Daily News Capsules
1. Profits from fraudulent share inflation proceeds of crime: HC
The Delhi High Court has ruled that profits earned from trading shares whose value was artificially inflated through fraud constitute “proceeds of crime” under the Prevention of Money Laundering Act (PMLA) and can therefore be attached by the Enforcement Directorate. A division bench of justices Anil Kshetarpal and Harish Vaidyanathan Shankar delivered the verdict on Monday, setting aside a single judge’s January 2023 ruling that had quashed the ED’s provisional attachment order against Prakash Industries Limited (PIL) and its group company, Prakash Thermal Power Limited — entities caught in the coal block allocation irregularities controversy of 2012. The case stems from PIL’s fraudulent acquisition of the Fatehpur coal block in Chhattisgarh, one of 214 coal blocks whose allocations the Supreme Court cancelled in September 2014 after finding them illegal and arbitrary. According to the ED, PIL had falsely declared to the Bombay Stock Exchange on November 19, 2007, that it had been allocated the coal block—months before the actual allocation was granted on February 6, 2008. This misrepresentation caused PIL’s share price to surge from ₹31 to ₹254.60 between November 2007 and February 2008.
Possible Question
Examine how judicial interpretations of “proceeds of crime” under the PMLA influence corporate accountability and investor confidence in India’s financial markets.
2. NCLAT junks ban on WhatsApp-Metadata sharing, but upholds ₹213 cr fine
The National Company Law Appellate Tribunal (NCLAT) on Tuesday upheld a ₹213.14 crore penalty imposed on WhatsApp and its parent company Meta Platforms Inc for abusing their dominant market position through the messaging platform’s 2021 privacy policy update, but set aside a five-year ban on data sharing for advertising purposes. A bench comprising NCLAT chairperson justice Ashok Bhushan and technical member Arun Baroka at the tribunal’s principal seat in New Delhi agreed with the Competition Commission of India’s findings that WhatsApp’s 2021 privacy update forced users into data sharing across Meta’s platforms. The tribunal found that WhatsApp’s “take-it-or-leave it” policy deprived users of meaningful consent, eroded privacy as an essential aspect of service quality, and created barriers for rival platforms in the online advertising ecosystem, violating Sections 4(2)(a)(i) and 4(2)(c) of the Competition Act. It found no flaw in the CCI’s calculation or methodology, holding that the penalty was justified given the extensive data sharing between WhatsApp and Meta had resulted in “anti-competitive effects” and was “proportionate to the gravity of the abuse”.
Possible Question
Evaluate how India’s competition law framework addresses data-driven monopolies in the digital economy. What reforms are needed to reconcile privacy protection with innovation and consumer welfare?
3. US govt shutdown in 35th day, tied for longest in history
The US government shutdown entered its 35th day on Tuesday, matching a record set during President Donald Trump’s first term, as lawmakers voiced optimism over progress behind the scenes to end the dispute. The federal closure appears almost certain to become the longest in history, with no major breakthroughs expected before it goes into its sixth week at midnight — although there were fragile signs in Congress that an off-ramp is closer than ever. The government has been grinding to a halt since Congress failed to approve funding past September 30, and pain has been mounting as programmes, including food aid relied on by millions of Americans, hang in limbo. Some 1.4 million federal workers — from air traffic controllers to park wardens — have been placed on enforced leave without pay or made to work for nothing, while vital welfare programmes and even paychecks for active duty troops are under threat. But both sides remain dug in over the main sticking point — health care spending. Democrats say they will only provide votes to end the funding lapse after a deal has been struck to extend expiring insurance subsidies that make health care affordable for millions of Americans. But Republicans insist they will only address health care once Democrats have voted to switch the lights back on in Washington.
Possible Question
Discuss how political polarisation and fiscal gridlocks affect the functioning of democratic institutions. How is the Indian system different from the US one, and what are the comparative advantages and disadvantages?
4. NE leaders announce new political party
Meghalaya Chief Minister Conrad Sangma, and leaders from Assam, Tripura and Nagaland announced the formation of a new and yet-to-be-named political party Monday to protect the “rights of indigenous people”. The formation of the outfit was announced by Sangma, who is also the National People’s Party leader, TIPRA Motha leader Pradyot Manikya, former Bharatiya Janata Party (BJP) spokesperson Mmhonlumo Kikon and Daniel Langthasa from the People’s Party, Assam. Sangma’s NPP is an ally of the BJP as is the TIPRA Motha. Addressing media in Delhi, Sangma said a committee has been set up to draw up the contours of the party, including its constitution and the symbol. “The joint committee will furnish details of the new outfit and the modalities will be announced in the next 45 days. We are not here to fight with anyone, we are trying to create a platform for what the Northeast today needs…The interest of our people is driving us.” he said. Sangma added that the new party will be an amalgamation of their respective parties. “Our parties are going to merge and become one political entity at the right time.” Responding to a question on whether the new party will be an ally of mainstream parties, Sangma said it would be a voice for the people of the Northeast and will contest the elections on its own.
Possible Question
Analyse the implications of regional political consolidation in the Northeast for India’s federal structure. How can such formations strengthen local governance while ensuring national cohesion?
5. Flying cars? Chinese firm starts trial production ahead of Tesla
Chinese firm Xpeng Aeroht this week began trial production of flying cars — stated to be the next-generation in the world of transportation — at the world’s first intelligent factory for mass-produced flying cars. The plant has rolled out the first detachable electric aircraft of its modular flying car, the ‘Land Aircraft Carrier’, Xinhua reported. Xpeng said it has secured orders for nearly 5,000 flying cars since its product release, and mass production and delivery are scheduled in 2026. The flying car comprises a six-wheel ground vehicle, referred to as the ‘mothership’, and a detachable electric vertical take-off and landing (eVTOL) aircraft. Xepeng’s eVTOL cars offer both automatic and manual flight modes. Its automatic mode enables smart route planning, as well as one touch take-off and landing. At 5.5m in length, the vehicle can be driven on public roads with a standard licence and parked in regular spaces, the Xinhua report said. Meanwhile, Tesla CEO Elon Musk said on Monday that his firm is getting closer to building a flying car. “We’re getting close to demonstrating the prototype,” Musk said.
Possible Question
Can emerging technologies such as eVTOL and autonomous systems change the transportation landscape? What can policymakers do to balance innovation with airspace safety and environmental sustainability?
Editorial Snapshots
A. Rethinking nuclear tests
US President Donald Trump’s remark expressing intent to resume testing of nuclear weapons after a gap of at least three decades, citing secret testing by China, Russia, North Korea, and Pakistan, has reopened a debate on such tests and the effectiveness of the 1996 Comprehensive Nuclear Test Ban Treaty (CTBT). It has also been perceived in some quarters as bordering on the irresponsible. Since the CTBT came into force, only India, Pakistan and North Korea — which have not signed on to the treaty — have conducted tests. The US last tested nuclear weapons in 1992, China and France in 1996, and the Soviet Union in 1990, though Russian President Vladimir Putin spoke in 2023 about the possibility of resuming nuclear tests. The US has never ratified CTBT, while Russia revoked its ratification in 2023, leaving the treaty ineffectual at a time when Cold War-era arms control mechanisms have been repeatedly diluted by Moscow and Washington. If Trump’s move provokes the start of testing by China and Pakistan, India will need to rethink its own self-imposed moratorium put in place after the nuclear tests of 1998. China and Pakistan have expanded their nuclear arsenals, forcing India to keep pace with the rapidly growing number of warheads in its neighbourhood. The main purpose of testing is validating design of weapons and calibrating them, especially given the transition to a new generation of tactical devices and miniaturised warheads. These were developed amid the worldwide moratorium, leading to discussions even within India about the need to keep the door open for tests to validate their reliability. The international framework that controlled testing was a deeply discriminatory framework imposed by the West after it had acquired a substantial stockpile, to prevent countries such as India from becoming nuclear powers, but any new round of nuclear tests will lead to its collapse. Trump’s policy pivot may help give the push for a new regime to replace the CTBT but it could also kickstart a new nuclear arms race. India must be prepared for all options.
Possible Question:
Evaluate the strategic options available to India in maintaining credible minimum deterrence amid renewed global nuclear testing. How can India balance technological modernisation with its commitment to non-proliferation norms?
B. G2 is a duopoly the world doesn’t need
President Donald Trump has promoted the concept of a G2 — a grouping of the US and China — since his recent meeting with Chinese President Xi Jinping, describing it as a force for everlasting peace and success. US Defence Secretary Pete Hegseth, one of Trump’s key acolytes, and his Chinese counterpart, Admiral Dong Jun, agreed at a subsequent meeting to set up military-to-military channels to de-conflict and de-escalate problems between the US and China. Beijing, in its first formal response, has spoken about continuing to practise true multilateralism and working with other countries to uphold the multilateral trading system, the UN Charter, and the norms of international ties. The era of the Cold War had seen a different G2 — the US and the erstwhile Soviet Union — and nations were forced to align with one of the two blocs. India and other players from what is today seen as the Global South came up with non-alignment and picked issues, rather than countries, to back until 1971, when New Delhi shifted to the Soviet side without joining the bloc per se. This time, considering the lingering tensions with China, India will need to walk the strategic tightrope, while emphasising multipolarity and strategic autonomy, and building parallel partnerships with neighbours and others in the Global South. India can ill afford any strategic alignments that enhance China’s position, and it should stay away from any talk of a G2 without adopting adversarial positions towards either Washington or Beijing. If this emerging duopoly takes shape, India will, perforce, have to double down on working closely with Russia, Japan, Germany, France, Brazil, South Africa, Vietnam and the European Union, all of whom face the risk of being seen as secondary powers.
Possible Question
Critically examine India’s diplomatic strategy in an emerging bipolar world order. How can New Delhi leverage its partnerships to advance a multipolar global governance framework while preserving strategic autonomy?
Fact of the day
Manufacturing activity revives in October on strong demand: India’s manufacturing activity, as measured by the HSBC India Manufacturing Purchasing Managers’ Index (PMI), rose to 59.2 in October from 57.7 in September, according to a release from S&P Global on Monday. A PMI reading above the 50-mark indicates expansion over the previous month. The index has remained above 50 for over four years now. The PMI reading for October was also higher than the flash PMI reading of 58.4 that was released last month. Flash PMI readings include 80-90% of the responses that go in the final PMI reading. “India’s manufacturing PMI accelerated to 59.2 in October, up from 57.7 during the month prior. Robust end-demand fuelled expansions in output, new orders, and job creation,” said Pranjul Bhandari, Chief India Economist at HSBC. Growth in new orders helped boost output, as per the release. New orders increased at a quicker pace than in September, and the rate of growth in output was the same as in August, which is the highest in five years. The increase in sales growth in October was mostly due to domestic demand. Growth in international demand was the slowest in the current calendar year. Input costs rose slowly in October, relieving cost pressures for manufacturers.
