CONTENTS:
- Supreme Court On Same Sex marriages
- Role of Banks in a Knowledge Economy
Supreme Court On Same Sex Marriages
Context:
The recent decision by the Supreme Court of India not to grant legal recognition to same-sex marriages represents a significant legal setback for the queer community in the country. Despite the advancements in law and the evolving understanding of individual rights in recent years, there was widespread anticipation that the five-judge Constitution Bench would interpret the Special Marriage Act (SMA) in a gender-neutral manner, thereby allowing individuals of the same sex to marry.
Relevance:
GS 2-
- Issues Related to Transgenders
- Welfare Schemes
- Gender
- Government Policies & Interventions
Mains Question:
The recent decision by the Supreme Court of India not to grant legal recognition to same-sex marriages represents a significant legal setback for the queer community in the country. Elucidate. (15 marks, 250 words).
More on the Judgement:
- Chief Justice of India D.Y. Chandrachud and Justice Sanjay Kishan Kaul acknowledged the right of queer couples to seek recognition for their unions but refrained from altering the provisions of the SMA to that effect.
- On the other hand, Justices S. Ravindra Bhat, Hima Kohli, and P.S. Narasimha held that any recognition for such unions should be based solely on statute, endorsing the government’s perspective that legalizing same-sex marriages falls within the legislative domain.
Implications of the judgement:
- By asserting that there is no fundamental right to marry, the court has contradicted expectations that it would not tolerate discrimination against same-sex couples in the realm of marriage.
- While marriage is acknowledged as a social institution with legal requirements, the court views the right to seek social and legal validation through marriage as subject to statutory limitations.
- The majority stance is against the idea that queer couples have the right to adopt children, but it aligns with the minority position that there is no prohibition on transpersons entering into heterosexual marriages.
- The judges unanimously agree on the right of same-sex couples to cohabit freely without coercion or threats.
- Given potential opposition to the legalization of same-sex marriages on religious and cultural grounds in large sections of India, the likelihood of Parliament taking the initiative for such legislation appears dim.
Conclusion:
Consequently, the LGBTQIA+ community may find solace in the court’s directive for the government to establish a committee to determine the rights and entitlements of queer couples. Nevertheless, the community faces an ongoing struggle for legal equality, as the law is yet to catch up with their aspirations.
Role of Banks in a Knowledge Economy
Context:
Intellectual property (IP)-based debt financing presents a significant opportunity for Indian banks to expand their balance sheets and increase their interest income. Recognizing the crucial role of IP rights in propelling India towards its goal of becoming a developed economy, the country, with its emphasis on knowledge and innovation, stands at an advantageous position.
Relevance:
GS3-
- Economy- Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment.
- Science and Technology- Issues relating to Intellectual Property Rights
Mains Question:
Utilizing intellectual property (IP) for debt financing offers a substantial chance for Indian banks to enlarge their financial portfolios and boost their interest earnings. Analyse. (15 marks, 250 words).
Status of IP assets in India:
- IP assets can be broadly categorized into industrial property (patents, trademarks, industrial designs, and geographical indications) and copyright (related to literary works, films, music, artistic works, and architectural design).
- Currently, India ranks as the world’s second-largest start-up hub, with a substantial number of start-ups possessing at least one IP asset.
Issues related to IP in India:
- Unlike industrialized economies, where IP is considered an asset class, India faces challenges due to the absence of advanced IP-related infrastructure and market inefficiencies.
- Debt funding for start-ups has been limited in India, primarily because of the lack of tangible assets as collateral for innovation-driven firms.
- The current geopolitical situation has exacerbated the funding crunch, compelling businesses to seek alternative funding sources.
- Debt financing, which allows firms to raise capital without diluting ownership, remains underutilized in India, constituting only 4.8% of start-up funding.
Way Forward:
- IP-based debt financing emerges as an untapped funding source for Indian start-ups.
- While various government schemes and initiatives promote start-ups, the potential of IP as collateral for debt financing remains largely unrealized.
- Although IP has been recognized as collateral by banks since 2002, concerns over IP valuation expertise, risk aversion, and the absence of a centralized valuation mechanism hinder its widespread adoption.
- To address these challenges, there is a need for the development of a value-enhancer instrument, such as insurance, for IPs. This would provide lenders with an insured value for intangible asset collateral, ensuring a guaranteed amount in case of foreclosure.
- Establishing necessary infrastructure for IP creation, maintenance, and valuation, along with the development of a liquid secondary market for IPs, would contribute to reducing credit risk and making IP-based collaterals more marketable.
Conclusion:
IP-based debt financing represents a promising avenue for Indian banks, requiring the development of supportive infrastructure, risk mitigation measures, and a regulatory framework to fully unlock its potential and contribute to the growth of innovative start-ups.
