May

• Article 244(A)


  Extends significant powers to the autonomous state, especially in managing law and order, judiciary, and financial resources, offering more extensive governance capabilities than those available under the current Sixth Schedule provisions
• History of the Autonomy Demand


  1. Origins of the Demand: The aspiration for autonomy emerged in the 1950s, driven by movements advocating for a distinct state for the hill regions of Assam

  2. Political Movements: The Autonomous State Demand Committee (ASDC) has been a key player in advocating for constitutional recognition and the subsequent implementation of Article 244(A)

  3. Link to Insurgency: The unresolved issues surrounding autonomy have occasionally led to insurgency, necessitating multiple peace accords with various insurgent groups

  4. Recent Peace Initiatives: Notable peace agreements in 2021 and 2023 have sought to address autonomy demands by promising enhanced powers and development packages

  5. Electoral Context: The complete implementation of Article 244(A) continues to be a pivotal issue in regional politics, prominently featured in electoral promises during the 2024 elections
• Meghalaya was created in 1972 to partly address the demand for a distinct state for the hill regions of Assam
• The 1995 Memorandum of Settlement aimed to expand the powers of the autonomous councils
• The Diphu Lok Sabha constituency covers six Assembly segments across its three tribal-majority hill districts: Karbi Anglong, West Karbi Anglong, and Dima Hasao
• The Sixth Schedule of the Indian Constitution contains provisions for the administration of tribal areas in Assam, Meghalaya, Tripura, and Mizoram, but not Nagalandi
• The Karbi Anglong Autonomous Council (KAAC) and the North Cachar Hills Autonomous Council govern the three tribal-majority hill districts within the Diphu Lok Sabha constituency
• Article 244(A) of the Indian Constitution promises the formation of an autonomous state within Assam
• Consumers act rationally by

  Maximising their utility
• Producers act rationally by


  Selling goods/services in a way that maximises their profits
• Workers act rationally by

  Balancing welfare at work with consideration of both pay and benefits
• Governments act rationally by

  Placing the interests of the people they serve first in order to maximise their welfare
• Rationality in classical economic theory is a flawed assumption as people usually don't act rationally
• Marginal utility


  The additional utility (satisfaction) gained from the consumption of an additional product
• The demand for adding Ladakh to the Sixth Schedule of the Indian Constitution has gained significant support in recent years from various groups within the region
• Ladakh became a Union Territory in August 2019, following the revocation of Article 370, which had previously granted special autonomy to the region
• Sixth Schedule


  Constitutional provisions that allow for the administration of tribal areas in Assam, Meghalaya, Tripura, and Mizoram
• Autonomous District Councils (ADCs)


  • They have the authority to legislate on a range of issues including land, forests, and agriculture
  • They are empowered to establish village courts to resolve minor disputes among the tribal communities
• Ladakh is home to a diverse population of tribal groups, with the majority in Leh being Buddhists and the majority in Kargil being Shia Muslims
• Inclusion of Ladakh under the Sixth Schedule

  It would help preserve and promote the unique social practices and cultural heritage of its tribal groups<|>It would allow for the establishment of local governance structures, providing the people of Ladakh with more power to address local issues effectively
• If Ladakh is included under the Sixth Schedule

  Autonomous District Councils (ADCs) would play a crucial role in local governance
• Role of ADCs


  • They would have the autonomy to develop policies that protect ethnic identities, promote development based on local needs, and manage resources in a sustainable manner
  • It could help reduce fears about the impact of external influences and migration on local culture and traditions, providing a sense of security to the people of Ladakh
• Many tribal communities have complex social structures and rich cultural traditions, despite often being perceived as primitive
• The Indian Constitution recognizes Scheduled Tribes as groups that require special assistance due to their unique social and economic conditions
• Tribal autonomy in other countries

  • United States: Tribal autonomy allows tribes to govern their own lands without interference from external entities
  • Brazil: The Brazilian constitution, recognizing the importance of tribal land rights, has provisions dating back to the 1980s to honor these rights
  • UN Declaration: The UN Declaration on the Rights of Indigenous Peoples recognizes the importance of protecting the rights of indigenous communities
• Asset Reconstruction Companies (ARCs)


  Entities empowered by the SARFAESI Act to manage and resolve distressed assets, helping in the recovery process by purchasing non-performing assets from financial institutions
• New RBI Guidelines for ARCs

  • Increased minimum capital requirement from Rs 100 crore to Rs 300 crore
  • Phased implementation with interim milestone of Rs 200 crore by March 2024
  • Supervisory actions by RBI for non-compliance with new capital thresholds
  • Criteria for ARCs to qualify as resolution applicants in stressed asset resolution process
  • Potential enhancement of investment opportunities for ARCs in distressed assets
• Minimum Capital Requirement


  Robust capital base for ARCs to manage and recover distressed assets effectively
• Phased Implementation of New Capital Requirements

  1. Existing ARCs to reach Rs 200 crore by March 2024

  2. Existing ARCs to fully comply with Rs 300 crore requirement by March 2026
• ARCs fail to meet new capital thresholds

  Supervisory actions by RBI, including restrictions on conducting new business
• New guidelines touch upon the criteria for ARCs to qualify as resolution applicants in the resolution process of stressed assets
• The updated guidelines may introduce or enhance avenues for ARCs to invest in distressed assets under regulated conditions
• Reserve Bank of India (RBI)


  Established in 1935, central bank of India, regulates the issuance of bank notes and maintains reserves to ensure monetary stability
• RBI is fully owned by the Government of India
• RBI's objectives include operating the currency and credit system to the country's advantage, implementing a modern monetary policy framework, and maintaining price stability while considering the objective of growth
• Governance of RBI

  • Managed by a central board of directors
  • Directors appointed by the Government of India for a term of four years
• Corporate tax


  Direct tax collected from companies on their profits
• Indirect taxes


  Taxes collected on consumption, such as union excise duties and Goods and Services Tax (GST)
• There was a 17.7% increase in total direct tax collections in 2023-24, totaling Rs. 19.58 lakh crores
• Personal income tax now constitutes 53.3% of the direct tax collections, up from 50.06% in the previous year