22, September 2016

1.Cabinet approves merger of rail budget with general budget; advancement of budget presentation and merger of plan and non-plan classification in budget and accounts

Source: PIB and The Hindu

The Union Cabinet has approved the proposals of Ministry of Finance on certain landmark budgetary reforms relating to

(i) The merger of Railway budget with the General budget,

(ii) The advancement of the date of Budget presentation from the last day of February

(iii) The merger of the Plan and the Non-Plan classification in the Budget and Accounts. All these changes will be put into effect simultaneously from the Budget 2017-18.

What are the reported reasons for this merger?

A separate Railway Budget is being dispensed with so that the Indian Railways need not pay the annual dividend to the Government of India on the budgetary support given each year, saving the financially stressed Railways about Rs.10,000 crore annually.

The recommendation of a NITI AAYAOG COMMITTEE headed by BIBEK DEBROY member Committee has recommended discontinuance of a separate Rail Budget and it is part of the Prime Minister’s reform programme.

The committee has recommended it not as a stand-alone step, but as part of a slew of measures such as:

  1. complete overhaul of the project financing architecture of the Railways involving ruthless weeding out of unviable/long-pending projects;
  2. comprehensive accounting reforms;
  3. separation of infrastructure and operations;
  4. setting up of a rail regulatory authority.

Pending these steps, each of which is a major project in itself (some politically sensitive), the move to give a hasty send-off to the Railway Budget is perplexing.

Merger of Railway Budget with the General Budget:

  • To maintain its distinct entity -as a departmentally run commercial undertaking as at present;
  • functional autonomy and delegation of financial powers etc
  • The existing financial arrangements will continue wherein Railways will meet all their revenue expenditure, including ordinary working expenses, pay and allowances and pensions etc. from their revenue receipts
  • Consequently, there will be no dividend liability for Railways from 2017-18 and Ministry of Railways will get Gross Budgetary support.

The merger would help in the following ways:

  • The presentation of a unified budget will bring the affairs of the Railways to centre stage and present a holistic picture of the financial position of the Government.
  • The merger is also expected to reduce the procedural requirements and instead bring into focus, the aspects of delivery and good governance. the appropriations for Railways will form part of the main Appropriation Bill.

Advancement of the Budget presentation:

  • The advancement of budget presentation by a month and completion of Budget related legislative business before 31st March would pave the way for early completion of Budget cycle and enable Ministries and Departments to ensure better planning and execution of schemes from the beginning of the financial year and utilization of the full working seasons including the first quarter.
  • Thiswill also preclude the need for seeking appropriation through ‘Vote on Account’ and enable implementation of the legislative changes in tax
  • laws for new taxation measures from the beginning of the financial year.

Merger of Plan and Non Plan classification in Budget and Accounts:

  • The Plan/Non-Plan bifurcation of expenditure has led to a fragmented view of resource allocation to various schemes.
  • The bias in favour of Plan expenditure by Centre as well as the State Governments has led to a neglect of essential expenditures on maintenance of assets and other establishment related expenditures for providing essential social services.
  • The merger of plan and non-plan in the budget is expected to provide appropriate budgetary framework having focus on the revenue, and capital expenditure.
  1. Cabinet approves provision of submarine optical fibre cable connectivity between mainland (Chennai) and Andaman & Nicobar Islands

The approval would equip Andaman & Nicobar Islands (ANI) with appropriate bandwidth and telecom connectivity for implementation of

  • e-Governance initiatives;
  • Establishment of enterprises & e-commerce facilities.

 It will also enable the provision of adequate support to educational institutes for knowledge sharing, availability of job opportunities and fulfil the vision of Digital India.

  1. Swatantrata Sainik Samman Pension Scheme

Source: PIB

  1. Enhancement of Pension for Freedom Fighters and for the spouses (widows/widowers),
  2. Eligible daughters and dependent parents of deceased Freedom Fighters.

4.Adani’s 648-MW solar plant inaugurated

Source: The Hindu

The Adani Group’s 648 MW solar power plant, claimed to be the world’s largest solar plant at a single location, was inaugurated at Sengapadai in Kamudhi taluk in Ramanathapuram district.

Solar – How Solar Plants Work

There are two ways we can produce electricity from the sun:

Photovoltaic Electricity – This method uses photovoltaic cells that absorb the direct sunlight just like the solar cells.

Solar-Thermal Electricity – This also uses a solar collector: it has a mirrored surface that reflects the sunlight onto a receiver that heats up a liquid. This heated liquid is used to make steam that produces electricity.

International Solar Alliance Cell and World Bank Signs Declaration for Promoting Solar Energy

The Joint Declaration by the ISA cell and the World Bank will help in accelerating mobilization of finance for solar energy, and the Bank will have a major role in mobilizing more than US $1000 billion in investments that will be needed by 2030, to meet ISA’s goals for the massive deployment of affordable solar energy. Interim Administrative Cell of International Solar Alliance (ISA Cell) and the UNDP.

Suryamitra initiative is also a part of Make in India. Suryamitra skill development program designed to create skilled manpower in installation, commissioning, and Operation & Maintenance of solar power plants and equipment.

Government of India intends to achieve the target of 175 GW which includes 100 GW from Solar Energy by 2022, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydro power

National Institute of Solar Energy (NISE), an autonomous institution of Ministry of New and Renewable (MNRE), is the apex National R&D institution in the field Solar Energy.

Sun without subsidy:  solar power this year is forecast to contribute more new electricity to the US grid than any other form of energy.

  1. Soon, it may be possible to provide zero emission energy without compromising on the dream of providing every home with electricity.
  2. Forecasts of International Energy Agency (IEA) indicate energy from renewables is expected to overtake coal by the early 2030.
  3. Among renewables, solar stands out. Its cost is falling, which means that for the first time it is possible to promote clean energy without offering large production subsidies. For instance, cost of electricity from large solar installations in the US is on occasions lower than that from natural gas.

Developments are crucial for India:

  • The government’s National Solar Mission has been crafted on the basis of a subsidy for expanding rooftop solar systems.
  • But such systems are inefficient and expensive, compared to large scale solar installations which feed power into the grid.
  • The pace of technological change should trigger a re-evaluation of a subsidy-led approach.
  • Germany, for example, has been scaling back solar subsidies without a negative impact on the industry.
  • Solar energy, when generated on a large scale, is on its way to being competitive without artificial boosts.
  1. 31 nations join Paris climate pact

Source: The Hindu

The landmark Paris agreement on climate change moved closer to reality through which countries commit to take action to stem the planet’s rising temperatures, would come into force by the end of the year during the United Nations General Assembly.


The accord requires all countries to devise plans to achieve the goal of keeping the rise of temperatures within two degrees Celsius (3.6 Fahrenheit) above pre-industrial levels.

To come into force, the Paris agreement needs ratification from 55 countries that account for at least 55 per cent of the planet’s greenhouse gas emissions.

At present total of 60 countries have joined the Paris accord. But they account for just less than 48 per cent of emissions, according to UN.

  1. Women’s empowerment through Panchayati Raj

A Panchayat, in the traditional sense, is a body of 5 elders of the village who help resolve conflict amongst the villagers. Yet, women & lower castes were not allowed membership of this body. In pre-independence India, legal provisions made it difficult for women to participate actively in politics.

Constituition of India:

The Constitution of Independent India only spoke of local self-governing bodies in Part IV, the Directive Principles of State Policy, and did not make any provisions for specific reservation for women in Panchayati Raj Institutions (PRIs).

73rd Amendment Act of 1992:

Reservation of Seats:

Act mandating reservation in at least 1/3rd of the seats of all Panchayat Councils and 1/3rd of the Pradhan (head of the Panchayat) positions for women, was a landmark for women’s political empowerment.

Bihar became the 1st state to reserve 50% of seats for women with Madhya Pradesh, Chhattisgarh, Rajasthan & Himachal Pradesh following suit. Among Tamil Nadu is the 17th state to legislate 50% representation for women in local bodies.

In a study by the Centre for Women’s Development Studies 1999, it was revealed that 95% of women surveyed believed that they would not have been elected had it not been for the reservation.

Ensuing progress towards political empowerment of women is also evident from this study as a sizeable proportion of women surveyed perceived enhancement in their self-esteem, confidence, decision-making ability and respect within the family after winning an election.

Tamilnadu Panchayatraj Elections:

Article 243 D of the Constitution relates to reservation and rotation of seats for Scheduled Castes, Scheduled Tribes and Women in rural Local Bodies. The relevant provisions of Tamil Nadu Panchayats Act, 1994.

It has decided to reserve seats and offices for women and SC/STs in three-tier Panchayat Raj institutions based on the 2011 census as per the constitutional mandate.

As per the TN Panchayats (Amendment) Act, 2016, 50 per cent reservation for women is being fixed in Panchayati Raj institutions.

Section 57 of the Panchayat Act clearly revealed the ratio and the rotation to be followed in fixing the seats for women in the panchayat elections.

Further, as per a GO dated August 7, 1995, issued by the Rural Development department under the TN Panchayat (Reservation of Seats and Rotation of Reserved Seats) Rules, the reservation of the seats should be changed for every 10 years.

Conduct of elections to panchayats as and when they are due is a constitutional requirement as envisaged under the constitutional framework. Such a requirement cannot be withheld or postponed on the ground that the task of delimitation and readjustment of territorial constituencies has not been undertaken.

Panchayats (Extension to Scheduled Areas) Act, 1996 or PESA:

PESA was enacted in 1996 to extend part IX of the constitution with certain modifications and exceptions to Fifth Schedule areas in 108 districts in 10 states.

Effective implementation of PESA will enhance people`s participation in decision making at local level as tribal population will feel more comfortable to raise their issues and concerns in smaller gram sabhas at village level rather than at gram panchayat level.