What is the Jan Vishwas Bill, 2023 proposed by Centre? (GS Paper 2, Governance)
Why in news?
- The Jan Vishwas (Amendment of Provisions) Bill, 2023 was passed in Parliament recently.
- Introduced by Commerce and Industry Minister Piyush Goyal, the Bill aims at giving further boost to ease of living and ease of doing business.
- It proposes to amend 183 provisions to be decriminalised in 42 Central Acts administered by 19 Ministries/Departments.
What is the Jan Vishwas Bill about?
- The Jan Vishwas (Amendment of Provisions) Bill, 2022 amends 42 laws, across multiple sectors, including agriculture, environment, and media and publication and health.
- The Bill converts several fines to penalties, meaning that court prosecution is not necessary to administer punishments.
- It also removes imprisonment as a punishment for many offences.
Changes introduced:
- Covered under the Jan Vishwas (Amendment of Provisions) Bill, 2023 are changes in the Drugs and Cosmetics Act, 1940, the Food Safety and Standards Act, 2006 and the Pharmacy Act, 1948.
- This has evoked heated debate about its pros and cons among health care activists, experts in the field of pharmacy and patient-welfare groups.
- Among these, the changes proposed to the Drugs and Cosmetics Act, 1940 have been the most contentious. The Act regulates the import, manufacture, distribution and sale of drugs and cosmetics in the country.
- Currently, the Act defines four categories of offences; adulterated drugs, spurious drugs, mislabelled drugs, and Not of Standard Quality drugs (NSQs) and lays out degrees of punishment (a combination of prison time and fine) based on the degree of offence.
What are the issues in the recent amendments?
- It allows manufacturers of Not of Standard Quality Drugs (NSQ) drugs to escape significant penalties despite the fact that these drugs can have an adverse effect on the patient.
- The bill also reduces penalties for owners of pharmacies who violate the terms of their licence.
- The Indian pharmaceutical sector, manufacturing and pharmacies included, are already subject to extremely lax regulation as evidenced by the explosion of scandals recently across the world linked to ‘Made in India’ medicine.
What is Fitch’s downgrade of U.S. about?
(GS Paper 3, Economy)
Why in news?
- Recently, rating agency Fitch downgraded the United States of America’s (U.S.A.) rating to ‘AA+’ from ‘AAA’, a rating that it had been holding at the agency since 1994.
- This was the first major downgrade for the country since Standard & Poor’s (S&P) actions in 2011.
What is downgrade?
- The rating agencies are institutions that assess the creditworthiness or financial capability of a region, country, its institutions or individual organisations. They assess its ability to meet future payment obligations particularly important for those making investment decisions.
- Fitch rates credit quality from ‘AAA’ (its highest rating) to ‘D’ (lowest rating).
- ‘AAA’ is assigned to entities with “exceptionally strong capacity for payment of financial commitments”.
- The downgrade in discussion, that is ‘AA’, denotes “very low default risk”.
What were Fitch’s concerns?
- There has been a steady deterioration in standards of governance over the last 20 years, including on fiscal and debt matters. This is despite the bipartisan agreement reached in June for suspending the debt limit until January 2025.
- It observed that the “repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.”
- The second of the observations relates to lacking a medium-term fiscal framework, unlike most peers, and having a complex budgeting process.
- These combined with several economic shocks, tax cuts and new spending initiatives has led to successive increases in debt over the last decade.
Future predictions:
- Fitch expects the general government deficit (balance of income and expenditure) to rise to 6.3% of the GDP in 2023 from 3.7% in 2022. This results from cyclically weaker federal revenues, new spending initiatives and a higher interest burden.
- It held that over the next decade, higher interest rates and rising debt would translate to an increased interest service burden.
- Additionally, an ageing population and rising healthcare costs would require more spending on the elderly absent fiscal policy reforms.
- To sum up, increasing national debt and rising interest rates result in interest costs to rise. Other than restricting the scope for investment in priority areas, it creates a potentially unwanted cycle of further borrowing, servicing interest and expanding debt.
- Fitch also projected that tighter credit conditions, weakening business investment and a slowdown in consumption would push the U.S. economy into mild recession in Q4 of 2023 and Q1 of next year. It also sees U.S. annual real GDP growth slowing to 1.2% this year from 2.1% in 2022.
