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Current Affairs: June 2009

New SEZs cleared
On June 2, 2009, the Union government approved ten special economic zones and allowed one-year extension to four projects, including Reliance Industries' Mukesh Ambani-promoted Rewas Ports, for land acquisition.

The Board of Approval (BoA) in the Commerce Ministry gave formal approvals to eight proposals, including those of Gulf Oil Corporation, Emmar MGF and Larsen and Toubro. Two other proposals were also given 'in-principle' approvals.

The board also allowed DLF to withdraw four of its IT/ITeS tax-free enclaves, asking the realty major to refund Rs 6-7 crore worth of fiscal sops the company would have availed of. DLF had cited economic downturn as reasons for seeking withdrawal.

However, the BoA outrightly rejected the proposals of Videocon Realty and Writers and Publishers for SEZs in Indore, on the ground that the promoters have not acquired "even an inch" of land.

The two proposals that have got in-principal approval include: Krishnapatnam Infratech in Kota Mandal (Andhra Pradesh) and Maharaja Multitrade in Nashik (Maharashtra), for multi-product and multi-services SEZs, respectively.

Since 2006, when the SEZ Act was notified, formal approvals have been granted for setting up 568 SEZs, of which 315 have been notified.

Yashpal panel report on Education sector
The beginning of bold reforms in the higher education sector was made on June 24, 2009, with the 24-member Yashpal committee—constituted last year to suggest revamp measures—scripting the end of regulatory mechanism era in India and rooting for university autonomy. In its report submitted to the government, the panel favoured vesting universities with full academic responsibility by allowing them the freedom to self regulate, choose the courses they want to offer and even design them.

The panel said institutes of excellence like the IITs and the IIMs should function like world-class universities, offering a range of courses in science, astronomy, management, psychology and philosophy in line with the global trends of inter-disciplinary approaches.

On the regulatory mechanism front, the panel’s report, “Renovation and Rejuvenation of Higher Education”, said the UGC, AICTE and MCI should not have a regulatory role and could be merged with the new National Commission for Higher Education and Research, which the committee recommended.

It called for a constitutional amendment to create the seven-member panel, which would function like the Election Commission. The Prime Minister, Leader of the Opposition and Chief Justice of India would select the members.

The commission would work as a facilitator to higher education institutes, which would be armed with the necessary legal mechanisms to offer courses of their choice. Notably, the commission is a part of the UPA’s promises and was mentioned by the President in her June 4, 2009 address to the Parliament. To bring it to life, the government would now have to bring a draft Bill.

On UGC and AICTE, Yashpal said a new commission could not be created unless old structures were removed. His report takes note of the delays, excessive inspection and corruption in the universities’ dealing with governments.

President’s address to the Parliament
More than six months after the Mumbai terror attacks, India, on June 4, 2009, extended olive branch to Pakistan with President Pratibha Patil asserting that the new UPA government would reshape the relationship with Islamabad provided the neighbouring country sincerely dealt with terrorist groups acting against India.
Emboldened by a reasonable participation by the people in the recent elections in Jammu and Kashmir, she also declared the UPA government’s resolve to constructively engage with all groups that abjure violence in the State, as also in North-East and other parts of the country.
Laying the road-map for the new UPA government in an address to the joint session of Parliament, President Patil announced that the government would maintain utmost vigil in the area of internal security by pursuing a policy of zero-tolerance towards terrorism, set up a national counter-terrorism centre to take anti-terrorism measures and seek an early approval of the bill for the prevention of communal violence.

As the first woman President of the Republic addressed the members from the two Houses in the Central Hall of Parliament, seated on her left was another woman—Meira Kumar—who made history a day before by becoming the first woman Speaker of the Lok Sabha.

Noting that creativity, innovation and enterprise held the key to people and nations realising their potential, the President observed that the ‘dreary desert sand of dead habit’ must be left behind. The young people were tearing down the narrow domestic walls of religion, region, language, caste and gender that confined them. “My government will ensure that its policies for education and science and technology are imbued with a spirit of innovation so that the creativity of a billion people is unleashed,” she said, declaring that the next ten years would be dedicated as a ‘Decade of Innovation’.

Describing the armed forces as the nation’s pride, she announced that they would be fully enabled with modern technology to repel any threat from land, sea or air. To enhance combat efficiency as also to address the requirements of modern day warfare, a number of steps were under way.

The address to Parliament also talked at length on the government’s pro-poor policies, and moves to strengthen welfare schemes and boost the economy. There were promises to enlarge the scope of NREGA, which has proved to be an effective social protection measure; introduce a new right to food Act; address the challenges in the health sector such as infant mortality, nutrition and pre-emptive cure; make quality education a right through the enactment of a new law; set up a national literacy mission for women; raise the target of rural housing for the next five years to one lakh twenty crore units; introduce a major housing scheme for the urban poor; and take up initiatives for skill development.

India-Bahrain pact to protect workers
India and Bahrain have inked a key agreement to ensure protection for Indian workers against unscrupulous employers. The agreement included housemaids who were not covered by Bahrain’s Labour Law and was signed during the visit of Overseas Affairs minister, Vayalar Ravi in June 2009. As per the agreement, a committee will be constituted to ensure that directives in the agreement are implemented and will consist of officials from Bahrain’s Labour Ministry and Indian Overseas Affairs Office. Employers who want to recruit Indian workers will now have to specify the nature of the work they will be doing and the required professional skills. Other required details include the duration of contract, an agreed salary and end-of-contract benefits, health services and holidays.

Prime Minister Manmohan Singh meets Pak President
A significant meeting between Prime Minister Manmohan Singh and Pakistan President Asif Ali Zardari, held at Yekaterinburg, Russia on June 16, 2009, sent out a clear message that India and Pakistan were edging towards the normalisation of bilateral ties, nearly seven months after the Mumbai terror attacks. They directed their foreign secretaries to meet within the next one month and discuss the “primary issue of terrorism” before the two leaders meet again on the margins of the NAM Summit in Egypt on July 15-16.

“I am pleased to meet you, His Excellency, I have a limited mandate to tell you that the territory of Pakistan should not be allowed to be used for terrorist acts against India,” Manmohan Singh firmly told the Pakistani leader right at the start of their 40-minute meeting. President Zardari was virtually rendered speechless for a while as neither he nor any member of his delegation expected such strong words from the Prime Minister.

The three conditions laid by Manmohan Singh for the resumption of dialogue were: Pakistan must take strong and effective action against forces representing terrorism, act against the perpetrators of terror attacks in India and dismantle the terrorist infrastructure. He also conveyed to Zardari India’s disappointment over the release of Hafiz Saeed, chief of the Jamat-ud-Dawa (Jud), one of the key plotters of the Mumbai carnage.

The beleaguered Pakistan President, who is facing the heat from the Pakistan Army, as well as the ISI back home, explained to Manmohan Singh the steps being taken by Pakistan to tackle terrorism and the problems the country was facing to deal with the menace.

Maoists banned
The Cental government, on June 22, 2009, formally listed CPI (Maoist) as a separate terrorist outfit under the Unlawful Activities (Prevention) Act. Though the decision will make little difference on the ground as the ban on CPI (Maoist) was already in effect by virtue of its constituents—CPI(ML), People’s War Group and MCC, along with all their formations and front organisations—featuring in the list of terrorist outfits under the UAPA, it is aimed at clearing any ambiguity regarding the illegal status of CPI (Maoist).

The CPI (Maoist) is the 35th organisation to be listed as terrorist outfit under UAPA.

It was formed by the merger of CPI (ML)-People’s War Group and MCC in September 2004. The question of a separate ban on CPI (Maoist) had come up soon after the merger, but the law ministry then took the view that there was no need for such ban as the UAPA clearly listed the formations and front organisations of CPI (ML)-People’s War Group and MCC as terrorist outfits, thus also including in its ambit CPI (Maoist). Besides, there were some differences within the constituent Naxal outfits regarding the acceptability of the merger—the Maoists in Nepal had at the time refused to recognise the merge—leading the Centre to settle for status quo.
The question of a separate ban on CPI (Maoist) cropped up again when Union Home Minister P. Chidambaram took a closer look at status of Naxalite outfits under UAPA. The minister is said to have insisted on a fresh ban on the merged outfits, CPI (Maoist), under which the Left-wing extremists were now operating in most States.

The Criminal Law Amendment Act, 1908, empowers the State government to declare an association as “unlawful.” Accordingly, while Orissa, Jharkhand and Tamil Nadu have declared CPI (Maoist) as an unlawful association, Bihar has listed MCC and CPI(ML)-PW as unlawful. Andhra Pradesh, MP and Chattisgarh have enacted their own separate State legislations declaring the CPI (Maoist) as an unlawful outfit. Under UAPA, last amended in December 2008, the Centre is also empowered to declare an association as unlawful.

The Act also defines a terrorist organisation in Section 2(1)(m), which are then specifically listed in the Schedule to the Act.

Security forces take control of Maoist-controlled areas in West Bengal
On June 30, 2009, security forces took control of Kantapahari, setting up a police camp after four years in the hub of Maoist-backed tribal agitation, with the West Bengal Government claiming that 95 per cent of the areas have been wrested from the ultras in West Midnapore district. Around 1,600 personnel of paramilitary forces, police and COBRA, the special anti-Naxal force, reached Kantapahari from both Lalgarh and Ramgarh ends as a helicopter kept an aerial vigil.
The Maoists set off a landmine and fired at the security forces in a forested area between Pirakata and Lalgarh but the troops retaliated. In Kolkata, Chief Minister Buddhadeb Bhattacharjee said the joint forces had been able to liberate nearly 95 per cent of the areas. The operations had been bloodless with no major encounter.

Earlier, the Maoists had gone on a rampage, targeting ruling CPM cadres and offices and had virtually taken control of a large area in West Midnapore district after driving away the police and paramilitary forces.

Today’s Bengal is a throwback to the Naxalbari uprising of the 1960s after tribals killed a police sub-inspector. The year was 1967, and the Left-led United Front was in power in the State. The recent Maoist violence has also ignited memories of the Sainbari killings in Burdwan in 1969 where CPM laid a siege. Forty years later, the State seems set for another round of bloodletting with the main opposition, Trinamool Congress, adopting the same tactic as the Left in the ‘60s: upstaging the ruling party on people’s insecurity. Ballot and bullets have ruled these parts since 1999 with rival groups in far flung pockets in West Midnapore, Bankura, Purulia, Birbhum and Hooghly fighting protracted gun battles. Violence and counter-violence are a major tactic of political parties to command support in the villages.

Babus to be insulated from netas
The end of the transfer/posting raj is in sight. Bureaucrats are set to get a new deal with the Centre readying a legislation that will not only assure babus of fixed-tenure postings but also protect them from political interference in their day-to-day functioning. Besides, all bureaucratic appointments, transfers and postings will be subject to Parliamentary scrutiny. As a consequence, IAS and IPS officers in the country will no longer be at the mercy of the whimsical transfer regime that operates currently.
However, along with these comforts will come added responsibility. The government plans to bring in a new public service code that will lay down a strict performance evaluation regime for promotions and postings of babus. All these provisions are expected to be part of the Civil Services Bill, 2009, a draft of which is being fine-tuned.

The Bill, which incorporates various suggestions of the second Administrative Reforms Commission, envisages setting up of a new Central Public Service Authority which will not only professionally manage civil services but also serve the interests of babus and citizens alike through checks and balances.

The Civil Services Bill moots: fixed tenure of three years per posting for all IAS and IPS officers; a new agency, Central Public Services Authority, to work as a watchdog against political interference in the bureaucracy. It will also keep a watch on performance of babus;  Postings to be strictly on basis of performance evaluated on a number of tasks assigned to bureaucrats over the years.


Iran’s Presidential polls
On June 14, 2009, hardline President Mahmoud Ahmadinejad was declared winner of the Presidential election held on June 12. The result was, however, bitterly contested by the opposition candidate Mir Hossein Mousavi. Ruling out any recounting of votes country’s supreme leader Ayatollah Ali Khamenei said President Mahmoud Ahmadinejad’s re-election victory was credible and insisted that the Islamic republic’s election mechanisms allowed no cheating. He said the street protests to pressure for change were not acceptable.

Khamenei insisted the elections showed off the country’s religious democracy for the world to see, shrugging an unprecedented challenge to the country’s ruling clerics by opposition supporters, who claimed the June 12, 2009 Presidential election was rigged. He said there was “definitive victory” and no rigging in the disputed Presidential elections.

“There is 11 million votes difference, Khamenei said. “How one can rig 11 million votes?” “The enemies (of Iran) are targeting the Islamic establishment’s legitimacy by questioning the election and its authenticity before and after (the vote)”.

On June 14, 2009, the Iranian police clashed with people protesting in Tehran against the re-election of hardline President Mahmoud Ahmadinejad. The unrest that rocked Tehran and several other cities was the sharpest expression of discontent against Iran’s leadership for years. Supporters of defeated moderate Mirhossein Mousavi, who dismissed Ahmadinejad’s triumph as a “dangerous charade”, gathered in central Tehran, chanted his name and threw stones at police.

The scale of Ahmadinejad's triumph upset widespread expectations that the race would at least go to a second round, and his victory is unlikely to help unblock a standoff with the West over Iran's nuclear programme. Interior Minister Sadeq Mahsouli, an ally of hardliner Ahmadinejad, declared that the President had been re-elected to a second four-year term with 62.6 per cent of the vote, against 33.7 per cent for Mousavi, in a record 85 per cent turnout.

The bitter election campaign generated strong interest around the world and intense excitement inside Iran. It revealed deep divisions among establishment figures between those backing Ahmadinejad and those pushing for social and political change. Ahmadinejad accused his rivals of undermining the Islamic Republic by advocating detente with the West. Mousavi said the President’s “extremist” foreign policy had humiliated Iranians.

The three-week election campaign was marked by mudslinging, with Ahmadinejad accusing his rivals of corruption. They said he was lying about the economy. Inflation, officially put at 15 per cent, and unemployment were core issues in the debate.

On June 22, locked in a continuing bitter contest with Iranians who were of the view that the Presidential polls were rigged, the authorities finally acknowledged that the number of votes cast in 50 cities exceeded the actual number of voters. But the authorities insisted that discrepancies, which could affect three million votes, did not violate Iranian law and the country’s influential Guardian Council said it was not clear whether they would decisively change the election result.  Iran’s top election body, however, ruled out cancelling the disputed Presidential vote as the world voiced increasing alarm at the violent crackdown on opposition demonstrators, posing the most serious challenge to the Islamic regime in 30 years.

Israeli PM endorses Palestinian Statehood
Under pressure from the US President Obama’s administration, Israeli Prime Minister Benjamin Netanyahu has for the first time endorsed a two-State solution in the Middle East, drawing praise from the West but flak from Palestinians who rejected the offer citing the tough conditions attached.

In a policy speech on June 15, 2009, that came a week after US President Barack Obama’s address to the Muslim world, Netanyahu said the “Palestinian State” would have to be demilitarised and recognise Israel as a State of the Jewish people.

The hardliner Israeli Premier had resisted agreeing to a two-State solution to the Israel-Palestinian conflict all through his political career and his veiled acceptance was couched under several other conditions, including refusal to allow Palestinian refugees to settle in Israel and keeping united Jerusalem the capital of Israel.
The address at Bar Ilan university, considered the bastion of Israeli right, came in the wake of Obama’s insistence that Israel impose a complete freeze on West Bank settlement construction and recognise the two-State solution.

President Obama welcomed the speech as an “important step forward” while the European Union described it as “a step in the right direction”.

However, the Palestinians were skeptic and angry. “Netanyahu’s remarks have sabotaged all initiatives, paralysed all efforts being made and challenges the Palestinian, Arab and American positions,” said Nabil Abu Rdeineh, a close aide to Palestinian Authority (PA) President Mahmoud Abbas. Reacting angrily to Netanyahu’s assertions that Palestinian refugees will not be allowed to settle in Israel and undivided Jerusalem will stay its capital, Rdeineh said, “this will not lead to complete and just peace”.

Nepal revokes army chief’s sacking
In order to avoid possible tussle between President Dr Ram Baran Yadav and Prime Minister Madhav Kumar Nepal, the newly formed Cabinet decided to uphold Yadav’s decision to retain the sacked Chief of Army Staff Rookmangud Katawal to his post.

The Cabinet has also nullified the controversial decision taken by the Unified Communist Party of Nepal–Maoists (UCPN-M)-led government to appoint Lt. Gen Kul Bahadur Khadka as the acting Chief of army.

After receiving pressure from the party rank and files, including the commanders of the Maoists combatants, the then Prime Minister and UCPN-M chairman Prachanda’s cabinet, on May 3, 2009, had sacked Katawal unilaterally and appointed Khadka as acting chief. As a result it had invited serious political and constitutional tussle between the President and the then government that finally forced the Maoist chairman Dahal to step down on May 4.

The meeting has annulled the May 4 Cabinet decision where the Dahal-led Cabinet’s last meeting had dubbed the President’s move to retain sacked army chief Katawal as “constitutional coup” and asked President Yadav to correct his unconstitutional move to uphold the civilian supremacy.  However, Yadav had refused to do so saying that whatever he had done was based on good faith and it was his responsibility to protect the constitution as Head of the State and avoid possible rift within the national army as its patron.

Burqa not welcome in France
The Islamic burqa is “not welcome” in France because it is not a symbol of religion but a sign of subservience for women, as per a statement by President Nicolas Sarkozy. “We cannot accept to have in our country women who are prisoners behind netting, cut off from all social life, deprived of identity,” he said.

“It will not be welcome on the territory of the French republic,” Sarkozy told a special session of Parliament. He further added that he was in favour of holding the inquiry sought by some French lawmakers into whether Muslim women who cover themselves fully in public undermine French secularism and women’s rights.

But the president added “we must not fight the wrong battle; the Muslim religion must be respected as much as other religions in France”.
The proposal to hold an inquiry has won support from many politicians from both the Left and Right, but France’s official Muslim council accused lawmakers of wasting time focusing on a fringe phenomenon.

In France, the terms “burqa” and “niqab” often are used interchangeably. The former refers to a full-body covering worn largely in Afghanistan with only a mesh screen over the eyes, whereas the latter is a full-body veil, often in black, with slits for the eyes.

France had enacted a law in 2004 banning the Islamic headscarf and other conspicuous religious symbols from public schools, sparking fierce debate at home and abroad. France has Western Europe's largest Muslim population, an estimated five million people.

One billion go hungry world over
One in six people in the world or more than one billion are now hungry, a historic high due largely to the global economic crisis and stubbornly high food prices, according to Food and Agriculture Organization (FAO). Compared with 2008, there are 100 million more people who are hungry, meaning they receive fewer than 1,800 calories a day, FAO said. Almost all the worlds undernourished live in developing countries, where food prices have fallen more slowly than in the richer nations, the report said. Poor countries need more aid and agricultural investment to cope, it said.

The silent hunger crisis, affecting one-sixth of all of humanity, poses a serious risk for world peace and security, said the Director-General of FAO, Jacques Diouf. Soaring prices for staples, such as rice, triggered riots in the developing world in 2008. Hunger increased despite strong 2009 cereal production, and a mild retreat in food prices from the highs of mid-2008. However, average prices at the end of 2008 were still 24% higher in real terms than in 2006.

Globally there are now about 1.02 billion people hungry, up 11% from 2008’s 915 million. The estimates are based on analysis by the US Department of Agriculture. Asia and the Pacific, the world’s most populous region, has the largest number of hungry people at 642 million. Sub-Saharan Africa has the highest hunger rate, with 265 million under-nourished, representing 32% of the region’s population.

G-8 nations see signs of economic stability
Citing “signs of stabilisation” in their economies, G-8 Finance Ministers have decided to ensure that such trends emerging in the global economy should be nurtured and asked the IMF to study exit strategies to “unwind” their hefty stimulus packages. On macroeconomic conditions, the Ministers recognised that the coordinated policy action implemented so far has borne some fruit, citing a recent rise in stock prices, a decline in interest rate spreads, and improved business and consumer confidence. “There are signs of stabilisation in our economies,” said a joint statement of the ministers from the G-8 countries—Britain, Canada, France, Germany, Italy, Japan, Russia and the United States—after their two-day meeting in Lecce, Italy, in June 2009.

The G-8 ministers said they discussed “appropriate strategies” on how to find a way out of big fiscal spending once their economies recover. They, however, noted that the framework for unwinding the unusual measures taken so far to fight the global economic crisis should “vary from country to country.”

US treasury secretary Timothy Geithner warned after the meeting that nations should not implement policy restraint too early as the global economy has yet to enter a recovery phase despite recent signs of improvement. But he echoed the G-8 statement’s call for charting the future course for the restoration of fiscal balances, saying financial and economic recovery “will be stronger and more sustainable if we make clear today how we get back to fiscal sustainability when the storm has finally passed.”
The ministers also reaffirmed the importance of combating all forms of money laundering and the financing of terrorism. In addition to macro-economic issues, major items on the meeting agenda were climate change, food security, financial regulation and strengthening the lending capacity of international organisations to assist developing countries.

IMF bond plan attracts emerging nations
The International Monetary Fund's plan to issue bonds for the first time has attracted several large emerging countries looking to diversify investments to the detriment of the dollar, whose lustre is dimming under the mushrooming US budget deficit.

After the G-20 major developed and emerging market countries pledged in April 2009 to boost the IMF's resources by $500 billion, each country must determine just how to deliver. To help gather such a colossal sum, the 185-nation IMF has decided to take the unprecedented step of issuing bonds.

Three countries lined up for the notes in the space of two weeks: Russia, China, then Brazil. Both Russia and Brazil are in the market for $10 billion worth, while China is aiming for $50 billion. Other G-20 members could follow, such as India or Saudi Arabia.

The new bonds will be offered in the IMF accounting unit, Special Drawing Right (SDR), whose value is based on a basket of currencies, re-balanced daily, in which the dollar represents only a 41% share. It is the dollar's relative weakness in SDRs that has raised market concerns that some countries are seeking to distance themselves from the greenback, the world's reserve currency.

For some, the announcements by Russia, China and Brazil are troubling rumbles for the US. "It is a clear sign that these countries are not comfortable with their large dollar holdings and should be read by the US as an additional signal of market unease about their large budget deficit," said Desmond Lachman of the American Enterprise Institute, a Washington think tank.

Green energy investments in developing nations rise 27%
The global economic crisis hasn’t deterred the developing countries from their green energy investments, which surged 27% in 2008 to $36.6 billion. According to a recent report of United Nation Environment Programme (UNEP) on Global Trends in Sustainable Energy Investment, 2009, global investment in clean energy witnessed a four-fold increase in 2008, compared to 2004.
Of the $155 billion invested in 2008 in clean-energy companies and projects worldwide, China, India, Brazil and African countries, among others, contributed almost a third of the amount. While China led investments in Asia with an 18% increase over 2007 to $15.6 billion, green energy investments in India grew 12% to $4.1 billion in 2008.

However, growth in clean energy sectors stalled in developed countries, said the report, which is being jointly prepared by the UNEP and global information provider New Energy Finance.
The total transaction value in the sustainable energy sector—including corporate acquisition, asset refinancing and private equity buyout— during 2008 was $223 billion, an increase of 7% over 2007. However, the capital raised via stock markets fell 51% to $11.4 billion as share prices of clean energy companies lost 61% of their value during 2008.

According to UNEP estimates, the world needs $750 billion to finance a sustainable economic recovery by investing in the greening of five key sectors: buildings, energy, transport, agriculture and water.

Pak diverted US aid to N-programme
Pakistan diverted a whopping sum of over $5 billion provided as aid by the US to fight Taliban militants into its nuclear programme, according to a report by security expert Andrew Cockburn. "Most of the aid we've sent them over the past few years has been diverted into their nuclear programme," the report published in 'Counter Punch' quoted a senior national security official in the Obama administration as saying.

Most of this 'diverted aid' was officially designated "Coalition Support Funds" for Pakistani military operations against the Taliban.
The report said the US allowed Pakistan's nuclear programme to continue in violation of its policy of non-proliferation, as it needed its help in defeating the Soviets in Afghanistan, among other things, and even the Obama administration has not changed this policy.

Pakistan has also misused a substantial amount of military aid from the US, meant to fight terrorism, to build up its army with modern weapons and equipment for a conventional warfare against India, according to released Pentagon documents. All this was done with the knowledge of the then Bush administration, which not only provided $1.9 billion in Foreign Military Financing (FMF), but also signed agreements with Pakistan for military sales worth nearly $5 billion during the period.

While the Taliban and Al-Qaida gained ground in the tribal areas of Pakistan bordering Afghanistan, Islamabad bought eight P-3C Orion maritime patrol aircraft and their refurbishment worth $474 million. It also placed orders for 5,250 TOW anti-armour missiles worth $186 million.
Besides buying more than 5,600 military radio sets worth $163 million, Pakistan bought six AN/TPS-77 surveillance radars worth $100 million and six C-130E transport aircraft and their refurbishment worth $76 million.

Under the Excess Defence Articles (EDA), it was granted 20 AH-1F Cobra attack helicopters, which were then refurbished.

Pakistan also used a substantial chunk of America’s FMF to purchase up to 60 mid-life update kits for F-16 A/B combat aircraft valued at $891 million. Of this, it paid $477 million from the FMF funds given by the United States.

Similarly, of the $87 million worth order for 115 M-109 self-propelled howitzers, it paid $53 million from FMF. And all this happened while Pakistan’s economic situation deteriorated.

US President Obama calls for a new beginning between Islam and West
On June 4, 2009, extending a hand of friendship to the Muslim world, US President Barack Obama called for a “new beginning between the United Sates and Muslims around the world,” saying together they could confront violent extremism across the globe and advance the timeless search for peace in the West Asia. “This cycle of suspicion and discord must end,” he said.

In a speech that was littered with references to the Quran, Mr Obama, who has been trying hard to repair ties with the Muslim world that has been alienated by US policy, rolled out his plan for engaging with the Muslim world. The President also used his own Muslim roots to push across the message that the US was not against Islam or the Muslim world.

President Obama started his highly anticipated Cairo speech by going back in history and tracing tensions that were rooted in history. “The relationship between Islam and the West includes centuries of co-existence and cooperation, but also conflict and religious wars,” he said. After going into history, he also touched on the main sources of current tension including the situation in West Asia, Afghanistan and the nuclear stand-off with Iran.

On West Asia, the US President said that he understood both the Israeli and Palestinian position. Expressing sympathy for the Palestinian cause, he supported an independent Palestinian State that co-existed peacefully with Israel. Saying he would not see the conflict from just one side, he said that Israelis must acknowledge that just as Israel’s right to exist cannot be denied, neither can Palestine’s and that Israel must live up to its obligation to ensure that Palestinians can develop their society.

On Afghanistan, he said the US had gone to Afghanistan out of necessity after the 9/11 attacks in which the al-Qaeda killed 3,000 people. He further said the US did not want to keep troops in Afghanistan. “We would gladly bring every single one of our troops home if we could be confident that there were not violent extremists in Afghanistan and Pakistan determined to kill as many Americans as they possibly can. But that is not yet the case,” he said.

Finally on Iran, President Obama said the US has made it clear to the Iranian leadership that it is prepared to move forward. He said he understood the protest that some countries have weapons that others do not. “No single nation should pick and choose which nations hold nuclear weapons. That is why I strongly reaffirmed America’s commitment to seek a world in which no nations hold nuclear weapons.” He said that any country, including Iran, had the right to access peaceful nuclear power if it complies with its responsibilities under the nuclear Non-Proliferation Treaty.

All in all, his speech was largely well-received and there was anticipation that this could set the stage for an easing of tension between the US and Muslim world.

SCO and BRIC nations meet at Yekaterinburg
Participating in back-to-back SCO (Shanghai Cooperation Organisation) and BRIC (Brazil-Russia-India-China) summits at Yekaterinburg, Russia, in June 2009, Prime Minister Manmohan Singh called for greater global cooperation to defeat terrorism and reform of international financial institutions.

Delivering his first speech at an international forum during his second term as the Prime Minister, he told the SCO Summit that terrorist crimes today were transnational in nature, adding "it is imperative that we genuinely cooperate with one another and on a global scale to resolutely defeat international terrorism."

India, along with Iran, Pakistan and Mongolia, participated as an observer at the summit of the SCO, a six-nation regional grouping that brings together Russia, China and the Central Asian Republics of Uzbekistan, Tajikistan, Kyrgyzstan and Kazakhstan.

This was the first SCO summit at which an Indian Prime Minister participated. The SCO leaders had decided to include observer countries in full-format discussions at their last summit in Dushanbe.

Prime Minister Manmohan Singh later attended the first BRIC Summit along with the Presidents of Russia, China and Brazil. In a joint statement adopted by the BRIC leaders, the four nations strongly demanded reforms of international financial institutions to reflect changes in the world economy. "The emerging and developing countries must have a greater voice and representation in international financial institutions, and their heads and senior leadership should be appointed through an open, transparent and merit-based selection process."

On the global economic situation, the BRIC leaders emphasised that the poorest countries had been hit the hardest by the financial crisis. “The international community needs to step up efforts to provide liquidity for these countries. The international community should also strive to minimise the impact of the crisis on development and ensure the achievement of the millennium development goals."

The four nations called for strengthening coordination and cooperation among BRIC States in the field of energy, including among producers and consumers of energy and transit states, in an effort to decrease uncertainty and ensure stability and sustainability. They also underlined the need for a more democratic and just multi-polar world order based on the rule of international law, equality, mutual respect, cooperation, coordinated action and collective decision-making of all States.

The BRIC nations condemned terrorism in all its forms and manifestations and reiterated that there could be no justification for any act of terrorism anywhere or for whatever reasons.

Pak among top 10 failed States
Pakistan, split in the middle with terrorist attacks and facing an economic crisis, remains among the top 10 failed States, says an index prepared by the Fund for Peace, an independent research organisation. The country, placed ninth among all countries in 2008, in terms of its overall achievement, has improved its position only by a notch—it was placed 10th in the index for 2009. The annual exercise, now in its fifth year, ranks countries on the basis of the following factors: demographic pressure, refugees/internally displaced persons, group grievance, uneven development, and economic decline, de-legitimisation of the State, public service, human rights, factionalised elites and external intervention.

The top 10 failed States in the latest list are: Somalia, Zimbabwe, Sudan, Chad, Democratic Republic of Congo, Iraq, Afghanistan, Central African Republic, Guinea and Pakistan.
India is placed 87th among the 177 countries under study, with its score showing an improvement over 2008.

Singapore’s civil servants are the most efficient among their Asian peers, according a business survey on 12 economies, but they tend to clam up unhelpfully when things go wrong. India’s “suffocating bureaucracy” was ranked the least-efficient by the survey, which said working with the country’s civil servants was a “slow and painful” process. The survey ranked Hong Kong second. Thailand was ranked third. China was ranked 9th.

In the first month of 2009-10, the six core industries together clocked the fastest growth rate in 10 months. Power, crude oil, refinery products, coal, cement and finished steel grew 4.3% year-on-year, recovering from a low of 1.1% in December 2008.

The Bandra-Worli sea link in Mumbai, seen as an engineering marvel, weighs equivalent to that of 50,000 African elephants! The steel wire used is equivalent to the circumference of the earth. The 5.6 kilometre-long cable stayed bridge is 63 times the height of the Qutub Minar. It has consumed 90,000 tonnes of cement, which would suffice to make five ten-storied buildings. The eight-lane 5.6 km-long Sea Link is India’s first bridge to be constructed in open sea conditions with a 4.7 km, twin, 4-lane carriageway. It has been decided to name the link as Rajiv Gandhi Setu.

Ram Pradhan Committee was formed to probe the 26/11 terror attacks.

An Indian Army regiment based in Western Assam district of Dhubri is set to enter in Guinness Book of World Records after it has planted 4.48 lakh saplings within a span of 24 hours in a massive plantation drive conducted in coordination with the Assam Forest Department on June 13, 2009. About 300 personnel from 21 Jat Regiment of Indian Army set out on a plan to plant 5 lakh saplings on an area of 180 hectares on a denuded forest land in Dhubri district at 3-30 p.m. on June 12 and ended up planting 4.5 lakh saplings at 3.30 p.m. on June 13, thereby toppling the current world record held by the Mexico Forest Department that had planted 3.40 lakh sapling in 24 hours.

Qualified Institutional Placement (QIP) is a capital raising tool, whereby a listed company can issue equity Shares fully and partly convertible debentures, or any securities other than warrants, which are convertible into equity Shares, to a Qualified Institutional Buyer (QIB). Apart from preferential allotment, this is the only other speedy method of private placement for companies to raise money. It scores over other methods, as it does not involve many of the common procedural requirements, such as the submission of pre-issue filings to the market regulator. The specified securities can be issued only to QIBs, who shall not be promoters or related to promoters of the issuer. The issue is managed by a SEBI-registered merchant banker.

India's external debt rose by 2.4 per cent at $230 billion during 2008-09 due to an increase in commercial borrowings and short-term debts. With a rise of $5.3 billion over the previous fiscal, the external debt rose to 22 per cent of the GDP from 19 per cent in 2007-08. On the positive side, India's debt service ratio was the third lowest, above China and Malaysia. Of the total external debt, the share of commercial borrowings was the highest at 27.3 per cent, followed by the short-term debt at 21.5 per cent. Non-Resident Indian deposits accounted for 18.1 per cent, while multilateral debt was 17.2 per cent of the total debt. The debt service ratio declined to 4.6 per cent at the end of March 2009. In terms of international comparison, India was the fifth most indebted country after China, Russia, Turkey and Brazil.

Section 377 of the IPC criminalizes homosexuality. There is a debate going on within and outside government to repeal this section of IPC.

Former Indian cricket captains Sunil Gavaskar and Saurav Ganguly, and former ICC President Jagmohan Dalmiya have been invited to give lecture at the University of Oxford, England, as part of ICC centenary celebrations.

The Eastman Kodak Company has decided to retire its most senior film Kodachrome, which became the world’s first commercially successful colour film in 1935, spent 74 years in Kodak’s portfolio. It enjoyed its heyday in the 1950s and ’60s but in recent years has nudged closer to obscurity.

Union HRD Minister Kapil Sibal has been nominated as member of the honorary senate of the Lindau Foundation, which supports the annual Nobel Prize winners meetings at Lake Constance in Germany. The foundation was created in year 2000, on the initiative of Nobel Laureates. The annual Nobel Prize winners’ meetings enable young researchers’ to interact with Nobel Laureates, besides allowing transfer of knowledge between the Laureates themselves.

After the Kullu shawl, Kangra tea and the Chamba “rumaal”, it is now the turn of the Kinnauri shawl to acquire a patent and a GI (Geographical Indication) stamp, a hallmark for quality and authenticity. Threatened with the loss of its distinctiveness to the machine-made Ludhiana shawls, the traditional Kinnauri shawl will be community patented, paving way for its marketing in the international market. With the Kinnauri shawl being registered under the Geographical Indications Act, 1999, the product made on wooden looms in practically every home of the tribal district of Kinnaur, will be protected from being lost in the race for modernity. Moreover, with the GI stamp on it, the product, it is hoped, would fetch handsome prices. The Kinnuari shawls have religious significance as the range of colours used in designs symbolise mythological background. The unique wrap made out of wool, pashmina and angora are known for their intricacy and finesse in weaving.

Biobin, India’s first biodegradable bags meant as an alternative to non-bio-degrable plastic bags, a main source of environment pollution, has been introduced in Tamil Nadu. This is the first time in India that bio-degradable bags with disinfectant properties and fragrance have been launched. These bags have special characteristics that help them degrade faster. The Sunstar Trading Corporation, jointly with Exnora International, has designed and launched the biobin bags.

The State Bank of India has launched car loan scheme “SBI Ezee” for financing new cars at interest as low as 8 per cent for the first year.


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13.0 Learning Outcome

13.1 Introduction

13.2 Initiatives towards Constitutional Status to Local Governance

13.2.1 Features of 73rd Constitutional Amendment

13.2.2 Features of 74th Constitutional Amendment

13.2.3 Decentralised Planning in Context of 73rd and 74th Constitutional Amendment Act

13.3 Initiatives after Economic Reforms

13.4 Functioning of PRIs in Various States after 73rd Amendment

13.5 Functioning of Local Governance after 73rd and 74th Constitutional Amendment: Observations

13.6 Conclusion

13.7 Key Concepts

13.8 References and Further Reading

13.9 Activities


After studying this Unit you should be able to:

• Identify the background of revitalisation of local governance;

• Understand the features of 73rd and 74th constitutional amendment;

• Discuss the initiatives after economic reforms; and

• Outlines the functioning of local governance in various states after the amendment.


The revitalization of Pancha…

General Studies :: Indian Polity #1

Constitutional evolution under British ruleRegulating Act 1773beginning of British parliamentary control over the East India Companysubordination of the presidencies of Bombay and Madras to BengalGovernor of Bengal made Governal-Generalcouncil of Governor-General establishedSupreme Court established in CalcuttaPitt’s India Act 1784commercial and political activities of the Company separatedestablished a board of control over the CompanyCharter Act 1813trade monopoly of the Company abolishedmissionaries allowed to preach in IndiaCharter Act 1833Governor-General of Bengal becomes Governor-General of Indiafirst Governor-General Lord William Bentickends commercial activities of the CompanyCharter Act 1853legislative and executive functions of the Governor-General’s council separatedopen competition for Indian Civil Services establishedIndian Council Act 1861establishes legislative councils at the centre, presidencies and provincesGovernor-General’s executive council to have Indians as non…

Q. What is the meaning of the terms like ‘Pardon’, ‘Reprieve’, ‘Respite’, ‘Remission’ and ‘Commutation’ with respect to the power of the President to grant pardon to convicted persons?

Ans. In terms of their scope and effect, these terms have specific connotations. The effect of Pardon is to abolish punishment and to absolve the convict of all charges. If Pardon is granted, it is assured as if the convict has not committed any crime. The convict will not face any disabilities due to the allegations and charges made against him. ‘Remission’ means reducing the punishment without changing the nature of punishment. For example, the imprisonment for 20 years may be reduced to the imprisonment for 10 years. ‘Commutation’ means reducing the punishment by changing the nature of punishment. For example, punishment to death may be changed to life imprisonment. ‘Respite’ means reducing or changing the nature of punishment in view of the specific facts and circumstances of the convict. For example, the punishment to death awarded to a pregnant woman, may be changed to simple life imprisonment. Respite means delay in execution of punishment especially that of death, in order to …