threats from climate change and commercial pressures.

• While the poorest countries need to do more to ensure healthy lives for children, carbon emissions — disproportionately from wealthier countries — threaten the future of all children, states the report. This report shows that the world’s decision makers are, too often, failing today’s children and youth: failing to protect their health, failing to protect their rights and failing to protect their planet.

Syllabus subtopic: Important International Institutions, agencies and fora - their Structure, Mandate.

Prelims and Mains focus: about G20, steps taken by India to deepen corporate bond market and attract foreign portfolio investment (FPI)

News: The Finance Ministers and Central Bank Governors’ meeting is being held in Riyadh under Saudi Arabia’s G20 presidency for the first time.

Highlights of the meeting

• Finance Minister of India called for closer collaboration between international revenue agencies to investigate tax affairs of offenders who cross borders for escaping tax investigation.

• With regard to infrastructure development, the FM suggested G20 nations to refrain from developing any common prescriptive approach since different countries are at varied stages of adoption of technology in infrastructure.

• Participating in a session on Financial Resilience & Development, the FM highlighted steps taken by India to deepen corporate bond market and attract foreign portfolio investments in the private debt and government securities market.

What are those steps taken by the Indian government?

• In the Union Budget 2020-21 announced on February 1, the FM had announced several steps to widen and deepen the corporate bond and the government securities market.

• The Centre substantially raised investment limit for foreign portfolio investors (FPIs) to 15 per cent of the outstanding stock of corporate bonds from 9 per cent earlier in the Budget.

• The Reserve Bank of India had last December raised FPI investment limits in G-sec as well as short-term bonds. The government also proposed to formulate a law for expanding the credit default swaps market.

• The Centre also proposed to float a new debt exchange-traded fund (ETF) that will comprise of government securities (G-sec), to enable retail investors — who are so far not investing much in the G-sec market — buy a basket of government bonds through the units in the proposed debt ETF in a seamless manner.

About G20

• The G20 is an annual meeting of leaders from the countries with the largest and fastest-growing economies. Its members account for 85% of the world’s GDP, and two-thirds of its population.

• The G20 Summit is formally known as the “Summit on Financial Markets and the World Economy”.

• Members: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, the United States and the European Union.

• Establishment: After the Asian Financial Crisis in 1997-1998, it was acknowledged that the participation of major emerging market countries is needed on discussions on the international financial system, and G7 finance ministers agreed to establish the G20 Finance Ministers and Central Bank Governors meeting in 1999.

Syllabus subtopic: Government Policies and Interventions for Development in various sectors and Issues arising out of their Design and Implementation.

Prelims and Mains focus: about the performance of IBC since its inception

News: After the Insolvency and Bankruptcy Code (IBC) became law in May 2016, the ecosystem of corporate insolvency resolution process (CIRP) was put in place by the year-end. As of December 2019, the system had been in existence for three years.

How good have been the loan recoveries?

As of 31 December 2019, the 190 companies that had defaulted on loans yielded resolution plans with different degrees of realization. Claims worth Rs.3.52 trillion in total had been filed by financial creditors, primarily banks. Of this, around Rs.1.52 trillion—43.1% of the claims under consideration—has been recovered. This is much better than the rate of recovery before IBC was put in place. Take the case of 2015-16: Of the total bad loans up for recovery worth Rs.2.21 trillion, only Rs.22,768 crore, or 10.3% of the loans, was recovered. This evidence suggests IBC has been a huge success compared to the earlier loan recovery process.

Is there a twist in the IBC success rate?

The two biggest loan recoveries in the case of Bhushan Steel and Essar Steel India make up around 49.5% of the overall recovery. If these recoveries are left out, the total rate of recovery falls to 30.5%. If another big recovery, Bhushan Power and Steel, is excluded, then the rate of recovery falls further to 28%, which is substantially lower than the overall rate of recovery of 43.1%. Having said that, it is much better than what used to be the case before IBC was in existence. Also, up until 2015, it used to take 4.3 years on an average to resolve an insolvency case in India. That has fallen dramatically after IBC came into effect.

What about the cases that do not go for resolution?

If a resolution plan cannot be agreed upon within 330 days, the company that has defaulted on the loan goes for liquidation. Till now, liquidation has been initiated against 780 firms, of which 40 have been closed in the process. The recovery rate for firms that were liquidated in October-December was 10.7%. If the biggest recovery is left out, the rate is close to nil.

How many firms are in bankruptcy courts?

As can be seen from the chart, the number of companies being admitted to corporate insolvency resolution proceedings at the National Company Law Tribunal (NCLT) has shot up since January-March in 2017. The number of such companies was 1,961 as of December 2019, up from 1,497 as of September. What the data indicates is that the number of companies facing insolvency resolution is piling up at NCLT faster than it can dispose of them. This is the problem Debt Recovery Tribunals used to face earlier.

What does this mean for the IBC system?

At the current rate of disposal of cases by NCLT, it could take nearly five-six years for the most important cases to be settled. There is also a risk that the new system is getting overloaded with too many corporate defaults being brought under CIRP. One way to get around this hurdle is by encouraging banks to sell smaller loan defaults of up to Rs.100 crore and not take them to NCLT, so as not to clog the IBC system.

Syllabus subtopic: Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.

Prelims and Mains focus: about Olive Ridley Turtles and steps taken for their conservation; about IUCN

News: Preparations are almost done at the Rushikulya rookery on the Odisha coast to welcome and protect Olive ridley turtles during mass nesting. Odisha has half of the world’s Olive Ridley turtle population and 90% of India’s turtle population lives in the state.

Steps taken by the state government

• To provide security to mother turtles as well as the eggs from human and predator intervention, the forest department is erecting an over 5-km-long fence of metal net from Gokharkuda to Bateswar. This stretch is the most preferred location for mass nesting in the Rushikulya rookery.

• The forest officials have already completed two to three rounds of awareness drive at all villages near the rookery.

• Fishing in mechanised boats, including trawlers, has been banned. The forest department officials are also patrolling the region in two trawlers, two speed boats and a country boat.

• Debris and plastic waste, like pieces of fishing net, are being removed with the help of locals. There will be regular monitoring of the beach.

• The department has set up 11 onshore camps. Personnel at these camps regularly document beach condition, inform about the debris deposited by the sea, prevent entry of predators like stray dogs and search for turtle carcasses.

About Olive Ridley Turtles

• There are five species of turtles in Indian waters — Leatherback (Vulnerable), Loggerhead (Endangered), Hawksbill (Critically Endangered), Green (Endangered) and Olive Ridley.

• In India, sea turtles are protected under the Indian Wildlife Protection Act of 1972.

• The Olive ridley turtles are the smallest and most abundant of all sea turtles found in the world, inhabiting warm waters of the Pacific, Atlantic and Indian oceans.

• The Olive ridley is the most numerous among the sea turtles found in India and is well known for its arribadas, or annual mass nestings when thousands of turtles migrate to the breeding ground to nest simultaneously.

• Recognized as Vulnerable by the IUCN Red list of Threatened Species.

• International trade in these turtles and their products is banned under CITES Appendix I.

• ‘Operation Kachhapa’: Conservation of the Olive Ridley Sea Turtle was launched by the Wildlife Protection Society of India in collaboration with the Orissa State Forest Department and the Wildlife Society of Orissa and other local NGOs.

• To reduce accidental killing in India, the Orissa government has made it mandatory for trawls to use Turtle Excluder Devices (TEDs), a net specially designed with an exit cover which allows the turtles to escape while retaining the catch.

Syllabus subtopic: Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.

Prelims and Mains focus: about MM wildlife sanctuary and the tiger reserves mentioned; about NTCA

News: Decks have been cleared to notify the Malai Mahadeshwara Wildlife Sanctuary in Karnataka’s Chamarajanagar district as a tiger reserve. The approval from the National Tiger Conservation Authority (NTCA) is expected any time now.

Background

State Board for Wildlife had given its concurrence to declare M.M. Hills sanctuary as a tiger reserve in January 2019. A proposal was submitted in May 2019 but it was returned as additional clarification was required with respect to the delineation of the boundary in the core area, list of existing settlements and the need to spell out the religious and tourism zone, etc. Hence, a revised proposal was submitted in January 2020 and a presentation made before the NTCA in Delhi.

What does it signify?

• Once notified, Chamarajanagar district will have the rare distinction in the country of harbouring three tiger reserves. It already has Bandipur and Biligiri Ranganatha Temple (BRT) Tiger Reserve within its territorial limits.

• Also, with this, Karnataka will have six tiger reserves, the others being Nagarahole, Bhadra, and Anshi-Dandeli, apart from Bandipur and BRT Tiger Reserves.

What’s next?

• The sanctuary will be renamed as Malai Mahadeshwara Hill Tiger Reserve (MMH TR) with a core area of 670.95 sq km spread across Malai Mahadeshwara Reserve Forest, Hanur Reserve Forest and Yediyarahalli Reserve Forest. The buffer will be spread over 235.19 sq km.

About MM Wildlife Sanctuary

• The sanctuary presently has about 20 tigers as evident in photographs from camera traps in Hanur, Ramapura, P.G. Palya, Hoogyam, M.M. Hills and Palar ranges, and wildlife experts vouch for its potential to rival the Bandipur-Nagarahole-Wayanad-Mudumalai landscape in the years ahead.

• This optimism stems from the fact that the MM Hills wildlife sanctuary – which is spread over 906.18 sq km – is contiguous to BRT Tiger Reserve (584 sq km) on one side, Satyamangalam Tiger Reserve (1,412 sq km) in Tamil Nadu on the other, while the Cauvery Wildlife Sanctuary (1,027 sq km) also borders it, thus providing a contiguous forest cover of over 3,500 sq km that can act as a sink to absorb surplus tiger population and help increase their numbers.

• Implementation of strict wildlife management and protection measures will enhance the landscape value in increasing the tiger densities as the forests has an abundance of prey species like gaur, sambar, chital, four-horned antelope, wild boar, etc., according to authorities who say that studies have proved that the prey density was 5.05 animals per sq km. Being part of Mysore Elephant Reserve, these forests also support nearly 300 elephants.

• There are 39 anti-poaching camps in MM Hills Wildlife Sanctuary and the plan is to double their number once it is elevated to the status of a tiger reserve. This sanctuary and the adjoining landscape – which was once Veerappan’s den and out of bounds for the forest department – had a history of poaching by local community for meat, especially along the forest boundary and fringes. But it has been curtailed over the years thus increasing the density of the prey.

• In the justification to declare the sanctuary a tiger reserve, the authorities have stated that this is a unique geographical zone that acts as a bridge between the Western and Eastern Ghats. There are about 285 bird species documented in this landscape as per a 2014 survey. The forests are important not only for tiger, elephants and leopards but also chitals, honey badgers, smooth-coated otter, striped hyena, wild dogs, sloth bear, grizzled giant squirrels, Mahseer fish, etc.