Schemes / Government Initiatives

Schemes / Government Initiatives

1. Universal Basic Income (UBI)

 Sikkim’s ruling party, the Sikkim Democratic Front (SDF),
recently declared to include the Universal Basic Income scheme
in its manifesto ahead of the Assembly election in 2019 and
aims to implement it by 2022.
 If everything goes according to the plan, it will be the first state
to implement UBI in India.
 Sikkim has set up examples in the country in different areas in
the past also, some of them being:
o Sikkim is the best state for women in the workplace, thanks
to its high rates of female workforce participation, there’s
less crime against women.
o Sikkim’s literacy rate increased to 82.2% from 68.8% in
2001, among the country’s highest.
o Sikkim is the least populated state in India, has its per
capita GDP growing in double digits since 2004-05.
o Sikkim also became the first fully organic state.
 What is Universal Basic Income?
o Universal Basic Income (UBI) is a programme for providing
all citizens of a country or other geographic area/state with
a given sum of money, regardless of their income, resources
or employment status.
o The main idea behind UBI is to prevent or reduce poverty
and increase equality among citizens. The essential
principle behind Universal basic income is the idea that all
citizens are entitled to a livable income, irrespective of the
circumstances they’re born in.
o The Economic Survey 2016-17 advocated the concept of
Universal Basic Income (UBI) as an alternative to the various
social welfare schemes in an effort to reduce poverty.
o The Survey points out that the two prerequisites for a
successful UBI are: (a) functional JAM (Jan Dhan, Aadhar
and Mobile) system as it ensures that the cash transfer goes
directly into the account of a beneficiary and (b) Centre-
State negotiations on cost sharing for the programme.
2. Gold Monetization Scheme
 Reserve Bank of India has allowed central and state
governments and entities owned by them to deposit gold under
its Gold Monetization Scheme. Furthermore, charitable
institutions have also been made eligible to deposit gold with
banks to earn interest under the program.
 Gold Monetization Scheme was launched in 2015. The basic aim
of this scheme is to monetise all the gold which is lying idle
with individuals or institutions like banks.
 The key features of Gold Monetization scheme are as follows:

The persons can open Gold Saving Account in designated
banks and anyone can deposit physical gold via BIS certified
collection, purity testing centres (CPTCs). The minimum
amount of gold thus deposited is 30 gms, no upper limit.
o The gold is deposited for short term (1-3 years), medium
term (5-7 years) and long term (12-15 years).
o The gold thus collected is sent to refineries and banks have
tripartite / bipartite agreements with refineries and CPTCs.
o On maturity, one can get back the cash / physical gold for
short term deposits and cash only for long term deposits.
o The scheme allows banks’ customers to deposit their idle
gold holdings for a fixed period in return for interest in the
range of 2.25 per cent to 2.50 per cent.
3. Pradhan Mantri Mudra Yojana (PMMY)
 The finance ministry has asked the banks to review all loans
sanctioned under the Pradhan Mantri Mudra Yojana (PMMY or
Mudra loan scheme), as the non-performing assets (NPA) have
crossed Rs 11,000 crore within three years of the launch of the
scheme.
 Pradhan Mantri MUDRA Yojana (PMMY) scheme:
o The PMMY Scheme was launched in April, 2015.
o PMMY is a scheme to extend collateral free loans by Banks,
Non-Banking Financial Companies (NBFCs) and Micro
Finance Institutions (MFIs) to Small/Micro business
enterprises and individuals in the non-agricultural sector to
enable them to setup or expand their business activities and
to generate self-employment.
o Banks, NBFCs and MFIs can draw refinance under the
MUDRA Scheme after becoming member-lending
institutions of MUDRA.
o Mudra Loans are available for non-agricultural activities
upto Rs. 10 lakh and activities allied to agriculture such as
Dairy, Poultry, Bee Keeping etc, are also covered.
o Mudra’s unique features include a Mudra Card which
permits access to Working Capital through ATMs and Card
Machines.
 There are three types of loans under PMMY:
o Shishu (up to Rs.50,000).
o Kishore (from Rs.50,001 to Rs.5 lakh).
o Tarun (from Rs.500,001 to Rs.10,00,000).
4. Know Your Budget Series
 It is a fortnight series started by the union Finance Ministry on
Twitter which explains the importance of Union Budget and its
making. It aims to educate the general public about the
budgetary process.
 The first series of tweets explained what is Union Budget and
Vote on Account.
 What is Budget?
Budget is the most comprehensive report of the government’s finances in which revenues
from all sources and outlays for all activities are consolidated.
o The budget, which is presented by means of the Finance bill and the Appropriation bill has to
be passed by Lok Sabha before it can come into effect.
o The Budget also contains estimates of the government’s accounts for the next fiscal year called
Budget estimates.

 Article 266 of the Constitution of India mandates that Parliamentary approval is required to draw
money from the Consolidated Fund of India.
 Besides, Article 114 (3) of the Constitution stipulates that no amount can be withdrawn from the
Consolidated Fund without the enactment of a law (appropriation bill).
 What is a vote on account?
o A vote on account essentially means that the government seeks the approval of Parliament
for meeting expenditure — paying salaries, ongoing programmes in various sectors etc — with
no changes in the taxation structure, until a new government takes over and presents a full
Budget that is revised for the full fiscal.
 Why present a vote on account?
o The reasoning is that there is little time to get
approvals from Parliament for various grants to
ministries and departments, and to debate these
as well as any provisions for changes in taxation.
o More importantly, the reasoning is that it would
be the prerogative of the new government to
signal its policy direction, which is often
reflected in the Budget.
 Difference between Full Budget and Vote on
Account:
o Full Budget deals with both expenditure and
revenue side but Vote-on-account deals only
with the expenditure side of the government’s
budget.
o The vote-on-account is normally valid for two
months but full budget is valid for 12 months (a
financial year

o As a convention, a vote-on-account is treated as a formal
matter and passed by Lok Sabha without discussion. But
passing for budget happens only after discussions and
voting on demand for grants.
5. Pradhan Mantri Rozgar Protsahan Yojana (PMRPY)
 The Pradhan Mantri Rozgar Protsahan Yojana (PMRPY), the
flagship scheme of the Union Government for employment
generation, crossed the milestone of one crore beneficiaries on
January 14, 2019.
 About Pradhan Mantri Rojgar Protsahan Yojana:
o The scheme “Pradhan Mantri Rojgar Protsahan Yojana”
(PMRPY) was announced in the Budget for 2016-17.
o The objective of the scheme is to promote employment
generation.
o The scheme is being implemented by the Ministry of
Labour and Employment through the Employees’ Provident
Fund Organization (EPFO).
o Under the scheme, Government is paying full employers’
contribution of 12% (towards Employees’ Provident Fund
and Employees’ Pension Scheme both), for a period of 3
years in respect of new employees who have been
registered with the EPFO on or after 1st April 2016, with
salary up to Rs. 15,000 per month.
 PMRPY has a dual benefit –
o The employer is incentivised for increasing the employee
base in the establishment through payment of EPF
contribution of 12% of wage, which otherwise would have
been borne by the employer.
o A large number of workers find jobs in such
establishments.
o A direct benefit is that these workers have access to social
security benefit through Provident Fund, Pension and Death
Linked Insurance.
6. National Entrepreneurship Awards 2018
 The Ministry of Skill Development and Entrepreneurship
(MSDE) has instituted the National Entrepreneurship Awards
(NEA) to recognize and honour outstanding young first
generation Entrepreneurs and their Ecosystem Builders for their
outstanding contribution in entrepreneurship development.
7. Arbitration
 Arbitration is a settlement of dispute between two parties to a
contract by a neutral third party i.e. the arbitrator without
resorting to court action. The process can be tailored to suit
parties’ particular needs.
 Arbitrators can be chosen for their expertise. It is confidential
and can be speedier and cheaper than court. There are limited grounds of appeal. Arbitral awards are binding and enforceable
through courts.
 The Lok Sabha has passed the New Delhi International
Arbitration Centre Bill to set up a revamped International
Arbitration Centre at New Delhi with an aim to make India the
hub of arbitration.
o The New Delhi International Arbitration Centre will take
over the undertakings of the International Centre for
Alternative Dispute Resolution (ICADR). The chief justice of
India is the ex-officio chairperson of the ICADR.
o The New Delhi International Arbitration Centre is being set
up as per the recommendation of the Justice B N Srikrishna
committee formed to identify the roadblocks in the
development of institutional arbitration in India.
8. Transport Subsidy Scheme
 To facilitate the process of industrialization in hilly, remote and
inaccessible areas, transport incentive is provided to the states
of:
o North Eastern Region (including Sikkim) under North
Eastern Industrial Development Scheme (NEIDS) – 2017
o Jammu & Kashmir under Industrial Development Scheme –
2017
o Lakshadweep and A&N Islands under Lakshadweep and
Andaman & Nicobar Island Development Scheme – 2018
 Industrial Units can avail Incentives:
o Under the above mentioned schemes, all eligible industrial
units can avail incentive on transportation of only finished
goods through Railways or the Railway Public Sector
Undertakings, Inland Waterways or scheduled
airline (shipping for Andaman & Nicobar and Lakshadweep
islands also) for five years from the date of commencement
of commercial production/operation.
 Freight Subsidy Scheme (FSS):
o The FSS (2013) replaced the Transport Subsidy Scheme,
1971.
o It was in operation in all 8 North Eastern States, Himachal
Pradesh, Uttarakhand, J&K, Darjeeling District of West
Bengal, Andaman & Nicobar Islands and Lakshadweep
islands.
o The FSS has been discontinued since 22.11.2016. But, the
industrial units under these schemes during their currency
are eligible for the benefits of the scheme.
o While the inland transport incentive is available for certain
landlocked states, there is no proposal to provide the same
to the state of Chhattisgarh.
 About Transport Subsidy Scheme –
o Government of India had introduced Transport Subsidy
Scheme (TSS) on 23.7.1971 to develop industrialization in
the remote, hilly and inaccessible areas.

o The objective is to develop industrialization in the remote, hilly and inaccessible areas in 8
North Eastern Region.
o DIPP (Department of Industrial Policy and Promotion) (The name of the Department of
Industrial Policy and Promotion (DIPP) has been changed as Department for Promotion of
Industry and Internal Trade (DPIIT)) is the implementing agency of TSS/FSS.
9. Insolvency and Bankruptcy Code
 Supreme Court has upheld the Insolvency & Bankruptcy Code’s constitutional validity in its
‘entirety’.
 The IBC was enacted in 2016, replacing a host of laws, with the aim to streamline and speed up the
resolution process of failed businesses.
 The code covers all individuals, companies, Limited Liability Partnerships (LLPs) and partnership
firms. It provides for a time-bound process to resolve insolvency. When a default in repayment
occurs, creditors gain control over debtor’s assets and must take decisions to resolve insolvency
within a 180-day period.
 The Code also consolidates provisions of the current legislative framework to form a common
forum for debtors and creditors of all classes to resolve insolvency.
 The Code creates various institutions to facilitate resolution of insolvency. These are as follows:
o Insolvency Professionals: A specialised cadre of licensed professionals is created. These
professionals will administer the resolution process, manage the assets of the debtor, and
provide information for creditors to assist them in decision making.
o Insolvency Professional Agencies: The insolvency professionals will be registered with
insolvency professional agencies.
o Information Utilities: Creditors will report financial information of the debt owed to them by
the debtor. Such information will include records of debt, liabilities and defaults.
o Adjudicating authorities: The proceedings of the resolution process will be adjudicated by the National Companies Law Tribunal (NCLT), for companies; and the Debt Recovery Tribunal (DRT), for individuals.
o Insolvency and Bankruptcy Board: The Board will regulate insolvency professionals, insolvency professional agencies and information utilities set up under the Code. The Board will consist of representatives of Reserve Bank of India, and the Ministries of Finance, Corporate Affairs and Law.


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