The HINDU Notes – 15th February 2018 - VISION

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Thursday, February 15, 2018

The HINDU Notes – 15th February 2018

📰 Crucible for civilisation

Since over a million years ago, the Indian region has not been deserted at any time

•In 1863, British geologist and archaeologist Robert Bruce Foote discovered the first Palaeolithic stone tools from India at the Attirampakkam site, close to Madras. Since then, this site has been visited by many investigators, and considerably more knowledge about the civilisation has been obtained.

•It was believed until recently that modern human ancestors moved out of Africa and settled in various places where they left their mark by introducing small tools, around 140,000-120,000 years ago. However, a recent paper published in Nature, ‘Early Middle Palaeolithic culture in India around 385-172 ka reframes Out of Africa models’, by Akhilesh Kumar, Shanti Pappu and others, has revealed stunning new evidence that small tools — as opposed to larger ones that characterised early human species — were being made at this site way before — nearly 385,000 years ago.

•Does this then contradict the theory of humans migrating out of Africa? Perhaps not, but it is no less important in that it sets a time to when the transition from larger hand axes and cleavers, known technically as the Acheulean culture, to smaller tools such as scrapers, used in the Middle Palaeolithic culture, happened.

•In the paper, the researchers have built up a picture of early hominins as hunter-gatherers who occupied this region on a seasonal basis. The reasons for visiting this area may have differed: once to acquire a specific resource, another time to make tools. The research is also cautious in stating that it does not actually identify who made the smaller tools — it may have been archaic hominins who had figured out that these were more useful than larger tools, or it could have been modern humans who coexisted with the last of the archaic hominins.

•Ms. Pappu of the Sharma Centre for Heritage Education says that the Attirampakkam puzzle is a complex one to solve. One reason is that close to this region, there is poor fossil record, owing to the prevailing soil conditions.

•Cranium fossils from this period have been found in Hathmora near the Narmada region, but it is difficult to correlate this with the Attirampakkam findings. It is only through the discovery of additional material from this site that researchers can hope to determine why the technology transfer happened, and its relevance to understanding Indian and global civilisation. Such research takes time and patience, and it is not often that one gets to discover a complete “toolkit” such as in the present finding.

•One thing is certain: since over a million years ago, the Indian region has not been deserted at any time and has been the crucible of numerous civilisations including the Acheulean, Lower Palaeolithic and Middle Palaeolithic, up to 5,000 years ago. As to deciphering the story of these civilisations, their behavioural changes, their adaptation to the environment, movement across countries and connection with the prehistories of West Asia and Southeast Asia, many more long-term and interdisciplinary studies are needed.

📰 Can sanitation reduce stunting?

Testing this hypothesis is hard, given how difficult it is to change toilet habits

•Studying the impact of sanitation on stunting is tricky, and the much-awaited results of two ambitious new trials published this year show why.

•The trials, which implemented water, sanitation and hygiene (WASH) interventions in Bangladeshi and Kenyan villages for two years, were an effort to prevent stunting (low height for age) seen in children under two years in developing countries. Specifically, the WASH interventions included replacing poor-quality toilets with improved ones, chlorinating drinking water, and promoting handwashing — all in an attempt to protect toddlers from the faecal pathogens that are believed to interfere with their growth. But when the trials ended, disappointingly, the researchers found these children were not taller than those who did not receive these interventions. The findings are a setback to the hypothesis that improving sanitation can thwart childhood stunting. But how big a setback they are is disputed.

The problem of open defecation

•One point of view is that even though Bangladesh and Kenya see childhood stunting, they are dramatically different from countries such as India on a critical count. India is the only country today in which over 50% of the rural population still defecates in the open. Bangladesh, while close to India in population density, brought down open defecation rates from 42% in 2003 to just 1% in 2016.

•This critical difference was apparent in the two trials as well. Only around 3-9% of the participants in the trial in Bangladesh, and less than 5% in the trial in Kenya, defecated in the open at the start of the experiment. Most people already had toilets, albeit poor-quality ones, which the trial improved. It is likely that the children sampled were exposed to lower levels of faecal pathogens in the first place, which is why the trials didn’t impact stunting, says Dean Spears, an economist at the Research Institute of Compassionate Economics (RICE). He argues that the only thing the trials show is that upgrading from a basic toilet to an improved toilet, along with other WASH interventions, didn’t make children taller. “But it is not as informative for someone focussed on India’s policy challenges, because the policy challenge in India is open defection,” he says.

•Others say the new trials raise doubts about the link between sanitation and stunting in India too. Wolf-Peter Schmidt, an epidemiologist at the London School of Hygiene and Tropical Medicine, points out that even in countries like Bangladesh, poor-quality toilets can cause heavy faecal contamination. Stephen Luby, an epidemiologist at the Stanford Woods Institute for the Environment and lead investigator in the Bangladesh study, says that the villages in his study saw high rates of both contamination and stunting. Yet the WASH improvements made no difference, which means that other factors could be driving stunting. “This heightens concerns that similar mechanisms underlie the association between open defecation and stunting in India,” he says.

•Stunting is a complex problem. Children in richer South Asian countries are shorter on average than those in poorer Sub-Saharan African countries, and no intervention so far has closed this gap. Even though prenatal health, breastfeeding and diet, among dozens of factors, have been implicated in stunting, trials to encourage breastfeeding or supplement the mother’s and child’s diets have come up short. Simultaneously, researchers have homed in on an alternative hypothesis: that poor sanitation plays a greater role in stunting, because faecal bacteria and parasites deprive the child of nutrition.

•Evidence for this hypothesis has piled up over the decades. Studies in Gambian children in the 1990s showed that intestinal inflammation, possibly caused by exposure to faecal germs, is correlated with stunting. Among animals, baby mice infected with Escherichia coli, a faecal bacterium, grew slower, and showed signs of such intestinal inflammation when dissected. In 2013, Mr. Spears analysed data from 65 countries and found that much of the height variation among those regions could be explained by differences in open defecation rates. The study also showed that open defecation had a stronger impact on height when population density was higher, as is the case of India and Bangladesh.

•The problem is that most of the data which show that children in households with poor toilets are more likely to be stunted comes from descriptive studies. Descriptive studies have a downside: they can show association but not causation. “The concern with these studies is that they may be explained by some other difference between households with nice toilets and those without,” says Mr. Luby. This is why randomised control trials (RCTs), like the ones in Bangladesh and Kenya, matter.

•But this is where researchers run into another stumbling block. It is extremely hard to conduct RCTs on sanitation. Since 2010, some six groups, including three in India, have experimented with sanitation approaches to tackle stunting. Nearly all failed because they were unable to convince enough people to use toilets in the first place. One RCT in Mali, in 2015, did increase toilet use by 30% and saw a small increase in child growth. But RCTs need to be replicated before their findings can be extrapolated to other countries, says Amy Pickering, one of the study’s authors who is from Tufts University. Another predicament is that for WASH interventions to be truly effective, more than one generation of families may need to adopt them. Most trials do not last longer than two years, given how expensive and logistically challenging they are.

Changing habits

•India’s Swachh Bharat Abhiyan (SBA) is an example of how difficult it is to change people’s sanitation habits. Even though the SBA aims to eliminate open defecation by 2019, data from the 2015-16 National Family Health Survey show the campaign hasn’t changed much since it began. “Almost halfway through the SBA, open defecation remained quite common in rural India and its distribution across districts looked pretty similar to 2011,” Mr. Spears says. InWhere India Goes, Mr. Spears and RICE demographer Diane Coffey argue that programmes like the SBA that focus on constructing toilets can’t do much in the face of deep-rooted cultural beliefs about open defecation because they presume that people do not build toilets for financial reasons. If behavioural change campaigns are not initiated to tackle the problem, Indians will continue to defecate in the open even if they get toilets for free.

•Against this background, the Bangladesh study is significant because it did succeed in changing participant behaviour. It provides critical information for countries that have already eliminated open defecation. They may now want to weigh the merits of sanitation against other interventions like nutrition. What the trials mean for India is a tougher question. For an RCT to test the link between open defecation and stunting, it must figure out first how to get Indians to stop open defecation. Several researchers have tried this, but have come up dry.

📰 Back to the chessboard?

The political crisis in Sri Lanka will likely end in a reconfiguration of coalition forces

•Sri Lanka’s local government election held on February 10 has become more than a mid-term poll that usually helps the opposition. Rather, it has led to an immediate political crisis of sorts, threatening the stability of the present government.

•While the disunited ruling coalition, jointly headed by President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe, has lost the election badly, the newly formed Sri Lanka People’s Front, unofficially backed by former President Mahinda Rajapaksa, has secured a sweeping victory in provinces except in the north and east.

Pressure points

•There are two dimensions to the crisis. The first is the pressure from the Rajapaksa camp for the Wickremesinghe government to resign, interpreting the local government election as a referendum on the government as well as a loss of its popular mandate of 2015. The government can easily dismiss that pressure by showing that Mr. Rajapaksa’s new party polled only 44% of the popular vote this time while the parties that were partners in the coalition that brought them into power in 2015 have nearly 52% of votes between them.

•Besides, the outcome of the local government election has no direct bearing on the government’s parliamentary majority. Mr. Rajapaksa has only about 50 MPs. Thus, the balance of power within Parliament has not been altered, and it is likely to remain that way unless the ruling coalition breaks up.

•It is in that sense that the second dimension is more serious than the first. The hostility and disunity between the two centres of power of the ruling coalition — one headed by Mr. Sirisena and the other by Mr. Wickremesinghe — has shaken the very foundations of the government. Mr. Wickremesinghe heads the United National Party (UNP), which is the largest component of the coalition with 106 MPs. Mr. Sirisena heads the Sri Lanka Freedom Party (SLFP) and United People’s Freedom Alliance (UPFA), with only 37 MPs with him in the coalition government. The local election showed 32% voter support for Mr. Wickremesinghe’s UNP —and Mr. Sirisena’s UPFA and SLFP polled a low 12%.

The discord build-up

•The discord between the President and the Prime Minister has been building up for over a year on a mixture of policy and personal issues. The President has been open in saying that Mr. Wickremesinghe and his ministers had been mishandling the economy, slowing down the investigation into alleged corruption by the Rajapaksa family, and even engaging in large-scale corruption while preaching clean governance. Mr. Sirisena also felt that Mr. Wickremesinghe has been ignoring him on policy issues. Thus, due to the simmering disharmony, bitterness and mutual distrust, the Sirisena and Wickremesinghe camps of the government could not even contest this election as a coalition. Once in the fray as competitors, the two main parties of the coalition quickly transformed themselves into rivals and adversaries.

•In the backdrop of the escalating cold war between the two leaders was a major policy failure of the government — a massive financial fraud that was committed during the central bank’s bond sales in 2015. This was under the new government, within three months of its coming to power on a platform of corruption-free good governance.

•Much of the blame for the bond sales fraud was laid at the door of the Prime Minister by the opposition and the media for allowing it to happen and then attempting a cover-up. Amidst a public outcry, Mr. Sirisena appointed a commission last year to investigate the fraud. In its report, submitted to the President late last year, the commission recommended the prosecution of the bank’s former Governor, his son-in-law and their accomplices. This was a blow against the government, and caused further deterioration of relations between the President and the Prime Minister.

•The issue dominated campaigning for the local government election, which began early in December, with Mr. Sirisena targeting the UNP. He also pledged that he was going to clean up the government after the election, indirectly suggesting a change in the composition of the cabinet.

•It is this conflict that exploded in February 11 soon after the election results showed Mr. Rajapaksa’s new party winning comfortably. Mr. Sirisena began to search for a replacement for Mr. Wickremesinghe, despite not having the constitutional authority to sack or appoint the Prime Minister or members of the cabinet. Mr. Sirisena failed to make any headway after two days of manoeuvring. Alive to the threat, UNP Ministers and MPs, even amidst fresh divisions, have now closed ranks against Mr. Sirisena. By the night of February 13, the UNP began a line of action independent of Mr. Sirisena and his SLFP/UPFA and then to reconstitute the coalition government.

•In this scenario, the UNP envisages an outcome in which Mr. Wickremesinghe will continue as the Prime Minister of a reconfigured coalition government, with a much weakened Mr. Sirisena as President. Mr. Wickremesinghe has 106 UNP MPs in the 225-member Parliament.

•There is speculation that nearly a dozen SLFP Ministers, who are currently with Mr. Sirisena, are ready to join Mr. Wickremesinghe’s new government in case of a clear split between the two leaders. There is also speculation that the Tamil National Alliance (TNA) is ready to offer conditional outside support to Mr. Wickremesinghe. Devolution, peace building and constitutional reform are sure to be the themes of those conditions.

•There is another scenario in which Mr. Sirisena will continue to insist on Mr. Wickremesinghe’s resignation as Prime Minister. This will certainly deepen the crisis because the UNP is no mood to lose the power struggle. As mentioned earlier, the President is reported to be searching for a replacement for Mr. Wickremesinghe from among senior members of the UNP, but with limited success. A part of Mr. Sirisena’s strategy would also be to create dissent within the UNP with a view to weakening Mr. Wickremesinghe.

•Thus, the political crisis that has been precipitated by the election seems to be intensifying but is expected to end with the significant step of re-constitution of the government.

Difficulties ahead

•Whatever happens, the undeclared power struggle between the two main coalition partners will have to come to an end in a new configuration of coalition forces. As things stand now, the two leaders do not seem to be giving way in the battle for supremacy within the coalition government. Reconciliation between the two coalition leaders is not in the realm of immediate possibilities, but they will have to find a framework of cohabitation given that the Rajapaksa family is waiting to move in. However, the political drama that began on February 10 is unlikely to end soon. Buoyed by the surprise win for its party which was formed just a year ago, the Rajapaksa family will continue to stake claim to power both within and outside Parliament. It will also have another chance of consolidating its newly gained electoral power in the Provincial Council elections to be held later this year. After this, presidential elections will have to be held by end-2019, followed by parliamentary elections. Sri Lanka watchers can expect more political surprises ahead.

•Meanwhile, if the President and the Prime Minister do not find a framework of constructive reconciliation between them, governance in Sri Lanka will crawl along for two years. Worse still, the much-valued programme of constitutional and political reform, peace building, inter-ethnic reconciliation and democratic consolidation will enter an extended state of stalemate. Its resurgence, sadly and ironically, might require another phase of democratic setback.

📰 The many conflicts in Syria

•With more interventions, the war is now more complicated

Is the Syrian crisis escalating further?

•Last year, after the regime forces made advances against the rebels, and the Islamic State was defeated, the Syrian civil war seemed to be winding down. However, the crisis is escalating with the regime beginning a new phase of the war in Idlib province, which is controlled by rebels and al-Qaeda-linked jihadists; Turkey sending troops across the border to fight the Kurdish rebels; and the U.S. seemingly determined to stay in Syria for a longer term. Like the first phase of the civil war, this phase is also multidirectional. The regime, backed by Iran and Russia, is fighting against the rebels and jihadists in Idlib, Eastern Ghouta, and some southern enclaves. Turkish proxies, backed by the air force, are attacking Kurdish militias in Afrin, a border town. The U.S., despite Turkey’s warnings, continues to support the Kurdish militias in several other towns in the border region.

What’s Israel doing in Syria?

•The downing of an Israeli fighter jet in Syria last week triggered this question once again. From the early phase of the civil war, Israel has been a passive player. In the initial stages, it backed rebels on the Golan side to create a buffer between the Golan Heights that have been occupied by Israel since 1967 and the Syrian mainland. With Iran and Hezbollah expanding their presence in Syria, Israel’s focus broadened to curtail their influence. Last week, an Israeli fighter jet was carrying out a raid against an Iranian drone control facility in Syrian deserts when it came under Syrian anti-aircraft fire. Following the incident, Israel has steadily enhanced its air campaign in Syria against what it calls “Iranian targets”.

Where is it heading?

•The conflict is becoming more complex with more powers intervening. Earlier, among external powers, only Russia and the U.S. were making direct interventions, with Iran, Saudi Arabia, the UAE, Qatar and Turkey all supporting their respective proxies. Saudi Arabia and its Gulf allies may have taken a beating after rebels lost Aleppo, but Turkish and Israeli jets are now carrying out airstrikes in Syria. Russia appears to be stuck in the conflict. Its heavy bombing campaign helped turn the war in favour of the regime, but its attempts to push the government to make concessions in peace talks have been a failure. With more powers in the war, finding a solution is becoming more complicated.

📰 War of words over pilgrim visas

•A war of words has broken out between India and Pakistan after reports alleged that Islamabad has denied visas to 173 pilgrims who wanted to visit the famous Katasraj temple near Lahore.

•“The applicants have submitted their applications to the High Commission and Pakistan is empowered to grant the visas without shifting the blame on its refusal to the applicant country,” sources said.

•However, Ministry of Foreign Affairs of Islamabad issued a statement saying it was India that refused to clear the pilgrims.

📰 Rouhani visit signals balance in ties

Iranian President coming exactly a month after Israel Prime Minister Benjamin Netanyahu

•Iranian President Hassan Rouhani will visit India from February 15 to 17, exactly a month after Israel Prime Minister Benjamin Netanyahu, Iran’s biggest rival, made a historic visit.

•Officials say Mr. Rouhani’s visit will send out a message that India aims for balance in its ties in the neighbourhood.

•Mr. Rouhani and Prime Minister Narendra Modi will seek to iron out issues on trade, connectivity, banking and energy.

•“During the forthcoming visit of the President of Iran, both sides would review the progress achieved in bilateral relations and also exchange views on regional and international issues of mutual interest,” the External Affairs Ministry said in a statement on Wednesday.

•Since Mr. Netanyahu’s visit, Mr. Modi has visited Palestine, Jordan, the UAE and Oman.

•“Clearly, the government is trying to cover all bases,” former Ambassador to Iran K.C. Singh said. “But it remains to be seen whether the Iranian establishment, including the clerics and the Iranian Revolutionary Guards, are comfortable with India’s relations with all these other countries. Iran is after all, not just important for India’s energy needs but also its only route for access to Central Asia.”

Port project

•Among the subjects expected to be discussed are the progress of the $500-million Beheshti port project in Chabahar, where India is expected to complete development of berths later this year. India is already routing a consignment of 1.1 million tonnes of wheat to Afghanistan through the existing facilities at Chabahar.

•On bilateral trade, the biggest stumbling block is banking channels, say diplomats in Tehran and Delhi. The two sides are now discussing the possibility of a “rupee-rial mechanism”, in addition to the current channel through UCO Bank for rupee payments. However, European banks have refused to support the trade, given the uncertainty over fresh sanctions from the U.S.

•Another issue is the pending negotiations over the Farzad-B gas and oil fields that India has expressed its interest in. During Mr. Modi’s visit in 2016, the two sides had hoped to see an agreement signed quickly, but according to officials dealing with the negotiations, the discussions had not made much progress because of what they called “Iran’s shifting goalposts” on the bid for Farzad-B.

•Sources said even negotiations for India’s bid for Russian and UAE oilfields that started much later had been concluded by now.

•Russia’s Gazprom has concluded deals for several oilfields and plans joint ventures with Iran’s National Iranian Oil Company, much to India’s chagrin.

•However, officials believe that India’s oil imports from Iran, which had plummeted to new lows last year, will go up this year, because of “better terms from Iran”, which is anticipating possible new sanctions being imposed by the Trump administration.

FATF meeting

•Iran is likely to seek India’s support at the upcoming meeting of the UN’s Financial Action Task Force, where Tehran is hoping to exit a blacklist on money laundering and terror finance, even as India hopes to see Pakistan put on a “grey-list” at the meeting.

•Mr. Rouhani will arrive in Delhi on February 17 after visiting Hyderabad, where he will address students and religious scholars at a series of functions and the Friday congregation at the Makkah Masjid. He will be the first Iranian head of state to do so.

•On Saturday, he will be given an official welcome at the Rashtrapati Bhavan before he and Mr. Modi sit down for bilateral talks. Mr. Rouhani is expected to return to Tehran the same evening, after delivering a special address at a foreign policy think-tank.

📰 India offers support for reconstruction of Iraq

Akbar says country will come up with project-specific proposals

•India has called for a comprehensive political settlement and reconciliation in Iraq at the International Conference for Reconstruction of Iraq in Kuwait, where major world powers are meeting to chalk out a plan of recovery for the country.

•Union Minister of State for External Affairs M.J. Akbar, who is leading the Indian delegation, has announced that India will play its part in the reconstruction, and called for an end to global terrorism.

Collaborative approach

•“We will play our part with project-specific proposals. We support the important role assigned to private sector investors in the rebuilding of the terrorist-affected areas in Iraq. We are willing to play a substantive role in major projects in petrochemicals, health, education, infrastructure and other sectors. We will also look at any specific requests for rehabilitation projects and essential supplies like medicines, equipment, etc., as required for internally displaced persons as part of our assistance programme,” said Mr. Akbar indicating a collaborative approach to rebuilding the country, which has witnessed war since the early 1980s.

•The conference being held in Iraq’s neighbour Kuwait has so far received promises of billions of dollars in the form of lines of credit from the international community and private investors, but reports say that Baghdad is yet to raise the resources for recovery from the destruction from years of foreign invasion and war with the Islamic State.

Pact against terror

•Mr. Akbar drew the attention of the conference towards India’s current campaign for a comprehensive global convention against terrorism.

•“This is also the moment to remind the international community that an early adoption of the Comprehensive Convention on International Terrorism, a draft of which was proposed by India as early as 1996...,” he said.

•During the visit of Iraqi Foreign Minister Ibrahim Jaafari last year, India assured Baghdad of support in the reconstruction of the country. Since the outbreak of the war in 2003, India had frequently responded to the humanitarian needs in Iraq and contributed in several ways, including providing $10 million in aid towards the International Reconstruction Fund Facility for Iraq (IRFFI) for investments, reconstruction and development in Iraq.

📰 Trump mulls China sanctions, scrapping S. Korea trade deal

Accuses Beijing of decimating American steel, aluminium industries via subsidies

•U.S. President Donald Trump threatened retaliatory action against two major Asian trading partners on Tuesday, warning of sanctions against China while vowing to revise or scrap a free trade deal with South Korea.

•Accusing Beijing of decimating American steel and aluminium industries, Mr. Trump said he was “considering all options”, including tariffs and quotas.

•Mr. Trump recently received two Commerce Department reports concerning alleged Chinese subsidies for steel and aluminium exports-materials that are vital for industries from construction to autos.

Spectre of a trade war

•He has another two months to decide on possible retaliatory action, but strongly indicated that he is leaning toward hitting back at Beijing.

•“I will make a decision that reflects the best interests of the U.S., including the need to address overproduction in China and other countries,’ he said.

•Experts believe any U.S. sanctions would prompt China to respond with sanctions of its own, raising the spectre of a trade war between the world’s two largest economies.

•China produces around half of the world’s steel and is accused of flooding the market in order to keep the economic wheels turning at home. For decades, Chinese leaders have been consumed with the need to — as former President Hu Jintao once put it — create “25 million jobs a year.”

•But Mr. Trump also is under domestic pressure. He came to office vowing to be a champion of America’s rust belt and said Monday he had to act to save the “empty factories” he saw on the campaign trail.

Widening trade deficit

•The U.S. trade deficit — which Mr. Trump has vowed repeatedly to fix — widened even further during his first year in office, up 12% to $566 billion.

•“They’re dumping and destroying our industry, and destroying the families of workers, and we can’t let that happen,” Mr. Trump told a group of Republican and Democratic lawmakers at the White House.

•Mr. Trump received some support from the group, but also warnings that action against China could drive up prices and hurt U.S. manufacturing outside the steel and aluminium sectors.

•“Mr. President, I think we do need to be careful here, that we don’t start a reciprocal battle on tariffs,’ said Republican Senator Roy Blunt. “You know, we make aluminium and we make steel” he said. “But we buy a lot of aluminium and we buy a lot of steel as well.”

•Daniel Ikenson of the pro-trade CATO institute said that Trump may be forced moderate his actions, if not his tone. “Despite the rhetoric, Mr. Trump doesn’t want to subvert ‘his’ economy,” Mr. Ikenson wrote this week.

📰 Don’t disrupt global economy, China warns

•U.S. trade sanctions will hit the world economy, Beijing warned on Wednesday, after President Donald Trump threatened to impose fresh tariffs on imports from China.

•Washington has already imposed a range of tariffs on Chinese-made goods, sparking fears of a tit-for-tat trade war between the world’s top two economies as China also threatens to take action.

•Foreign ministry spokesman Geng Shuang said that “any sign of unilateralism or protectionism will worsen global trade and will hurt the recovering momentum of the world economy”.

📰 Pakistan backed terrorists will continue attacks in India, says U.S. intel chief

In remarks coming after the Sunjuwan Army camp attack, Daniel Coats sees threat to the U.S. and Afghan interests too.

•Terror groups supported by Pakistan will continue to carry out attacks inside India, the United States intelligence chief has warned.

•Director of National Intelligence Daniel Coats’ remarks came days after a group of Pakistan-based Jaish-e-Mohammad terrorists attacked the Army's Sunjuwan camp in Jammu on February 10, killing seven people, including six soldiers.

•On February 12, a gunfight broke out between security forces and militants, who took shelter in a building in Karan Nagar area of Srinagar after their attack on the CRPF camp in Karan Nagar area of Srinagar was foiled.

New nukes may be deployed

•Pakistan, in fact, will continue to threaten the U.S. interests by deploying new nuclear weapons capabilities, maintaining its ties to militants, restricting counter- terrorism cooperation, and drawing closer to China, Mr. Coats said in his testimony before the Senate Select Committee on Intelligence.

•“Militant groups supported by Islamabad will continue to take advantage of their safe haven in Pakistan to plan and conduct attacks in India and Afghanistan, including against the U.S. interests,” Mr. Coats said during the hearing on ‘Worldwide Threat Assessment’ of the US intelligence community.

Actions will run counter to U.S. goals for the region

•The Intel chief said Pakistan’s perception of its eroding position relative to India, reinforced by endemic economic weakness and domestic security issues, almost certainly would exacerbate long held fears of isolation and drive Islamabad’s pursuit of actions that run counter to the U.S. goals for the region.

•“Ongoing Pakistani military operations against the Taliban and associated groups probably reflect the desire to appear more proactive and responsive to our requests for more actions against these groups.” However actions taken thus far “do not reflect a significant escalation of pressure against these groups and are unlikely to have a lasting effect,” he said.

•Without specifically referring to any terrorist incident by Pakistan-based groups, Mr. Coats told the lawmakers that he expected increased tension between the two Asian neighbours.

•“Relations between India and Pakistan are likely to remain tense, with continued violence on the Line of Control and the risk of escalation if there is another high-profile terrorist attack in India or an uptick in violence on the Line of Control,” he said.

📰 Order to install CCTV cameras in courts is only for security reasons, clarifies Supreme Court

It is not for recording the proceedings, it says.

•The Supreme Court on Wednesday clarified that its orders directing the government to install closed circuit television (CCTV) cameras in courts and tribunals is meant solely for security purposes and not to record proceedings, which anyway were open to the public.

•“We have passed orders for installation of CCTV cameras so that concerns regarding safety and administration of justice could be addressed. A court proceeding is open to all those who are present in the court, but it may not be open to everyone who is not there in the court too,” a Bench of Justices A.K. Goel and U.U. Lalit said.

•On March 28, 2017, the Supreme Court directed that CCTV cameras should be installed in courts and important locations of court complexes in at least two districts in every State and Union Territory. The monitor of these cameras should be placed in the chamber of the district and session judge concerned.

•The apex court had, in its order, made it clear that footage from the cameras would not be made available to the public under the Right to Information Act or without the permission of the High Court concerned.

•The court had also considered the issue of CCTV cameras in tribunals where open hearing takes place like courts. It was further directed that cameras may be installed in subordinate courts in a phased manner.

“Substantial work” done by government

•Examining the status report filed by the Centre on the installation of cameras, the Supreme Court on Wednesday observed that “substantial work” had been done by the government in this regard.

•“Only further issue that survives is whether installation of CCTV cameras can be considered in State tribunals and quasi judicial authorities, including the executive magistrate and revenue courts,” the Supreme Court recorded in its order. It asked the High Courts and the Centre to consider this issue and take a decision.

•The court asked the Union Law Ministry to take a call on whether CCTV cameras should be installed in central quasi judicial authorities within four weeks.

•Amicus curiae and senior advocate Sidharth Luthra, however, urged the court to address the concerns over exposing the identity of victims in sexual offences/protected witnesses while having CCTV cameras in courtrooms.

•The Bench said the High Courts and the Centre should consider this aspect and pass necessary timely instructions.

•The court scheduled the PIL petition filed by Pradyuman Bisht in 2015 for next hearing on April 5.

📰 Prasar Bharati, Centre on collision course

Ministry wants IAS officer on board

•The Prasar Bharati Board on Thursday will discuss a proposal of the Information and Broadcasting Ministry to appoint an IAS officer as a board member, giving it a larger say in the working of the autonomous public service broadcaster.

•It is learnt that Surya Prakash, who was recently reappointed Prasar Bharati Chairperson, is likely to red-flag the appointment as it is in contravention of two clauses of the Prasar Bharati Act.

•The agenda of Thursday’s meeting proposes that a member’s post that has been vacant for more than a year now should be filled by an IAS officer.

•It does not mention any specific name. The member (personnel) is responsible for all the personnel and administrative matters concerning the public service broadcaster.

Against the Act

•Clause 4(1) of the Act says the Chairman and all the members of the board are to be appointed by the President on the recommendation of a committee consisting of the Vice-President, the Chairman of the Press Council of India and a nominee of the President.

•Clause 6(2) says the member (personnel) “shall be whole-time member” and Clause 6(7) says whole-time members shall be the employees of the corporation.

•“It is not under the board’s jurisdiction to make such a suggestion to the government when there is an Act that clearly lays down the method to make such an appointment. The proposal seeks to bypass the office of Vice-President M. Venkaiah Naidu and if such a resolution is cleared, it will denigrate his position,” one of the board members told The Hindu .

Applications junked

•The Ministry had advertised the post twice last year. The first was in June and the next in August.

•Senior Prasar Bharati officials says more than 50 applications came in response to the first advertisement and nearly 40 for the second.

•The officials complain that the Ministry did not set the wheels running and the applications were junked.

•“The Ministry’s proposal is clearly to have a better control over the autonomous body, which completely defeats the purpose of having an independent organisation,” another member said.

Editorial appointments

•The board will deliberate on a proposal to appoint the journalists Siddharth Zarabi and Abhijeet Majumder in editorial positions.

•Mr. Zarabi is the executive editor of Business TV India and Mr. Majumder is the Managing Editor of Mail Today . The Board has to vet the appointments of Mr. Majumder as the Chief Editor of Prasar Bharati News Service and Mr. Zarabi as the head of news in Doordarshan News.

📰 Supreme Court may hear plea to take up two-child norm

Petition says couples who follow policy should be rewarded.

•The Supreme Court may hear a plea to direct the Union government to give a “serious thought” to the rise in population and adopt the “two-child” policy norm in family planning.

•The public interest litigation petition, filed by activist Anupam Bajpai, said couples who followed the policy should be rewarded with incentives, while those who violated the “norm” should be punished by withdrawal of government “facilities and concessions”.

•“The citizen should have a limit in giving birth only to the maximum of two children, failing which the person concerned shall attract disqualification with respect to government facilities and other benefits being provided by the government to its citizens," the petition, filed through advocate Shiv Kumar Tripathi, said.

•It said that unless measures were taken to make a course correction of the mindset of the present generation, the future generations may have to lead a miserable life.

'Motivate people'

•The petition asked the court to direct the Central government to “motivate the people of this country” to follow the two-child policy norm.

•The petition said the pressure put on natural resources by the growing population had led to land degradation, dangerous levels of pollution, global warming and the depletion of ground and surface water.

•"The rapid population growth and economic development in the country are degrading the environment through the uncontrolled growth of urbanisation and industrialisation, expansion and intensification of agriculture and destruction of the natural habitat. If the population of India continues to multiply with the existing rate, the impact on the environment could be devastating," the petition noted.

📰 Mind the perimeter: On J&K terror attacks

The security protocol at military installations must be speedily upgraded

•The number of casualties in the terror attack on the Sunjuwan Army base in Jammu has risen to seven after clearing operations. The garrison of the 36 Brigade of Jammu and Kashmir Light Infantry was attacked last Saturday by a small group of heavily armed terrorists that managed to enter the residential quarters of soldiers. While three terrorists were killed, six soldiers and a civilian lost their lives. Many more sustained injuries. This is the latest in a series of attacks on military installations over the last few years. The worrisome aspect is the repeated success of terrorists in infiltrating high-security military complexes. As in every case, the Army will conduct a court of inquiry into the incident to identify lapses. However, the Sunjuwan attack exposes the vulnerabilities in perimeter security and the scant progress made in improving the security protocol since the attack on the Pathankot Air Force station in January 2016. Since then, there have been major attacks in Uri, Handwara, Nagrota and Panzgam, with significant casualties. In the aftermath of Pathankot, a committee headed by a former Army vice chief, Lt General Philip Campose, undertook a security audit of all military bases across the country. It identified sensitive installations and recommended measures to fortify them. In addition, in July 2017 the government delegated substantial financial powers to the three services to strengthen perimeter security at military installations. The Sunjuwan attack underscores the need for speedy measures on the ground, beyond the inquiries and policy announcements, to overhaul the system.

•As the terror attack in Jammu was under way, the Defence Ministry sanctioned ₹1,487 crore to strengthen sensitive military installations across the country as per the recommendations of a 2016 audit. Defence Minister Nirmala Sitharaman has also directed the Army to complete its implementation by the end of the year. This impetus is welcome, but the implementation must be broad-based, and go beyond ad hoc measures. It must be borne in mind that a successful attack does not necessarily mean that the soldier on the ground is lax in performing his duties. Many bases along the border are located in tough terrain, and are in close proximity to civilian dwellings, demanding care from the soldier to avoid civilian casualties in crossfire while adhering to the standard operating procedures. For a country that takes pride in its modern, technologically advanced military, India still relies heavily on putting more boots on the ground and on the calibre of the soldier. It is time the Defence Ministry adopted a holistic approach, making sure that the soldier is fully backed by technology and calibrated security drills. Preventing terrorists from scoring a strike is the best defence.

📰 ₹11,500 crore fraud rocks state-run PNB

Govt. swings into action, asks all lenders to ‘clean up’.

•In what could be one of the biggest frauds in the Indian banking system, state-run lender Punjab National Bank (PNB) reported unauthorised transactions worth ₹11,500 crore in one of its branches in south Mumbai.

•The Enforcement Directorate has registered a money laundering case in the matter, which involves Mumbai-based billionaire diamond merchant Nirav Modi. A case has been registered by the Central Bureau of Investigation against him and his business associates as well as a serving PNB official and a retired deputy manager of the bank.

•In a communication to the stock exchanges on Wednesday morning, the country’s second largest lender said it had detected some unauthorised transactions in one of its branches for the benefit of a few select account holders with their apparent ‘connivance’. “The quantum of such transactions is $1771.69 million. The matter is already referred to law enforcement agencies to examine and book the culprits as per law of the land,” the communication said.

Stock plunges

•The bank’s stock plunged almost 10% through the day and its market capitalisation eroded by nearly ₹3,900 crore by the end of trading on the Bombay Stock Exchange.

•The government also swung into action with the Finance Ministry asking all the banks to carry out a clean-up exercise. Financial Services Secretary Rajeev Kumar said the government will not tolerate ‘unclean banks’ while adding that the case dates back to 2011, when a fraudulent Letter of Undertaking (LoU) was submitted to PNB. “However, the PNB case is an isolated one. The CBI is looking into the case, and 10 employees of the bank have been suspended,” Mr. Kumar added.

•“I don’t think this is out of control or too big a worry at this point,” Financial Services Joint Secretary Lok Rajan said.

•On January 29, Anveesh Nepalia, the deputy general manager of PNB’s zonal office filed a complaint on the issue with the CBI.
•Mr. Nepalia alleged that Nirav Modi, Nishal Modi, Ami Modi and Mehul Choksi — all of whom are partners at Diamond R US, Solar Exports and Stellar Diamonds, conspired with a retired bank employee and a current staffer to defraud the bank.

•The retired PNB official Gokulnath Shetty and current employee Manoj Kharat fraudulently issued LoUs worth ₹280 crore to these companies in 2017, without going through the proper channels and bypassing a lot of procedures.

•Bank officials stumbled on the deceitful transactions on January 16 this year, when these three firms approached the branch and presented a set of import documents with request to allow buyers’ credit for making payment to overseas suppliers.

•Since there was no sanction limit in the name of these firms, the branch insisted on 100% cash margin for issuing LoUs for raising buyers’ credit.

•However, the firms contested they had been availing this facility in the past, although branch records did not have details of any such facility.

•A senior CBI officer said it has booked Mr. Shetty and Mr. Kharat of PNB, along with Nirav Modi, Ami Modi and Nishal Modi, the owners of the two diamond firms.

•All the accused have been booked for cheating and criminal conspiracy under the Indian Penal Code along with criminal misconduct by a public servant under the Prevention of Corruption Act.

•“Inquiries against all the accused are under way. We are examining the bank records and details of the LoUs issued during the period specified by Mr. Nepalia in his complaint,” the officer said.

•The bank has alleged the accused employees issued a series of LoUs to the three companies in favour of Hong Kong branches of Allahabad Bank and Axis Bank.

📰 The ratings illusion

Nations give too much importance to credit rating agencies despite their structural flaws

•The idea of rating an individual, an entity and even a nation has been there for aeons. The historian Herodotus, along with the scholar Callimachus of Cyrene, made lists of the original Seven Wonders, describing them and their worth in soaring rhetoric. Modern day credit rating agencies, however, have a far more recent origin — ironically, they were first established after the financial crisis of 1837 in the U.S. Such agencies (with the first established by L. Tappan in 1841 in New York) were then needed to rate the ability of a merchant to pay his debts, consolidating such data in ledgers. Soon enough, such ratings were being applied to equity stocks.

•Demand also rose for independent market information, offering trustworthy analysis of credit-worthiness, with Moody’s ratings’ publication increasingly focusing on industrial firms and utilities, offering letter based ratings. By the 1920s, the big three of the ratings world (including Fitch, Standard & Poor’s) had been incorporated. The passage of the Glass-Steagall Act in 1933 helped formulate the separation of the securities business from banking, with American banks authorised to only hold investment grade bonds, as determined by such ratings. Soon enough, by the 1960s, such ratings had spread over to commercial paper and bank deposits, along with expansion into rating the global bond market (including sovereign bonds), albeit with a business model change — such agencies were starting to charge both the investors and the entity covered.

•Yet, despite their vital role in the global financial world, rating agencies fail to inspire confidence, with allegations of improper and inaccurate ratings occurring frequently. Prior to the subprime mortgage crisis in U.S., Moody’s had issued an AAA rating to 45,000 mortgage-related securities between 2000 to 2007, which after the crisis had slumped to just six AAA ratings for mortgage-backed securities in 2010. The U.S. Department of Justice launched an investigation in 1996 into a potential improper pressuring of issuers by Moody’s. Such agencies have been subject to a range of lawsuits, especially after Enron’s collapse and during the recent subprime mortgage crisis in the U.S. The National Commission on the Causes of Financial and Economic Crisis in the United States (2011) held the failure of rating agencies to be essential cogs in the wheels of financial destruction. Moody’s has been fined across various geographies for non-adherence to standard rating protocols. For instance, Moody’s has raked up fines of $864 million for its role in 2008 crisis, while incorrect rating practices has led to fines of €1.2m in Europe. Standard & Poor’s (S&P) paid $1.4 billion for rubber stamping dicey mortgage bonds.

Case for regulation

•Even in India, rating agencies have had a mixed record. Cases such as Amtek Auto and Ricoh India led the Securities and Exchange Board of India (SEBI) to investigate rating agencies and tighten rules and disclosure norms.

•More importantly, such rating agencies can have a global impact, affecting the fiscal fortunes of nations, due to flight of capital, as witnessed during the East Asian crisis of the 1990s. Recent downgrades of U.S. and European sovereign debt have been criticised, with the relegation of Greece, Portugal and Ireland to “junk” status, leading to a sovereign-debt crisis, along with ensuing unemployment and eurozone instability. Such credit rating agencies have been criticised for failing to predict the 1997 Asian financial crisis and then downgrading such countries several notches during the event. The lack of recognition of India’s economic achievements and its non-correlation with its sovereign rating is an issue that rankles with most Indian economists. Such arbitrary behaviour has led to moves by Russia and China to set up their own ratings agency — S&P cut its rating on Russia to one notch above junk, in 2014, a few months after the annexation of Crimea, a change dismissed by Russia as politically motivated.

•Nations perhaps give too much importance to the achievement on such ratings, despite their structural flaws. Consider the conflict in interest — such rating agencies generate a significant portion of revenues through non-rating activities, and despite maintaining an iron curtain between their rating and non-rating businesses, common management and search for profits lets conflict of interest creep in. Numerous studies have showcased that rating agencies seek to provide issuers, whether entities or nations, with non-rating services, along with potentially influencing a higher rating (for instance, “Non-rating revenue and conflicts of interest”, by R.P Baghai and B. Becker).

Development matters

•In our development journey, we must utilise such rating agencies, preferably indigenous, to help clean house in our corporate sector. To safeguard investors, SEBI can explore reforms so that credit rating agencies do not provide non-rating advisory services to their clients, even at the cost of reduced profits. A fixed operating fee model may also be explored, thereby eliminating incentives to be the “lowest-bidder” with compromised quality. Outstanding ratings and sudden downgrades need to be subjected to greater supervision. Akin to auditors, corporates should be pushed to change rating agencies on a regular basis. The “issuer-pays” model needs to change to an “investor-pays” model, with fees being standardised by the market regulator. However, at the governmental level, our fiscal decisions should be marked by a push towards developing an economy with full employment and innovation, instead of seeking to chase down ratings quarter by quarter.

📰 Punjab National Bank warns peers about letters of undertaking fraud

Blames overseas branches of other Indian banks also

•Reeling from a ₹11,500-crore fraud, Punjab National Bank reached out to alert other lenders to the perpetrators’ modus operandi, while at the same time apportioning a share of the blame to its competitors’ overseas branches.

•In a letter dated February 12, to the CEOs of other banks, PNB said it was found that the SWIFT system had been misused by a junior-level branch official, who had fraudulently issued letters of undertaking (LoUs) on behalf of some companies for availing buyers’ credit from overseas branches of Indian banks. The SWIFT network and identification codes are most commonly used for international wire transfers.

•“The companies were maintaining only current account with the branch and were not enjoying any fund or non-fund based limits. None of the transactions were routed through the CBS [core banking solution] system, thus avoiding early detection of fraudulent activity,” PNB wrote.

•In one instance, LoUs were opened in favour of overseas branches of Indian banks for import of pearls for a period of one year, for which as per RBI norms, the total time period allowed is 90 days from the date of shipment.

•“This stipulation was overlooked by overseas branches of Indian banks, who are required to follow RBI guidelines,” PNB said, adding none of them had shared any information at the time of availing buyers’ credit.

•“This information is being shared strictly for exercising necessary caution in the matter,” the bank added.

📰 India initiates review of anti-dumping duty on Chinese steel wheel imports

•India has initiated a review of the anti-dumping duty on flat base steel wheels from China to take a call on “the need for continued imposition of the duties in force.”

•The Directorate General of Anti-dumping and allied Duties (DGAD) has initiated the review investigation “to examine whether the expiry of such duty (on imports of flat base steel wheels from China) is likely to lead to continuation or recurrence of dumping and injury to the domestic (Indian) industry.”

Trade deficit

•The move comes in the backdrop of India’s huge trade deficit with China ($51.1 billion in FY’17).

•Kalyani Maxion Wheels Pvt. Ltd. and Wheels India Ltd. have filed an application “alleging likelihood of continuation or recurrence of dumping of the subject goods, originating in or exported from China and consequent injury to the domestic industry.”

•They have sought a review and continuation of the anti-dumping duties, imposed on such imports. “The Authority (DGAD) has considered the period of October, 2016 to September, 2017 as the period of investigation. The injury investigation period has however, been considered as the period 2014-15, 2015-16, 2016-17 and the period of investigation,” the DGAD said.

•India had in 2013 imposed duty up to $613 per tonne on import of the product from China for five years. As per the World Trade Organisation, if a company exports a product at a price lower than the price it normally charges on its own home market, it is said to be “dumping” the product.

•The global body has also said that the WTO agreement allows governments to act against dumping where there is genuine (“material”) injury to the competing domestic industry.

📰 DVC to start exporting power to Bangladesh

Utility had won a bid to sell 300 MW

•Damodar Valley Corporation (DVC) would soon begin exporting power to Bangladesh on the basis of a bid it had won, through its power trading partner NTPC Vidyut Vyapar Nigam Ltd., for supplying 300 MW.

International tender

•This is the first time that DVC had won a global tender for cross-border power supply, according to a statement. DVC is administered by the Union Power Ministry and co-owned by the Centre and the States of West Bengal and Jharkhand.

•With an installed capacity of 7,237.2 MW, DVC supplies power to six States, apart from its two holding States. DVC would supply power to Bangladesh from January 2020 to May 2033. The short-term supply would commence from June 2018 and end in December 2019. The power would be evacuated through the 500 MW HVDC transmission line through Baharampur in West Bengal and Bheramara in Bangladesh. The line would be commissioned in June 2018, an official said.

📰 Funds push for project to benefit desert areas

Restructuring of Indira Gandhi Canal

•A new loan agreement for water sector is set to benefit the desert areas in Rajasthan through restructuring of Indira Gandhi Canal and formulation of flood management systems for the Ravi, Beas, Sutlej and Ghaggar rivers.

•The agreement with the New Development Bank, stipulating the release of ₹1,000 crore as first instalment of a loan worth ₹3,300 crore, was signed by Rajasthan Principal Irrigation Secretary Shikhar Agrawal, Joint Secretary in Union Finance Ministry Govind Mohan and an NDB representative in New Delhi on Tuesday.

•Mr. Agrawal said the project to be undertaken by utilisation of the loan amount would facilitate usage of rainwater and floodwaters of the four rivers coming from Punjab, besides stopping the flow of excess water towards the India-Pakistan border. The loan amount of second phase will be released in April, followed by the release of subsequent instalments to match the project’s implementation.

•The restructuring and repairing of Indira Gandhi Canal and its distributaries will help solve the problems of loss of water and water-locking in the agricultural fields. It will also ensure the supply of irrigation water to the farmers at the tail-ends of the Indira Gandhi Canal Project.

•The project will benefit 10 districts in Rajasthan – Sriganganagar, Hanumangarh, Churu, Nagaur, Bikaner, Jodhpur, Jaisalmer, Sikar, Jhunjhunu and Barmer. Mr. Agrawal said the issue of scarcity of clean drinking water in these districts would also be resolved to a significant extent with the help of the project.

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