PIB 18th April

Contents

1. Procurement operations of Pulses and Oilseeds at MSP
2. Setting up RE Equipment Manufacturing Park
3. Draft Electricity Act (Amendment) Bill 2020

PROCUREMENT OPERATIONS OF PULSES AND OILSEEDS AT MSP

Focus: GS-III Agriculture

Why in news?

• Government of India through Central Nodal Agencies like NAFED and FCI has been striving to assure better returns for the farmers.
• Procurement of notified commodities at Minimum Support Price (MSP) from the farmers in several States in the Rabi 2020-21 season has started.
• Farmers are being given timely marketing support in the time of lockdown.
• Maximum numbers of farmers are being catered to by observing the guidelines issued to manage the COVID-19 pandemic.

Details

• The procurement of Pulses & Oilseeds at MSP from farmers under the Price Support Scheme (PSS) scheme in Rabi 2020-21 season is currently in progress in Karnataka, Andhra Pradesh, Telangana, Rajasthan, Maharashtra, Uttar Pradesh and Haryana.
• Toor is being procured from farmers by NAFED at MSP under Price Stabilisation Fund (PSF) scheme and also for the buffer stock of pulses.

Minimum Support Price (MSP)

• The minimum support price (MSP) is an agricultural product price set by the government of India to purchase directly from the farmer.
• This rate is to safeguard the farmer to a minimum profit for the harvest, if the open market has lesser price than the cost incurred.
• The MSP helps to incentivize the framers and thus ensures adequate food grains production in the country.
• It gives sufficient remuneration to the farmers, provides food grains supply to buffer stocks and supports the food security programme through PDS and other programmes.
• The minimum support prices are announced by the Government of India at the beginning of the sowing season for certain crops on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).

NAFED

• National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) is an apex organization of marketing cooperatives for agricultural produce in India, under Ministry of Agriculture.
• Aims to promote the trade of agricultural produce and forest resources across the nation.
• It is registered under Multi State Co-operative Societies Act.
• NAFED is now one of the largest procurements as well as marketing agencies for agricultural products in India.
• NAFED is the nodal agency to implement price stabilization measures under “Operation Greens” which aims to double the farmers’ income by 2022.
• NAFED along with FCI with proactive role of state governments also physically procures oilseeds, pulses and copra under the Price Support Scheme (PSS) which in turn is under the umbrella scheme of PM-AASHA.

Price Stabilisation Fund (PSF) scheme

• Price Stabilisation Fund (PSF) refers to any fund constituted for the purpose of containing extreme volatility in prices of selected commodities.
• The amount in the fund is generally utilised for activities aimed at bringing down/up the high/low prices say for instance, procurement of such products and distribution of the same as and when required, so that prices remain in a range.
• The Price Stabilization Fund (PSF) was set up in 2014-15 under the Department of Agriculture, Cooperation & Famers Welfare (DAC&FW) to help regulate the price volatility of important agri-horticultural commodities like onion, potatoes and pulses were also added subsequently.
• PSF Scheme provides for advancing interest free loan to State Governments/Union Territories (UTs) and Central agencies to support their working capital and other expenses they might incur on procurement and distribution interventions for such commodities.
• Procurement of these commodities will be undertaken directly from farmers or farmers’ organizations at farm gate/mandi and made available at a more reasonable price to the consumers. Losses incurred, if any, in the operations will be shared between the Centre and the States.

SETTING UP RE EQUIPMENT MANUFACTURING PARK

Focus: GS-III Industry and Infrastructure

Why in news?

• The Ministry of New and Renewable Energy(MNRE) has initiated action in big way towards setting up new hubs for manufacturing renewable energy equipments in the country to meet both domestic and also cater to global demand.
• With this objective in view, Ministry has written to various State Governments and various Port Authorities to identify land parcels of 50-500 acres for setting up such Parks.

What is the use of such Parks?

• These hubs will manufacture equipments like silicon ingots & wafers, solar cells & modules, wind equipments and ancillary items like back sheet, glass, steel frames, inverters, batteries etc.
• At present, country has around 10 GW of Wind equipment manufacturing capacity.
• In case of Solar Cells and Modules India imports about 85 % from abroad.
• To incentivise domestic manufacturing, Government of India already announced provisions to enable levying of Basic Customs Duty on import of solar cells and modules.

What is the significance now?

• in a time when many companies are planning to shift their manufacturing base from China, it is opportune time for India to bring policy changes for facilitating and catalysing manufacturing in India. The Ministry has also strengthened the clauses in Power Purchase Agreements (PPAs) to boost investor confidence.
• IREDA has brought out a new Scheme for project specific funding to promote RE manufacturing in India.

Renewable energy in India

• Over the years, renewable energy sector in India has emerged as a significant player in the grid connected power generation capacity. It supports the government agenda of sustainable growth, while, emerging as an integral part of the solution to meet the nation’s energy needs and an essential player for energy access.
• Enlarging the scope of the Jawaharlal Nehru National Solar Mission symbolizes both, and indeed encapsulates the vision and ambition for the future. In addition, the launching of Renewable Energy Certificate (REC) mechanism helps in the creation of a Pan-India renewable energy market.

India has an estimated renewable energy potential of about 900 GW from commercially exploitable sources viz. Wind – 102 GW (at 80-meter mast height); Small Hydro – 20 GW; Bioenergy – 25 GW; and 750 GW solar power, assuming 3% wasteland.

DRAFT ELECTRICITY ACT (AMENDMENT) BILL 2020

Focus: GS-III Industry and Infrastructure

Why in news?

• Supply of quality power at affordable prices is essential for sustained growth of the economy of the country. 
• For further development of the power sector, Ministry of Power has issued draft proposal for amendment of Electricity Act, 2003 in the form of draft Electricity Act (Amendment) Bill, 2020 for comments / suggestions from Stakeholders on 17th April 2020.

Major Amendments Proposed:

Viability of Electricity Distribution companies

1. Cost reflective tariffs
2. Direct Benefit transfer

Sanctity of Contracts

1. Establishment of Electricity Contract Enforcement Authority
2. Establishment of adequate Payment Security Mechanism for scheduling of electricity

Strengthening the regulatory regime

1. Strengthening of the Appellate Tribunal (APTEL)
2. Doing away with multiple Selection Committees
3. Higher penalties according to Electricity Act

Renewable and Hydro Energy

1. National Renewable Energy Policy
2. Minimum percentage of purchase of electricity from hydro sources of energy is to be specified by the Commissions
3. Levy penalties for non-fulfilment of obligation to buy electricity from renewable and/or hydro sources of energy

Provisions have been added to facilitate and develop trade in electricity with other countries.

Electricity Act, 2003

• The Electricity Act, 2003 is an Act of the Parliament of India enacted to transform the power sector in India.
• The act covers major issues involving generation, distribution, transmission and trading in power.
• While some of the sections have already been enacted and are yielding benefits, there are a few other sections that are yet to be fully enforced till date.
• The Act delicenses power generation completely (except for all nuclear and hydro-power projects over a certain size). As per the Act, 10 per cent of the power supplied by suppliers and distributors to the consumers has to be generated using renewable and non-conventional sources of energy so that the energy is reliable.
• The Act licenses distribution in rural areas and brings in a licensing regime for distribution in urban areas.
• However, as per the Act, only 16 states in India have notified what constitutes as rural areas and therefore the rural distribution is yet to be freed up in nearly one third of the country.