SBI Current Affairs - 2019

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SBI Ecowrap Report recommends Unconditional Cash Transfer to Farmers

The SBI Ecowrap report recommends the government to opt for the unconditional cash transfer to farmers to alleviate agrarian distress rather than Universal Basic Income (UBI) scheme.

Why does the SBI report recommend unconditional cash transfer?

The report has recommended the unconditional cash transfer based on the following reasons:

  • Currently, it is not feasible to implement Rythu Bandhu Scheme at the national level because the land data is yet to be digitized in several states including Jharkhand, Bihar, Gujarat, and Tamil Nadu.
  • Hence the unconditional cash transfer scheme is a best available option as it will be more equitable (on a per farmer basis) with a meaningful impact and once the problems are ironed out in terms of proper tenancy laws, then it can be made conditional.
  • The report mentions that many countries have found that UBI does not address the structural problems and is at best a solution in interregnum.
  • The report estimates various subsidy benefits the farmers are availing and suggests if a farmer is availing one or all the three modes of subsidy/supports (Crop Insurance, Interest Subsidy and Fertilizer Subsidy) then he/she will receive a minimum of Rs 5,335 to maximum Rs 10,162 per annum as cash support.
  • The report predicts that government would be required to provide cash support in the range of Rs 10,000-12,000 per annum to make it completely cash neutral and the annual cost of such a scheme is Rs 1.2 lakh crore per annum.
  • The challenge of providing cash transfer to tenant transfer would be left unaddressed under this scheme.

The study notes that there have been reports saying that the government is planning to provide direct cash support to the farmers in lieu of various farm level subsidies/support.

SBI to issue and encash electoral bonds soon

The GoI has notified the sale of electoral bond by SBI through its 29 authorized branches from 1.11.2018 to 10.11.2018. 29. These SBI branches are in cities like New Delhi, Gandhinagar, Chandigarh, Bengaluru, Bhopal, Mumbai, Jaipur, Lucknow, Chennai, Kolkata and Guwahati. The concept of electoral bond was initiated in Union Budget 2017.Later on Electoral bond scheme 2018 was introduced.

What is Electoral Bond?

An Electoral Bond is just like a promissory note that will be payable to bearer on demand and free of interest. It can be purchased by a citizen of India or anybody incorporated in India.

Benefits of an Electoral bond
  • Transparent political funding
  • Protecting donors from harassment
  • No disclosure of information to third parties
  • Achieving Digital India vision
  • Bringing donations under tax preview

Electoral Bonds Scheme 2018

The scheme introduced that the a party registered under the Representation of People’s act, 1951 and securing not less than one percent of the votes polled in the preceding election is entitled to receive the electoral bonds. Electoral Bonds may be purchased by only citizen of India. An individual can buy Electoral Bonds, either singly or jointly with other individuals. The bonds can only be encashed by an eligible political party only through a bank account with the authorized bank. Electoral Bonds are valid for fifteen calendar days from the date of issue. If the Electoral Bond is deposited after expiry of the validity period, no payment is made to any Political Party. The Electoral Bond deposited by an eligible Political Party in its account is credited on the same day.  The bonds are issued in multiples of 1000, 10000, 1lakh, 10 lakh, 1 crore. The cash donation has been capped at Rs. 2000 and beyond that donations are via electoral bonds.