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States and State Legislatures

Government of Karnataka’s response to the COVID-19 pandemic (Feb 2020–April 14, 2020)

Prachi Kaur - April 15, 2020

As of April 13, 2020, there have been 260 confirmed cases of COVID-19 in Karnataka.  Of these, 70 have been discharged and 10 have died.[1]  In order to contain the spread of the disease, both, the Central and State governments have come up with a series of policy responses.  In this blog, we take a look at the key measures taken by the Government of Karnataka in this regard as of April 14, 2020.

Movement restrictions

To contain the spread of COVID-19 in the state, the Government of Karnataka took the following measures to restrict the movement of people in the state:
 

  • On March 13, the Directorate of Health and Family Welfare ordered the closure of various establishments such as theatres, pubs, gyms, malls, swimming pools, and educational institutions until March 21.  The order also directed all international passenger arrivals to be mandatorily home quarantined for 14 days.[2]
     
  • On March 20, the above order was revised to extend the closure of said establishments until April 1.  The order also banned all religious gatherings.[3]
     
  • Further, on March 23, all bus services to and from the nine districts that had reported COVID-19 positive cases were completely stopped until April 1.[4]
     
  • The central government later announced a 21-day country-wide lockdown starting March 25.[5] This was followed by the announcement of a pass system by the Bengaluru Commissioner of Police on March 25 to regulate the movement of people in Bengaluru City.[6]
     
  • On April 6, District Collectors were empowered to issue inter-district transport passes.[7]
     
  • On April 14, the Prime Minister announced the extension of the lockdown till May 3, 2020.[8] On April 15, the Ministry of Home Affairs issued guidelines on the measures to be taken by governments until May 3. As per these guidelines, to mitigate hardship to the public, select activities will be permitted from April 20 onwards. These include health services, agriculture and related activities, financial sector, MNREGA works, cargo movement etc. In addition, subject to conditions, commercial and private establishments, industrial establishments, government offices, construction activities etc, will also be permitted.[9]

Essential Goods and Services

  • The pass system in Bengaluru City facilitated the movement of personnel involved in manufacturing and providing essential goods and services. 
     
  • On April 2, the government announced that it will distribute the excess stock of milk to poor people for free.[10]
     
  • On April 6, the government declared that rations for the month of April will be supplied to people without the usual OTP authentication process.[11]

Health Measures

Karnataka Epidemic Disease COVID-19 Regulations 2020

On March 11, 2020, the government released the Karnataka Epidemic Disease COVID-19 Regulations 2020 to prevent the spread of COVID19 in the state.  These regulations specify the protocol for hospitals to follow for screening and treating COVID-19 patients. These regulations are valid for one year.[12]

Preventive measures

On February 5, 2020, the Department of Health & Family Welfare and AYUSH services issued the Terms of Reference for district-level teams to take preventive measures against the spread of COVID-19.[13] The terms relate to various administrative and complementary aspects related to COVID19 management. These include activities of various teams, human resource management, training and awareness generation etc.

Following this, on April 6, 2020, the Department also issued instructions to all districts to prepare a District Level Crisis Management Plan to prevent large outbreaks of COVID-19.[14]

Setting up of fever clinics, isolation centres etc

On March 4, the state government issued guidelines to the district administration to ensure hospitals maintain a 10-bed isolation ward for COVID-19 patients.[15]  

On March 31, the government issued orders to establish fever clinics as the first points of contact for COVID-19 suspect patients.  These fever clinics would have COVID-19 Rapid Response team of one doctor, two nurses and a health care worker.[16]

Personnel measures

On March 30, the Department of Health & Family Welfare invited applications from doctors for immediate appointment (on contract basis) in Urban Primary Health Centres in Bengaluru City.[17]  Subsequently, on April 2, the state government issued orders to extend the tenure of retiring medical professionals from March 31, 2020 to June 30, 2020.[18]

On March 26, all Registered Medical Practitioners were permitted to provide telemedicine services during the lockdown period. Telemedicine services will be available for minor, non-COVID-19 ailments, and  existing patients only.[19]

For more information on the spread of COVID-19 and the central and state government response to the pandemic, please see here.

[1] Novel Coronavirus (COVID19) Media Bulletin, Karnataka, Department of Health and Family Welfare, last accessed on April 15, 2020, https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/14-04-2020(English).pdf

[2] GOK order No. DD/SSU/COVID-19/17/19-20, Directorate of Health and Family Welfare, Government of Karnataka, March 13, 2020, 

https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Notification(Covid-19)-Dir-HFWS.pdf

[3] Revised GOK order No. DD/SSU/COVID-19/17/19-20, Directorate of Health and Family Welfare, Government of Karnataka, March 20, 2020  https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Revised-Order-COVID-19(20-03-2020).pdf

[4] Order No. STA-6/SCP/PR-20/2019-20, Directorate of Transport, Government of Karnataka, March 23, 2020, https://transport.karnataka.gov.in/storage/pdf-files/restrictions.pdf

[5] Order No. 1-29/2020-PP, National Disaster Management Authority, March 24, 2020, https://mha.gov.in/sites/default/files/ndma%20order%20copy.pdf.

[6] Order No.02 / CP-BLR/Covid-19/2020, Commissioner of Police, Bengaluru City, March 25, 2020, https://karnataka.gov.in/storage/pdf-files/covid_rules/Covid_pass.pdf

[7] Order of Chief Secretary, Government of Karnataka, April 6, 2020, https://ksuwssb.karnataka.gov.in/frontend/opt1/images/covid/Orders/IMG-20200406-WA0005.jpg

[8] “PM addresses the nation for 4th time in 4 Weeks in India’s fight against COVID-19” Press Release, Prime Minister’s office, April 14, 2020, https://pib.gov.in/PressReleseDetail.aspx?PRID=1614255

[9] No.40-3/2020-DM-I(A), Ministry of Home Affairs, April 15, 2020, https://www.mha.gov.in/sites/default/files/MHA%20order%20dt%2015.04.2020%2C%20with%20Revised%20Consolidated%20Guidelines_compressed%20%283%29.pdf

[10] Proceedings,  Government of Karnataka, April 2, 2020, ,https://ksuwssb.karnataka.gov.in/frontend/opt1/images/covid/Orders/GO%20Free%20Milk%20%20(1).pdf

[11] RD 158 TNR 2020, Government of Karnataka, April 6, 2020, https://ksuwssb.karnataka.gov.in/frontend/opt1/images/covid/Orders/IMG-20200406-WA0015.jpg

[12]Karnataka Epidemic Disease COVID-19 Regulations 2020, Government of Karnataka, March 11, 2020,  https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Exercise-of-Powers-COVID-10(11-03-2020).pdf

[13] No. JRO(1A)/148/2019-20, Department of Health & Family Welfare and AYUSH Services Government of Karnataka, February 5, 2020, https://ksuwssb.karnataka.gov.in/frontend/opt1/images/covid/Circulars/%E0%B2%B8%E0%B3%81%E0%B2%A4%E0%B3%8D%E0%B2%A4%E0%B3%8B%E0%B2%B2%E0%B3%86%20%E0%B3%A8%E0%B3%AA.pdf  

[14]No. HFW 87 ACS 2020 Department of Health & Family Welfare and Medical Education, April 6, 2020, https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Circular-Preparation%20of%20District%20Level%20Crisis%20Management%20Plan%20for%20COVID-19(06-04-2020).pdf

[15]Circular No. HFW 47 CGM 2020 (P), Government of Karnataka, March 3, 2020,   https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Guidelines-Isolation-Ward.pdf

[16]No. HFW 73 ACS 2020, Government of Karnataka, March 31, 2020,    https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Circular-Establishment%20of%20Fever%20Clinic%20and%20Movement%20Protocol%20for%20Suspect%20Cases%20of%20COVID-19(31-03-2020).pdf

[17]No. HFW 71 ACS 2020, Department of Health & Family Welfare and Medical Education, March 30, 2020, https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Order%20-%20Immidiate%20Appointment%20of%20Contract%20Doctors%20in%20BBMP%20(30-03-2020).pdf

[18] No. 40 HSH 2020 (B), Government of Karnataka, April 2, 2020, https://ksuwssb.karnataka.gov.in/frontend/opt1/images/covid/Circulars/Extension%20of%20service%20reg_001.pdf

[19]No. HFW 54 CGM 2020, Government of Karnataka, March 26, 2020,        https://karunadu.karnataka.gov.in/hfw/kannada/nCovDocs/Order-Registered%20Medical%20Practitioners%20(26-03-2020).pdf

Legislation

The Insolvency and Bankruptcy Code: All you need to know

Aravind Gayam - May 10, 2016

The Insolvency and Bankruptcy Code, 2016 is listed for passage in Rajya Sabha today.  Last week, Lok Sabha passed the Code with changes recommended by the Joint Parliamentary Committee that examined the Code.[1],[2]  We present answers to some of the frequently asked questions in relation to the Insolvency and Bankruptcy Code, 2016. Why do we need a new law?Time resolve insolvency1 As of 2015, insolvency resolution in India took 4.3 years on an average.  This is higher when compared to other countries such as United Kingdom (1 year) and United States of America (1.5 years).  Figure 1 provides a comparison of the time to resolve insolvency for various countries.  These delays are caused due to time taken to resolve cases in courts, and confusion due to a lack of clarity about the current bankruptcy framework. What does the current Code aim to do? The 2016 Code applies to companies and individuals.  It provides for a time-bound process to resolve insolvency.  When a default in repayment occurs, creditors gain control over debtor’s assets and must take decisions to resolve insolvency within a 180-day period.  To ensure an uninterrupted resolution process, the Code also provides immunity to debtors from resolution claims of creditors during this period. The Code also consolidates provisions of the current legislative framework to form a common forum for debtors and creditors of all classes to resolve insolvency. Who facilitates the insolvency resolution under the Code? The Code creates various institutions to facilitate resolution of insolvency.  These are as follows:

  • Insolvency Professionals: A specialised cadre of licensed professionals is proposed to be created. These professionals will administer the resolution process, manage the assets of the debtor, and provide information for creditors to assist them in decision making.
  • Insolvency Professional Agencies: The insolvency professionals will be registered with insolvency professional agencies. The agencies conduct examinations to certify the insolvency professionals and enforce a code of conduct for their performance.
  • Information Utilities: Creditors will report financial information of the debt owed to them by the debtor. Such information will include records of debt, liabilities and defaults.
  • Adjudicating authorities: The proceedings of the resolution process will be adjudicated by the National Companies Law Tribunal (NCLT), for companies; and the Debt Recovery Tribunal (DRT), for individuals. The duties of the authorities will include approval to initiate the resolution process, appoint the insolvency professional, and approve the final decision of creditors.
  • Insolvency and Bankruptcy Board: The Board will regulate insolvency professionals, insolvency professional agencies and information utilities set up under the Code.  The Board will consist of representatives of Reserve Bank of India, and the Ministries of Finance, Corporate Affairs and Law.

What is the procedure to resolve insolvency in the Code? The Code proposes the following steps to resolve insolvency:

  • Initiation: When a default occurs, the resolution process may be initiated by the debtor or creditor. The insolvency professional administers the process.  The professional provides financial information of the debtor from the information utilities to the creditor and manage the debtor’s assets.  This process lasts for 180 days and any legal action against the debtor is prohibited during this period.
  • Decision to resolve insolvency: A committee consisting of the financial creditors who lent money to the debtor will be formed by the insolvency professional. The creditors committee will take a decision regarding the future of the outstanding debt owed to them.  They may choose to revive the debt owed to them by changing the repayment schedule, or sell (liquidate) the assets of the debtor to repay the debts owed to them.  If a decision is not taken in 180 days, the debtor’s assets go into liquidation.
  • Liquidation: If the debtor goes into liquidation, an insolvency professional administers the liquidation process. Proceeds from the sale of the debtor’s assets are distributed in the following order of precedence: i) insolvency resolution costs, including the remuneration to the insolvency professional, ii) secured creditors, whose loans are backed by collateral, dues to workers, other employees, iii) unsecured creditors, iv) dues to government, v) priority shareholders and vi) equity shareholders.

What are some issues in the Code that require consideration?

  • The Bankruptcy Board (regulator) will regulate insolvency professional agencies (IPAs), which will further regulate insolvency professionals (IPs).  The rationale behind multiple IPAs overseeing the functioning of their member IPs, instead of a single regulator is unclear. The presence of multiple IPAs  operating simultaneously could enable competition in the sector. However, this may also lead to a conflict of interest between the regulatory and competitive goals of the IPAs.  This structure of regulation varies from the current practice where the regulator directly regulates its registered professionals.  For example, the Institute of Chartered Accountants of India (which regulates chartered accountants) is directly responsible for regulating its registered members.
  • The Code provides an order of priority to distribute assets during liquidation. It is unclear why: (i) secured creditors will receive their entire outstanding amount, rather than up to their collateral value, (ii) unsecured creditors have priority over trade creditors, and (iii) government dues will be repaid after unsecured creditors.
  • The smooth functioning of the Code depends on the functioning of new entities such as insolvency professionals, insolvency professional agencies and information utilities.  These entities will have to evolve over time for the proper functioning of the system.  In addition, the NCLT, which will adjudicate corporate insolvency has not been constituted as yet, and the DRTs are overloaded with pending cases.

 

 

  1. The Insolvency and Bankruptcy Code, 2016, http://www.prsindia.org/administrator/uploads/media/Bankruptcy/Bankruptcy%20Code%20as%20passed%20by%20LS.pdf.
  2. Report of the Joint Committee on the Insolvency and Bankruptcy Code, 2015, April 28, 2016, http://164.100.47.134/lsscommittee/Joint%20Committee%20on%20Insolvency%20and%20Bankruptcy%20Code,%202015/16_Joint_Committee_o n_Insolvency_and_Bankruptcy_Code_2015_1.pdf

A version of this blog appeared in the Business Standard on May 7, 2016.

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