Relevance IN - Prelims (about IFAD and its objective + about FAO)
What's the NEWS

• The 43^rd session of the Governing Council, the decision making body of the International Fund for Agricultural Development (IFAD) 2020, under the theme Investing in sustainable food systems to end hunger by 2030, which is being held at the headquarters of the UN Food and Agriculture Organization (FAO) in Rome, capital of Italy, from February 11^th to 12^th.

• The United Nations will miss its target of achieving 17 Sustainable Development Goals by 2030 stated by UN representative
• Set in 2015 by the UN General Assembly, the self development goals (SDGs) are the "blueprint to achieve a better and more sustainable future for all", intended to be achieved by 2030.
• The goals include zero poverty, zero hunger, good health and well being, quality education, gender equality, clean water and sanitation, clean and affordable energy, sustainable cities and communities, and climate action.
• IFAD, a UN financial institution that offers grants and low-interest loans to projects that help reduce poverty and increase food security, is particularly interested in fighting hunger.

• The International Fund for Agricultural Development (IFAD), a specialized agency of the United Nations, was one of the major outcomes of the 1974 World Food Conference.
• The conference was organized by the United Nations in response to the food crises of the early 1970s
• an International Fund for Development established to finance agricultural development projects, primarily for food production in the developing countries
• The Fund shall provide financing primarily for projects and programmes specifically designed to introduce, expand or improve food production systems and to strengthen related policies and institutions
• Three years after the Rome conference, IFAD was set up as an international financial institution in 1977.

• The Food and Agriculture Organization of the United Nations (FAO) is a specialized agency of the United Nations that leads international efforts to defeat hunger and improve nutrition and food security.
• Founded in October 1945, the FAO is the oldest existing agency of the U.N.
• Composed of 197 member states, the FAO is governed by a biennial conference representing each member country and the European Union, which elects a 49-member executive council

• The Finance Commission submitted its report for the financial year 2020-21 to President Ram Nath Kovind on Thursday.
• The Commission headed by N K Singh apprised the President of the recommendations contained therein

• Article 280 - President of India forms a Finance Commission (a quasi judicial body) every 5th Year or earlier, with 1 chairman and four member. Eligible for re-appointment. Recommendations are not binding to the government but usually they are not rejected
• 14^th FC - YV Reddy (Recommendation Period - 1^st April 2015 - to 31^st March 2020)
• 15^th FC - NK Singh (Recommendation Period - 6 years)

• 15^th Finance Commission was appointed on November 27, 2017.
• Originally, it was to submit report by October 30, 2019 for five years i.e., for the period 2020-21 to 2024-25.
• Now, Finance Commission is submitting two reports. Interim Report for 2020-21 and the Main Report covering the period of five years beginning April 1, 2021 and ending March 31, 2026.

• The 15^th Finance Commission has recommended maintaining States' share in the divisible pool of tax collections at the same level of 42% for 2020-21.
• To factor in the changed status of the erstwhile State of Jammu & Kashmir, the rate at which funds may be shared with the States has been reset at 41%.
• This is after adjusting 1 percentage point for the needs, including special ones of the two new Union Territories of J&K and Ladakh.
• The actual pool of funds available to States will be equivalent to what they were receiving from the 42% share granted by the 14^th Finance Commission, as the number of States are now 28 instead of 29.

1. Vertical Devolution (41%)

• It recommends the distribution of the net proceeds of taxes of the Union between Union and the States.

2. Horizontal Devolution (how to distribute the 41% among the states)

• It allocates among the States the proceeds of the Vertical Devolution.

• In addition to income distance, population, area and forest cover, it has used two additional factors, demographic performance and tax effort.
• It assigned 15% weight to the 2011 population.
• It reduced the weight of income distance to 45%, it increased the weight to forest cover and ecology to 10%.
• Demographic performance is given 12.5% and tax effort is given 2.5%.

1. Income Distance -50%
2. Population -27.5% ( 17.5 % acc. to 1971 population and 10 % acc. to 2011 population)
3. Area -15%
4. Forest and Ecology - 7.5 %

1. Income Distance -45%
2. Population - 15% (2011)
3. Demographic Performance (newly added) -12.5%
4. Tax effort (newly added) - 2.5%
5. Area -15%
6. Forest and Ecology - 10%

• In the relative shares in tax devolution, among the major States, the biggest loser is Karnataka. The other States which lost heavily include Uttar Pradesh, Kerala, Telangana and Andhra Pradesh.

• The Lok Sabha passed The Constitution (Scheduled Tribes) Order (Amendment) Bill, 2019 by voice vote.

• The Bill seeks to include the Parivara and the Talawara communities in the ST category to ensure they get reservation and other benefits provided by the government.
• The Siddi tribes of Belagavi and Dharwad would also be included in the category apart from those living in the Uttar Kannada districts.
• The amendments had been made in the list of the STs in Karnataka.
• The Bill amends the 1950 order by granting ST status to and including the communities ""Parivara and Talawara as Synonyms of ‘Nayaka' at Sl. No.38 and (ii) "Siddi" community of Dharwad and Belagavi districts along with existing ‘Siddi' community of Uttar Kannada district at Sl. No. 50, in the list of Scheduled Tribes of Karnataka
• The first specification of Scheduled Tribes in relation to a particular State or Union territory is by a notified Order of the President after consultation with the State Government / UT concerned.
• Any subsequent inclusion in or exclusion from and other modifications in the list of Scheduled Tribes can be made only through an amending Act of Parliament

Relevance IN - Prelims (about the MoU and its objective) + Mains (GS II Bilateral relations)
What's the NEWS

• The Union Cabinet, chaired by the Prime Minister , was apprised of a Memorandum of Understanding (MoU) signed between India and Iceland in the field of Fisheries

The salient features of the MoU are:

a. Creation of facilities for exchange of scientists and technical experts and their proper placement, especially in areas of estimating Total Allowable Catches in off shore and deep sea areas;
b. Provision of training to fisheries professionals from key fisheries institutions in the various management aspects on areas of modern fisheries management and fish processing
c. Exchange of scientific literature research findings and other information.
d. Exchange of experts / expertise to study the prospects of fishing. Processing and marketing of products from high seas fisheries for entrepreneurship development.

Economic Development
RBI planning umbrella entities for retail payment systems
Relevance IN - Prelims (about the proposed umbrella entity and its objective) + Mains (GS III Economic development)
What's the NEWS

• The Reserve Bank of India is proposing to set up an alternative digital retail payments organisation as it aims to prevent a monopoly in a system that's currently dominated by National Payments Corporation of India Ltd.
• Prior to 2008, the RBI managed, developed and operated various payment systems. In the early 2000s, it set up the National Electronic Funds Transfer System and Electronic Clearing Service, which it operates to date.
• As retail electronic transactions gained traction, the RBI set up NPCI to develop and operate various retail payment systems.
• The RBI suggested that NPCI has become ‘too big to fail' and threw up the idea of an alternative umbrella organisation for retail payments.

Know! the draft guidelines for the New Umbrella Entity (NUE)

• The new umbrella entity will set up, manage and operate new payment systems, especially in the retail space
• This organisation will operate clearing and settlement systems. It will also identify and manage relevant risks such as settlement, credit and liquidity,

Eligibility Criteria for opening a NUE

• The umbrella entity could be a for-profit or not-for-profit entity
• owned and controlled by Indian residents.
• Proposed umbrella entity can be ‘for profit' and registered as a company under PSS Act 2007.
• Entities eligible to apply as promoter / promoter group shall be ‘owned and controlled by residents with 3 years' experience in the payments ecosystem as Payment System Operator (PSO) or Payment Service Provider (PSP) or Technology Service Provider (TSP).
• Minimum paid up capital should be Rs 500 crore and a minimum net-worth of Rs 300 crore shall be maintained at all times.
• Promoters shall upfront demonstrate capital contribution of not less than 10 percent, that is, Rs 50 crore.
• No single promoter can hold more than 40 percent.
• Promoter shareholding to be diluted to a minimum of 25 percent after five years.
• NUE will have a board to ensure compliance with corporate governance principles.
• The RBI will retain the right to appoint directors on the board and may nominate a member

Know! more about NUE

• The new umbrella entity shall set-up, manage and operate new payment systems, especially in the retail space comprising but not limited to automated teller machines, white-label point of sale terminals, Aadhaar-based payments and remittance services.
• The entity shall also develop new payment methods, standards and technologies, monitor-related issues in the country and internationally, take care of developmental objectives like enhancement of awareness about the payment systems

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