5 Stories for Today

(1) Ministry approves higher allocation for RTE Act

The Centre has revised the financial allocation under the Right of Children to Free and Compulsory Education Act over the next five years. As against the Rs.1,71,000 crore suggested earlier, the Finance Ministry has now approved an allocation for Rs.2,31,000 crore.

The Expenditure Finance Committee (EFC) under the Finance Ministry has also agreed to increase the Centre's share effectively to 68 per cent and reduce the State share to 32 per cent for implementing the Right to Education (RTE) Act, which makes elementary education compulsory for children in the age groups of six to 14 years.

The total outlay approved by the EFC includes Rs.24,000 crore allocated to the States by the 13th Finance Commission. The Centre's share of this amount will be at 65 per cent and that of the States at 35 per cent. However, when the Rs.24,000 crore awarded by the Commission is taken into account, the Centre's share effectively works out to 68 per cent, while that of the States' is 32 per cent.

State governments had been demanding a higher share from the Centre while expressing their inability to implement the Act. The higher allocation of Rs.2,31,000 crore was required on account of the cost of harmonising the Sarva Shiksha Abhiyan (SSA) with RTE norms.

The National University of Educational Planning and Administration initially estimated that the requirement of funds for implementing the RTE Act over five years would be Rs.1,71,000 crore.

The RTE Act requires primary classes to have a pupil-teacher ratio of 1:30 and upper primary classes a ratio of 1:35, against the SSA ratio of 1:40. The Act also has the norm of one classroom per teacher, which increases the number of classrooms and teachers required, and implementing these norms would increase fund requirement.

The EFC gave its seal of approval to providing a one-time grant to help States ensure that all primary schools have five grades — classes one to five — and upper primary, classes six to eight.

Financial support will also be provided for residential schools in thinly populated areas and urban centres, where the focus would be on street children and migrants' children. In sparsely populated areas, support will also be provided for transport systems for students.

(2) FBI access to e-mail and Web records raises fears

Invasion of privacy could be there in the Internet age, expanding the reach of law enforcement to snoop on e—mail traffic or on Web surfing. Those are among the criticisms being aimed at the FBI, as it tries to update a key surveillance law.

With its proposed amendment, is the Obama administration merely clarifying a statute or expanding it? Only time and a suddenly- on- guard Congress will tell.

Federal law requires communications providers to produce records in counterintelligence investigations to the FBI, which doesn’t need a judge’s approval and court order to get them.

They can be obtained merely with the signature of a special agent in charge of any FBI field office and there is no need even for a suspicion of wrongdoing, merely the basis is that the records would be relevant in a counterintelligence or counterterrorism investigation. The person whose records the government wants doesn’t even need to be a suspect.

The bureau’s use of these so—called national security letters to gather information has a checkered history.

The bureau engaged in widespread and serious misuse of its authority to issue the letters, illegally collecting data from Americans and foreigners, the Justice Department’s inspector general concluded in 2007. The bureau issued 192,499 national security letter requests from 2003 to 2006.

Weathering that controversy, the FBI has continued its reliance on the letters to gather information from telephone companies, banks, credit bureaus and other businesses, with personal records about their customers or subscribers, and Internet service providers.

That last source is the focus of the Justice Department’s push to get Congress to modify the law.

The law already requires Internet service providers to produce the records, said Dean Boyd, a spokesman for the Justice Department’s national security division. But he said as written, it also causes confusion and the potential for unnecessary litigation, as some Internet companies have argued that they are not always obligated to comply with the FBI requests.

A key Democrat on Capitol Hill, Senate Judiciary Committee chairman Patrick Leahy of Vermont, wants a timeout.

The administration’s proposal to change the Electronic Communications Privacy Act “raises serious privacy and civil liberties concerns,” Mr. Leahy said in a statement .

“While the government should have the tools that it needs to keep us safe, American citizens should also have protections against improper intrusions into their private electronic communications and online transactions,” said Mr. Leahy, who plans hearings in the fall on this and other issues involving the law.

Critics are lined up in opposition to what the Obama administration wants to do.

“The FBI is playing a shell game,” says Al Gidari, whose clients have included major online companies, wireless service providers and their industry association.

“This is a huge expansion” of the FBI’s authority and burying it this way in the intelligence authorization bill is really intended to bury it from scrutiny,” Mr. Gidari added.

Mr. Boyd said the changes being proposed will not allow the government to obtain or collect new categories of information; rather it simply seeks to clarify what Congress intended when the statute was amended in 1993, he argued.

Critics, however, point to a 2008 opinion by the Justice Department’s Office of Legal Counsel, which found that the FBI’s reach with national security letters extends only as far as getting a person’s name, address, the period in which they were a customer and the numbers dialed on a telephone or to that phone.

The problem the FBI has been having is that some providers, relying on the 2008 Justice opinion, issued during the Bush administration, have refused to turn over Internet records, such as information about persons who have e—mailed others and who have received e—mails from others and information about a person’s Web surfing history.

To deal with the issue, there’s no need to change the law, since the FBI has the authority to obtain the same information with a court order issued under a broad section of the Patriot Act, said Gregory Nojeim, director of the Project on Freedom, Security and Technology at the Centre for Democracy and Technology, a nonprofit Internet privacy group.

The critics say the proposed change would allow the FBI to remove federal judges and courts from scrutiny of its requests for sensitive information.

“The implications of the proposal are that no court is deciding whether even that low standard of ‘relevance’ is met,” said Mr. Nojeim. “The FBI uses national security letters to find not just who is the target of an investigation who has e—mailed, but also who those people are e—mailed.”

(3) Govt. to give state-owned banks Rs. 4,868 cr for cheap farm loans

The government on Friday decided to release Rs. 4,868 crore to public sector lenders for providing concessional loans to farmers.

The decision, taken at a Cabinet meeting, will help lenders provide farmers short-term crop loan at 7 per cent interest.

"The Union Cabinet today gave its approval for the release of Rs. 4,868 crore as interest subvention to Public Sector Banks (PSBs), Regional Rural Banks (RRBs), Cooperative Banks and NABARD for refinance to RRBs at concessional rates to reimburse the amount of interest subvention to ensure that the farmer, in general, should receive short-term crop loan at 7 per cent per annum this fiscal," the government said in a statement.

The lenders would have given loans to farmers at 9 per cent, had the subsidy of 2 per cent not been provided by the government.

The government has, since 2006-07, been subsidising short term crop loans so as to ensure the availability of funds to farmers.

This interest subvention scheme has been continued for 2010-11 for public sector banks, regional rural banks and cooperative banks.

In 2009-10, an additional subvention of one per cent was being provided to farmers who repaid on time.

This has been increased from one per cent in 2009-10 to two per cent in 2010-11. Thus, the effective rate of interest for such farmers will be five per cent per annum.

The banks have been consistently meeting the targets set for agriculture credit flow in the past few years. For 2010-11, the target for agricultural credit flow has been raised to Rs. 3,75,000 crore from Rs. 3,25,000 crore in 2009-10.

(4) Apple is world’s most valuable brand: Forbes

Global technology major Apple tops the Forbes list of the ‘World’s Most Valuable Brands’, ahead of giants Microsoft and Coca Cola.

The Forbes Top 50 list of the world’s most valuable brands, compiled by the magazine, is dominated by 32 U.S. firms.

The top nine brands in the list were from the U.S. No Indian company features in the list.

Tech major Apple, which topped the list, “is a company that has faced setbacks before and bounced back to become the world’s most valuable brand worth $57.4 billion,” Forbes noted.

The magazine further said, “Apple shows just how a brand can survive and thrive even when a parent company stumbles.

Apple’s sales in the late 1990s plummeted 46 per cent over a four-year stretch while the company lost money seven times over eight quarters.”

Interestingly, tech brands accounted for 30 per cent of the top 50 brands, occupying four of the first five places in the Forbes rankings. Financial services and food and beverage firms captured six spots each.

Tech major Apple, which topped the list, is followed by software major Microsoft, with a brand value of $56.6 billion.

Beverage firm Coca Cola was third, with a brand value of $55.4 billion, followed by technology giant IBM, now worth $43 billion and search titan Google, which came fifth in the ranking, with a brand value of $39.7 billion.

Other companies featuring in the top 10 include U.S.-based McDonald’s, General Electric, Marlboro and Intel and Finnish handset maker Nokia at the tenth spot.

“The brands on our list fared a little better, with sales, on average, flat in 2009. Some brands were hit hard by the economic downturn, as well as their own missteps,” Forbes said.

Among the other top 50 brands are Toyota (11), Vodafone (13), Pepsi (24), Nescafe (29), Frito-Lay (38), ESPN (48) and Gucci (50).

(5) Inflation to reach 6 % by Dec

“The Planning Commission's ongoing mid-term appraisal of the XI Plan shows that there has been progress in promoting inclusion,” said the Commission's Deputy Chairman Montek Singh Ahluwalia here on Friday. “Although the data will become available only after two or three years, I can categorically assert that things are getting better, although not as fast as we would have liked,” said Mr. Ahluwalia, while addressing members of the Bangalore Chamber of Industry and Commerce (BCIC).Referring to inflation, which he said was “a current issue of huge interest,” Mr. Ahluwalia said the inflation rate would “be at a more comfortable level of about 6 per cent” by December. He said the employment guarantee programmes have provided relief by “putting more purchasing power in the hands of rural folk.” The lower fiscal deficit, the “series of steps taken by the central bank, and the release of more food grains by the Union Ministry of Civil Supplies are aimed at countering the effects of inflation,” he added.

Mr. Ahluwalia said the agricultural sector was likely to grow at 3-3.5 per cent during the current Plan period, compared to 2 per cent in the X Plan. “Yes, there has been progress, but I would have liked to more,” he said. He pointed out that agricultural growth might be below the target of 4 per cent fixed for the XI Plan. Mr. Ahluwalia said inter-regional disparities had diminished, implying that economic growth was more evenly distributed across States. “Earlier, the so-called BIMARU States (Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh) lagged behind, but now there is growth in these States too,” he said. “The issue,” he said, “is more about regions within States that are lagging behind others.”

“Most of the shortfall in investment in infrastructure is on account of public sector,” he said. He said investments in telecom and pipelines for gas and oil have been above the set targets. The biggest challenge on the infrastructure front, he said, was in raising investment levels from about $500 billion to $1 trillion in the next Plan period. “Coordination between the Centre and the States is the biggest challenge,” he said.

Referring to the Maoist threat, Mr. Ahluwalia said a three-pronged solution was needed. While greater security was needed, this must also be accompanied by establishing institutions of governance and by “actually funding development in these areas.”