News: June 11, 2020

Sub: Geography
Topic: India Physical Setiings
Category: Prelims & Mains


News: 1/10

Lakes and Rivers in focus


  • Ladakh
    • Pangong Tso lake
  • Maharashtra
    • Lonar lake
      • Lonar lake in Buldhana district had turned pink.
      • CSIR-NEERI and Geological Survey of India will give their findings in 4 weeks, about glass formation  on surface of lake
      • As per study by Pune based institute, the pink coloration is due to Haloarchaea or halophilic archaea bacteria. the bacteria is found in salt saturated water bodies. The coloration is supposed to be temporary


Himalayan rivers

  • Brahmaputra River
    • Originates from Angsi glacier near Mansarovar Lake, and enters India along the eastern side of Namcha Barwa mountains
    • Tributaries : Subansiri, Bhareli, Manas, Sankos, Jaldhaka, Tista on right bank; Dibang, Lohit, Dhansiri, Kolong on left bank
  • Indus River
    • Tributaries
      • Shyok River - Flows through northern Ladakh and enters Gilgit Baltistan. Originates in Siachen Glacier
  • Ganges
    • Tributaries
      • Ghaghra River
        • Tributaries
          • Kali River (Mahakali, Sharda) - originates in the Pithoragarh district in Uttarakhand, and flows along western boundary of Nepal. Dudhwa National Park in Uttar Pradesh lies in its basin

Peninsular rivers

East flowing rivers

  • Godavari
    • Largest river of peninsular India, it rises in Western Ghats near Nasik.
    • Major tributaries from left are Purna, Maner, Penganga, Pranhita (the combined Wardha and Wainganga), Indravati, Tal, and Sabri. Major tributary from right is Manjira
    • The delta is characterized by extensive mangrove swamps, mud-flats, lagoons and barrier splits
  • Krishna
    • Originates in Western Ghats near Mahabaleshwar
    • Major tributaries: Bhima, Tungbhadra
      • Tungbhadra:  Tungabhadra River is formed by the confluence of the Tunga River and the Bhadra River at Koodli which flow down the eastern slope of the Western Ghats in Karnataka. It joins Krishna River near Alampur Village in Telangana near Sangameshwara temple and Jogulamba temple
    • Dams - Nagarjuna Sagar dam
    • The delta is characterized by extensive mangrove swamps, mud-flats, lagoons and barrier splits
West flowing rivers
  • Sharavathi - West flowing river, which originates and flows entirely within Karnataka, and it houses Jog Falls
  • Periyar
    • It originates from the Sivagiri peaks of Sundaramala in Tamil Nadu.
    • Dams: Iduki dam,  Mullaperiyar dam
    • Tributaries - Muthirapuzha, Mullayar, Cheruthoni, Edamala, Chalakudy
      • Chalakudy
        • The river has its origin in the Anamalai region of Tamil Nadu. The river hosts Athirappilly hydroelectric project

Other rivers

  • Nag river - The river gives Nagpur city its name, and originates in Lava hills. There is a lobby which places its origin further below at Ambazari dam, so as to carry with industrialization in upper stretch.

[In News]

  • June, 20
    • Union government is going to take stock of water utilisation from the Krishna and Godavari rivers following Telangana to assess whether there will be surplus water for new projects
  • July, 20
    • Nagpur Bench of the Bombay High Court takes note of pollution in Nag river.
  • Aug, 20
    • With a considerable increase in the water level in the Mullaperiyar dam following heavy rain, Kerala has asked Tamil Nadu to initiate urgent measures to keep the storage in the dam at a manageable level
    • Heavy rainfall in Krishna, Bhima, Tungabhadra basin areas of Maharashtra is expected to increase inflows to various dams and barrages in the neighbouring state.

Sub: Politics
Topic: Judiciary
Category: Prelims & Mains


News: 2/10

Codes And Articles In Focus


  • States
    • Nagaland
      • Article 371A - Special provision with respect to the state of Nagaland
      • Article 371A (1) (b) - important functions like "transfer and posting of officials" entrusted with the maintenance of law and order of and above the district level will be with the approval of the Governor.
  • Right to Health
    • Right to Health is an integral part of Right to Life as enshrined in Article 21.
    • Article 38 lays down the responsibility of the state to secure social order for the in promotion of the welfare of public health.
    • Article 39 (e) pertains to the protection of health of the workers.
    • Article 41 relates to providing public assistance by the state in special circumstances such as sickness, disability, old age etc.
    • Article 42 protects the health of the infant and the mothers, i.e. in a way, it pertains to maternity benefit.
    • Article 47 imposes a primary duty of the state in improvement of public health, in securing of justice, providing humane conditions of work for the workers, extension of benefits pertaining to sickness, disability, old age and maternity benefits. In addition to this, the state is under an obligation to prohibit the consumption of liquor in the interest of the public good.
    • Article 48A: State shall endeavour to protect and improve the environment and to safeguard the forests and wildlife of the country.
    • Article 164 (1A) : The total number of Ministers, including the Chief Minister, in the Council of Ministers in a State shall not exceed 15% of the total number of members of the Legislative Assembly of that State
  • Environment
    • Article 48A - State shall endeavour to protect and improve the environment and to safeguard the forests and wildlife of the country.
    • Article 51 A - Every citizen shall protect the environment.
  • Governor
    • Article 159 :  Oath or affirmation by Governor 
    • Article 174 :  Empowers Governor to decide on session sittings of Legislative Assembly and Legislative Council, but no more than six months should pass between two sittings. It also allows Governor to Prorogue either House and dissolve Legislative Assembly.
    • Article 175 : Governor may address the Legislative Assembly or Legislative Council, and can require attendance of its members. Governor may also send message (pending Bills, functioning of House, order, etc) to either House, and the respective House will have to consider the said message


Criminal Procedure Code (CrPC)  codes

  • Section 144
    • Power to issue order in urgent cases of nuisance of apprehended danger.
    • It authorizes the Executive Magistrate of any state or territory to issue an order to prohibit the assembly of four or more people in an area. According to the law, every member of such 'unlawful assembly' can be booked for engaging in rioting.
    • Also referred as 'gag order'

Indian Penal Code (IPC) codes

  • Section 188:  Disobedience to order duly promulgated by public servant. It is sufficient that he knows of the order which he disobeys. It can lead to imprisonment of 6 months and/or a fine of Rs 10000
  • Section 295: Damage to a place of worship or an object held sacred, punishable with imprisonment which may extend to two years, or fine, or both.
  • Section 300 and 302: Mob Lynching - Lynching incidents can be dealt with under Section 300 and 302 of IPC. IPC does not specifically describes lynching
  • Section 330 and 331: causing hurt or grievous hurt to extort confession 
  • Section 383: Extortion
  • Section 497 and 498: Adultry
  • Section 498A: Domestic violence
  • Section 506: Criminal Intimidation. non bailable remand

[In News]

  • June, 20
    • Madhya Pradesh Council of Ministers exceeding prescribed limit
    • Section 188: Lockdown curbing, in Uttar Pradesh alone, as of 29th April, 2020, FIRs have been registered against 33094 people under Section 188 of IPC during the period of lockdown.
  • July, 20
    • Governor of West Bengal cites Article 159 of deteriorating condition of state
    • 10 yr old dalit girl booked for sacrilege in Punjab
    • Rajasthan Governor allows holding of Assembly session
  • Aug, 20
    • Section 188 - Cases of hospitals and ambulances overcharging public during pandemic

Sub: Geography
Topic: Environment Ecosystem Biodiversity
Category: Prelims & Mains


News: 3/10

Species in focus

Animal Species 

  • Asiatic lion
    • IUCN status: Endangered
    • Found in Saurashtra region
    • There number have risen to 674
  • Common Leopard / Panthera pardus 
    • IUCN status: Near Threatened
    • Found in India near shivaliks, Egypt
  • Gangetic river dolphin
    • IUCN status: Endangered
    • Listed in Schedule I of India’s Wildlife (Protection), Act, 1972
    • India's national Aquatic Animal
    • It is primarily found in the Ganges and Brahmaputra, in fresh waters. The dolphin uses echolocation as they are effectively blind.
  • Gee's golden langur
    • IUCN status: Endangered
    • Found only in Assam and Bhutan
  • Golden birdwing butterfly
    • IUCN status: Least Concern
    • endemic to himalayan region, China, South Asia
    • Became largest butterfly in India in 2020, breaking 88 year old record
  • Hornbill
    • Wreathed hornbill
      • IUCN status: Least Concern
      • They are found in tropical and evergreen forests in Indian subcontinent and South East Asia
    • Oriental pied hornbill
      • IUCN status: Least Concern
      • They are found in tropical and evergreen forests in Indian subcontinent and South East Asia
  • Indian Gaur / Indian Bison
    • IUCN status: Vulnerable
    • Native to South and Southeast Asia,
    • Found in evergreen forests or semi-evergreen and moist deciduous forests
  • Indian Pangolin
    • IUCN status: Endangered
    • Of the eight extant species of pangolin, the Indian Pangolin Manis crassicaudata and Chinese Pangolin M. pentadactyla are found in India.
  • Indian rhinoceros /  Greater one-horned rhinos
    • IUCN status: Vulnerable, CITES appendix I
    • Found only in South Asia and South East Asia
      • Of the 2000 rhinos living, 1800 are in two places; Kaziranga National Park in Assam, India and Chitwan National Park, Nepal
    • Indian Rhino Mission 2020: Started in 2005 by Assam government, International Rhino Foundation, World Wide Fund for Nature (WWF), Bodoland Territorial Council to attain the rhino population of at least 3000 in seven protected areas of Assam by the year 2020
  • Pashmina goat / Changthangi
    • Found in Tibet, Burma, Ladakh
    • Reared by nomadic communities called the Changpa in the Changthang region of Greater Ladakh
  • Tibetan antelope / Chiru Goat
    • IUCN status: Near Threatened 
    • They are hunted for their fur - shahtoosh

Plant Species

  • Globbaandersonii / "Dancing ladies"
    • IUCN status: Critically endangered
    • Usually grows in a dense colony as a lithophyte (plant growing on a bare rock or stone) on rocky slopes in the outskirts of evergreen forests

[In News: Latest]

  • July, 20
    • A Himalayan butterfly named golden birdwing is now India’s largest butterfly
    • Assam floods
  • Aug, 20
    • Gang smuggling pangolin scales arrested
    • Leopard poaching by a study by TRAFFIC is highest in Uttarakhand, Maharashtra
    • A study by National Centre for Biological Sciences, shows heavy deforestation in Papum Reserve Forest in Arunachal Pradesh is threatening hornbill habitats.

Sub: Geography
Topic: Environment
Category: Prelims & Mains


News: 4/10

Environmental Bodies In India


Environment (Protection) Act, 1986 (EPA)

  • EPA was introduced as an umbrella legislation that provides a holistic framework for the protection and improvement to the environment.
  • Environment Protection Act, 1986 was passed and enacted under Article 253 of constitution
  • It clearly defined the term ‘environment’ as a reference for all undertakings that were concerned with the environment 
  • EPA allowed for formulation of guidelines for the management of hazardous substances and national environmental standards.

Environmental impact assessment (EIA)

Environmental impact assessment is a planning process to predict, assess, and mitigate the potential impacts of project development on the biophysical and human environment. In 1994, the Union ministry of environment and forests (MoEF), under the Environmental (Protection) Act 1986, promulgated EIA notification, making Environmental Clearance (EC) mandatory for expansion or modernization of any activity or for setting up new projects listed in Schedule 1 of the notification. An EIA notification is issued under Section 3 of the Environment Protection Act.

draft Environment Impact Assessment Notification, 2020

Released by Ministry of Environment, Forests and Climate Change (MoEFCC), EIA Notification 2020 is to replace and supersede EIA Notification 2006.

  • Categorization of projects and activities: All projects are divided into three categories
    • Category ‘A’: Category ‘A’ projects, including expansion and modernization shall require prior Environment Clearance from the Ministry
    • Category ‘B1’: Category ‘B1’ projects, including expansion and modernization of existing projects, excluding those near sensitive or protected zones (Polluted areas, protected areas, inter state boundaries, etc), shall require prior Environment Clearance from State Level Environment Impact Assessment Authority (SEIAA) or Union Territory Level Environment Impact Assessment Authority (UTEIAA)
    • Category ‘B2’: Category ‘B2’ projects that are required to be placed before Appraisal Committee as specified in the Schedule, shall require prior Environment Clearance from SEIAA or UTEIAA. Such projects shall not require any Scoping
  • Linear projects such as roads and pipelines in border areas (100km from boundary) will not require any public hearing
  • All inland waterways projects and expansion/widening of national highways will be exempted from public clearance.
  • Post-facto clearance: Starting a project before obtaining environmental approvals will no longer be a violation, and it can be regularised post-facto. 
  • Reduces public consultation hearings to a maximum of 40 days, and reduces response submission during public hearing to 20 days
  • For environment assessment, baseline data will be collected once (twice for river valley projects)
  • Section 14 provides exemption from public consultation, also limiting the scope of public involvement to the districts concerned, in the case of national parks and sanctuaries where pipeline infrastructure will pass.
  • Section 26 provides a list of projects that would not attract environmental clearance or permission, including coal mining and seismic surveys for oil, methane and shale gas on some lands

Water (Prevention and Control of Pollution) Act, 1974

To provide for prevention, control and abatement of water pollution and the maintenance or restoration of the wholesomeness of water. The Act provides for constitution of central and State Boards for preventing water pollution

Central Pollution Control Board (CPCB)

  • CPCB is a statutory organisation, constituted in 1974, under the Water (Prevention and Control of Pollution) Act, 1974. 
  • It serves as a field formation and also provides technical services to the Ministry of Environment and Forests of the provisions of the Environment (Protection) Act, 1986. 
  • CPCB is under mandate - to promote cleanliness of streams and wells in different areas of the States by prevention, control and abatement of water pollution; and to improve the quality of air and to prevent, control or abate air pollution.
  • Recent Initiatives
    • CPCB will classify railway stations under the red, orange and green categories based on the quantity of waste water generated.


National Green Tribunal (NGT)

  • National Green Tribunal was set under National Green Tribunal Act 2010, for effective and expeditious disposal of cases relating to environmental protection and conservation of forests and other natural resources
  • NGT is guided by principles of natural justice. NGT is vested with the powers of a civil court under the Code of Civil Procedure for discharging its functions. NGT does not have suo moto power to take a case.
  • NGT has original jurisdiction over all civil cases involving a substantial question relating to environment 
    • Substantial questions are those which affect the community at large, and not just individuals or groups of individuals.
  • NGT consist of both judicial and expert members. Judicial members must have been judges of the Supreme Court or High Courts. Chairperson should either be a judge of Supreme Court or Chief Justice of High Court
  • NGT has the power to hear all civil cases relating to environmental issues and questions that are linked to the implementation of laws listed in Schedule I of the NGT Act. These are:
    1. The Water (Prevention and Control of Pollution) Act, 1974
    2. The Water (Prevention and Control of Pollution) Cess Act, 1977
    3. The Forest (Conservation) Act, 1980
    4. The Air (Prevention and Control of Pollution) Act, 1981
    5. The Environment (Protection) Act, 1986 (EPA)
    6. The Public Liability Insurance Act, 1991
    7. The Biological Diversity Act, 2002

[In news]

  • June, 20
    • EPA, TERI - Baghjan oil field fire in Tinsukia district, Assam
    • NGT imposes fine on Karnataka government over pollution in Kithiganahalli Lake
    • NGT imposes fine on LG chem for Visakhapatnam gas leak
  • July, 20
    • Parliamentary panel to discuss draft EIA
  • Aug, 20
    • NGT orders OIL to disburse compensation ranging from ₹2.5 lakh to ₹25 lakh to those affected by the oil well blowout in Assam’s Tinsukia

Sub: Politics
Topic: Governance Agencies and Bodies
Category: Prelims & Mains


News: 5/10


Enforcement Directorate (ED)

  • Directorate of Enforcement is a specialized financial investigation agency under the Department of Revenue, Ministry of Finance
  • It comprises officers from Indian Revenue Service, Indian Police Service and the Indian Administrative Service.
  • Enforcement Directorate enforces following two Acts
    • Foreign Exchange Management Act 1999 (FEMA) 
      • FEMA allows only authorised person (defined by Reserve Bank) to hold, transfer and exchange in foreign securities
      • It imposes a penalty of upto three times of original sum involved for contravening Acts' provision, or conditions subject for authorisation
      • Failing to make full payment of the penalty imposed under section 13, within a period of ninety days from the date on which the notice is served will make defaulter liable to civil imprisonment.
      • Section 37 empowers Enforcement Directorate to exercise the power of investigation for any contravention that may occur under FEMA.
    • Prevention of Money Laundering Act 2002 (PMLA)
      • The Act came into force in 2005, and provides for confiscation of property derived from money laundering, impose penalty and prison on confiscators
      • Financial Intelligence Unit - India (FIU-IND) is the central, national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions to enforcement agencies and foreign FIUs.
      • Investigation is to be carried by Enforcement Directorate.

State anti corruption bodies

Some states have their own anti-corruption agencies and courts

  • Anti-Corruption Bureau - Andhra Pradesh, Rajasthan
  • Anti Corruption Organisation - uttar pradesh
  • Lokayukts - Kerala

[In News]

  • Rajasthan ACB to investigate MLA poaching in state
  • ED - Nirav Modi in PNB case. Sterling Biotech case

Sub: History
Topic: Modern India
Category: Prelims & Mains


News: 6/10

Revolutionaries In Focus

Jyotiba Phule 

  • Born in Maharashtra, Phule founded the Satyashodhak Samaj (Truth Seekers’ Society) in 1873 for doing social service and spreading education among women and lower caste.
  • Wrote Sarvajanik Satyadharma and Gulamgiri.
  • Phule was against Sanskritic Hinduism and worked for abolition of the caste system and socio-economic inequalities.
  • Phule was awarded the title of 'Mahatma' for his social reform work

Tatya Tope 

  • A general in the Indian Rebellion of 1857
  • Served Baji Rao and Nana Sahib

Bal Gangadhar Tilak

  • Part of the Lal-Bal-Pal, Bal Gangadhar Tilak was called 'father of the Indian unrest" by British colonial rulers. 
  • Founded Deccan Education Society in 1884 aimed at educating the masses, especially in the English language
  • He thus organized two important festivals, Ganesh in 1893 and Shivaji in 1895
  • In 1914 he founded and served as president of the Indian Home Rule League
  • In 1916 he concluded the Lucknow Pact with Mohammed Ali Jinnah
  • He published two newspapers -  Kesari in marathi, and Mahratta in english; and wrote 'Gita Rahasya'

[In News]

  • June, 20
    • Irregularities in maharashtra's Jyotirao Phule crop loan waiver scheme
  • July, 20
    • Maharashtra - Over ₹2.5 crore already spent on Tatya Tope monument, state tells HC
  • Aug, 20
    • Home Minister Amit Shah pays tribute to Bal Gangadhar Tilak

Sub: International Relations
Topic: International institutions, Agencies and Fora
Category: Prelims & Mains


News: 7/10

Group Summits

Group of 7 (G7) summit

  • Intergovernmental economic organization consisting of the seven major countries: Canada, France, Germany, Italy, Japan, United Kingdom and United States
  • In addition, the presidents of the European Council and the European Commission represent the European Union. They hold all the privileges and obligations of membership but without the right to host or chair a summit
  • It was formed in the backdrop of 70's oil shock.
  • It is held annually attended by heads of government from these countries
  • Russia joined in 1998, making it G-8 but was left out after annexation of Crimea

Group of 20 (G20) summit

  • G20 was created in response to both to the financial crises of 1990s and to a growing recognition that some of these countries were not adequately represented in global economic discussion and governance.
  • In December 1999, the Finance Ministers and Central Bank Governors of advanced and emerging countries of systemic importance met for the first time in Berlin. Since then they have been meeting annually.
  • G20 was raised to the Summit level in 2008 to address the global financial and economic crisis of 2008
  • The G-20 operates without a permanent secretariat or staff. The chair rotates annually among the members and is selected from a different regional grouping of countries.
  • G20 Leaders Summits - First held in 2008, its been held annually since 2011
  • The finance ministers and central bank governors of the G-20 countries meet twice a year 
  • Established in 1999 after a series of major international debt crises, the G20 aims to unite world leaders around shared economic, political and health challenges.
  • G20 members account for 85 per cent of the world economy, 75 per cent of global trade, and two-thirds of the world's population
  • The G20 operates without a permanent secretariat or staff. The group's chair rotates annually among the members and is selected from a different regional grouping of countries

Russia, India and China (RIC) grouping

  • RIC is a strategic grouping that first took shape in the late 1990s by Russia, for multi-sectoral corporation.
  • In 2003 a decision was made to bring political approach for boundary disputes. An agreement in 2005, identifying political parameters applicable in an eventual border settlement, implicitly recognised India’s interests in Arunachal Pradesh.
  • RIC 2020 was chaired by Russia, and discussed on global pandemic, security and corporation

[In News]

  • June, 20
    • U.S. President Donald Trump on Tuesday invited Prime Minister Narendra Modi to the next G-7 summit to be hosted by the U.S. India is studying the gesture and will examine if the invite is aimed at making India a permanent part of the global high table at the G-7 or its redesigned shape as G-11.

Sub: Economics
Topic: Banking, Finance and Tax System Finance and Banking - India
Category: Prelims & Mains


News: 8/10

Twin Balance Sheet

Twin balance sheet problem

  1. High non-performing assets (NPAs) of Public Sector Banks (PSBs)
  2. Highly stressed balance sheet of the private corporate sector

Insolvency And Bankruptcy 2016 (IBC)

The Code offers a uniform, comprehensive insolvency legislation encompassing all companies, partnerships and individuals (other than financial firms). 

  • Insolvency Resolution Process for Corporate debtors: To initiate an insolvency process, the default amount should be at least 1 lakh. The code proposes two steps
    • Insolvency Resolution Process
      • financial creditors assess whether the debtor's business is viable to continue and the options for its rescue and revival.
      • For this financial creditor can go to National Company Law Tribunal (NCLT).
    • Liquidation - a corporate debtor may be put into liquidation in the following scenarios
      • 75% majority of the creditor's committee resolves to liquidate the corporate debtor at any time during the insolvency resolution process
      • The creditor's committee does not approve a resolution plan within 180 days (or within the extended 90 days)
      • The NCLT rejects the resolution plan submitted to it on technical grounds
      • The debtor contravenes the agreed resolution plan and an affected person makes an application to the NCLT to liquidate the corporate debtor
  • Insolvency Resolution Process for Individuals and Partnerships - To initiate an insolvency process, the default amount should be at least 1 lakh. The code proposes two steps
    • Automatic fresh start - Under the automatic fresh start process, eligible debtors (basis gross income) can apply to the Debt Recovery Tribunal (DRT) for discharge from certain debts not exceeding a specified threshold, allowing them to start afresh.
    • insolvency resolution - The insolvency resolution process consists of preparation of a repayment plan by the debtor, for approval of creditors. If approved, the DRT passes an order binding the debtor and creditors to the repayment plan. If the plan is rejected or fails, the debtor or creditors may apply for a bankruptcy order.
  • The Code provides for the constitution of a new insolvency regulator i.e., the Insolvency and Bankruptcy Board of India (Board).
  • Insolvency And Bankruptcy (Amendment) Ordinance 2020 - Application for corporate insolvency resolution process for a corporate debtor, shall not be filed after March, 2020 for a period of six months

Partial Credit Guarantee Scheme (PCGS)

  • Sovereign portfolio guarantee of up to 20% of first loss for purchase of Bonds or Commercial Papers (CPs) with a rating of AA and below issued by NBFCs/ MFCs/Micro Finance Institutions (MFIs) by Public Sector Banks (PSBs) 
  • The window for one-time partial credit guarantee offered by the government will remain open till March 31, 2021, for purchase of pooled assets and for the period as specified under the scheme for purchase of bonds/CPs, or till such date by which Rs. 10,000 crore worth of guarantees, including both guarantees toward the purchase of pooled assets and bonds/ CPs, are provided by the Government, whichever is earlier

[In News]

  • June, 20
    • IBC amendment in wake of pandemic
    • Govt. suspends all new insolvency proceedings for six months

Sub: Politics
Topic: Constitution Constitutional and Statutory bodies
Category: Prelims & Mains


News: 9/10

Finance Commission

Article 280 of the Constitution of India provides for a Finance Commission as a quasi judicial body. It is constituted by the president of India every fifth year or at such earlier time as he considers necessary.

  • Constitution
    • The Finance Commission consists of a chairman and four other members to be appointed by the president. They hold office for such period as specified by the president in his order. They are eligible for reappointment.
    • Constitution aloows Parliament to determine qualifications and selection process. The chairman should be a person having experience in public affairs and the four other members should be selected from amongst the following: - a judge of high court or one qualified to be appointed as one; and people with knowledge of finance, administration, and economics
  • Functions
    • Distribution between the Union and the States of the net proceeds of taxes 
    • Suggest principles which should govern the grants-in-aid of the revenues of the States (Article 275) out of the Consolidated Fund of India. The Grants-in-aid cover Revenue Deficit of States, Local Body grants (rural and urban local bodies), and grants to augment SDRF.
    • To augment the Consolidated Fund of a State, on the basis of the recommendations made by the Finance Commission of the State, for supplementing resources of Municipalities and Panchayats 
  • Recommendations made by Commission are advisory in nature.
  • The commission submits its report to the president who tables it in Parliament.

15th Finance Commission was required to submit two reports. The first report, consisting of recommendations for the financial year 2020-21, was tabled in Parliament on February 1, 2020.  The final report with recommendations for the 2021-26 period will be submitted by October 30, 2020.  

Report recommendations for the financial year 2020-21

  • Share of states in the centre’s taxes is recommended to be decreased from 42% during the 2015-20 period to 41% for 2020-21. This 1% share will be diverted to newly formed Jammu and Kashmir, and Ladakh
  • Grants-in-aid : Commission has proposed a framework for sector-specific and performance-based grants
    • Sector-specific grants : Guidelines for Sector-specific grants include - nutrition, health, pre-primary education, judiciary, rural connectivity, railways, police training, and housing.
    • Performance-based grants : Guidelines for performance-based grants include:
      • implementation of agricultural reforms,
      • development of aspirational districts and blocks
      • power sector reforms
      • enhancing trade including exports
      • incentives for education, and
      • promotion of domestic and international tourism.
  • Recommendations on fiscal roadmap
    • Governments should focus on debt consolidation, and disclose their extra-budgetary borrowings.
      • debt consolidation is the process of paying debts by taking loan over a long manageable period
    • Broaden the tax base, and streamline tax rates.
    • Address state dependency on Centre for GST revenue shortfalls.

In Focus

  • Fiscal Council: Setting up a Fiscal Council was first recommended by the Thirteenth Finance Commission, subsequently endorsed by the Fourteenth Finance Commission and then by the FRBM (Fiscal Responsibility and Budget Management) Review Committee headed by N.K. Singh.

[In News]

  •  June, 20
    • Centre deciding to take the ordinance route to push through reforms in agricultural marketing and contract farming
  • July, 20
    • Need for a "Fiscal Council" in current times, where government is required to spend more.

Sub: Politics
Topic: Constitution Constitutional and Statutory bodies
Category: Prelims & Mains


News: 10/10

NITI Aayog

NITI Aayog was established as successor to the planning commission in 2015. It was created by an executive resolution, so its neither a constitutional nor a statutory body.


  • Chairperson:Prime Minister of India
  • Governing Council: Comprising Chief Ministers of all the States and Union Territories, and Lt. Governors of other Union Territories. 
  • Regional Councils: Formed to address specific issues and contingencies impacting more than one state or region. These are formed for a specified tenure. These are chaired by Prime Minister (or his nominee) and comprises of the Chief Ministers of States and Lt. Governors of Union Territories
  • Full-time Organisational Framework:
    • Vice-Chairperson: appointed by the Prime Minister.
    • Members: full-time, specialists with international exposure.
    • Part-time Members: maximum of 2 on a rotational basis.
    • Ex-Officio Members: maximum of 4 members of the Union Council of Ministers to be nominated by the Prime Minister.
    • Chief Executive Officer: appointed by the Prime Minister for a fixed tenure, in the rank of Secretary to the Government of India.
    • Secretariat: as deemed necessary.

Recent initiatives

  • NITI Aayog member V.K. Saraswat on Wednesday favoured imposing a border adjustment tax (BAT) on imports to provide a level-playing field to domestic industries. BAT is a duty that is proposed to be imposed on imported goods in addition to the customs levy that gets charged at the port of entry.


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