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Daily Current Affairs 01.10.2021 (NEET: OCI candidates can appear in general category, 2.Hidden debt rising for partners of China’s BRI plan)

Daily Current Affairs 01.10.2021 (NEET: OCI candidates can appear in general category, 2.Hidden debt rising for partners of China’s BRI plan)

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1.NEET: OCI candidates can appear in general category

Court says they need not be treated on a par with NRIs

The Supreme Court on Thursday permitted Overseas Citizens of India (OCI) candidates to participate in the NEET-UG 2021 counselling in the general category.

A Bench of Justices S. Abdul Nazeer and Krishna Murari was hearing a challenge to a March 4, 2021 notification issued by the Ministry of Home Affairs directing OCI candidates to be treated on a par with Non-Resident Indians (NRIs) for the purpose of NEET. This would mean that successful OCI candidates would have to pay the higher fee paid by NRIs for medical seats in India.

An NRI is an Indian citizen residing abroad. An OCI is a foreign national of Indian origin who is registered as an OCI cardholder under Section 7A of the Citizenship Act.

‘Seats taken away’

The government, represented by Additional Solicitor General Aishwarya Bhati, justified the notification, saying OCIs were “foreigners” who had pledged allegiance to a foreign state. Allowing them to participate in the general category meant taking a chunk of the seats away from young Indian citizens who aspired to study medicine and work as doctors in India. Ms. Bhati said there was a very high possibility that OCIs would use the scarce medical education resources in India and then return to their countries with their degrees.

The court, while appreciating the point made by Ms. Bhati, said the sudden implementation of the March 4 notification, starting with the current academic year itself, was arbitrary.

“We are of the view that at least for the current academic year 2021-2022, the petitioners are entitled to be considered eligible for all the medical seats which the OCIs were eligible for before the issuance of the impugned notification dated March 4, 2021. Therefore, we direct the National Testing Agency to declare the result of the examination taken by the petitioners (NEET-UG 2021) and the eligible petitioners are permitted to appear for the counselling in the general category,” the court directed in its order.

The court, on Ms. Bhati’s insistence, clarified that the order allowing the OCIs to compete in the general category was confined to the 2021-2022 academic year alone. During the hearing, Ms. Bhati said OCIs had voluntarily taken up the citizenship of another country.

Justice Murari observed that the government recognised these people as OCIs and gave them rights. It was now not right on the government’s part to take it away from them all of a sudden.

Overseas Citizenship of India

  • Definition

    • The Ministry of Home Affairs defines an OCI as a person who:
      • Was a citizen of India on or after 26th January 1950; or
      • Was eligible to become a citizen of India on 26th January 1950; or
      • Is a child or grandchild of such a person, among other eligibility criteria.
    • According to Section 7A of the OCI card rules, an applicant is not eligible for the OCI card if he, his parents or grandparents have ever been a citizen of Pakistan or Bangladesh.
    • The category was introduced by the government in 2005. The Government of India via Citizenship (Amendment) Act, 2015 merged the Person of Indian Origin (PIO) category with OCI category in 2015.
  • Benefits to OCI Cardholders
    • OCI cardholders can enter India multiple times, get a multipurpose lifelong visa to visit India, and are exempt from registering with Foreigners Regional Registration Office (FRRO).
    • If an individual is registered as an OCI for a period of five years, he/she is eligible to apply for Indian citizenship.
    • At all Indian international airports, OCI cardholders are provided with special immigration counters.
    • OCI cardholders can open special bank accounts in India, buy the non-farm property and exercise ownership rights and can also apply for a Permanent Account Number (PAN) card.
  • Limitations
    • OCI cardholders do not get voting rights, cannot hold a government job and purchase agricultural or farmland.
    • They cannot travel to restricted areas without government permission.

Constitutional Provisions

  • The Constitution deals with citizenship from Articles 5 to 11 under Part II. However, it contains neither any permanent nor any elaborate provisions in this regard.
  • It only identifies the persons who became citizens of India on 26th January 1950 (i.e. when the Constitution commenced).
  • It empowers the Parliament to enact a law to provide for matters relating to citizenship. Accordingly, the Parliament has enacted the Citizenship Act, 1955, which has been recently amended in 2015.

Person of Indian Origin

  • A Person of Indian Origin (PIO) means a foreign citizen (except a national of Pakistan, Afghanistan, Bangladesh, China, Iran, Bhutan, Sri Lanka and Nepal)
    • Who at any time held an Indian passport or
    • Who or either of their parents/ grandparents/ great grandparents were born and permanently resident in India as defined in Government of India Act, 1935 and other territories that became part of India thereafter or
    • Who is a spouse of a citizen of India or a PIO.
  • PIO category was merged with OCI category in 2015.

2.Hidden debt rising for partners of China’s BRI plan

42 countries now have debt exposure to China in excess of 10% of GDP

A new study has found under-reported debts to the tune of $385 billion in projects carried out in dozens of countries under China’s Belt and Road Initiative (BRI), with a rise in “hidden” debt on account of an increasing number of deals struck not directly between governments but structured through often opaque arrangements with a range of financing institutions.

The study by AidData, a development research lab at the College of William & Mary in the U.S., found that “Chinese debt burdens are substantially larger than research institutions, credit rating agencies, or intergovernmental organisations with surveillance responsibilities previously understood” and “42 countries now have levels of public debt exposure to China in excess of 10% of GDP.”

The total debt, the study added, was “systematically under-reported to the World Bank’s Debtor Reporting System (DRS) because, in many cases, central government institutions in LMICs [low and middle income countries] are not the primary borrowers responsible for repayment”.

It estimated that the average government “is under-reporting its actual and potential repayment obligations to China by an amount that is equivalent to 5.8% of its GDP” and “collectively, these under-reported debts are worth approximately $385 billion.”

The report studied 13,427 projects across 165 countries worth $843 billion, in the time period from 2000 to 2017, and examined how President Xi Jinping’s BRI plan, launched in 2013, has changed China’s overseas lending.

The big difference between China and other prominent sources of overseas financing was that Chinese banks have used “debt rather than aid to establish a dominant position in the international development finance market”. Since the introduction of the BRI, China “maintained a 31- to-1 ratio of loans to grants and a 9-to-1 ratio of Other Official Flows (OOF) to Official Development Assistance (ODA)”, although Chinese agencies sometimes do not differentiate between loans and grants in public statements of financial assistance. The report found the average loan from China has a 4.2% interest rate, a grace period of less than two years, and a maturity length of less than 10 years.

Biggest recipients

From 2000 to 2017, Iraq ($8.5 billion), North Korea ($7.17 billion) and Ethiopia ($6.57) were the biggest recipients of ODA, while Russia ($151.8 billion), Venezuela ($ 81.96 billion) and Angola ($50.47 billion) were the biggest recipients of Chinese loans. India ranked 23rd in the list of top recipients of Chinese loans from 2000 to 2017, receiving $8.86 billion, according to the report.

What has, however, led to many countries, such as Nepal and Sri Lanka in South Asia, turning to Chinese loans at higher interest rates is the lack of financing options elsewhere for infrastructure projects.

This has seen a surge in lending from Chinese institutions over the past two decades. What has changed under the BRI, the study found, was that while earlier most overseas lending involved central government institutions, now nearly 70% of China’s overseas lending is now directed to state-owned companies, state-owned banks, special purpose vehicles, joint ventures, and private sector institutions. These debts “do not appear on government balance sheets in LMICs” although “most of them benefit from explicit or implicit forms of host government liability protection, which has blurred the distinction between private and public debt and introduced major public financial management challenges for LMICs.”

The other change with the BRI is the rising number of “mega projects” (worth $500 million or more), which has prompted Chinese banks to work through lending syndicates and financing arrangements to share the risk. The share of projects thus co-financed accounts for 32%, and is another reason behind the debt being “hidden”.

Scandals, corruption

The report found that Chinese institutions use collateralisation to mitigate risk, for instance with loans collateralised against future commodity export receipts to minimise repayment risk, or later priced at higher interest rates, up to 6%.

The report said 35% of the BRI infrastructure project portfolio has encountered major implementation problems, such as corruption scandals or labour violations, with Pakistan topping the list of countries with the most number of projects hit by scandals and corruption.

This editorial is based on the article ‘Transparency road: on India-China relations’ which appeared in “The Hindu” on 1st May, 2019. The article discusses how India’s relationship with China has played out in the context of the Belt and Road initiative.

India-China relations have always been of interest to the world. Everyone wants to see how these two civilisational giants will behave with one another and what role they will claim for themselves in the future of the world.

The current situation is that both India and China have found themselves with overlapping interests – both geopolitical and economic – and due to this a certain amount of friction exists that periodically either heats up or cools down.

Of the two countries, China seems to be the aggressive one, while India seeks to play by the book in keeping with its long tradition of non-interference and universal peace. Therefore, we need to look for areas in Indian foreign policy where we’ve been successful, where we need to work and most importantly, where we are going to end up if we keep pursuing the current policies.

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