IBPS PO 2020 Prelims is just 5 days away. We hope that you are preparing for the English Language section with all your means. We strongly encourage you to solve 3-4 topic-wise tests on a daily basis. More importantly, take a while to review your attempts so that you don’t repeat any mistake in the actual examination. Talking about the English Language section of IBPS PO Prelims, vocabulary is something which can always be improved by knowing new words. You never know which difficult word you can encounter in the actual exam.
So it makes all the more sense to be updated on the new words on an ongoing basis. To help you with this, we have been coming up with the analysis of The Hindu Editorial where we analyse the editorial and pick the difficult words/phrases. We put its contextual meaning next to it so that you can understand the word’s meaning as you read the editorial without being interrupting. You don’t have to scout for a dictionary to check the difficult word’s meaning. It’s all there; you just need to read it out.
Let’s have a look at today’s editorial which discusses the Vodafone’s case.
|Difficult Word/Phrase||Contextual Meaning|
|Salutary||(especially with reference to something unwelcome or unpleasant) producing good effects|
|Retrospective legislation||legislation that operates on matters taking place before its enactment, e.g. by penalising conduct that was lawful when it occurred|
|protracted||longer than expected or usual|
|perverse||showing a deliberate and obstinate desire to behave in a way that is unreasonable or unacceptable, often in spite of the consequences|
|fraught||filled with or likely to result in (something undesirable)|
|recourse||a source of help in a difficult situation|
|pyrrhic||won at too great a cost to have been worthwhile for the victor|
|wariness||caution about possible dangers or problems|
Salutary ((especially with reference to something unwelcome or unpleasant) producing good effects) lesson: On the Vodafone case
The Vodafone case shows why India should not undermine the faith of foreign investors
Vodafone Group Plc has won yet another round in its 13-year-long battle with India’s tax authorities. On Friday, an international arbitration tribunal ruled that the Indian government’s efforts to claim more than ₹20,000 crore in tax (including related interest and penalties) from Vodafone using retrospective legislation (legislation that operates on matters taking place before its enactment, e.g. by penalising conduct that was lawful when it occurred) was in clear breach of the ‘fair and equitable treatment’ protections afforded under Article 4(1) of the Bilateral Investment Treaty between India and the Netherlands. The ruling upholding the British multinational’s stand ought to end India’s protracted (longer than expected or usual) and often perverse (showing a deliberate and obstinate desire to behave in a way that is unreasonable or unacceptable, often in spite of the consequences) pursuit of what at the very outset was a highly contentious claim. The dispute began in September 2007 when tax authorities served a demand on Vodafone International Holdings BV for tax that it said Vodafone’s Dutch unit ought to have withheld while acquiring the controlling stake in the erstwhile (former) Hutchison Essar Ltd. from Hutchison Telecommunications International Ltd. Since the stake purchase transaction took place outside India between two overseas entities, Vodafone was emphatic from the start that it was not liable for any tax relating to the deal. Following a setback at the Bombay High Court, Vodafone presented its position to the Supreme Court, which ruled in its favour in 2012. In a move fraught (filled with or likely to result in (something undesirable)) with implications for all its international investment treaties, the government of the day, however, amended the tax legislation to give retrospective effect to its claims. This was the trigger for the U.K.-based company to seek arbitral recourse (a source of help in a difficult situation).
For Vodafone, the legal win is at best a pyrrhic (won at too great a cost to have been worthwhile for the victor) victory. After having spent about $11 billion in 2007 for acquiring the 67% stake in Hutchison Essar, the telecom services provider has struggled with challenges that forced it, in November 2019, to write down the book value of its Indian holdings to zero. While the Indian operation has gained size and market share including through its merger with the erstwhile Idea Cellular — from, respectively, 44 million subscribers in 2007 to 305 million users, and 26.7% at the end of June — there have been continued losses in the face of intense competition and unviable tariffs. Add to the mix the substantial sum of money it owes the government in the form of adjusted gross revenue dues and the future fund requirements of a rapidly technologically evolving and highly capital intensive industry, Vodafone’s wariness (caution about possible dangers or problems) to commit more equity to the Indian venture becomes understandable. The government must not seek to litigate the matter any further. The cost of doing otherwise will surely be bruisingly (hurtfully) high, especially at a time when Prime Minister Narendra Modi spares no opportunity to woo foreign investment. Any failure to learn a salutary lesson from this loss would only serve to undermine overseas investors’ faith in India’s commitment to international treaties and the rule of law.
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