📰 Rafale deal not done in a hurry: Centre
Defence procurement procedure was fully followed, SC told
•The Cabinet Committee on Security (CCS) approved the procurement of the 36 Rafale jets well over a year after the Indo-French Joint Statement to acquire the aircraft “as quickly as possible” was issued, said a government note in the Supreme Court on the Rafale deal.
•The Defence Procurement Procedure (DPP) 2013 mandates that acquisitions worth over ₹1,000 crore should be first cleared by the CCS.
•Since 2002, over 1,100 contracts valued at ₹7.45 lakh crore were successfully concluded using the DPP structure, introduced after the Kargil War.
•The note, submitted earlier to the court and made public on Monday as per a court order of October 31, claimed that DPP 2013 was “completely followed.”
•The document showed that the CCS approved the signing of the Inter-Governmental Agreement (IGA) for procurement of the 36 jets only on August 24, 2016 — well over a year after the Indo-French statement of April 10, 2015, which the note said conveyed an “intent” to acquire the jets in a fly-away condition.
•The approval of the Defence Acquisition Council (DAC), the highest body for defence procurement, was taken on May 13, 2015. Again, a month after the Indo-French statement.
•The government said the DAC approval was taken “as stipulated in the DPP.”
‘Critical necessity’
•The note said the joint statement was issued after the Government of India conveyed to the French government about the “critical operational necessity” for Multi-role Combat Aircraft for the Air Force. This necessity, it said, was triggered by the “extremely critical” combat potential of the Air Force caused by a three-year stalemate.
•The situation was due to “unresolved issues” over man-hours and contractual obligations between HAL and Dassault Aviation over the production of 108 Rafale jets, of a total 126, to be inducted in the Air Force as part of an earlier proposal.
•The government said the prolonged impasse over the 126-aircraft deal had caused an “urgent need” to acquire 36 Rafale jets or two squadrons in a fly-away condition.
•The note said an Indian Negotiating Team (INT) was constituted after the joint statement was signed in April 2015. The INT led by the Deputy Chief of Air Staff held 74 meetings with the French for a year on various aspects like pricing, delivery schedule, maintenance terms, offset, and IGA terms.
•According to the note, the INT, which submitted its report on August 4, 2016, “indicated better terms and conditions arrived at as a result of negotiation as compared to 126 MMRCA (Medium Multi Role Combat Aircraft) case...”
•The INT had recommended CCS approval and signing of the IGA on the 36 jets. After due consultations with the ministries of finance and law, the proposal was placed before the CCS on August 24, 2016. The CCS approval for signing the IGA for the 36 jets was given the same day. Finally, the IGA was signed by the Indian and French defence ministers on September 23, 2016.
•On the question of an Indian offset partner, the government said, “There is no mention of any private Indian Business house in the IGA or the offset contract.”
•“The offset contract does not envisage manufacture of 36 Rafale aircraft in India by any public or private sector firm,” it said.
•The Centre said Dassault was yet to submit a formal proposal indicating details of Indian offset partners and products for offset discharge. This means that the government is unaware of who Dassault’s Indian offset partner is, if there is any at all.
•The note echoed a clarification put out by the Ministry of Defence on September 22, 2018 against “unnecessary controversies” regarding a statement purportedly made by former French President Francois Hollande on the selection of Reliance Defence as offset partner by Dassault.
📰 Deny MSP to stubble burners: NGT
Green Bench asks Chief Secretaries of 4 States to draw up scheme to check pollution
•Stating that State governments had failed to curb stubble burning, the National Green Tribunal (NGT) on Monday summoned the Chief Secretaries of Delhi,Punjab, Haryana and Uttar Pradesh. Officers have been directed to draw up a plan to provide economic incentives and disincentives to farmers.
•Observing that stubble burning is adversely affecting environment and public health, a Bench headed by NGT Chairperson Justice Adarsh Kumar Goel said, “The fact remains that the problem has not been fully tackled and the adverse impacts on the air quality and consequent impacts on the citizens’ health and lives are undisputed.”
•“The problem is required to be resolved by taking all such measures as are possible in the interest of public health and environment protection” the Bench added.
•During the hearing, it was suggested to the Bench that incentives could be provided to those who are not burning the stubble and disincentives for those who continue the practice.
•“We do not see any difficulty why such economic incentives and disincentives should not be duly planned or executed. We make it clear that the existing Minimum Support Price (MSP) Scheme must be so interpreted as to enable the States concerned to wholly or partly deny the benefit of MSP to those who continue to burn the crop residue” the Bench said.
•While the officers have been asked to be present on November 15, the NGT specified that the “short time is on account of the urgency of the situation with regard to deteriorating air quality prevailing in NCT Delhi and adjoining areas.”
•Secretary, Union Ministry of Agriculture and Farmers’ Welfare has also been directed to be present to “find a lasting solution.”
•The NGT also said that “it is open to the Central government” convening a meeting with the States.
📰 Dangerous tactics: on recent Maoist attacks
Recent attacks suggest that Maoists are focussing on greater militarisation
•There has been an uptick in attacks by Maoists, indicating that their ability to strike remains strong. Last week, in two attacks in Chhattisgarh, five persons were killed in a blast in Dantewada district, and one BSF sub-inspector was killed in Kanker district. Maoists have also owned up responsibility for the killing of TDP MLA Kidari Sarveswara Rao and his predecessor Siveri Soma in Araku valley in Andhra Pradesh in September. These attacks, however, come amid a series of military setbacks to the Maoists in the Andhra Pradesh-Odisha border regions. Clearly, the government’s strategy of using military force while earmarking funds for infrastructure and welfare programmes in the districts most affected by left-wing extremism has weakened the Maoists. Paramilitary and police actions have resulted in the death of senior leaders, including Cherukuri Rajkumar (‘Azad’) and Mallojula Koteswara Rao (‘Kishenji’). Welfare measures, even if they have been implemented haphazardly, have enabled outreach into tribal areas where the state was hitherto absent. These actions have forced the Maoists to retreat further into the forest areas of central and south-central India to use them as bases to launch attacks, seeking to invite state repression on tribal people and to get recruits. The change of guard in the CPI (Maoist) leadership also suggests that it has moved towards further militarisation to secure its guerrilla forces’ influence. General secretary Nambala Kesava Rao (‘Basavraj’), who has replaced Muppala Lakshmana Rao (‘Ganapathy’), is alleged to have led attacks on security forces and killings.
•The CPI (Maoist) has sought to project itself as a revolutionary political movement led by peasants and tribals, seeking to rebuild after the failures of the earlier Naxalite movement. After the merger of the People’s War Group and the Maoist Communist Centre of India into the CPI (Maoist) in 2004, the outlawed party managed to consolidate its presence across a “Red Corridor” spanning central and north-central India, marked by rural deprivation. Rather than focussing on socio-economic struggles to uplift peasants and tribals in this region, the Maoists relied on waging a military battle against the state with the intention of capturing power through violent means. This was largely due to a gross and mindless misreading of the nature of the Indian state and its democratic institutions. These actions have resulted in the militarisation of these areas, repression of tribal people both by state actions such as the creation of the Salwa Judum — disbanded by judicial order — and Maoist authoritarianism. The change in leadership of the CPI (Maoist) and its recent actions suggest there is no end in sight to this insurgency in the near term — a sad reality for tribals caught in the crossfire.
📰 RBI unlikely to open window for NBFCs
‘NBFCs should explore other options’
•Amid growing demand for liquidity support for non-banking finance companies, the Reserve Bank of India (RBI) is unlikely to provide any special support to the sector, though it will continue to provide funds to the banking system as liquidity deficit in the system is a concern.
•According to sources, the RBI is of the view that bigger NBFCs that have high ratings from rating agencies are not facing any liquidity issues. It is the mid-sized and smaller NBFCs, mostly housing finance firms, that will face some issues. According to market estimates, about ₹1.5 lakh crore of commercial paper face redemption this month, a bulk of which are issued by NBFCs.
•“There is liquidity in the system. But interest rates have gone up,” said a source. Some NBFCs that are not higher-rated now have to pay higher rates to raise funds.
•That better-rated NBFCs aren’t handicapped for funds was evident when Dewan Housing Finance — for example — repaid commercial paper worth ₹1,775 crore on November 5.
•Another large housing finance company, PNB Housing Finance repaid ₹4,225 crore of CP in October 2018.
•“RBI is the lender of last resort. When all other avenues fail, then only such an option could be explored,” the source said, indicating NBFCs are yet to explore all other options that may have turned expensive for them.
•NBFCs can avail refinance facility from SIDBI or National Housing Bank and can also sell loans to banks. NHB has recently increased its refinancing limit by ₹6,000 crore-- to ₹30,000 crore-- to eligible institutions, including housing finance companies, for the July 2018-June 2019 period. Similarly, SBI trebled its loan purchase target for NBFCs to ₹45,000 crore for the current financial year.
•On Monday, PNB Housing Finance said NHB has santioned ₹3,500 crore refinance facility to them.
•“The NHB refinance are of a maturity of up to 15 years hence shall help further enhance our ALM… We wish to again reiterate that as on date, the company is very well placed, both on liquidity and ALM position and continue to be cautiously optimistic,” said Sanjaya Gupta, managing director, PNB Housing Finance.
•The liquidity issue for NBFCs, along with other issues like capital requirement for banks and more dividend from RBI to the government, has been a bone of contention between the central bank and the Finance Ministry. The Centre has cited the never-used provision under section 7 of the RBI Act to initiate consultations with RBI. Under this section, the government can issue directions to RBI. All eyes are now on the RBI’s board meeting scheduled for November 19.
📰 Report sees climate risk from rise in Indian AC units
Refrigerants used for cooling are the major contributors to global warming
•By 2022, India is expected to have a fourth of the world’s air conditioning units, and the risks to climate from this could be immense, according to a report.
•The refrigerants used for cooling are the major contributors to global warming, and if left unchecked, they could cause global temperatures to rise by 0.5 degrees Celsius. Several Departments in India, including the Department of Science and Technology and the Ministry of Power, on Monday announced a partnership with the Rocky Mountain Institute (RMI), a U.S.-based institute, and Conservation X Labs, a technology solutions company, to institute a Global Cooling Prize to motivate research laboratories across the world to develop highly efficient cooling technologies.
•A technology solution that could help to reduce the impact by one-fifth and ensure that air conditioning units use 75% less electricity would be needed, says Solving the Global Cooling Challenge, a report written by the Rocky Mountain Institute. A technology solution would not only significantly reduce the burden on electricity grids but also save ₹109 trillion ($ 1.5 trillion).
Phasing out HFCs
•In 2016, India was a signatory to a compact of 107 countries to “substantially phase” out a potent greenhouse gas, called hydrofluorocarbons (HFC), by 2045 and move to prevent a potential 0.5 C rise in global temperature by 2050.
•HFCs are a family of gases that are largely used in refrigerants at home and in car air-conditioners. However, they substantially worsen global warming. India, China, the United States and Europe have committed themselves to reducing the use of HFC by 85% by 2045.
•“I urge innovators to rise to this global challenge to develop a super-efficient technology, which provides access to affordable cooling to people around the world,” Union Environment Minister Harsh Vardhan said at a function to launch the prize. “We need to mitigate the risks of global warming that will follow the massive deployment of ACs in the near future.”
•Over ₹21 crore ($3 million) will be awarded over the course of the two-year competition. Up to 10 short-listed competing technologies will be awarded up to ₹1.4 crore ($200,000) each in intermediate prizes to support the design and prototype development of their innovative residential cooling technology designs. The winning technology will be awarded at least ₹7 crore ($1 million) to support its incubation and early-stage commercialisation, according to a press statement.
•Under a business-as-usual growth trajectory, about 4.5 billion room air-conditioners are estimated to be installed by 2050 — a nearly four-fold jump from today’s installed base, with emerging economies observing a five-fold increase, the report says.
