Relevance IN - Prelims (about ETF) + Mains (GS III economic development)
What's the NEWS

• The Union Cabinet has recently approved launching a bond ETF (Exchange Traded Fund).
• Called the Bharat Bond ETF, this fund will track the index comprising debt securities of Public Sector Undertakings with the highest credit rating.

• Unlike existing ETFs in India, the Bharat Bond ETF will have a defined maturity date just like bonds and fixed maturity plans of mutual funds.
• On maturity, investors will get the investment proceeds along with returns.
• Edelweiss MF is launching two series of Bharat Bond ETFs - one matures in April 2023 and the other after 10 years (ie April 2030).
• These ETFs will invest only in AAA-rated bonds issued by PSUs maturing on or before the maturity of the ETFs.
• The ETF will hold the bonds till maturity and coupons received from those bonds will be reinvested in the fund.
• Through demat accounts, investors can buy and sell units at the prevailing market prices.
• Bharat Bond ETF will be the first corporate bond debt ETF to be launched in India.
• An ETF or exchange traded fund invests in a basket of securities that mostly tracks a certain index.
• ETFs are similar to mutual funds, but the big difference is that can be bought and sold only through the stock exchanges.
• A bond ETF invests in a basket of bonds in the underlying index. It can invest in the government, corporate, or public sector unit bonds.

• It would be the first corporate bond ETF in the country. Initially, it will constitute AAA -rated bonds.
• Price will be kept at Rs.1,000 per unit to attract retail investors.
• Each ETF will have a fixed maturity date. Initially they will be issued in two series, of three years and ten years.
• A bond ETF is cheaper than an actively-managed debt fund. For instance, Bharat Bond ETF will charge 0.0005%.
  
  
• The Asset Management Company Edelweiss charges an expense ratio of 0.0005% for managing the Bharat Bond ETF. This is the cheapest among mutual funds schemes and ETFs in India
• ETFs are passively managed mutual funds. These are traded on the BSE and NSE.
• Through demat accounts, investors can buy and sell units at the prevailing market prices.
• It is the cheapest mutual fund product in India and one of the cheapest debt fund products in the world," claims Edelweiss Mutual Fund.

Relevance IN - Prelims (about the bill) + Mains (GS II Indian Constitution- historical underpinnings, evolution, features, amendments, significant provisions and basic structure. Functions and responsibilities of the Union and the States, issues and challenges pertaining to the federal structure, devolution of powers and finances up to local levels and challenges therein. Separation of powers between various organs dispute redressal mechanisms and institutions.
What's the NEWS

• The Lok Sabha today passed the Citizenship (Amendment) Bill 2019.
• The Bill seeks to grant Indian Citizenship to persons belonging to Hindu, Sikh, Buddhist, Jain, Parsi and Christian communities who have migrated to India after facing persecution on grounds of religion in Pakistan, Afghanistan and Bangladesh, if they fulfil conditions for grant of citizenship.

Highlights

• At present, it is mandatory for a person to stay here for at least 11 years to get citizenship of India.
• The bill will reduce this period to six years. It will enable people from these communities to get Indian citizenship in six years.
• It will make some amendments to the Citizenship Act 1955 to provide legal aid for citizenship.

Know! more about the bill and the government point of view regarding it

• The provisions of the amendments to the Act would not apply to tribal area of Assam, Meghalaya, Mizoram or Tripura as included in the Sixth Schedule to the Constitution and the area covered under ‘The Inner Line' notified under the Bengal Eastern Frontier Regulation, 1873.
• The Bill also seeks to amend the Third Schedule to the Act to make applicants belonging to the said communities from the aforesaid countries eligible for citizenship by naturalisation if they can establish their residency in India for five years instead of the existing eleven years.
• Manipur would be brought under the Inner Line Permit (ILP) regime and with that the problems of all the North Eastern States would be taken care of.
• The provisions from Constitutions of Afghanistan, Pakistan and Bangladesh where they provide for a specific state religion.
• These countries have had a history of persecution of religious minorities viz., Hindus, Sikhs, Buddhists, Jains, Parsis and Christians.
• The Bill contains provisions to grant Citizenship to such refugees on reasonable grounds, which in no way go against any provision under the Constitution of India and does not violate Article 14.
• The Bill seeks to amend section 7D so as to empower the Central Government to cancel registration as Overseas Citizen of India Cardholder, after providing a reasonable opportunity of being heard, in case of violation of any provisions of the Citizenship Act or any other law for the time being in force.

Know! the concerns

• Opposition parties said that this is a violation of Article 14 of the Constitution, which speaks of the right to equality.

Know! about illegal migrants

• Illegal migrants cannot get citizenship of India according to the Citizenship Act, 1955
• The people, who have entered India without valid travel documents like passports and visas or have come to India with valid documents but stay here longer than the period mentioned therein, are considered as illegal migrants under this law.
• Under the Foreigners Act, 1946 and the Passports (Entry into India) Act, 1920 these illegal migrants can either be kept in jail or sent back to their country.
• In the laws of 1920 and 1946 the central government has made some to exempt Hindus, Sikhs, Buddhists, Jains, Parsi and Christians from Afghanistan, Bangladesh and Pakistan so that they can stay in India.
• So after the amendments if people belonging to these communities live in India without valid documents, then they can neither be imprisoned nor deported.
• This exemption has given to those religious groups who have reached India on or before 31 December 2014.
  
  

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