Strengthening the Insolvency and Bankruptcy Code 2016 (IBC)

GS Paper- III

Context- The implementation of the Insolvency and Bankruptcy Code (IBC) in 2016 resulted in a fundamental shift in the country’s resolution architecture. However, despite its potential, the IBC has fallen short of expectations in its operation. The Ministry of Corporate Affairs solicited feedback last week on a new set of modifications to the Code that it is exploring. This is a positive move.

What exactly is insolvency?

• Simply put, insolvency is a financial situation that occurs when you are unable to pay off your debts on time.
• Insolvency is essentially the state of being that leads to the filing of a bankruptcy petition. When a person, family, or corporation is unable to repay its loans on time, the entity becomes insolvent.

What is Bankruptcy?

• Bankruptcy, on the other hand, is a legal procedure used to resolve the issue of insolvency.
• Bankruptcy is a formal declaration of an individual’s inability to repay obligations. When filing for bankruptcy, one is obligated to repay what is owing with the assistance of the government.

What is the Insolvency and Bankruptcy Code (IBC) of 2016?

• The Insolvency and Bankruptcy Code (IBC) was implemented in 2016 to streamline insolvency and bankruptcy processes, protect the interests of all stakeholders (the business, workers, debtors, and notably creditors), and resolve non-performing assets.
• It was a transition from a ‘debtor in possession’ to a ‘creditor in control’ system.
• The IBC establishes a time-bound framework for addressing insolvencies.
• The Insolvency and Bankruptcy Board of India (IBBI) is the regulator in charge of enforcing the code and monitoring stakeholders’ performance.

Why was the IBC established?

• The IBC was created in 2016 to restructure India’s corporate crisis resolution process, at a time when Non-Performing Assets and debt defaults were building up and earlier loan recovery methods were underperforming.
• To combine previously accessible legislation in order to build a time constrained mechanism with a creditor in control model as opposed to a debtor in possession system.
• When the IBC declares insolvency, there are only two options: resolution or liquidation. The process of winding up a corporation or incorporated body is referred to as liquidation.

What are the shortcomings in the code’s functioning?

• Creditors’ realisations have been lower than expected, and the Code’s rigorous timetables for resolving cases have not been followed.
• According to the most current data, the total realisable value in cases concluded till September 2022 was just 30.8% of the admitted claims.
• According to the data, 64% of the continuing cases had lasted more than 270 days. According to statistics, the average time it takes to conclude cases has increased, owing in part to additional time spent on connected litigation.

Proposals to address the shortcomings

• The modifications aim to shorten the time it takes to admit cases and streamline the process by increasing dependence on data from Information Utilities. Given the delays in accepting cases and the ramifications of previous judicial interventions, this proposal aims to eliminate ambiguity and restore stability to the process.
• It has also been suggested that the pre-packaged insolvency resolution procedure that was created for micro, small, and medium-sized businesses be expanded to include additional businesses. While such a suggestion should be enticing, relatively few cases have been allowed as a result of it.
• There is now a separation between a specific real estate project and the wider corporate organisation. The government’s reasoning is that doing so will allow the business body to continue working on other projects while the stressed project is handled separately.
• Creditors shall receive proceeds up to the liquidation value in accordance with the priority set out in Section 53 of the Code, and any surplus will be rateably allocated among all creditors in proportion to their unmet claims.

Conclusion

Attempts to enhance the operation of the IBC are encouraged. However, several of the concepts require further investigation. After all, changes to the Code should be motivated by the desire to improve its functionality and consequences. This should be done while keeping all stakeholders’ incentive structures in mind.

Source – The Hindu

Menstrual leave and the question of gender equality

GS Paper- II

Context- Kerala Chief Minister Pinarayi Vijayan stated on social media on January 19 that the state government will provide menstruation leave to female students at all state universities under the Department of Higher Education.

Background

• The declaration came shortly after the Cochin University of Science and Technology (CUSAT) voted to grant menstruation leave to all female students in response to a student union petition.
• Vijayan described the decision as part of the government’s commitment to achieving a gender-just society. The government’s allegation should spark a larger debate.

What is Menstruation?

• Menstruation, often known as a period, is the natural vaginal bleeding that happens as part of a woman’s monthly cycle.
• It is a typical stage of development for girls and women who have reached puberty.
• Every month, the body of a girl or woman prepares for pregnancy.
• If no pregnancy develops, the body eliminates the uterine lining.
• Menstrual blood is made up of blood and tissue from inside the uterus.
• A period can last anywhere from 3 to 7 days depending on the individual.

What is the idea behind the Menstrual leave?

• Paid leaves: Menstrual leave is a policy that allows women to take paid time off from work or education throughout their menstrual cycle.
• Allows for rest: This leave is expressly for menstruation women and is intended to allow them to relax and manage symptoms such as cramps and exhaustion, which can be particularly severe for certain women.
• Menstrual leave is intended to help remove the stigma connected with menstruation and to recognise it as a normal and natural biological occurrence.

Debate over the mandatory Period leave

Advantages:

• Making period leave available to students and, in the future, women in the profession might be a significant step toward recognising and resolving the often-debilitating pain and discomfort that so many are forced to work through.
• Period leave would aid in the creation of more inclusive and adaptable workplaces and classrooms.
• Making menstrual leave official can assist to lessen the stigma attached to menstruation and recognise it as a normal and natural physical occurrence.
• Allowing women to take time off during their menstrual cycle allows them to return to work or school refreshed and better able to focus on their tasks, potentially leading to higher productivity.

Concerns:

• In a traditional country like India, where menstruation is still a taboo subject, a specific period vacation might become another reason for discrimination.
• South Korea and Japan are not encouraging examples of similarly conservative societies: Both nations have period leave regulations, but recent polls show a fall in the proportion of women taking use of it, blaming the social shame associated with menstruation.
• There’s also the potential of medicalizing a natural biological process, which might reinforce existing biases against women.
• The perceived financial and productivity costs of enforced period absences may make businesses even more hesitant to recruit women.
• Implementing menstrual leave could reinforce the stereotype that women are weaker and less capable than men, which could have negative consequences for women in the long term.

Conclusion

The current discussion around menstrual leave and menstruation health is important and welcome. It’s also reassuring to see governments recognise the significance of this issue. However, making menstruation leave a legal necessity has its own set of difficulties. It is critical for governments to negotiate these obstacles while maintaining the ultimate aim of gender justice and equality.

Source – The Hindu

Bimodal Nuclear Propulsion can send missions to Mars in 45 days

GS Paper – III

Context- NASA intends to launch a trip to Mars in 45 years utilising Bimodal Nuclear Propulsion.

What is Bimodal Nuclear Propulsion?

• A few years ago, NASA resumed its mission to create bimodal nuclear propulsion. Bimodal nuclear propulsion is a two-part system comprised of an NTP and a NEP component.
• This technique is projected to allow Mars transits in 100 days.
• NASA Innovative Advanced Concepts (NIAC), a new initiative launched by the US space agency in 2023, has chosen a nuclear idea for Phase I development.
• This novel bimodal nuclear propulsion system will employ a “wave rotor topping cycle,” which has the potential to shorten transit durations to Mars to 45 days.

How will nuclear propulsion work?

• Nuclear propulsion is divided into two categories: nuclear-thermal propulsion (NTP) and nuclear-electric propulsion (NEP) (NEP).
• The NTP system contains a nuclear reactor that will heat liquid hydrogen (LH2) propellant to create ionised hydrogen gas (plasma), which will then be channelled via nozzles to generate thrust.
• NEP is reliant on a nuclear reactor to power a Hall-Effect thruster (ion engine).
• It will produce an electromagnetic field that will ionise and accelerate an inert gas (such as xenon) to provide propulsion.

Benefits offered

• Nuclear propulsion has many benefits over traditional chemical propulsion.
• These advantages include increased fuel economy, a better specific impulse rating, and infinite energy density (virtually).
• The benefit of NEP over NTP and traditional chemical propulsion systems is that it has a Specific impulse of more than 10,000 seconds (ISP).
• ISP measures how effectively a reaction mass engine (a rocket that uses propellant or a jet engine that uses fuel) generates thrust.

Benefits for manned missions

• A crewed journey to Mars using traditional propulsion technologies may take up to three years.
• A transit period of 45 days, on the other hand, reduces the whole mission duration to months rather than years.
• This will significantly lessen the key dangers connected with Mars missions, including as radiation exposure, time spent in microgravity, and related health issues.
• These nuclear propulsion methods have limitations.
• This indicates that NEP systems can sustain thrust for about three hours.
• However, as compared to traditional rockets and NTP systems, the thrust level is lower.
• Under ideal conditions, the thermal energy conversion rate in outer space is just 30-40%.

Source – The Hindu

INS Vagir commissioned into the Indian Navy

GS Paper- III

Context– The fifth Scorpene class conventional submarine, INS Vagir, was commissioned into the Indian Navy.

The INS Vagir

• The current submarine is named after the former Vagir, a submarine that served in the Navy from 1973 until 2001 and performed a variety of operational roles.
• The new Vagir’s construction began in 2009, and it had its first sea sortie in February of this year.
• The submarine, also known as Sand Shark, was delivered to the Indian Navy in December 2022.

Kalvari class

• A class of ships is a group of vessels that share the same make, function, and displacement.
• Vagir is a submarine in the Kalvari class, which also includes the INS Kalvari, INS Khanderi, INS Karanj, INS Vela, and INS Vagsheer.
• Kalvari and Khanderi were commissioned in 2017 and 2019, respectively, while Vela and Karanj were entered in 2021.
• Vagir has now been commissioned, while Vagsheer will be introduced next year after being launched in 2022.
• The present Kalvari-class submarines are named after retired Kalvari classes, which included the Kalvari, Khanderi, Karanj, and Vela classes, which included the Vela, Vagir, and Vagshir.

Capabilities and technical details of INS Vagir

• Submarines of the Kalavari class have an estimated endurance of 50 days.
• They may also engage in a variety of naval warfare activities such as anti-warship and anti-submarine operations, information gathering and reconnaissance, and naval mine laying.
• These submarines are around 220 feet long and 40 feet tall. When surfaced, it can attain speeds of 11 knots (20 km/h) and 20 knots (37 km/h) when submerged.
• Modern Scorpene class submarines include what is known as Air Independent Propulsion (AIP), which allows non-nuclear submarines to function for extended periods of time without access to surface oxygen.

Strategic importance

• India currently has fewer submarines than is necessary, with further submarines of both classes in various stages of construction.
• India has one nuclear-powered submarine in the Chakra class and two more nuclear-powered boats in the Arihant class.
• There are also submarines from the three Diesel Electric classes — Kalvari, Shishumar, and Sindhughosh — some of which are old.
• Nuclear-powered and diesel-electric submarines have specific roles in Carrier Battle Groups, which are formations of ships and submarines led by Aircraft Carriers.
• According to the basic principles of submarine deployment and the minimal requirement for India to generate strategic deterrence, India must have a particular number of submarines of both categories in active service.

Source – Indian Express

Hazards of Trans-fats in Foods

GS Paper- II

Context- The World Health Organization warns that trans-fat intake puts roughly 5 billion individuals at risk of heart disease.

About

• According to a new World Health Organization (WHO) research, over 5 billion people worldwide are still shielded against hazardous trans fats, which can raise their risk of heart disease and death.
• WHO originally recommended for the global eradication of industrially generated trans-fats in 2018, with a 2023 deadline.
• Denmark was the first country to outlaw trans fats in 2003, followed five years later by Chile and Switzerland.

Key Takeaways

• Trans fats are often found in packaged foods, baked products, cooking oils, and spreads, and are responsible for up to 500,000 premature coronary heart disease deaths per year.
• There is no best-practice policy in nine of the 16 nations with the highest estimated proportion of coronary heart disease fatalities related by trans fat consumption.
• While over 43 nations are already implementing legislation to combat trans fats in food, 5 billion people remain at danger, with the worldwide goal of absolute eradication by 2023 being unreachable.
• Trans fats are often found in packaged foods, baked products, cooking oils, and spreads, and are responsible for up to 500,000 premature coronary heart disease deaths per year.

What are Trans-fats?

• Trans fats, also known as trans-fatty acids, are an unsaturated fat found in trace levels in some animal-based diets.
• These are most typically manufactured in the industrial setting by adding hydrogen to vegetable oil to make it more solid, a process known as hydrogenation.
• Trans fats enhance bad cholesterol, such as very low density lipoprotein (VLDL) and low density lipoprotein-cholesterol (LDL-c), while decreasing good cholesterol, such as high density lipoprotein-cholesterol (HDL-c), in our bodies.
• Trans fat intake has been linked to heart disease, overweight/obesity, high blood pressure, diabetes, and some forms of cancer.

Types of trans-fats based on Source:

• Natural trans-fats, also known as ruminant trans fats, are found in trace amounts in meat and dairy products derived from ruminant animals such as cows, sheep, and cattle.
• These kinds of trans fat are not typically regarded as dangerous.
• Artificial trans fats: These are also known as industrial trans fats because they are produced industrially through a chemical process of partial hydrogenation or thermal treatments of edible oils containing unsaturated fatty acids, such as during the refining of vegetable oils and during the frying process.
• They are typically regarded as hazardous and are abundant in partly hydrogenated vegetable fats (vanaspati, margarine and bakery shortenings).

Why are trans fats used in India?

• Trans fats are less expensive than other types of fats and oils, making them an appealing alternative for cost-conscious food makers and restaurateurs.
• It can help extend food shelf life, making it a popular choice for packaged meals and baked products that require a longer shelf life.
• Because they have a high smoke point, they are suited for deep frying and other high-heat cooking methods, making pastries and fried meals more flavorful and crispier.
• Many Indians may be unaware of the detrimental health consequences of trans fats and hence fail to make an effort to avoid them in their diet.
• Unlike some other nations, India has not imposed rigorous rules on the use of trans fats in food, which may make it simpler for food makers to utilise them.

What are the risks of consuming trans fats?

• Trans fats can raise bad cholesterol (LDL) and reduce good cholesterol (HDL) levels in the blood, increasing the risk of heart disease and stroke.
• Trans fat consumption may also raise the chance of developing other chronic diseases such as type 2 diabetes, cancer, and other inflammatory disorders.
• A diet rich in trans fats has been proven in studies to have a deleterious influence on cognitive function as well as the immune system.
• Trans fats have little nutritional benefit and can cause better fats to be replaced in the diet.
• Trans fats’ negative health impacts can impose a strain on healthcare systems since the treatment and management of the disorders they lead to can be expensive.
• Because of the lack of effective restrictions limiting the use of trans fats in food, it is becoming more difficult for consumers to avoid them in their diet.
• Trans fats have been related to weight gain and obesity, and they are regarded as a key contributor to the obesity pandemic.

Government steps to remove trans-fats in India

• Freedom from Trans Fat @75: Recognizing the health risks associated with industrial trans fat intake, the Food Safety and Standards Authority (FSSAI) implemented a two-pronged strategy to phase out trans fat from the diet by 2022.
• On the supply side, the FSSAI has issued numerous important laws to limit trans fat in industrial goods, urging the edible oil sector and food company owners to eradicate trans fat from their products.
• Through a modification to the Food Safety and Standards (Prohibition and Restriction on Sales) Regulations, the FSSAI has reduced the quantity of trans fatty acids (TFA) in oils and fats to 3% in 2021 and 2% in 2022 from the present acceptable level of 5%.
• On the demand side, FSSAI has initiated a public media campaign in the form of a 30-second Public Service Announcement (PSA) to raise awareness about the detrimental effects of trans fat by,
• The World Health Organization (WHO) urged for the eradication of industrially generated trans fats by 2023 in 2018, and developed a policy guide dubbed ‘REPLACE’ to assist governments in developing legislation.
• In 2011, India’s FSSAI established a 10% limit on trans fats in oils and fats, which was later reduced to 5% in 2015.
• The ‘Eat Right India’ campaign is a large-scale attempt to overhaul the country’s food system in order to secure safe, healthy, and sustainable food for all Indians.
• It is a 6-month programme that teaches chefs how to cook without trans fats by using less sodium (salt) and certifies them by leading them through sustainable cooking practises and food safety legislative standards.
• It was introduced in 2019 by FSSAI, and it permits food industry enterprises such as manufacturers and restaurants that make meals with less than 0.2g/100g trans fat to wear the “Trans-fat free” emblem on their goods and in their outlets.

What more can be done to eliminate the use of trans fats in food?

• Governments can develop rules to limit the use of trans fats in food by limiting the quantity of trans fats that can be present in food items or by prohibiting the use of partly hydrogenated oils (a significant source of trans fats) in food.
• Education campaigns may be used to educate the public about the dangers of trans fats and how to detect and avoid them in their diet.
• Researchers and food scientists can collaborate to create trans fat substitutes that give the same functionality in food without the negative health consequences.
• Food producers can be urged to reformulate their goods such that trans fats are reduced or eliminated.
• Encourage individuals to consume a diet high in fruits and vegetables, healthy grains, and lean protein while being low in saturated and trans fats.
• The government can raise taxes on trans fat-containing items to discourage their usage and consumption.
• The government can provide incentives to food businesses that make products with low or no trans fats.

Source – Indian Express

Sexual Harassment in Sports

GS Paper- I

Context– The Union Sports Minister announced that boxer M.C. Mary Kom, a six-time World champion and Olympic medalist, would lead a five-member government-appointed Oversight Committee to investigate the allegations levelled by some prominent wrestlers against Wrestling Federation of India (WFI) president Brij Bhushan Sharan Singh.

Concerning the Oversight Committee

• The committee also includes Olympic medalist wrestler Yogeshwar Dutt, well-known shuttler Trupti Murgunde, former Target Olympic Podium Scheme (TOPS) CEO Commander Rajesh Rajagopalan, and former Executive Director (Team) of the Sports Authority of India (SAI) RadhicaSreeman.
• Its goals are to investigate the significant accusations levelled by the wrestlers and deliver a report within a month. Until then, the committee will handle the WFI’s day-to-day operations.
• The group will investigate charges of sexual misbehaviour, harassment and intimidation, financial problems, and administrative oversight.

Concerning Sexual Harassment in Sports

• Sexual harassment is “when any sort of unwelcome verbal, nonverbal or physical behaviour of a sexual character occurs, with the aim or effect of violating the dignity of a person, in particular when creating an intimidating, hostile, demeaning, humiliating or offensive environment”.
• Sexual harassment in sports is viewed as a violation of professional ethics, prestige, and authority.

Impacts

• Sexual harassment in sports decreases self-esteem and hinders women’s and girls’ capacity to reach their full potential in sports and fitness activities.
• It jeopardises the coach’s professional credibility as well as athletics’ educational goal.
• It undermines the mission of sports organisations and educational institutions to offer leadership and resources to improve the physical, mental, and emotional well-being of all girls via participation in sports and fitness.
• In a nation like India, where sports are still not regarded as a viable career choice, sexual harassment in sports may deter parents from bringing their daughters to stadiums.

Initiatives

• Women coaches must accompany the contingent with female athletes on domestic or foreign travel, according to rules provided by the Sports Authority of India (SAI) to the National Sports Federation of India (NSFOI).
• On the claimed inappropriate behaviour of a coach, the National Human Rights Commission (NHRC) issued notifications to the Union Youth Affairs and Sports Ministry and the Sports Authority of India.
• In 2013, the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act became law.
• It defines sexual harassment, outlines the processes for filing a complaint and conducting an investigation, and specifies the appropriate action.
• It expands on the Vishaka rules that were previously in place.
• The Vishaka standards are widely regarded as the most effective instrument for protecting women from sexual harassment and punishing those who violate them. In ‘Vishaka and others against State of Rajasthan and others,’ the Supreme Court established the rules.
• Women’s rights organisations, including Vishakha, filed the public interest litigation in the case of Bhanwari Devi, a social worker from Rajasthan, who was allegedly gang-raped.
• Women employees can pursue legal action in addition to the Vishakha rules under the Indecent Representation of Women (Prohibition) Act.
• Sections 294, 354, and 509 of the Indian Penal Code can be used to take action.
• SHe-Box: The Ministry of Women and Child Development launched the Sexual Harassment electronic Box (SHe-Box) to provide a single point of contact for every woman, regardless of her employment status, whether in the organised or unorganised, private or public sector, to facilitate the filing of sexual harassment complaints.
• The National Commission for Women (NCW) has requested all states to guarantee that coaching centres and educational establishments strictly enforce the sexual harassment at work statute.

Suggestions and Conclusion

• Leaders of sports governing bodies, educational institutions, and athletic programmes must be encouraged to develop, implement, and assess sexual harassment policies.
• The policy should define sexual harassment explicitly and explain the consequences of sexual harassment.
• Create a mechanism for reporting sexual harassment complaints.
• Ensure that the processes for reporting sexual harassment respect the privacy of any athlete or coach involved to the greatest extent practicable.
• It is useful to distinguish between informal and official reporting methods for sexual harassment.
• All athletes should be encouraged to report any instance of sexual harassment by a coach, whether the act was aimed at her or she witnessed it occurring to someone else.
• The International Olympic Committee must assist strengthen measures against sexual abuse for athletes or risk losing them.

Source – Indian Express

Facts For Prelims

Buddhist monastery complex at Bharatpur

Context: Recent excavations in West Bengal’s Paschim Bardhaman district have revealed the presence of a Buddhist monastery in Bharatpur.

• Previous excavation discoveries (between 1972 and 1975)
• A magnificent Buddhist stupa was discovered.
• Chalcolithic Age black and red clay ceramics
• Five exquisite sitting Buddha statues in Bhumisparsha Mudra — with all five fingers of the right hand outstretched to touch the ground — were discovered.
• A Buddhist stupa is a memorial structure that generally houses sacred treasures linked with the Buddha.

It represents the Buddha’s enlightenment under the bodhi tree, when he called on the earth goddess Sthavara to bear witness to his enlightenment.

Sebi launches information database on municipal bonds

Context: Sebi, the market regulator, has developed a municipal bond information database.

Objective: Raise public awareness; efforts to establish bond markets and make the procedure simple and simplified.

What exactly is a database of information?

Sebi’s municipal debt securities information database offers a wide range of information in the form of statistics and rules, circulars, guidance notes, and Frequently Asked Questions.

What exactly are municipal bonds?

Municipal bonds (abbreviated “munis”) are debt instruments issued by states, cities, counties, and other public bodies to support day-to-day commitments and capital projects such as the construction of schools, roadways, and sewer systems.

In 1997, Bengaluru issued the first municipal bond.