News Wrap


In the third week of February, 2018 the Cabinet Committee of Economic Affairs has approved the auctioning of coal mines to any firm, bidding the highest per tonne price, in India. At present, private firms are only allowed to mine coal for their own use in their cement, steel, power and aluminium plants. The government has allowed the private sector to mine coal, and sell it for commercial use, ending state-owned Coal India Limited’s monopoly, in a bid to raise domestic output, and cut imports. The coal sector reform ushers in competition and lower power tariffs, since the nationalisation of the sector in 1973. 70% of India’s electricity is generated by thermal power plants. The Cabinet Committee has approved the methodology for auction of coal mines/blocks for sale of coal under the Coal Mines (Special Provisions) Act, 2015 and the Mines and Minerals (Development and Regulation) Act, 1957. The entire revenue from the auction of coal mines for sale of coal would accrue to the coal bearing states. The new methodology will encourage the states with the new revenues.

Unregulated Deposits
The Banning of Unregulated Deposit Schemes Bill, 2018 provides a comprehensive legislation to deal with the menace of illicit deposit schemes in India, through complete prohibition of unregulated deposit taking activity, deterrent punishment for promoting or operating an unregulated deposit taking scheme, and stringent punishment for fraudulent default in repayment to depositors. The Chit Fund (Amendment) Bill, 2018, is designed to facilitate orderly growth of the chit funds sector, and remove bottlenecks being faced by the chit funds industry, thereby enabling greater access of people to their financial products. The Bill seeks to ban Ponzi Schemes, such as those run by Saradha, and imprison up to ten years collectors of unregulated deposits. Timelines have been provided for attachment of property, and restitution to depositors. The deposit bill will make unregulated deposit collection an ‘‘exante’’ (before the event) offence. The regulatory framework initiates action in the present system, only ‘‘ex-post’’ (after the event).

Black Money
5% of the world’s GDP is laundered black money, as per estimates of the International Monetary Fund. Only 1% of it is ever identified. Trillion dollars of illicit black money is being pulled out of developing countries every year. Indians’ hoard abroad is $2 trillion, which potentially could have netted a tax revenue of $600 million, six times the amount the Union Government will borrow, to meet expenses in 2018-19. The looted funds are put to lucrative and purposeful use. There are nearly 4000 incorporation agents and international enablers, who provide one-touch, lightening speed transfer of funds. Black money is being stored in reliable hands, viz Barclays, Deutche Bank and HSBC. Rebranded as foreign money, the black money can re-enter the homeland easily, to fund political campaigns, buy opulent real estate, and lubricate business transactions. Globalisation and the worldwide capital market facilitate the setting up of an initial company, with a good off-shore bank in Cyprus, Gibralter, Guersey, Switzerland, the Bahamas, and Virgin Islands. Shell companies are not real companies. Such corporate entities have ownership carefully guarded to withstand identification of the owner or his source of funds, either in his country, or where the money is stashed. More than Rs 1.1 lac crore was owed to banks by people or companies, characterised as ‘‘wilful defaulters’’ that is defaulters unwilling to pay, despite having the capacity.

Killing Sohrabuddin
On 26 November 2005, a Gujarat police team shot Sohrabuddin Sheikh. He was cornered by a police party on a highway near Ahmedabad, who claim that he was a terrorist. He was no terrorist, but part of a criminal gang who ran an extortion racket in Rajasthan. Certain police officers and politicians patronised him. Immediately prior to his death, Sohrabuddin, his wife Kausar-bi, and an associate Tulsiram Prajapati were travelling from Hyderabad to Sangli in a bus. A team of Gujarat police inter-cepted the bus, and pulled them out. Prajapati was handed over to the Rajasthan police, while the Sheikh couple was kept in separate farm houses in Gujarat. Four days later, Sohrabuddin was killed in a staged encounter. Kausar-bi was an eye witness to the abduction of Sohrabuddin. She was eliminated by alleged accused persons, and her body was burnt in village Illol. The Central Bureau of Investigation chargesheet has enumerated details of the modus operandi. The other witness Tulsiram Prajapati was brought from Udaipur jail to Ahmedabad in late December 2016, and on 28 December 2006, was killed by the Gujarat police on a highway, near the Gujarat-Rajasthan border. Amit Shah and several police officers were eventually charged as accused in the extra-judicial killings, and sent to jail. The trial took a new turn after the BJP came to power in May 2014. Amit Shah was appointed BJP party chief two months later, and was scheduled for appearance in the special CBI court on 26 June 2014. On 25 June 2014, Utpat was transferred to another court, even though the Supreme Court had said that the same judge should hear the case from beginning to end.

Judge Brijgopal Harkishan Loya was appointed the judge in the special CBI court. Loya too, asked Amit Shah’s counsed to ensure Shah’s appearance on 15 December 2014. On 01 December 2014, judge Loya passed away in Nagpur, where he had gone to attend a wedding. The third judge hearing the case, MB Gosavi, discharged Amit Shah from the fake encounter case. Loya was facing tremendous pressure. The body of lawyer friend Shrikant Khandalkar was found in the premises of Nagpur district court on 29 November 2015. Another friend, retired district judge met ‘‘accidental’’ death in March 2016, when he broke his spine apparently falling from the upper berth of a train. On 1 January 2008, iron rods smashed the office of another friendly lawyer, Satish

Political Union in Nepal
In December 2017 elections in Nepal, the Left Alliance of the CPN-UML led by prime minister K P Sharma Oli and CPN-Maoist Centre led by former premier Prachanda, had secured 174 seats in the 275-member parliament. The provincial and parliamentary polls led to the UML winning 121 seats, while the Maoist centre securing 53 seats in parliament. The two parties had secured a comfortable majority in six of the seven provinces. Nepal adopted in 2015, a new constitution that split the country into two provinces. In the third week of February 2018, Nepal’s two main communist parties CPN-UML and CPN-Maoist centre struck a huge merger deal, and formed Nepal’s biggest political bloc. Top leaders of the two communist allies officially approved the ‘‘Left Unity’’ deal, agreeing in principle on party leadership, organisation and ideology. The deal, brokered through a series of negotiations, since the two-sides reached an understanding on merger in October 2017, has confirmed the biggest political union in Nepal’s history. Nepal’s first and third largest parties are converted into a single political entity, just 10 short of two-thirds majority.

Vol. 50, No.45, May 13 - 19, 2018