DAILY CURRENT AFFAIRS ANALYSIS

28 JUNE 2022

. No.	Topic Name	Prelims/Mains
1.	Anti Defection Law	Prelims & Mains
2.	Cyptocurrency in India	Prelims & Mains
3.	Iran USA Nuclear Deal	Prelims & Mains
4.	Gig Economy in India	Prelims & Mains

1 – Anti Defection Law: 

GS II

Topic – Parliament related issues

• Context:
• Shiv Sena rebel MLAs received temporary relief when the Supreme Court ruled they had until 5.30 p.m. on July 12 to send their responses, despite Maharashtra Deputy Speaker Narhari Zirwal’s request that they respond by Monday evening to notices on petitions seeking their disqualification from the Assembly.
• What does anti-defection law entail?
• The anti-defection statute penalises specific Members of Parliament (MPs)/MLAs who switch parties.
• In 1985, it was included by Parliament as the Tenth Schedule to the Constitution. Its goal was to prevent legislators from switching parties, so bringing stability to governments.
• Through the 52nd Amendment Act of 1985, the Tenth Schedule, also referred to as the Anti-Defection Act, was incorporated into the Constitution.
• It lays forth the guidelines for disqualifying elected officials for joining a different political party.
• After the 1967 general elections, party-hopping MLAs overthrew several state governments, prompting this reaction.
• It does, however, permit a group of MPs or MLAs to join (or combine with) another political party without risking the defection penalty. Additionally, political parties are not punished for supporting or taking on dissident lawmakers.
• The 1985 Act defined a “merger” as the “defection” of one-third of an elected political party’s members:
• However, this was altered by the 91st Constitutional Amendment Act of 2003, and today, in order for a “merger” to be considered legal, at least two-thirds of the members of a party must be in favour of it.
• The lawmakers who are legally disqualified from serving in the House may run for office in elections from any political party.
• The Chairman or Speaker of that House is asked to make decisions about defection-related disqualification, and those decisions are then subject to “Judicial review.”
• The law, however, does not provide a deadline for the presiding officer to make a decision in a defection case.
• The reasons for disqualification are as follows:
• If a political party membership is voluntarily renounced by an elected MP/MLA.
• If he casts a vote or doesn’t cast a vote in that House against the wishes of his political party or anyone else with that authority, without first getting consent
• His refusal to cast a ballot must not have been approved by his party or the designated person within 15 days after the incident in order for him to be disqualified.
• If a member who was elected independently decides to join a political party.
• If any nominee joins a political party after the initial six months have passed.
• What problems does the anti-defection law cause?
• Undermining Parliamentary & Representative Democracy:
• After the Anti-defection law was passed, the MP or MLA is forced to vote in accordance with the party’s platform and is not allowed to do otherwise.
• The Anti-Defection statute has broken the chain of accountability by holding MPs solely responsible to their political party.
• Speaker’s Controversial Role:
• The timetable for the House Chairperson’s or Speaker’s decision in anti-defection matters is not explicitly stated in the law.
• Some legal matters take six months, while others go on for three. After the period has ended, some cases are resolved.
• No acknowledgment of the split:
• The 91st amendment established an exception for anti-defection verdicts in the anti-defection law.
• The amendment, however, recognises a “merger” rather than a “split” in a legislature party.
• Election mandates being violated:
• Legislators who are elected on the platform of one party but later decide it would be more convenient to switch to another party because of the allure of cabinet slots or financial rewards are said to be defying their constituents’ will through defection.
• Impacts Government’s Regular Operations:
• The infamous “Aaya Ram, Gaya Ram” slogan was created in the 1960s in response to the constant defections of parliamentarians.
• The defection causes instability in the government and has an impact on the executive branch.
• Defection encourages legislator horse dealing, which is obviously against the spirit of a democratic system.
• Retail defection is not permitted, but wholesale defection is. To close the gaps, amendments are necessary.
• He expressed worry that while a politician may leave one party, they shouldn’t be offered a position in the new one.
• What various suggestions are there in relation to the Anti-defection Law?
• The Election Commission has proposed that it be the body that makes decisions on defections.
• Some have contended that applications for defection should be heard by the President and the Governors.
• In order to rapidly and fairly decide defection cases, the Supreme Court has recommended that Parliament establish an independent panel led by a retired judge from the higher judiciary.
• Some observers have declared the law to be ineffective and suggested its repeal. According to former vice president Hamid Ansari, it only applies to saving administrations during motions of no-confidence.
• Way ahead:
• The attempt to resolve what is basically a political issue through the legal system creates the problem.
• Parties should strengthen their internal procedures if party defections are a problem for the stability of the administration.
• Political party regulation legislation is urgently needed in India. Such a measure ought to promote intra-party democracy, bring political parties under the RTI, etc.
• The application of the anti-defection law can be limited to only those laws where the loss of confidence in the government can result in order to protect representative democracy from the harmful effects of the law.

Source – The Indian Express

2 – Cyptocurrency in India:

GS III

Topic – Indian Economy

• Context:
• Crypto exchange founders are forced to flee India due to a crackdown and ambiguous policy.
• What is Cryptocurrency:
• A cryptocurrency is a digital asset intended to function as a means of exchange, with each coin’s ownership history being recorded in a ledger that takes the form of an electronic database.
• Strong cryptography is used to protect transaction records, regulate the production of new coins, and confirm ownership transfers. It often isn’t issued by a central authority and doesn’t exist in tangible form (unlike paper money).
• As opposed to centralised digital currency and central banking institutions, cryptocurrencies often employ decentralised control.
• Why is it so popular?
• It will be simple to transfer money between two parties without the use of a third party like a bank or a credit/debit card.
• In comparison to other online transactions, it is a less expensive option.
• Payments provide an unmatched level of privacy and are safe and secure.
• A user’s “wallet” or account address in contemporary cryptocurrency systems is only accessible through a public key and a pirate key.
• Only the wallet’s owner has access to the private key.
• Transfers of funds are completed with comparatively low processing costs.
• Cryptocurrencies’ importance:
• Blocks’ ability to track the movement of money and transactions on a peer-to-peer network helps keep corruption in check.
• Time Effective: Because cryptocurrency transactions are handled fully online, with very low transaction fees and practically rapid processing, they can help both senders and receivers save money and a significant amount of time.
• Cost-Effective: To pay for their services, intermediaries like banks, credit card companies, and payment gateways take approximately 3% of the global economy’s overall $100 trillion output.
• These industries might save hundreds of billions of dollars by incorporating blockchain technology.
• Cryptographic currency worries:
• Consumer risk: Cryptocurrencies carry a sovereign guarantee. They lack a governmental guarantee and are not accepted as legal currency.
• Their speculative nature also makes them very volatile in the market. The price of Bitcoin, for instance, dropped from USD 20,000 in December 2017 to USD 3,800 in November 2018.
• Threat to security: If a user misplaces their private key, they can no longer access their cryptocurrency (unlike traditional digital banking accounts, this password cannot be reset).
• Threats posed by malware: These private keys may occasionally be kept by technical service providers (such as cryptocurrency exchanges or wallets), which are vulnerable to malware or hacking.
• Money laundering: Criminal behaviour and money laundering are more likely to involve cryptocurrencies. Since no personal information can be associated with the public keys used in a transaction, they offer better anonymity than traditional payment options.
• Regulatory evasion: It is impossible for a central bank to control the flow of cryptocurrencies into the market. If its use spreads widely, it might put the country’s financial stability at jeopardy.
• Power usage: Because transaction validation consumes a lot of energy, it could have a negative impact on the nation’s energy security (the total electricity use of bitcoin mining, in 2018, was equivalent to that of mid-sized economies such as Switzerland).
• Indian cryptocurrency:
• The RBI issued a circular in 2018 prohibiting all banks from conducting cryptocurrency business. The Supreme Court ruled that this circular was illegal in May 2020. The government has declared that it would introduce the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, to establish a national digital currency and outlaw all private cryptocurrencies at the same time.
• Less than 0.2 percent of the total amount raised by the global blockchain industry has been invested in Indian blockchain startups. The prevailing attitude toward cryptocurrencies makes it all but impossible for blockchain investors and entrepreneurs to reap significant financial rewards.
• Problems with Prohibiting Decentralized Cryptocurrencies:
• Blanket Ban: The core of the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 is the planned ban. In India, it aims to outlaw all privately held cryptocurrencies.
• The cryptocurrencies are decentralised but not private, therefore classifying them as public (supported by the government) or private (owned by an individual) is incorrect.
• Bitcoin and other decentralised cryptocurrencies can’t be controlled by any organisation, private or public.
• Brain Drain: Similar to what happened after the RBI’s 2018 ban on cryptocurrencies, a restriction on cryptocurrencies is most likely to cause a talent and business exodus from India.
• At that time, blockchain professionals migrated to nations like Switzerland, Singapore, Estonia, and the US where cryptocurrencies were governed.
• Blockchain innovation, which has applications in governance, the data economy, and energy, will be stopped in India with a general ban.
• Loss of Transformative Technology: A prohibition will deny India, its business owners, and its people access to a transformative technology that is quickly gaining traction around the globe, including with some of the biggest corporations like Tesla and MasterCard.
• An Ineffective Effort: Banning instead of regulating will merely foster illegal usage and encourage a parallel economy, contradicting the whole goal of the prohibition.
• A prohibition is impossible because anyone may buy cryptocurrencies online.
• Contradictory Policies: The Ministry of Electronics and IT (MeitYDraft )’s National Strategy on Blockchain, 2021, which extolled blockchain technology as a transparent, secure, and efficient technology that adds a layer of trust to the internet, does not support the prohibition of cryptocurrencies.
• Steps to Take:
• Regulating the market is the answer: Regulating the market is necessary to avoid significant issues, ensuring that cryptocurrencies are not misused, and shield unwary investors from irrational market volatility and potential scams.
• The regulation must be unambiguous, transparent, logical, and driven by an overarching goal.
• Clarification of the term “cryptocurrency” Cryptocurrencies must first be classified as securities or other financial instruments under the pertinent national laws by a legal and regulatory framework, which must also name the regulatory body in responsibility.
• Strong KYC Norms: The government should regulate cryptocurrency trading instead of outright banning it by enacting strict KYC standards, reporting requirements, and taxability.
• Ensuring Transparency: To address concerns about transparency, information accessibility, and consumer protection, record keeping, inspections, independent audits, investor grievance redress, and dispute settlement may also be taken into consideration.
• Cryptocurrencies and blockchain technology have the potential to rekindle the entrepreneurial surge in India’s startup ecosystem and provide up job opportunities for people at all career levels, including blockchain developers, designers, project managers, business analysts, promoters, and marketers.
• Conclusion:
• India is currently on the verge of the next stage of the digital revolution and has the opportunity to invest its human capital, knowledge, and resources in it in order to become one of the revolution’s victors. All that must be done is to create sound policy.
• The Fourth Industrial Revolution will be heavily reliant on blockchain technology and digital assets; Indians shouldn’t be forced to ignore it.

Source – The Indian Express

3 – Iran USA Nuclear Deal:

GS II

Topic – International Relations

• Context:
• According to the chief diplomat of the European Union, talks between the US and Iran to resurrect the 2015 nuclear deal will resume in the “coming days.”
• What was the Iran nuclear agreement of 2015?
• Officially called as the Joint Comprehensive Plan of Action, the agreement (JCPOA).
• Long-term negotiations between Iran and P5+1 (China, France, Russia, the United Kingdom, the United States, and Germany) between 2013 and 2015 led to the JCPOA.
• As part of the agreement, Iran promised to drastically reduce its stockpiles of heavy water, enriched uranium, and centrifuges—all essential components for nuclear bombs.
• Iran also consented to put into practise a mechanism that would grant IAEA inspectors access to its nuclear sites in order to guarantee that Iran would not be able to secretly develop nuclear weapons.
• Although the West consented to waive sanctions relating to Iran’s nuclear proliferation, additional restrictions targeting alleged human rights violations and Iran’s ballistic missile programme were left in place.
• The US promised to eliminate the financial restrictions that had prevented foreign trade with Iran but kept the sanctions on oil exports in place.
• Nevertheless, after years of recessions, currency depreciation, and inflation, Iran’s economy dramatically stabilised once the accord went into effect, and its exports soared.
• Israel, the United States’ closest Middle Eastern ally, outright rejected the agreement, while other nations including Iran’s major regional adversary Saudi Arabia complained they were left out of the talks despite the fact that Iran’s nuclear programme posed security dangers to all of the countries in the region.
• Iran intensified its nuclear programme seriously after Trump pulled out of the agreement and reinstituted financial and oil sanctions, bringing it back to roughly 97 percent of its pre-2015 nuclear capabilities
• What took place after the US backed out of the agreement?
• The US declared its plan to reimpose sanctions in April 2020. The other partners disapproved of the action, arguing that since the US was no longer a party to the agreement, it was ineligible to unilaterally reimpose penalties.
• Following the pullout, a few nations initially carried on importing Iranian oil thanks to waivers given by the Trump administration. After a year, the US revoked the waivers to harsh international criticism, greatly reducing Iran’s oil exports as a result.
• In an effort to maintain the agreement, the other parties established the INSTEX barter system to enable trade with Iran outside of the US banking system. Only food and medicine, which were previously free from US sanctions, were covered under INSTEX.
• After the US killed the top Iranian general Qasem Soleimani, Iran said in January 2020 that it would no longer place restrictions on its uranium enrichment.
• What Obstacles Face the JCPOA’s Restoration?
• The rehabilitation is further hampered by the regional conflict between Saudi Arabia and Iran.
• In accordance with US Middle East policy and also to oppose Iran, the US and Saudi Arabia have improved their partnership.
• It has been challenging to negotiate peace in the region because of the long-standing Shia vs. Sunni dispute between these nations.
• The deal becomes more difficult to implement if Iran continues to flout a number of key agreements, including the restrictions on stockpiles of enriched uranium.
• Iran is attributing its economic losses to US sanctions after the Trump administration withdrew from the agreement and re-imposed penalties.
• What does India’s role in the JCPOA entail?
• Enhancement of Regional Connectivity:
• India’s interest in the Bandar Abbas and Chabahar ports, as well as other initiatives for regional connectivity, may resurface if sanctions are lifted.
• This would aid India in its efforts to counteract Chinese influence in Pakistan’s Gwadar port.
• In addition to Chabahar, the International North-South Transit Corridor (INSTC), which passes via Iran and would enhance connectivity with five Central Asian countries, may potentially spark increased interest in India.
• Energy Security: India is under pressure to eliminate all oil imports as a result of the US’s Countering America’s Adversaries Through Sanctions Act (CAATSA).
• India will be able to purchase inexpensive Iranian oil and improve its energy security if relations between the US and Iran are repaired.
• Way ahead:
• The US would have to take into account Iran’s nuclear programme in addition to its growing hostility in the region. The realities of the emerging multipolar world, in which its unilateral leadership is no longer assured, would also need to be taken into account.
• Given that Israel has recently reevaluated its relations with a number of Middle Eastern Arab nations, Iran would need to take into account the quickly shifting dynamics in the region.

Source – The Indian Express

4 – Gig Economy in India:

GS III

Topic – Indian Economy

• Context:
• The NITI Aayog has recommended fiscal incentives like tax rebates or startup grants for businesses with around one-third of their workforce being made up of women and people with disabilities in an effort to encourage the participation of women in the gig economy (PwDs).
• What does “gig economy” mean?
• A gig economy is a form of free market where businesses hire independent workers on a temporary basis and temporary positions are common.
• In India, there are 15 million gig workers operating in sectors like software, shared services, and professional services, according to a Boston Consulting Group analysis.
• India is the world’s fifth-largest flexi-staffing market, behind the US, China, Brazil, and Japan, according to a 2019 research by the India Staffing Federation.
• What is the Potential of the Gig Economy in India?
• Companies in the gig economy are responsible for creating 56 percent of the country’s new jobs, which include both white-collar and blue-collar workers.
• In India, the gig economy is common among blue-collar jobs, but there is also a growing need for gig workers in positions that require project-specific consulting, sales, web design, content writing, and software development.
• Up to 90 million employment in India’s non-agricultural industries might be supported by the gig economy, which has the potential to boost the country’s GDP by 1.25 percent in the “long term”.
• The gig economy will be a key component in bridging the income and unemployment gap as India progresses toward its declared goal of becoming a USD 5 trillion economy by 2025.
• What are the Main Forces Driving the Gig Economy?
• The ability to work remotely:
• In the digital age, employees are no longer required to work from a set place; instead, they can complete their tasks from any location, allowing businesses to choose the best personnel without regard to location.
• The millennial generation appears to have a very different perspective toward careers. Instead of pursuing occupations that might not satisfy their inner desires, they try to pursue the work they want to do.
• Different remuneration mechanisms, including fixed-fee (determined at contract commencement), time & effort, actual unit of labour completed, and quality of output are used for gig workers. The most common approach is the fixed-fee model, although the time & effort model is a close second.
• The emergence of a start-up culture has been accompanied by a rapid expansion of the Indian start-up ecosystem.
• Due to the high fixed costs associated with recruiting full-time staff for start-up businesses, contractual freelancers are used for non-core tasks.
• To strengthen their technological platforms, start-ups are also considering hiring qualified technology freelancers (on a project-by-project basis) in fields including engineering, product, data science, and machine learning.
• Rising demand for contract workers: MNCs are implementing flexible employment practises, particularly for specialised projects, to cut operational costs in the wake of the epidemic.
• The gig culture in India is greatly influenced by this tendency.
• What Problems Are Related to the Gig Economy?
• The gig economy develops mostly in an unregulated environment, thus employees have limited job security and little benefits.
• Few, however, contend that India’s gig economy is a continuation of the country’s long-standing, unregulated informal labour sector, which does not provide workers with social security, insurance, etc.
• Required Skills: A worker must possess the necessary skills. A person’s ability to negotiate will necessarily be constrained unless they are exceptionally talented.
• While businesses frequently spend money on employee training, a gig economy worker will need to do so on his own and at his own expense.
• Demand and supply imbalance: Since there are already far more potential online freelancers than there are open positions, the demand-supply gap will only widen over time, lowering pay.
• The Gig Economy and the Pandemic:
• Due to Covid-19, businesses were affected, and people needed to find a stable source of income. Due to the epidemic, there was an increase in demand for gig labour.
• For instance, Google announced the launch of its Kormo Jobs app in India in August 2020 to link job seekers with opportunities in sectors including retail, hotel, and on-demand enterprises.
• The workers have increasingly lamented a decline in their salaries as the number of gig workers has increased over time, particularly with consumer internet companies like Zomato, Swiggy, Uber, Ola, Urban Clap, etc.
• On the environment of contractual labour, it has had two major effects:
• To begin with, it has developed new business models to meet the expanding demand for on-demand staffing.
• Second, it has once again brought attention to the labour laws that protect gig workers and establish a federal minimum wage.

What Benefits and Drawbacks Do Gig Jobs Offer to Women?

• Pros:
• Help with Juggling Work and Home:
• Gig labour enables part-time employment and flexible working hours, enabling women to juggle their traditional roles as caregivers and homemakers with employment.
• Offer a Safe Work Environment for Women: The issue of safety during travel and night shifts has been solved by technology and gig employment, which is reinforced by Work From Home (WFH).
• In addition, women now have more work options in tier 2 and 3 cities.
• Provides On-Demand Work: It gives women access to on-demand employment, enabling them to enter and leave the workforce at their discretion.
• Help in Earning Extra Money: Gig work allows women to make extra money, boosts their confidence, and gives them the ability to make decisions—all of which are crucial elements of women’s empowerment.
• Cons:
• The gig economy presents major barriers to entrance for women since it exacerbates issues with the gender wage gap, biassed algorithms, gender stereotypes, and the technology divide that already exist in the labour market.
• It is crucial to identify and fix these underlying structural problems in the digital environment as a result.
• Women’s engagement in gig work is significantly hampered by the gender gap in digital literacy. Only 21% of women in India are mobile internet users, according to the GSMA Mobile Gender Gap Report 2020, creating an unequal access to digital technologies required for participating in the platform economy.
• Despite the lack of a comprehensive database on gig workers in the nation, it has been noted that platforms separate occupations based on gender stereotypes.
• Men work more in transportation and delivery whereas women typically perform formal domestic and care duties as well as beauty and wellness services.
• Wage Differences: In the gig economy, wage disparities frequently show up.
• According to reports from before the pandemic, men and women gig workers in India earned between 8% and 10% less.
• Studies actually show that learnt inequality causes women to undervalue themselves and take on lower-paying jobs, which adds to the already pervasive wage difference in the gig economy.
• Biased Against Women: Because of their “on-demand” work schedules and incentive structures, the platforms are frequently biassed against women.
• Women who are involved in household and childcare duties frequently miss out on the benefits of peak hours, when both demand and salaries are high.
• Additionally, the combination of paid and unpaid work results in a longer working day for women than for males, which adds to their time insecurity.
• What does the Gig Economy’s Labor Code entail?
• Current Regulations:
• A universal minimum wage and floor wage are set forth in the 2019 Code on Wages for both organised and unorganised sectors, including gig workers.
• Gig workers are recognised as a new occupational category in the 2020 Social Security Code.
• A person who performs work or engages in work arrangements and earns from such activities outside of the conventional employer-employee relationship is referred to as a gig worker in this definition.
• Related Problems with the Security Code:
• Benefits are not guaranteed under the Code on Social Security bill of 2020; nonetheless, platform workers are now entitled to some benefits, including as maternity benefits, life and disability insurance, old age security, provident fund benefits, and compensation for work-related injuries.
• However, eligibility does not imply a promise of receiving the benefits.
• None of the clauses guarantee benefits, thus although the Central government occasionally develops social programmes that address these issues of personal and employment security, they are not guaranteed.
• No Fixed Responsibilities: According to the Code, the central government, platform aggregators, and employees are all jointly responsible for providing fundamental welfare measures.
• It does not, however, specify which stakeholder is in charge of providing what level of benefit.
• What conditions for GIG workers should be made better?
• Need to Empower the Gig Workers: It is necessary to give the gig workers more negotiating leverage by creating an umbrella union.
• They will be able to hold their ground against the platforms better thanks to the formal recognition and information symmetry.
• Platform Workers Must Be Provided with Mandatory Coverage: Although the inclusion of gig workers in the labour law has given rise to some hopeful developments, the conditions of their social security are vague and without any established regulatory bodies.
• The officially sponsored programmes Pradhan Mantri Jan Arogya Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana, and Pradhan Mantri Suraksha Bima Yojana must therefore provide platform workers with required coverage.
• The aggregators can make this possible so that women gig workers, who are frequently more vulnerable in the platform economy, are protected.
• Building the Right Physical and Social Infrastructure is Required: In order to facilitate women’s participation in gig labour, it is necessary to construct the Right Physical and Social Infrastructure.
• Women’s transition into gig labour will be facilitated by fostering social norms that encourage males to perform unpaid care and domestic work equally and by creating public care infrastructure.

Source – The Indian Express