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June 2020
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CURRENTAFFAIRS• Fastest Revision of Exam Specific Current
Affairs• Crisp & Comprehensive Subject-Wise
Coverage• Multi-Dimensional Analysis Using Kipling's
Method
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Table of Contents Polity & Governance ........................................................ 4
Autocracy and Covid-19.............................................. 4
Inner line Permit ........................................................... 4
Absent Parliament ....................................................... 5
Private Sector & Health Care...................................... 6
QS World University rankings..................................... 7
Improving Local Finances........................................... 8
Universal Basic Income............................................... 9
State’s Finances ......................................................... 10
Rajya Sabha Election ................................................. 10
IPC Section 309 .......................................................... 11
Transparency during Crisis ...................................... 11
Defection ..................................................................... 12
Public Data .................................................................. 13
Economy .......................................................................... 14
GDP Growth Rate ....................................................... 14
Globalisation at Crossroads ..................................... 15
Mudra Shishu loan ..................................................... 16
Credit Rating ............................................................... 18
Creative Destruction .................................................. 19
Space Tech Start-ups ................................................ 19
MSME Sector .............................................................. 20
Free Power to Farmers .............................................. 21
Agriculture Reforms .................................................. 22
Economic Recovery ................................................... 23
Forex Reserves ........................................................... 27
NBFCs and RBI ........................................................... 28
S&P India’s rating ....................................................... 28
Rights issue ................................................................ 29
Fuel Pricing ................................................................. 30
Bankruptcy Code Ordinance ..................................... 31
PK Mohanty Committee ............................................ 31
COVID-19 & Banking Sector ..................................... 32
SFAC ............................................................................ 32
Skill University ............................................................ 33
Household Savings .................................................... 34
Corona Bonds ............................................................. 34
Economic Development ............................................ 35
World Investment Report .......................................... 35
Tourism Sector ........................................................... 36
Housing Finance Companies ................................... 36
Digital Payments ........................................................ 37
Market Economy Status ........................................... 37
De-coupling from Chinese Manufacturing............. 38
PM SVANidhi .............................................................. 39
Ruling on Liquidation ................................................ 39
Power Sector Overhaul ............................................. 40
Economy of India & China ........................................ 41
New Infrastructure Projects ..................................... 41
Bharat Savings ........................................................... 42
Air Travel Bubbles ..................................................... 43
Urban Development Missions .................................. 43
Country of Origin ........................................................ 44
World Economic Outlook .......................................... 44
Oil Production ............................................................. 45
Cash Transfers & PDS ............................................... 46
Government Expenditure .......................................... 47
PM-FME scheme ........................................................ 47
Environment .................................................................... 49
Organic Livestock Farming ...................................... 49
Climate Change in India ............................................ 51
Environment Performance Index ............................. 52
Urban Forests ............................................................. 52
Oil Spill in Russia ....................................................... 53
GM seeds .................................................................... 54
Lion Census ................................................................ 55
Desertification & Draught ......................................... 55
Macaws ....................................................................... 56
Science & Technology ................................................... 58
Indian National Supermodel ..................................... 58
Origin of the COVID-19 Pandemic ........................... 58
Banning animal test for Vaccines ........................... 59
Arsenicum Album 30 ................................................. 60
Crystalline rubrene .................................................... 60
Cholesteric Liquid Crystals ...................................... 61
Corona Glossary......................................................... 62
Nature Index 2020 ..................................................... 64
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Mobile COVID Testing Lab ....................................... 64
Gateway Lunar Orbiting Outpost ............................. 65
TrueNat Test ............................................................... 66
IN-SPACe ..................................................................... 66
Green Energy Solutions ............................................. 67
Plasma Bank ............................................................... 68
International Relations .................................................. 70
India – Nepal Bilateral Relations ............................. 70
India – Australia Bilateral Relations ....................... 72
Daulat Beg Oldie ......................................................... 73
G-7 Summit ................................................................. 74
India-West Asia .......................................................... 75
Trade with China ........................................................ 76
Debt Trap Diplomacy ................................................. 76
Financial Action Task Force ..................................... 77
Defence & Internal Security .......................................... 79
Line of Actual Control ............................................... 79
Law Enforcement post-COVID-19 ........................... 81
Society ............................................................................. 83
Covid-19 & Poor ......................................................... 83
Task Force on MMR .................................................. 83
COVID-19 in Rural India ............................................ 84
Double Pandemic ....................................................... 84
Global Education Monitoring Report ...................... 85
Pandemic & Education .............................................. 86
STARS Scheme .......................................................... 86
Geography ....................................................................... 88
Cyclone Nisarga ......................................................... 88
Delhi earthquakes ...................................................... 89
Challenger Deep ......................................................... 89
Annular Solar Eclipse ................................................ 90
Ocean Floor Mapping ................................................ 91
Seabed 2030 Project ................................................. 92
History, Art & Culture..................................................... 93
History of Ladakh....................................................... 93
Variyamkunnath Kunjahammed Haji ...................... 93
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Polity & Governance
Autocracy and Covid-19
1. China’s success in containing Covid-19 has given the idea that autocratic regimes may be able to handle such pandemics better.
2. But according to a new study, such regimes have been less effective in reducing public movement despite imposing stricter lockdowns.
3. When democracies employed the same restrictions, they experienced steeper declines in public movement.
4. Apart from China, other East Asian countries have also taken a more effective response to Covid-19.
5. The study took into consideration even the distinctive factors such as state capacity, GDP per capita and experience with past epidemics.
6. The lack of transparency in autocratic regimes has proved to be a drawback in fighting the pandemic.
Cultural Values
1. Cultural values of societies have also likely played a role in determining the effectiveness of mobility restrictions.
2. Individualistic societies such as the United States, Sweden, and the United Kingdom found collective action as a response to a pandemic more difficult.
3. This is because people in individualistic societies tend to pursue their own interests rather than the collective good.
4. Societies that emphasize group loyalty, conformity and obedience towards superiors find it easier to take collective action.
5. Collectivistic countries have mounted a more coordinated response to covid-19 in terms of reducing movement and travel.
Source: Live Mint
Inner line Permit
1. The Supreme Court declined to stay the operation of a Presidential order.
2. The order deprive Assam of the powers to implement the Inner Line system in its districts and limit the applicability of the Citizenship (Amendment) Act (CAA).
What is Inner Line?
1. The Inner Line separated the tribal-populated hill areas in the Northeast from the plains.
2. Indian citizens from other areas need an Inner Line Permit (ILP) to enter and stay for any period in these areas.
3. Arunachal Pradesh, Nagaland, Manipur and Mizoram are protected by the Inner Line system.
Where did the ILP concept originate?
1. The concept originates from the Bengal Eastern Frontier Regulation Act (BEFR), 1873.
2. Policy of exclusion was aimed to reduce the reckless expansion of British entrepreneurs into new lands that threatened British political relations with the hill tribes.
3. The BEFR prohibits an outsider’s (British subject or foreign citizen) entry into the area beyond the Inner Line without a pass and purchase of land there.
4. It also protected the commercial interests of the British from tribal communities.
5. After Independence, the Indian government replaced “British subjects” with “Citizen of India” with an aim to protect the indigenous/tribal population.
How is ILP connected to CAA?
1. CAA relaxes eligibility criteria for certain categories of migrants from 3 countries seeking Indian citizenship.
2. It also exempts certain categories of areas, including those protected by the Inner Line system.
3. The Adaptation of Laws (Amendment) Order, 2019, issued by the President, amended the BEFR, 1873, extending it to Manipur and parts of Nagaland that were not earlier protected by ILP.
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Why was the order opposed?
1. Original BEFR included the then Assam districts of Kamrup, Darrang, Nowgong (now Nagaon), Sibsagar, Lakhimpur, and Cachar.
2. Assam government’s permissive power to implement the ILP could have made the CAA inapplicable in these areas.
3. Now the presidential order takes away the state government’s power in this regard.
Source: The Indian Express
Absent Parliament
1. Parliaments in democracies around the world are meeting and questioning their governments on their responses to the COVID-19 pandemic.
2. Countries like Italy, Argentina, UK, etc. held sessions either with physical distancing with fewer MPs or video conferencing or a combination of both.
3. Many others are convening their committees through video conferencing.
4. Inter-Parliamentary Union has documented the processes used by various national parliaments to meet during the pandemic.
5. But the Indian Parliament has remained absentee as it has not held a session for over two months.
What is the significance of Parliament?
1. The drafting committee of the Constitution preferred a parliamentary form over the presidential system of governance.
2. Though the presidential system provides a higher level of stability, the parliamentary system is better at holding the government accountable through questions, motions and debates.
3. Parliament has a central role in our governance system as it checks and challenges the government.
4. But absentee Parliament indicates the absence of scrutiny of government action.
Why does the session need to be held?
1. There are serious challenges like
a. Stalling the spreading of the epidemic
b. Treatment of infected people and minimizing the loss of life to the virus.
c. Impact on the economy, both in the supply side and demand side as incomes and spending contract.
d. Humanitarian issue of mitigating the impact on the most vulnerable sections of the population, both the urban poor and in rural areas and issues of migrants.
2. Parliament provides a forum to discuss and take concerted action to alleviate these distresses.
3. MPs represent people by raising issues in Parliament and shape policy and guide the government in the national interest.
4. Center’s current measures are being taken under the Disaster Management Act, 2005, that was not designed to handle epidemics.
5. This was done as there are no other laws that provide the centre with powers to impose a lockdown across the country.
6. Parliament could have passed an appropriate Act with suitable checks like in many other countries.
7. The Constitution requires all expenditure by the government to be approved by Parliament.
8. But the recent economic measures taken by the government to address the crisis have not been subject to parliamentary scrutiny.
How is it procedurally possible?
1. Constitution does not prohibit meetings that may require maintenance of physical distancing or remote meetings.
2. President has the power to summon Parliament to meet at such time and place as he thinks fit. Rules of procedure of both houses also enable holding remote meetings.
3. Even though the parliamentary committees are required to sit within the precincts of the House, the Speaker may permit meetings to be held outside.
4. There is also no prior parliamentary action required to permit meetings through video conferencing.
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5. As the meetings of the Houses are usually telecast live, and there is no issue of confidentiality involved.
6. Even committee meetings requiring secrecy and security can be tackled with technological solutions as in other countries.
7. In case of connectivity issues, MPs could use government facilities like district headquarters as all are linked with fibre optic lines.
Where the focus should be?
1. Parliamentarians should find a way to perform their constitutional duties.
2. India is the world’s largest democracy and a leader in information technology provider to the world.
3. So, Parliament has to capitalize on India’s IT strengths to support our credentials as a performing democracy.
Source: The Hindu
Private Sector & Health Care
What are the challenges?
1. Too much burden on India’s public health sector during the crisis highlights the need to mobilize available resources in both the public and private sectors of health care.
2. But, the current strategies to involve the private sector in combating the infectious disease are not clear.
3. There are no clear policy guidelines on the usage of private sector resources to complement public sector efforts, and the mode of payments for their services.
4. The private sector is also constrained due to a lack of cash flows.
5. Countries with a policy-based strategic relationship with the private sector have performed well in controlling this pandemic.
6. So, there is a need to formulate a stable policy-based strategy to get the private sector on board.
Where can the private sector be engaged?
1. Certain policy options to leverage private sector resources include testing, hospitalisation, procurement of biomedical equipment and supplies, and a central intelligence system.
2. Despite the government's efforts to scale-up testing capacity, India is still lagging in mass scale testing.
Option 1
a. An accredited private laboratory can be contracted to be co-located in a public health facility preferably in tier-II/tier-III public hospitals.
b. States that already have private laboratories under a public–private partnership (PPP) contract can add COVID-19 tests.
c. The government may procure test kits and the private sector could charge a service fee from the government.
Option 2
a. Suspect cases can be issued vouchers for testing at any empanelled private laboratories.
b. E-vouchers generated by tele-health call centres can subsequently be reimbursed by the government.
Option 3
a. A mobile sample collection and testing facility can be operated by a private entity in high-density clusters. This arrangement can be under the hub-spoke principle.
b. The cost of tests, key performance indicators and payment system should be worked out in the purchase contract.
How can the issue of hospitalisation be addressed?
1. Hospitalization of COVID-19 cases cannot be restricted to hospitals in major cities. Improving the infrastructure and capacity in tier II and tier III cities in collaboration with the private sector is critical.
2. The proposed increase in viability gap funding to 30% will ease the capex pressure for the private sector.
Option 1
a. A private contractor could be hired to refurbish an existing ward in a public hospital into an intensive care unit (ICU) ward.
b. This would enable availability of an ICU ward within a short time.
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Option 2
a. If the district hospital does not have staff to operate an ICU ward, a private hospital partner could be contracted to provide staff and operate the ICU ward.
b. Alternatively, a private hospital partner can refurbish, operate and later transfer the ICU ward.
c. The Centre can provide viability gap funding to the State to support the development of such a facility.
Option 3
a. The government can refer patients to empanelled private COVID-19 hospitals, at a fixed package rate.
b. Such strategic purchasing or insurance reimbursement (like in Pradhan Mantri Jan Arogya Yojana) requires clear policy directions, a robust referral system, agreement on tariffs, and a quick reimbursement mechanism.
c. The current government tariffs do not attract the private sector.
Which other areas need improvement?
1. The rise in demand for test kits, ventilators, and other biomedical supplies cannot be met by current supply chain sources.
2. So, repurposing through alternate sources indigenously is needed.
3. Innovations and prototypes need government laboratories to test in quick time, approve and grant a licence for production and patenting.
4. Apart from facilitating quick credit access for manufacturing, the government can give buyback guarantees and facilitate the supply chain channels.
5. An integrated artificial intelligence system should be developed using India’s IT sector to support all public and private sector efforts in combating COVID-19.
6. The intelligence system should help in case identification, contact tracing, managing a tele-health centre, hospitalisation in the private sector, payment, etc.
7. These efforts have the potential to create good health infrastructure and strengthen health systems eventually.
8. But these initiatives require quick policy formulation and procedural guidelines.
Source: The Hindu
QS World University rankings
1. The top five Indian Institutes of Technology and the Indian Institute of Science have all dropped in this year's QS World University rankings.
2. Only the newer IITs in Guwahati and Hyderabad improved their rankings from 491 to 470 and by entering the top 1,000 respectively.
3. Total number of Indian institutions in the top 1,000 global list has also fallen from 24 to 21, despite the Institutes of Eminence scheme launched to boost the Indian presence in these global rankings.
India’s Performance
1. The slight drop in rankings of some institutes is because of the parameter of internationalization.
2. India performs the poorest on this parameter, while scoring well on research impact, measured through citations per faculty.
3. Out of the six parameters, Indian institutions get zero score on the ratio of international faculty and students.
4. They also score poorly on faculty-student ratio as it only counts full time faculty and not Ph.D. students who are teaching or research assistants as in the USA.
5. If a parameter comparing the cost of education to students was introduced, Indian institutions would be among the world’s top 50.
6. The top seven IITs had jointly decided to boycott the Times Higher Education rankings citing issues in its methodology and transparency.
7. IIT-Bombay still maintains its position as the top institution in India in the QS rankings, but has slipped 20 places from 152 to 172 in the global list.
8. IISc overtook IIT Delhi to make it to the second place, but still dropped a rank to 185.
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Private universities
1. It was a mixed performance for elite private universities.
2. Prestigious institutes such as BITS Pilani and the Vellore Institute of Technology have dropped out of the top 1,000 list.
3. OP Jindal Global University, a new entrant last year, has climbed to the 650-700 band in the rankings.
Source: The Hindu
Improving Local Finances
1. In terms of information, monitoring and immediate action, local governments are at an advantage to meet any disaster such as COVID-19.
2. States already have restrictive conditionalities in availing the enhanced borrowing limits (3.5% to 5% of Gross State Domestic Product, or GSDP) for 2020-21.
3. So, local governments should be fiscally empowered immediately for the future of local governance.
Challenges
1. COVID-19 has raised four major challenges: economic, health, welfare/livelihood and resource mobilisation.
2. These challenges have to be addressed by all tiers of government in the federal polity, jointly and severally.
3. Own revenue is critical for empowerment of local government.
Drawbacks
There are several gaps that affects local governance and have to be simultaneously addressed.
1. The new normal demands a paradigm shift in the delivery of health care at the cutting edge level.
2. Rise of parallel bodies after the 73rd/74th Constitutional Amendments have considerably distorted the functions-fund flow matrix at the lower level of governance.
3. There is no clarity in the assignment of functions, functionaries and financial responsibilities to local governments.
4. Functional mapping and responsibilities continue to be ambiguous in many States. But Kerala attempted responsibility mapping besides activity mapping.
5. The critical role of local governments will have to be recognized by all.
Suggestions
Suggestions for resource mobilization are given under: local finance, Members of Parliament Local Area Development Scheme (MPLADs), and the 15th Finance Commission (FFC).
Local Finance
1. Property tax collection with appropriate exemptions should be a compulsory levy and preferably must cover land.
2. As per Economic Survey 2017-18, urban local governments (ULGs), generate about 44% of their revenue from their own sources as against only 5% by rural local governments (RLGs).
3. Per capita own revenue collected by ULGs is about 3% of urban per capita income while it is only 0.1% for RLGs.
4. There is a gap between tax potential and actual collection, resulting in underperformance.
5. In States such as Uttar Pradesh, Bihar and Jharkhand, local tax collection at the panchayat level is almost nil.
6. Property tax forms the major source of local revenue throughout the world. All States should take steps to enhance and rationalize the property tax regime.
7. The share of property tax in GDP has been declining since 2002-03, which is only 0.14% of GDP in 2017-18 as against 2.1% in the Organisation for Economic Co-operation and Development (OECD) countries.
8. Property tax covering land will hugely enhance the yield from this source without any increase in rates.
9. Land monetization and betterment levy can be tried in the context of COVID-19 in India.
10. Land values have to be unbundled for socially relevant purposes.
11. Municipalities and suburban panchayats can issue a corona containment bond for a period of 10 years, on a coupon rate below market rate but significantly above the reverse repo rate to attract banks.
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MPLADs
1. MPLADs have been suspended by the Union government for two years.
2. These funds appropriated for local area development must now be assigned to local governments (to panchayats) on the basis of well-defined criteria.
15th FC
1. A special COVID-19 containment grant to the LGs by the FFC to be distributed on the basis of SFC-laid criteria.
2. Local government grant for 2020-2021 by the 15th FC is only 3% higher than that recommended by the 14th FC.
3. There is no provision made for building health infrastructure and disease control strategies at the local level.
4. The ratio of basic to tied grant is fixed at 50:50 by the commission.
5. All grants must be untied for freely evolving proper COVID-19 containment strategies locally.
6. The 13th FC’s recommendation to tie local grants to the union divisible pool of taxes to ensure a better predictable source of revenue to LGs (accepted by the then Union government) must be restored by the commission.
Disaster Management
1. While flood, drought, and earthquakes are covered under the Disaster Management Act 2005, it does not recognise epidemics.
2. The new pandemic is a public health challenge along with livelihood and welfare challenges.
3. Any type of mitigation funds and the disaster risk index prepared to map out vulnerable areas are redundant during COVID-19.
4. The 2005 Act has to be modified to accommodate the emerging situation and the local governments must be equipped and empowered.
Source: The Hindu
Universal Basic Income
1. Nations Human Rights Commission’s (NHRC) midterm report to the United Nations Human Rights Council (UNHRC) mentions the possible implementation of Universal Basic Income (UBI) by GoI.
2. The report is submitted by the NHRC as part of the 3rd round of the Universal Periodic Review process that is done once every 4.5 years.
About UBI
1. It is the process of giving unconditional cash transfers to all the citizens of a country irrespective of their income or social status.
2. Three main features of UBI are Universal (all citizens are eligible), Unconditional (no pre-conditions), and cash transfer.
3. UBI helps in eradicating poverty, reducing income inequality and ensuring social dignity for all.
4. According to the Economic Survey 2017-18, If atleast BPL people get UBI (at Rs. 7620, fixed according to Tendulkar’s poverty line), it costs the government about 4.9% of GDP annually.
5. Currently, GoI spends about 5.2% of GDP on all central sector and centrally sponsored schemes. So, implementing both UBI and schemes is not possible due to fiscal constraints.
6. Recently, Sikkim decided to implement UBI in its state by 2022.
About NHRC
1. It is a statutory body established through the Human rights act, 1993.
2. The commission comprises of Chairperson and 12 members.
a. The Chairperson should be a person who has been Chief Justice of India or a Judge of Supreme Court.
b. Of the 12 members, one should have been a judge of the Supreme court, one should have been chief justice of high court and 3 other members having practical experience in matters of Human rights.
c. Ex-officio members include Chairpersons of National Commission for Women, National Commission for Minorities, National Commission for Scheduled Caste, National Commission for Scheduled Tribes, National
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Commission for Backward Classes, National Commission for the Protection of Child Rights, and the Chief Commissioner for Persons with Disabilities.
3. NHRC has powers to
a. Investigate cases relating to violations of Human rights either suo-motto or through a complaint.
b. Interfere in any judicial process that involves allegations of violation of Human rights.
4. It also submits a report to the President of India every year on the working of the commission and the recommendations given by it.
Source: The Hindu
State’s Finances
As the GST collections have reduced due to the collapse of the Indian economy, the Centre is expected to use ‘force majeure’ clause and not provide the GST Compensation share to states.
Situation
1. Before the introduction of GST, Centre promised states to compensate for the losses in tax revenue due to underperformance in GST collections for the first 5 years.
2. But the pandemic and the lockdown have brought the economy and the business to a standstill.
3. Both Centre’s and State’s finances have been constrained due to shortfall in GST collections and other taxes.
Problems with GST Compensation
1. Centre projected 14% increase in growth of tax collection post introduction of GST, as it reduces the indirect tax rate and increase the tax base.
2. But GST implementation had not been smooth and the tax system had some operational glitches, leading to poor revenue collection.
3. This factor of changing the taxation system has not been taken into account while projecting the increase in tax revenue year on year.
4. All these reasons led to poor GST collections and untimely transfer of GST Compensation to states.
State’s Finances
1. Several states are in acute need of money to fight the pandemic and other regular administration costs.
2. As part of Atmanirbhar package, the centre allowed states to borrow beyond their fiscal deficit limits to up to 5% of GSDP but with conditions.
a. States can borrow up to 3.5% of GSDP without any conditions and rest of the borrowing is coupled with reform criteria such as implementing the one nation one ration card scheme, reforms in power sector etc.
b. These additional conditions pose extra burden on the states that are already facing problems in raising finances.
3. As the centre may not be able to provide compensations, it should allow states to borrow freely and manage their finances.
4. The limits on fiscal deficits have lost their significance in an extraordinary situation like these.
Source: Indian Express, Livemint
Rajya Sabha Election
The Election commission had conducted the election of members to Rajya Sabha (RS) in Andhra Pradesh, Rajasthan, Mizoram etc.
Election Procedure
1. The members of RS are elected by elected members of state legislative assembly and the method of election is called Proportional representation through a single transferable vote system.
2. The election happens in open ballot i.e., the choice of the candidate is shown to the party representative unlike secret ballot where the vote is not disclosed.
3. In this system, members of state legislatures give their voting preference to candidates like 1, 2 etc.
4. The candidate getting more than the value obtained in the quotient is declared winner.
A. Votes required = Number of MLA’s ÷ total vacancies for RS
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B. Ex: If there are 5 vacancies for RS from a state and the number of MLA’s are 180 than the winner should get more than 36 votes (1805 = 36)
5. The term of each RS member is 6 years and 1/3rd of the members of RS retire every 2 years.
6. In case of death/ resignation/ disqualification of an existing member of RS, election to that seat is conducted and the term of the new member would be the remainder of the predecessor’s term.
Important points
1. The MLAs elected from a party should show their vote to their party representative and the independent MLAs need not show their vote to anyone.
2. Not showing the vote to the party representative/cross-voting does not attract disqualification under anti-defection provisions.
3. The NOTA (None of the above) option is not applicable in the case of Rajya Sabha election.
4. Supreme Court ruled that a legislator can vote in the RS elections without taking oath as oath is required to perform legislative activity and RS election is a non-legislative activity.
Source: The Hindu
IPC Section 309
IPC Section 309 has become relevant due to growing mental health issues that are leading to suicide among people.
About
1. Section 309 of the Indian Penal Code (IPC) punishes persons trying to commit suicide with imprisonment for a term of 1 year or fine or both.
2. It has been included by the British as it was regarded as a crime against the state as well as against religion at those times.
Relevance
1. The perception that a person committing suicide needs to be punished should be done away with because
a. It denies the person access to health care as Doctors need permission from Police because it is a medico-legal case.
b. It can lead to extortion by corrupt police officers as they can misuse the situation.
c. It also becomes difficult to understand a person’s mentality and may put him under more stress if he is punished.
2. The enactment of Mental Healthcare act, 2017 has significantly reduced the scope of using section 309 of IPC, as it should be used as an exception.
3. But police authorities have been using this section more often and pushing the victim under stress.
Solution
1. Some people misuse this section to blackmail authorities to get their demands met. So, repealing this section may provide a loophole to criminals.
2. The solution lies in redefining the section to ensure that genuine people are not affected while people misusing this act get punished.
Source: Indian Express
Transparency during Crisis
1. The RTI (Right to Information) application seeking information on PM-CARES (PM Citizen Assistance and Relief in Emergency Situations) Fund has been rejected stating it is not a public authority under the RTI act, 2005.
2. The RTI act empowered people to access information from the public authorities and hold them accountable.
3. RTI act, 2005 defines a public authority as one
a. Established through an act of Parliament or state legislature or
b. Established through a notification issued by appropriate government or
c. Any body that is owned, controlled or substantially financed by the government including NGOs (Non-Governmental Organization)
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4. Such non-disclosure of information impedes the developmental activities for the poor hugely impacted by the pandemic.
5. Disclosure of information helps in the wide dissemination of information like
a. Disclosure of stocks of rations in a fair price shop
b. ICU beds/ ventilators availability in hospitals etc
6. Greater openness can prevent misinformation being circulated and can also ensure transparency, openness in the functioning of the government.
7. The scope for secrecy and discretionary power could lead to corruption. For example, a fair price shop can divert the ration in black market and claim non-availability of stock.
8. Also, 21 out of the 29 Information commissions did not work during the lockdown while the Central Information Commission and other commissions held video conferencing to dispose of cases.
9. So, Transparency Watchdogs has to intervene and provide relevant information to the public.
Source: The Hindu
Defection
A Minister from the Manipur’s cabinet was removed by the Supreme Court for defecting from one party to the other and as the Speaker did not take action on disqualification.
Situation
1. As per the 10th schedule of the Constitution, the decision of disqualification was vested in the Presiding Officer of the House and it was final.
2. But there was no time period mentioned in the schedule for deciding on disqualification and the appeal. Members also defected to the ruling party without getting disqualified due to the partisan nature of the Speaker.
3. So, the Supreme Court had set a time frame of 3 months within which Presiding officers of assemblies and Parliament must decide on disqualification of members, except in extraordinary circumstances.
4. The Supreme court also recommended Parliament to reconsider the provisions of the 10th schedule citing partisanship of the Speaker.
5. In Manipur case, the Supreme Court intervened as the legislative assembly Speaker could not decide on defection even after the expiry of 3 months
10th schedule
1. This schedule was introduced in the Constitution through the 52nd Constitutional Amendment act, 1985.
2. It provided for disqualification of members of the house in certain cases and the appeal is decided by the Presiding officer of the House.
3. Defection is considered when a member of a house belonging to a political party
A. Voluntarily gives up membership of his political party or
B. Votes or does not vote in legislature contrary to the directions of his Political party or
C. If an independent candidate joins a political party or
D. If a nominated member joins a political party 6 months after becoming a member of the legislature.
4. The exception is given in 2 cases
A. In case of merger of a political party i.e., when 2/3 rd of members of a political party is in favor of merger then disqualification under 10th schedule will not be applicable.
B. The provisions under 10th schedule are not applicable to the Speaker of the House if he resigns from his party and rejoins the same or different party after demitting the office of Speaker.
Source: Indian Express
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Public Data
1. The deficiencies in collecting credible data in India is hampering the fight against coronavirus.
2. The recent upward revision of coronavirus deaths shows the dismal state of data collection and processing.
Government Initiatives
1. GoI (Government of India) adopted National Data Sharing and Accessibility policy in 2012 to make non-sensitive data available to the public.
2. This promotes business creation and encourages innovative citizen centric services.
3. As part of the Open Government Initiative, a portal called data.gov.in was launched to share the government’s data in a machine-readable format.
Challenges during COVID-19
1. The lack of availability of District wise, demographic wise case statistics and anonymous contact traces is creating challenges in breaking the chain of coronavirus.
2. The data shared in the public domain contains only the graphical image of number of cases which is unsuitable for any analysis.
3. The lack of credible and incomplete data from different sources is posing challenges in creating model forecasts for lockdowns and spread of the disease.
4. Much of the data from the census and socio-economic studies is not open to the public or available in unusable formats.
Way forward
1. The applications designed by startups to predict train running status and ticket confirmation have become possible only because of availability of data.
2. Thus the government should share substantive data respecting privacy concerns which helps for the betterment of mankind.
Source: The Hindu
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Economy
GDP Growth Rate
1. Ministry of Statistics and Programme Implementation (MoSPI) released the data for the fourth quarter (January to March) of the last financial year (2019-20) and the provisional estimates of the full-year GDP growth rate.
2. The provisional figure states that the Indian economy grew by 4.2% in 2019-20.
3. This is the lowest annual growth rate of GDP registered under the new GDP data series that uses 2011-12 as the base year.
4. This is significantly lower than the budget expectation of 8.5% growth and also lower than the Second Advance Estimates of 5%.
How is the nominal GDP is affected?
1. These figures are of growth rate in real GDP. A similar fall can be observed in the nominal GDP.
2. Real GDP is arrived at by subtracting the nominal GDP growth by the inflation level.
3. At the time of the 2019-20 Budget presentation in July, nominal GDP was expected to grow by 12%-12.5%. %. In 2018-19, the nominal GDP grew by 11%.
4. This sharp deceleration in nominal GDP growth shows the continued weakening of India’s growth momentum even before it was hit by the Covid-19 induced lockdown in the last week of March 2020.
Why sharp deceleration in the nominal GDP matters?
1. The nominal GDP growth rate is the base of all fiscal calculations in the country.
2. The government bases its calculations, such as the amount revenues it will raise and the amount of money it will be able to spend, on this initial assumption.
3. A sharp divergence in nominal GDP growth rate upsets all other calculations in the economy.
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4. For instance, a sharp fall means the government does not get the revenues it had hoped for and, as such, it cannot spend as much as it was planned.
Poor fiscal marksmanship
1. The substantial deceleration in nominal GDP growth reflects poorly on the government’s fiscal marksmanship.
2. It shows that the government was not able to assess the magnitude of economic growth deceleration that was underway.
3. Poor fiscal marksmanship, in turn, leads to inaccurate policy making because a government could end up making policies for an economy that does not actually exist on the ground.
What does the data reveal?
1. Provisional GDP estimates revel the undesirable emerging structure of the Indian economy.
2. For India to grow and create jobs for the millions that enter its workforce each year, manufacturing growth has to rise.
3. Together with services, manufacturing growth was supposed to absorb the millions still dependent on agriculture, which even when it grows fast, does not have the ability to raise per capita income in a big way.
4. To create lots of well-paying jobs that allow it to reap the demographic dividend then it had to be via manufacturing growth.
5. But 2019 shows that agriculture and allied sectors had buoyant growth while manufacturing has been declining with contracting for three of the four quarters.
How credential are these data?
1. India’s national income accounting data, the new GDP data series using 2011-12 as the base year, has been criticised in past.
2. Former Chief Economic Advisor to India’s Finance Ministry has argued, in 2019, that the new series overestimated India’s GDP by as much as 2.5 percentage points.
3. Further, India’s GDP estimates are frequently revised where provisional estimates have fluctuated repeatedly.
Where lies the overall trend?
1. The provisional GDP estimates for 2019-20 supports that growth deceleration since 2016-17 and became worse as the last financial year progressed.
2. In the last quarter of the financial year, the economy grew by just 3.1%. It shows that the economy had already become vulnerable before Covid-19 hit India at the end of March.
However, given the trend of repeated downward revisions, it is likely that even these provisional estimates may turn out to be optimistic.
Source: The Indian Express
Globalisation at Crossroads
1. Over the years, globalisation has significantly impacted human lives.
2. Conceptually, ‘globalisation’ means integration of all sorts, economic, socio-cultural, financial, technical, etc, among nations across the world.
3. The term ‘globalisation’ has been used frequently by all people from academicians and theorists to corporates and politicians. It has also been widely misused, both knowingly and unknowingly.
4. To be a world leader, one has to develop a ‘global understanding’, travel ‘globally’ and promulgate one’s ‘global vision’.
5. The overuse of ‘global’ in one’s discourse evoked mass appeals and became crucial to success and it has been used to rise and gain mass acceptance.
6. Politicians across the world promulgate ‘global approach’ and also blamed globalisation for failures such as country’s economic chaos, the poor performance of trade, unemployment, even terrorism.
Economic Theories and Globalisation
1. Over the years, traditional economic theories such as comparative advantage, factor endowment, competitive advantage have been extensively researched, and this has led to the evolution of a globalised system of manufacturing and marketing.
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2. Economists across the world never tired of carrying out path-breaking research and developing innovative techniques to show integration among nations to promote efficiency and growth.
3. Consequently, economic activities worldwide transformed to establish globally integrated value and supply chains systems.
4. A large number of emerging economies, especially China and some of its South-East Asian neighbours, got their manufacturing activities integrated with Global Value Chains (GVCs) to achieve efficiencies of scale and reap its benefits.
5. Such an approach become an integral part of the Global Supply Chain which significantly helped China to become the ‘factory of the world’ and transform itself into an economic giant.
Declining Growth
1. Due to the pandemic, China has witnessed an economic slump and further expected to tumble
2. IMF estimates the world economy to fall by 3% in 2020, the Euro area (-7.5%) and the US (-5.9%) are likely to be the worst-hit whereas China and India to grow at 1.2% and 0.5% respectively.
3. However, these economic predictions now seem too optimistic, as India’s real GDP is now estimated to decline to 5-6% in FY21 and is liable to further fluctuations.
4. India witnessed a steep fall in its composite IHS Markit PMI, that measures both manufacturing and services to 7.2 in April, from 50.6 in March 2020.
5. During the same period, the composite PMI for France was 13.6, UK 13.8, Germany 17.4, Japan 25.8, Brazil 26.5, US 27%, and China 47.6%.
6. This reveals that India was worst hit primarily due to its rigorous lockdown compared to other major economies.
Global Trade with China
1. China, with exports of over $2.5 trillion, has emerged as the largest supplier in the world. Most of the importers are becoming wary of their trade deficit with China.
2. The countries with the highest trade deficit with China in 2019 were the US ($295 billion), the Netherlands ($63 billion), India ($ 57 billion) and the UK ($ 38 billion).
3. Disruptions of global supply chains due to worldwide lockdowns and overdependence on China has led to increasing concerns of the entire system of global production networks based on efficiency in supply chain systems.
4. Countries around the world are facing difficulties in making medical equipment and medicines for their citizens.
5. Most countries are helpless and do not have the means to deal with such massive economic calamity coupled with health emergencies.
6. Lack of transparency on the part of China raised the levels of distrust among a large number of its trading partners. And, this has led to a realisation of ‘self-sufficiency’ doctrine.
Way Forward
1. Isolation under no circumstance is the prescription to economic resilience.
2. Instead, countries, including India, need to make concerted efforts to improve efficiencies at all levels, be it sourcing, logistics, manufacturing, policy provisions and implementation.
3. As there are no shortcuts to becoming globally competitive.
Source: Financial Express
Mudra Shishu loan
1. A 1500 crore interest subvention for small business and cottage industries has been announced under Mudra Shishu loan.
2. Under this scheme, one lakh beneficiaries can avail interest benefit of 2 per cent for a year.
3. A Rs 5000 crore package was announced for the roadside hawkers. Under this, 50 lakh street vendors can avail loan up to Rs 10,000.
MUDRA Yojana
1. Micro Units Development and Refinance Agency Ltd. [MUDRA] is an NBFC supporting development of the micro-enterprise sector in the country.
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2. MUDRA provides refinance support to Banks / MFIs / NBFCs for lending to micro units having loan requirement up to Rs. 10 lakh.
3. MUDRA provides refinance support to micro-business under the Scheme of Pradhan Mantri MUDRA Yojana.
4. The other products are for development support to the sector. The offerings are being targeted across the spectrum of beneficiary segments.
Pradhan Mantri MUDRA Yojana (PMMY)
1. Under the aegis of Pradhan Mantri Mudra Yojana (PMMY), MUDRA has created products/ schemes.
2. The interventions have been named 'Shishu', 'Kishore' and 'Tarun' to signify the stage of growth/development and funding needs of the beneficiary micro unit/entrepreneur.
a. Shishu: covering loans up to Rs. 50,000/-
b. Kishor: covering loans above Rs. 50,000/- and up to Rs. 5 lakh
c. Tarun: covering loans above Rs. 5 lakh and up to Rs. 10 lakh
3. The funding support from MUDRA are of two types:
a. Micro Credit Scheme (MCS) for loans up to 1 lakh finance through MFIs.
b. Refinance Scheme for Commercial Banks / Regional Rural Banks (RRBs) / Small Finance Banks / Non-Banking Financial Companies (NBFCs).
Purpose of MUDRA Loan
Mudra loan is extended for a variety of purposes which result in income generation and employment creation. The loans are extended mainly for:
a. Business loan for Vendors, Traders, Shopkeepers and other Service Sector activities
b. A working capital loan through MUDRA Cards
c. Equipment Finance for Micro Units
d. Transport Vehicle loans – for commercial use only
e. Loans for agri-allied non-farm income-generating activities, e.g. pisciculture. beekeeping, poultry farming, etc.
f. Tractors, tillers as well as two-wheelers used for commercial purposes only.
Source: AIR and mudra.org
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Credit Rating
1. Moody’s Investors Service downgraded the Government of India’s foreign-currency and local-currency long-term issuer ratings to “Baa3” from “Baa2”.
2. The downgrade reduces India to the lowest investment grade of ratings.
3. It states that the outlook remained “negative”, implying India could be rated down further.
4. This rating is in line with the other two main rating agencies – Standard & Poor’s and Fitch.
What does a negative outlook mean?
1. It reflects dominant downside risks from deeper stresses in the economy and financial system that could erode fiscal strength.
2. It also points to persistent structural challenges to fast economic growth such as weak infrastructure, rigidities in labour, land and product markets, and rising financial sector risks.
Where will it impact?
1. A rating downgrade means that bonds issued by the Indian governments are now riskier than before.
2. This is because weaker economic growth and worsening fiscal health undermine a government’s ability to pay back.
3. Normally, lower risk allows governments and companies of that country to raise debts at a lower rate of interest.
4. The downgrade makes rasing of funds costlier for the Indian government and Indian companies.
Why the rating has been downgraded?
1. There are four main reasons for downgrade
a. Weak implementation of economic reforms since 2017
b. Relatively low economic growth over a sustained period
c. Significant deterioration in the fiscal position of governments (central and state)
d. Rising stress in India’s financial sector
2. Previously the outlook on India’s Baa2 rating was changed to negative from stable as these risks were increasing.
3. While the pandemic didn’t directly influence the downgrade, it amplifies existing vulnerabilities in India’s credit profile.
4. Provisional estimates of GDP for 2019-20 were at 4.2%, the lowest annual growth in a decade, is almost prior to the lockdown in India.
5. Even before the coronavirus outbreak, government debt was already quite high and is increasing.
6. Worse government finances have further deteriorated poor growth and the central government has failed to meet its fiscal deficit targets.
7. High debt was expected to go up to 84% of the GDP within 2020. This could be even more as government revenues are likely to decrease.
When was the rating upgraded?
1. In 2017, Moody’s upgraded India’s rating to Baa2 with a stable outlook.
2. Effective implementation of key reforms was expected to strengthen the sovereign’s credit profile through improvement in economic, institutional and fiscal strength.
3. But the implementation of reforms has been weak and has not resulted in material credit improvements.
4. This low effectiveness of policy and the resulting loss of growth momentum resulted in the sharp deceleration in India’s GDP growth rates.
Which are the other issues?
1. India’s real GDP is expected to contract by 4% in the current financial year and sharply recovery in 2021-22.
2. Longer-term growth rates are likely to be materially lower than in the past, due to persistent weak private sector investment, job creation, and an impaired financial system.
3. A prolonged period of slower growth may dampen the pace of improvements in living standards.
Source: The Indian Express
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Creative Destruction
The business cycles of economies can be viewed in two ways
1. Inward Looking
a. The economic cycle is seen as a result of happenings within an economic system.
b. Great Depression can be explained by the collapse in aggregate demand across the world.
c. The genesis of the North Atlantic financial crisis can be traced to happenings within the US economic system.
d. So, the primary task of economic policy is to bring the system back to its old ways.
2. Outward-Looking
a. The economic crisis is viewed as a consequence of happenings outside the economic system such as a new technology, natural disaster or a virus from a wet market in China.
b. It also involves external shocks like Climate change that significantly alter the lives of the people.
c. This demands newer ways that make the task of policymakers more complicated.
d. There will be pressure to stabilize the old system and also to encourage entrepreneurs to grab new opportunities.
Forces of Creative Destruction
1. The ongoing economic crisis will affect the ability of economies to grow in both positive and negative ways.
2. The negative forces will bring down potential growth as
a. Education will get temporarily suspended
b. Public investment will be weak and
c. Global supply chains will get disrupted.
3. The positive force is the disruption of existing ways of doing things.
4. It will open up space for innovative new entrants, through the process of creative destruction.
5. The new opportunities will be seen in the use of digital payments, demand for oximeters, and growth of the personal protective equipment industry.
6. The more virus fundamentally alters human behaviour, the greater the opportunities for entrepreneurs to create new markets.
Source: Live Mint
Space Tech Start-ups
1. Finance Ministery has announced to open up space and atomic energy to the private sector.
2. Recently, SpaceX launched NASA astronauts into orbit by the first-ever commercially built rocket and spacecraft.
3. “New Space” is a rapidly growing market with great potential.
New Reforms
1. It aims to level the playing field for private companies in satellites, launches and space-based services.
2. It includes
a) Introduction of a predictable policy and regulatory environment to private players
b) Providing access to geospatial data and facilities of the Indian Space Research Organisation (ISRO).
3. Reportedly, more than 17,000 small satellites will be launched in Low Earth Orbit by 2030 and many Indian space-tech startups are emerging in this area.
a. Prixxels is building a constellation of nano-satellites to provide global, real-time and affordable satellite imagery services.
b. Bellatrix Aerospace offers novel electric propulsion systems that have applications in the field of nano and micro-satellite propulsion.
c. Manastu Space has developed a green propulsion system using hydrogen peroxide as fuel.
Supporting Space Tech Start-ups
1. Funding
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a. Space tech startups must be trusted and supported at early-stage innovations through ‘adventure’ capital, not just risk-averse venture capital.
b. It also needs ‘patient’ capital, as the lead times are long in this sector. The government can be the provider of such adventure and patient capital.
c. Such support was given to early-stage startups to explore radical ideas with very low-interest soft loans under CSIR’s New Millennium Indian Technology Leadership Initiative.
d. The public-private partnership should be in both development and financing.
2. Public Procurement
a. Startups need a head start in the market and the current public procurement system is against them.
b. The lowest-cost-selection approach must change to lower total cost of ownership.
3. National Innovation System
a. Robust space tech-startup national innovation ecosystem comprising incubators, accelerators, scalerators and mentors needs be created.
b. ISRO has to play a major role in this and initiatives such as Digital India, Startup India, Make in India, Smart Cities Mission, etc. need to be synchronized.
4. Supporting Law
a. A law that allows private players to participate across the space value chain is needed.
b. Draft Space Activities Bill, introduced in 2017, has lapsed and need to be reintroduced and passed.
India needs a new approach with bold policies and determining actions to achieve a 10% share of the global space economy within a decade.
Source: The Indian Express
MSME Sector
Despite the Central government’s relief package majorly focussing on Micro, Small & Medium Enterprises (MSMEs), MSMEs are pessimistic about the prospects.
What is the issue?
A survey by All India Manufacturers’ Organisation reveals that
1. About 1/3rd of MSMEs were beyond recovery
2. About another 1/3rd would recover in six months
3. Just 12% may recover in less than three months.
4. Only 3 % of MSMEs, 6% of corporates, and 11% of the self-employed would stay unaffected as they were engaged in the supply of essential services during the lockdown.
How important are MSMEs?
1. MSMEs makes up about 45% of the country’s total manufacturing output.
2. MSMEs contribute to 40% of India’s exports
3. They contribute to almost 30% of the national GDP.
4. It employs an estimated 11 crore persons.
Which are the reasons for issues in MSMEs?
1. MSMEs were already facing issues and it got aggravated by the lockdown.
2. The main reasons were
a. Faulty implementation of demonetization and Goods and Services Tax (GST) regime.
b. Problems in the banking sector and the Non-Banking Financial Companies (NBFCs) further impacted MSMEs.
3. These issues depleted their internal reserves and aggravated the low visibility of demand.
Why the MSME package is insufficient?
1. MSME package lack fiscal support to share some of the costs inflicted by the pandemic lockdown.
2. It is based on credit guarantee that has limited relevance as only about 15% of Rs 70 lakh crore MSME credit demand was met by formal financial channels.
3. While the willingness of lenders is uncertain, the interest rate determines the borrowing to meet working capital as not much production occurred.
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4. Additional loans would necessitate earning a sizable amount to service the loans after 12 months.
5. Much of this intervention is aimed at firms with loan accounts that continue to remain standing up to a cut-off date.
6. But the majority of smaller units are behind on this count, as their payment from customers (larger companies and state-owned units) is pending.
Pending Payments
1. A lot of payments are pending, and there is no confidence in it be cleared soon.
2. The total outstanding payments to the MSME sector is estimated at Rs 5 lakh crore.
3. Majority of the dues are on account of state government entities and larger private companies.
4. Also, unfulfilled assurances in the past make it difficult for MSMEs to be convinced by the government’s assurance of clearing dues in 45 days.
Consolidated MSME Notification
1. The Ministry of MSME has issued a consolidated notification for classification and registration of MSMEs from 01-July-2020.
2. This notification supersedes all other notifications and is the final document in this regard.
Classification of MSME
1. The new classification is based on investment on plant machinery and turnover both inclusive, this definition is applicable to both manufacturing and service industries
Notification
1. From now onwards MSMEs will be known as Udyam and the registration process is known as Udyam registration.
2. Udyam registration can be completed on the basis of Aadhaar number and only self-declaration is needed without the need to upload documents, papers, certificates or proof.
3. Exports of goods and services or both shall be excluded while calculating the turnover of the Udyam.
4. The ministry has also set up facilitation centres at district and regional levels to facilitate entrepreneurs who are unable to complete Udyam registration.
Atmanirbhar package for MSMEs
1. Credit Guarantee Trust fund for Micro and Small Enterprises.
2. Emergency Credit line Guarantee scheme, worth Rs. 3 lakh crore to provide working capital finance.
3. Subordinate debt for stressed MSMEs worth Rs. 20,000 crores.
4. Equity infusion through fund of funds, where a fund of funds will be set up with a corpus of Rs.10,000 crores to provide equity fund support to MSMEs.
5. No Global tenders for government tenders of up to Rs. 200 crore, thus promoting MSMEs.
Source: PIB and The Indian Express
Free Power to Farmers
1. The central government is planning to eliminate the scheme of free power supply to farmers.
2. This scheme has been much-abused and regarded as a major vote bank policy measure.
3. It is to be replaced with the direct benefits transfer (DBT) as a condition to allow States to increase their borrowing limit.
4. By December 2020, the DBT should be introduced at least in one district of a State and from the next financial year, a full roll-out should be made.
5. It has been opposed by states like Tamil Nadu that became the first State to introduce free power in 1984.
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4. Maharashtra has been the only State that scrapped the scheme and Karnataka may become the first southern State to have DBT in the power supply.
Consequences of Free Power
1. Power subsidy bills in the four southern States and Punjab are at least ₹33,000 crore, that is difficult to be met by the State governments due to current resource crunch.
2. The universal application of the scheme has led to widespread wastage of water and electricity.
3. The scheme is against incentivizing even a conscientious farmer to conserve power and water.
4. India is the largest user of groundwater that exceeds the combined withdrawal by China and the U.S.
5. This has led to severe depletion of groundwater and increased financial burden for farmers as they invest in high-capacity pump sets.
4. Absence of meters or segregation of feeders of distribution transformers makes measurement of consumption difficult.
5. So, power Discoms combine the portion of aggregate technical and commercial (AT&C) losses with energy consumption by the farm sector to show a reduced AT&C loss.
Need for free power
1. Free power ensures food security and provides livelihood opportunities to landless workers.
2. As farmers dependent on canal irrigation gets water almost free of cost, the farmer not covered by canal irrigation should be given free electricity.
Way Forward
1. A fair pricing mechanism must be adopted for farmers benefiting from canals.
2. Small and marginal farmers outside the canal supply should be given free power but with restrictions.
3. They have to be made aware of the judicious use of groundwater and the need to conserve it.
4. Changes in the mindset of agriculturists and political parties towards the concept of free power are needed for better results in the power sector.
Source: The Hindu
Agriculture Reforms
The Union Cabinet has cleared 3 ordinances
I. The ordinance to Amend the Essential Commodities Act of 1955.
II. The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020
III. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020
I. The ordinance to amend the Essential Commodities Act of 1955
1. The Essential Commodities Act was enacted at a time of food scarcity in the country.
2. It allowed the government to notify a commodity as “essential” to take control of its production, supply and distribution, and impose a stock limit.
3. The amendment lifts restrictions on to stock key commodities such as cereals, pulses, onion and potato.
4. It gives farmers the freedom to sell their produces directly or through e-trading platforms to entities of their choice instead of being confined to state mandis.
5. The installed capacity of a value chain participant and the export demand of an exporter will remain exempted from such stock limit imposition to ensure investments in agriculture are not discouraged.
6. But the government can still impose regulations on agriculture commodities in situations such as war, famine, extraordinary price rise and natural calamity.
7. Any action on imposing a stock limit under the amended Act will be based on price triggers, such as
a. 100% increase in the retail price of horticulture produce and
b. 50% in non-perishable agricultural foodstuff for over 12 months.
II. The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance
1. It promotes trade and commerce outside the physical premises of markets covered by State Agricultural Produce Marketing legislation.
2. So far, farmers had to sell their produce only at Agriculture Produce Market Committee (APMC) mandis.
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3. The ordinance also provides for an electronic trading transaction platform for agricultural commodities.
4. Several states have promulgated ordinances to allow farmers to sell their produce outside APMC market yards and granted traders a unified licence to purchase from any mandi across the state.
III. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020
1. It will allow farmers to engage directly with processors, aggregators, wholesalers, large retailers and exporters.
2. It will also allow farmers and buyers to enter into contracts. Farmers will be assured a certain price at the time of sowing and the buyer procures the harvested produce at the pre-decided rate subject to quality norms.
3. Both parties will be insulated from excessive market risk, and the model agreements for different commodities will be prepared by the Agriculture Ministry.
4. Farmers can engage in direct marketing, thereby eliminating intermediaries, resulting in full realisation of price.
5. These ordinances also provide for a separate dispute resolution mechanism under which farmers can approach the designated district authority for grievance redressal in a time-bound manner.
Features of the new ordinances
1. The reforms will largely free the sector from a system of inspectors and permits and ensure One India, One Agriculture Market.
2. It helps both farmers and consumers by bringing in price stability and removing fears of private investors of excessive regulatory interference.
3. These reforms provide barrier-free inter-state and intra-state trade in agriculture produce and eliminating intermediaries.
4. These changes aim to free agricultural markets from the limitations imposed by permits and mandis that were originally designed for an era of scarcity.
5. While this provides more choices for farmers to trade their produce, its success depends on the private sector’s response.
Source: The Indian Express
Economic Recovery
The United States monthly jobs data showed that as many as 2.5 million jobs were added in May.
Which factors determine economic recovery?
Some of the major factors that determine the shape of recovery include
a) Overall duration of the pandemic
b) Effect on jobs and household incomes
c) Extent of fiscal stimulus provided by the government.
What are the various types of economic recoveries?
Z-shaped recovery
1. Under this, the economic disruption is assumed to be for just a small period.
2. The ability of people to spend is restricted but their incomes don’t drop.
3. In this, the absolute GDP actually overshoots the trend path because of a rise in demand for goods and services.
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V-shaped recovery
1. Economic disruption lasts longer resulting in forgoing of several activities instead of being deferred.
2. But it is assumed that incomes and jobs are not permanently lost.
3. Economic growth recovers sharply and returns to the path followed before the disruption.
Which graphs explain slow recovery?
1. In certain cases, recovery is slower as the economic disruption would result in the loss of several jobs and incomes, drawing down on savings, etc.
2. Under this situation, the economy will follow a “U”-shaped path.
3. In such a scenario, after the initial fall, the recovery is gradual before regaining its momentum. If this process is more-long drawn than it follows the “elongated U” shape.
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How are W-shape & L-shape recovery relevant?
1. Both these recovery paths are relevant at COVID-19 time.
2. W-shape allows for the possibility of a V-shaped recovery, followed by the second wave of infections until the economy recovers for the second time.
3. But “L”-shape recovery is the worst scenario as there is a permanent loss to the economy’s ability to produce.
4. In this, the economy fails to regain the level of GDP even after years.
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Where is the Indian economy headed?
1. In the current financial year, India’s economy will experience contraction in the range between minus 4% to minus 14%.
2. After hitting low this year, the economy will start its recovery in the next financial year (2021-22).
3. But India’s economy is also expected to contract in 2021-22 as well.
4. India’s absolute GDP (in Rs Trillion) is unlikely to even come back to the 2019-20 level by 2023-24.
5. The weakness of the economy during the COVID crisis and the less than adequate fiscal stimulus is expected to result in an “elongated U-shape” recovery for India.
Source: Indian Express
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Forex Reserves
1. India’s foreign exchange reserves have steadily increased by 8,400% from .8 billion as of March 1991 to the current level.
2. This forex reserve enables India to avoid any financial crisis, instead of pledging gold reserves as done in 1991.
3. For the first time in 40 years, India’s GDP growth in contracting and manufacturing and trade activity are at standstill.
4. But, India’s forex reserves are rising and is expected to reach the $500 billion mark soon.
What are forex reserves?
1. They are external assets in the form gold, SDRs (special drawing rights of the IMF) and foreign currency assets (capital inflows to the capital markets, FDI and external commercial borrowings) accumulated by India and controlled by the Reserve Bank of India.
2. Forex reserves are held for objectives like supporting and maintaining confidence in the policies for monetary and exchange rate management including the capacity to intervene in support of the national or union currency.
3. It will also limit external vulnerability by maintaining foreign currency liquidity to absorb shocks during times of crisis or when access to borrowing is curtailed.
Why are forex reserves rising?
1. The investment in foreign portfolio investors (FPIs) in Indian stocks and foreign direct investments (FDIs) is rising.
2. Foreign investors had acquired stakes in several Indian companies in the last two months.
3. After pulling out from debt and equity segments earlier, FPIs have now returned to the Indian markets expecting a turnaround in the economy.
4. Forex inflows are set to rise further and cross the $500 billion due to major foreign investments that are taking place.
5. The fall in crude oil prices also has saved forex by reducing the oil import bill.
6. Similarly, overseas remittances and foreign travels have fallen steeply.
How is this significant?
1. While the economic growth is set to contract by 1.5% in 2020-21, rising forex reserves help the government and RBI in managing India’s external and internal financial issues.
2. It’s enough to cover the import bill of the country for a year.
3. The rising reserves have also helped the rupee to strengthen against the dollar.
4. The foreign exchange reserves to GDP ratio is around 15%.
5. Reserves will
a. provide a level of confidence to markets about country’s ability to meet its external obligations,
b. demonstrate the backing of domestic currency by external assets,
c. assist the government in meeting its foreign exchange needs and
d. external debt obligations and maintain a reserve for national disasters or emergencies.
Who handles forex reserves?
1. RBI functions as the custodian and manager of forex reserves, and operates within the overall policy framework agreed upon with the government.
2. RBI allocates the dollars for specific purposes. For example, under the Liberalised Remittances Scheme, individuals are allowed to remit up to $250,000 every year.
3. It uses the reserve for the orderly movement of the rupee. It sells the dollar when the rupee weakens and buys the dollar when the rupee strengthens.
4. The RBI has been buying dollars from the market by releasing an equal amount in rupees to shore up the forex reserves.
5. This excess liquidity is sterilized through the issue of bonds, securities and LAF operations.
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Where are India’s forex reserves kept?
1. The RBI Act, 1934 provides the overarching legal framework for deployment of reserves in different foreign currency assets and gold within the broad parameters of currencies, instruments, issuers and counterparties.
2. As per RBI data, 64% of the foreign currency reserves are held in securities like Treasury bills of foreign countries, 28% is deposited in foreign central banks and 7.4% is also deposited in commercial banks abroad.
3. India also held 653.01 tonnes of gold as of March 2020, with 360.71 tonnes being held overseas in safe custody with the Bank of England and the Bank for International Settlements, and the remaining gold is held domestically.
Which are the costs involved in Forex maintenance?
1. Return on India’s forex reserves kept in foreign central banks and commercial banks is negligible with around 1% or less interest as rates in the US and Euro zone are falling.
2. The Usage of the forex reserves for infrastructure development in the country has been demanded but is being opposed by RBI.
3. Greater weightage to return on forex assets than on liquidity is being demanded thereby reducing net costs of holding reserves.
4. The high ratio of volatile flows (portfolio flows and short-term debt) to reserves is around 80%. So, this money can exit at a fast pace.
5. There are some differences among academics on the direct as well as indirect costs and benefits of the level of forex reserves, from the point of view of macro-economic policy, financial stability and fiscal or quasi-fiscal impact.
Source: Indian Express
NBFCs and RBI
1. The COVID-19 pandemic related disruptions have impacted market financing conditions for non-banking financial companies (NBFCs).
2. This could result in higher redemption pressure, necessitating further policy assistance for the sector.
3. The mutual fund (MF) sector emerging as a key source for funding to non-banks has aggravated the situation.
4. Though central bank measures have eased the stress, further policy interventions are required to ensure flow of funds to credit-worthy entities.
5. The NBFC sector faced a liquidity crunch as banks were reluctant in extending the benefits of loan repayment moratorium to them.
6. But the non-banks extended the same to their borrowers.
Challenges
1. Financing conditions had become challenging, especially for lower-rated NBFCs.
2. This is due to an overall environment of greater risk sensitivity and heightened risk aversion.
3. There are near-term scheduled redemptions of commercial papers and corporate bonds issued by NBFCs.
4. The stress in certain areas of the market require policy interventions that are beyond liquidity-related measures to credit-related ones.
5. There is a need for ensuring flow of credit/liquidity to NBFCs with concrete credit backstop to address the risk aversion in the system.
Source: The Hindu
S&P India’s rating
1. Global rating agency S&P has maintained India’s long term rating at BBB-, the lowest investment grade, but observed the long-term rating to be stable.
2. While the risks to long-term growth are rising, proper execution of the on-going reform process would result in better growth rate for India than others.
3. The outlook expects fiscal consolidation over the next 3 years following a larger fiscal deficit this financial year due to the COVID-19 pandemic.
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4. India’s economy will recover following the containment of the COVID-19 pandemic, and will maintain sound net external position.
5. The stable outlook also assumes that the government’s fiscal deficit will recede markedly following a multi-year high in fiscal year 2021.
Downgrade
1. India can face a ratings downgrade over the next 1-2 years if GDP growth fails to recover from 2021.
2. The net general government deficits have exceeded the estimated level.
3. This signifies weakening of India's institutional capacity to maintain sustainable public finances.
4. On the other hand, there could be an upgrade if the fiscal deficit is significantly curtailed.
5. Moody’s also maintained a negative outlook by downgrading India’s rating to Baa3, the lowest investment grade.
Contraction
1. The country’s productive capacity had been severely disrupted as millions of workers had left their jobs to return home.
2. India’s labour markets have weakened drastically and may take time to get back to normal.
3. The economy is expected to grow strong in the next financial year as S&P projected 8.5% growth in real GDP in fiscal 2022.
Long term
1. The economy’s long-term outperformance highlights its resilience.
2. India’s wide range of structural trends, including healthy demographics and competitive unit labour costs are favourable factors.
3. A more favourable corporate tax regime, supportive of manufacturing firms, should reinforce growth, alongside additional fiscal and monetary easing.
Source: The Hindu
Rights issue
Following Reliance Industries Limited, several companies are planning to raise funds through rights issue.
What is rights issue?
1. It is a mechanism for companies to raise money from the existing shareholders through issue of new shares.
2. It is not mandatory for the existing shareholders to buy the new shares, but provides a right to invest first in the company.
3. A shareholder has the option to buy the new shares or to sell their right to buy the new shares to other shareholders.
Why companies use this route?
1. Regulatory compliance in rights issue is less cumbersome as only approval from the Board of Directors is sufficient.
2. Time taken to raise the money is less compared to other modes of raising money as it requires approval from shareholders.
3. So, the rights issue is a more efficient and preferred mechanism of raising capital during the COVID crisis.
Which are the temporary relaxations?
SEBI has provided temporary relaxations in rights issue process because of the COVID-19 crisis.
1. Eligibility requirement of average market capitalization of public shareholding has been reduced from Rs 250 crore to Rs 100 crore to ease issuance of rights issue.
2. The minimum subscription requirement has been reduced from 90% to 75% of the issue size.
3. Listed entities raising funds upto Rs 25 crores (earlier 10 crores) through a rights issue are now not required to file draft offer document with SEBI.
How did previous reforms help?
1. The streamlining of the rights issue process reduced the timelines for completion of the process by 40%.
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2. It facilitated trading of rights entitlement (RE) by eligible investors and subscriptions to more than eligible shares by interested investors.
3. Dematerialization and permitting of REs to be traded through stock exchange framework helped to overcome issue of low liquidity.
4. It also helped in the determination of a fair market price for REs for shareholders with small holdings.
Source: Indian Express
Fuel Pricing
Oil marketing companies (OMC) have been increasing the automobile fuel prices continuously, despite a drop in the barrel price of crude oil.
Who decides the oil prices in India?
1. Government has decontrolled the fuel prices of Aviation turbine fuel (ATF) in 2002, Petrol in 2010 and Diesel in 2014.
2. Decontrolling of fuel prices means that the price will not be decided by the government (for sale by fuel retailers) rather by the OMCs.
3. OMCs (downstream companies) fix the cost of fuel prices based on the price of crude oil they get from upstream oil companies such as ONGC, Oil India limited, imports etc and add distribution costs, profits to them.
4. Upstream oil companies perform activities like identifying oil wells, exploration, drilling etc (ONGC, Oil India ltd,etc) and get crude oil as output. Using this as input, downstream companies (IOCL, BPCL, HPCL) produce products such as petrol, diesel, ATF, etc. by refining the crude oil.
5. The OMCs have been permitted by the government to revise the prices of petrol and diesel daily based on price movement of crude oil.
6. The rise in prices of crude oil globally following resumption of economies has prompted the OMCs to increase the prices.
7. Indian crude oil basket comprises sour grade (Oman and Dubai average) and sweet grade (Brent) that are processed in OMCs. The variation in these prices decides the rates of petrol and diesel in India.
8. Currently only kerosene and domestic LPG are under price control i.e., the government decides the retail prices.
How it affects the final consumers?
1. The drastic reduction in crude oil prices in International markets has not benefited final consumers.
2. This is because the OMCs have increased the petrol and diesel prices as the government has increased the excise duty on petrol and diesel.
3. The taxes (Excise duty and VAT) collected on petrol and diesel as a percentage on their respective base prices, has also been increased drastically.
4. Globally, India has the highest rates compared to other countries like Germany, Japan and the USA that have high rates.
5. The government is the sole entity that has benefited due to the increase in taxes.
6. OMCs and Customers had to bear the increase in petrol and diesel prices despite a drop in the global crude oil price.
7. So, a rise in crude oil prices is transferred to the customers, while the government benefits from a decrease in the form of taxes.
Why are OMCs not benefitted?
1. OMCs have to bear huge inventory losses i.e., losses incurred when crude oil prices start falling and the crude oil sourced at higher prices have reduced by the time the product reaches the customer.
2. According to CRISIL, these losses account to about Rs 25,000 crores in Jan-March quarter.
What is the rationale for increasing tax?
1. It helps the government cover up the fiscal deficit losses during the current crisis, as the tax revenue from other sources is expected to decline.
2. If the price volatility in crude oil is passed directly to customers, it creates panic and sudden drop/rise in associated products is not good for the economy.
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Source: Indian Express
Bankruptcy Code Ordinance
Government has recently promulgated an ordinance suspending bankruptcy code for 6 months starting 25-Mar-2020.
About ordinance
1. It introduced Section 10 A under the Insolvency and Bankruptcy Code, 2016 to suspend Section 7, Section 9 and Section 10 dealing with initiation of Insolvency Resolution Process for companies.
2. The ordinance is applicable for a period of 6 months or such further period notified by the government, but not exceeding 1 year from 25-Mar-2020.
3. So, no insolvency petition can be allowed against a debtor during this exempted period for not paying his principal/interest to a creditor.
4. This has been done to protect the companies from economic downfall due to the pandemic.
Problems
1. This deprives lenders the opportunity to restructure the company that can be saved from liquidation.
2. It is difficult to assess whether the company defaults its payments due to reasons other than the pandemic.
3. The provision may not be useful as banks/Financial institutions can still approach debt recovery tribunals for recovery.
4. Earlier, government increased the minimum amount from 1 Lakh to 1 Crore to start an insolvency petition to protect the MSMEs.
5. This provision may work against the MSMEs as they have to approach the civil courts to recover the disputed debts below 1 crore.
Source: The Hindu
PK Mohanty Committee
1. Promoters of banks like IndusInd and Kotak Mahindra bank are either increasing or decreasing their holding.
2. So, RBI is relooking at the existing norms on promoter holdings in private sector banks.
3. Currently, private bank promoters need to reduce their holdings to 40% within 3 years, 20% in 10 years and 15% in 15 years to ensure that the ownership is well diversified and major shareholders are ‘fit and proper.’
4. RBI has constituted an internal working committee under PK Mohanty to comprehensively review the existing guidelines on ownership of private sector banks.
Terms of Reference
1. The working group will suggest norms keeping in mind the issue of excessive concentration of ownership and control.
2. It will examine and review the eligibility criteria for individuals or entities to apply for a banking license, and review the promoter shareholding norms at the initial licensing stage.
3. The group will also study the current regulations on holding of financial subsidiaries through a non-operative financial holding company (NOFHC) and suggest steps to migrate all banks to a uniform regulation.
NOFHC
1. Non-Operative Financial Holding Company (NOFHC) means a non-deposit taking NBFC.
2. An NOFHC can not
a) have any exposure (credit and investments including investments in the equity / debt capital instruments) to the Promoters / Promoter Group entities or individuals associated with the Promoter Group or the NOFHC
b) make investment in the equity / debt capital instruments in any of the financial entities under the NOFHC
c) invest in equity instruments of other NOFHCs.
Source: Livemint
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COVID-19 & Banking Sector
What is the impact of COVID on society?
1. Low & Lower-middle income classes that accounted for 66% of India’s total consumption prior to the pandemic, are the most affected now.
1. The impact of pandemic on upper middle & high income households that accounts for 64% of savings is expected to be mixed.
2. The expenditure will contract by 9-11%, even if the economy is rapidly stabilized with large fiscal stimulus and aggressive containment strategy.
3. In case of a longer crisis (12-18 months), expenditure will contract to about 35%-55% even with fiscal stimulus measures.
How will it impact Banks?
1. India had one of the highest Gross non-performing assets(GNPAs) among major economies.
2. Already, liquidity crisis due to failure of IL&FS in the NBFC sector and high level defaults in corporate debt led to contraction of available credit in the market.
3. Now, moratorium on interest payments impacts assessment of quality and quantity of NPAs.
4. NPAs will rise further due to the pandemic effect on jobs and incomes of people.
5. Most negative effects will be on assets related to MSMEs, unsecured debt, urban microfinance, commercial vehicles due to drop in incomes of the middle class.
6. There could be an increase in GNPAs, that had started to decline recently, as corporates are also expected to be impacted.
Where the banks need to focus?
1. Banks need to aggressively manage their NPA through measures such as increasing their collection infra on retail loans, stress testing of balance sheets.
2. Banks with lower capital adequacy ratio(CAR) or higher provisioning requirements will have to raise additional capital to improve their balance sheets.
3. They should consider changes in their operating models and digitization of processes.
4. Partnering with fintech companies can create the right ecosystem for banks that enables digitized lending and fulfilling the needs of the customers.
Source: Livemint
SFAC
The Small Farmers Agribusiness Consortium (SFAC) has linked 1000 markets to e-NAM platform.
About SFAC
1. SFAC is an autonomous society promoted by the Ministry of Agriculture, Cooperation and Farmers welfare.
2. It was registered under societies registration act, 1860 in 1994.
3. Union Minister of Agriculture is the ex-officio President of SFAC, and Secretary of Department of Agriculture, Cooperation and farmers welfare acts as ex-officio Vice President.
4. SFAC promotes groupings of small and marginal farmers to Farmers interest groups, Farmer producers organization and Farmer producers company to help them with bargaining power and price discovery of commodities.
5. Its main functions are
a. Ensuring accessibility and cheaper availability of agri inputs to small and marginal farmers.
b. Establishing forward and backward linkages in agriculture supply chain management.
6. It has been tasked with the implementation of e-NAM (e-National Agriculture Market) and Delhi kisan mandi.
FPO
1. Farmer Producer Organisation (FPO) is a producer organisation (PO) with farmers, milk producers etc. as members.
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2. An FPO can be setup by an individual or an entity and can be registered as a cooperative society or a producer company under Companies act, 2013 or a society under society’s registration act, 1860 or an NGO under section-8 of companies act, 2013 or as a public trust under Indian Trusts act, 1882
3. FPO generally consists of small and marginal farmers to help them with access to investments, technology, inputs and markets. It helps them in increasing collective bargaining power.
4. In the budget 2020, the government announced a new central sector scheme, ‘Scheme for formation and promotion of FPO’ and decided to form 10,000 FPO’s in the country over the next 5 years.
e-NAM
1. e-NAM is a pan India electronic trading platform for agricultural commodities to create a unified national agricultural market.
2. SFAC is implementing the e-NAM scheme.
3. e-NAM links farmers, traders, FPOs, APMC (Agricultural Produce Market committee) in helping them realize the better price discovery for agricultural commodities and provides a smooth marketing facility.
4. So far e-NAM has connected 1.66 crore farmers and 1.30 lakh businesses.
Source: PIB
Skill University
Our Current Education system has not been able to ensure inclusiveness in education, employability and employment.
What are the problems?
1. Current setup in traditional universities could not provide employment related education, as 60% of taxi drivers in Korea, 31% of USA retail check out alerts and 15% of high end security guards in India are graduates.
2. Many graduates remain unemployed due to lack of job oriented training and placement drives.
3. Mismatch between infrastructure, placement scenario and the high tuition fees in private universities is leading to poor return on investment for students and high NPAs in banks due to lack of job opportunities.
4. The system created an inclusiveness deficit as majority of the students in universities are from urban background, and rural background people are left behind.
5. The lack of Industry-University linkages led to companies spending more on training of candidates, resulting in lower packages to students.
How can Skill Universities bridge the gap?
1. Unlike the traditional universities, skill universities have 4 types of learning methodologies i.e., on-campus, on-line , on-site and on- the job.
2. Skill universities impart Industry related skills that are acknowledged by Industry that can spend less on training them for jobs.
3. Skill Universities are financed by employers, students, CSR and loans while most of the traditional universities are funded by the government.
4. Curriculum, faculty, governance are decided by the employers while in case of traditional universities curriculum cannot be decided without government guidelines.
Where the changes have to be made?
1. Traditional universities need to work like 1/4th college, 1/4th ITI, 1/4th apprenticeship and 1/4th employment exchange.
2. UGC act needs to be amended to recognize apprenticeship linked degree programmes.
3. UGC teacher regulations need to be amended to redefine the qualifications, roles and number of teachers required and to recognize industry experience as a teaching qualification.
4. NAAC (National Assessment and Accreditation Council) also needs amendments to
a. Include Industry workplaces and online classes as extensions of campus.
b. Integrate online learning with university programmes.
c. Include work based learning and work integrated learning.
Source: Indian Express
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Household Savings
The net household savings in India has increased from 7.2% of GDP in 2018-19 to 7.7% in 2019-20.
What are household savings?
1. Currency, bank deposits, debts securities, mutual funds, pension funds, insurance and investment in small savings schemes of an economy are referred to as Gross household savings.
2. When Financial liabilities including loans from banks, NBFCs and housing finance companies are subtracted from gross savings it is termed as Net household savings.
Why did the change happen?
1. The current increase in net household savings is due to the slowdown of economy at the start of 2019 and reduction of financial liabilities from 3.9% of GDP in 2018-19 to 2.9% in 2019-20.
2. The per capita income in 2019-20 also grew by mere 6.1% in nominal terms, lowest since 2002-03 when it grew by 6.03%.
How does it affect the economy?
1. At individual level, people started borrowing less due to slowdown in per capita income leading to a slowdown in lending growth.
2. The weak financial state of NBFCs like the failure of IL&FS had led to credit crunch in the financial sector.
3. The overall effect on societal level led to slowdown in consumption, loan growth resulting in the slowdown of the economy.
Where the focus should be?
1. As per RBI’s report, there would be an increase in the net household savings in 2020-21 due to reduced consumption because of COVID-19.
2. Due to slowdown in real estate sector and the pandemic , people resorted to bank deposits. Following heavy cash inflow, banks have reduced their deposit interest rates as the growth in loan is low.
3. So, a new policy should be developed to channel these savings in lifting the economy from slowdown.
Source: Indian Express, Livemint
Corona Bonds
In the COVID-19 crisis, government may assess the option of borrowing from external markets using the Corona Bonds to ensure that its expenditure on critical supplies is not curtailed .
What was India’s experience borrowing from abroad?
1. During the 1991 crisis, India was on the verge of defaulting on the external debt. But the opening of the economy brought relief and avoided that situation.
2. The 1997 Asian financial crisis made India accumulate surplus forex reserves to overcome capital flight of dollars and saved rupee from depreciating.
3. Currently India has been receiving large amounts of Forex in the form of both FDI and FPI.
a. RBI recently announced that it has about $500 billion in forex reserves.
b. Corporates like Reliance Industries has been receiving huge FDI into investments from USA, UAE etc
4. India’s external debt of $564 billion at the start of 2020 is modest, of this government owed about $110 billion and the bulk comprises of corporate loans and non-resident deposits.
How much can India borrow?
1. Considering the existing situation, India can safely borrow $40 billion from abroad which is equivalent to 3 trillion INR.
2. The credit rating agencies have recently downgraded India’s ratings, so India may need to sell the bonds at higher premium.
3. Global market would be ready to accept India’s Corona Bonds as the yields on low risk bonds are dipping below zero. If India provides positive interest rates on these bonds, it can attract investors.
4. Taking into account the track record in paying up these bonds on time, India can also tap into the diaspora to accumulate up to $20 billion.
Where India needs to concentrate?
1. India needs to focus more on exports (which is on decline) as capital inflows may not be reliable all the time and the mismatch in Balance of payments may lead to 1991 kind of crisis.
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2. If India keeps its borders open (open economy), it can safely borrow in dollars.
Source: Livemint
Economic Development
1. The return of migrants to their home states like UP, Bihar, Haryana, etc is creating pressure on states to create new employment opportunities.
2. The current GDP led growth model had created inequality and under-development of rural India.
3. So states have to develop a new economic model to increase the well-being of the people.
Singapore Model
1. Lee Kuan Yew, the founder of Singapore declared that Singapore would become the first developed country in South Asia in 1965.
2. Singapore focussed more on raising per-capita incomes of citizens similar to developed countries rather than increasing the GDP growth rate of the country.
3. Methods used
a. Initially, when companies were unwilling to invest in Singapore, JRD Tata was approached to set up a tool room and a training centre that led to foundation for Singapore’s industrial growth.
b. MNCs were invited to leverage the strategic geography of Singapore by establishing manufacturing industries using Singapore labour.
c. Companies were provided concessions on land, tax exemptions, etc. to train Singaporeans to train for high value jobs for raising their earning potential.
4. This approach didn’t regard humans as tools to produce returns for investors rather money as tool to produce benefits for humans.
Gandhian Economics
1. Gandhi’s model focussed on village as a pivot for economic development. He observed that India can’t be a free country unless the villages have social and economic freedom.
2. He also believed that economy must serve human needs rather than human beings becoming fodder for the GDP.
3. Principles of Gandhian Economics
a. Well-being of humans must be the ultimate goal of all economic activities.
b. Governance must be strengthened at grass root levels of villages and towns.
c. Wealthy people must only be a trustee of community’s wealth and not its owners.
d. Creation of new models of cooperative capitalistic models where workers are the owners of the enterprises.
Source: The Hindu
World Investment Report
1. World Investment Report is released by UNCTAD (United Nations Conference on Trade and Development), headquartered in Geneva, Switzerland.
2. According to the report, India jumped from the 12th spot in 2018 to the 9th spot in 2019 on the list of World’s top FDI recipients.
Global Scenario
1. Global FDI flows are expected to decrease by 40% in 2020 compared to the value of $1.54 trillion in 2019.
2. FDI would go below $1 trillion for the first time since 2005 and is further projected to decrease by 5% before initiating a recovery in 2022.
3. The rise in 2019 is modest at 3% following decline in 2017, 2018 due to higher flows of FDI to developed countries and also tax reforms in USA in 2017.
4. In South Asia, FDI is expected to contract sharply, where India is the recipient of 70% of this value.
India’s Scenario
1. Following a 20% rise in 2019, FDI to India may shrink in 2020 due to the pandemic.
2. The number of greenfield investments decreased by 4% in the first quarter of 2019 and Mergers and Acquisitions (M&A) contracted by 58%.
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3. India’s FDI has been on a long term growth trend and despite slowdown in post pandemic period, India is bound to attract investments due to its huge market size.
4. India’s Industries like professional services and the digital sector could see a faster growth compared to other sectors as global tech firms show huge interests in these companies.
UNCTAD
1. It is a permanent intergovernmental body established in 1963 by the UNGA.
2. It is part of UNECOSOC (United Nations Economic and Social Council)
3. Other reports released by UNCTAD
a. Digital Economy report
b. Trade and Development report
c. Technology and Investment report
Source: Livemint
Tourism Sector
1. The COVID-19 pandemic has impacted every sector of the economy with travel, tourism, and hospitality sectors being impacted the most.
2. With the recent SOP (standard operating procedures) for reopening, these sectors should reopen.
Significance
1. Travel and tourism have employed about 42 million people in India that accounted for 8.1% of total employment opportunities.
2. It contributed to 9.3% of India’s GDP and received 5.9% of total investments in 2019.
3. It can generate millions of high-quality jobs and can accelerate our economic growth to 9-10% annually.
4. India is ranked 3rd after China and the USA in the World Travel and Tourism council’s Travel and Tourism power ranking. It assess countries based on Total travel and tourism GDP, foreign visitor spending, domestic spending, and travel and tourism capital investment.
5. India was also ranked 34th out of 140 countries in the World Economic Forum ‘ Travel and Tourism Competitiveness ranking.’
Areas to Focus
1. Incredible India campaign accelerated growth in the tourism sector in India. Domestic focused Incredible India 2.0 could be the post-pandemic plan for the sector.
2. Government needs to expedite the process of launching 100 tourism-oriented trains similar to air transport under the UDAN scheme.
3. The holistic Island development plan for developing Andaman and Nicobar, Lakshadweep Islands can add jobs, develop tourism-based projects in these regions.
4. India became a major player in the culinary ecosystem, making restaurants a 4lakh crore market, creating jobs and having a massive multiplier effect. The recent guidelines of Unlock 1.0 is slowly reviving this sector.
5. Making India a global hub for tourism was also emphasized by PM of India, urging every citizen to visit 15 tourist destinations in India by 2022. The sector must convert this opportunity to advance domestic tourism.
6. While the pandemic has altered the progress, tourism’s revival will benefit all other sectors in the downstream and upstream that accompany this sector.
Source: Hindustan Times
Housing Finance Companies
1. As the new regulator for Housing finance companies (HFC), RBI proposed new stringent norms for them in the draft regulations.
2. In the Housing finance norms, ‘housing finance’ was not defined. The draft defines it as financing for the purchase/ construction/ renovation/ repairs of residential dwelling units.
3. All other loans such as loans for furnishing dwelling units, loans given against mortgage of property for any other purpose other than buying/construction of new building are termed as non-housing loans.
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4. It also classified HFCs as systematically important and non-systematically important. All deposit-taking HFCs irrespective of asset size and non-deposit taking HFCs of with asset size of above 500 crores will be treated as systematically important HFCs.
5. At least 50% of net assets should be in the form of ‘qualifying assets’ for HFCs of which at least 75% should be towards individual housing loans.
6. It has also provided steps to curtail double financing i.e., lending to construction companies and also to individuals buying flats from them by allowing HFCs to choose only at one level.
Housing Finance Companies
1. It is considered as an NBFC(Non-banking financial company) under the RBI regulations for regulatory purposes.
2. A company is treated as an NBFC if its financial assets are more than 50% of its total assets and income from financial assets is more than 50% of the gross income.
3. Previously, HFCs were regulated by the National Housing Bank, a subsidiary of RBI. Now RBI has taken over the powers from NHB as a regulator.
4. Some of the HFCs are Deewan Housing Finance Limited (DHFL), India Bulls Housing Finance Limited, etc.
Source: Business Standard
Digital Payments
1. There has been a decrease of 46% in digital transactions in April-2020, while the government transfers increased by 138% in the same period.
2. As per RBI report, the fall was between 26% to 71% across different sectors.
3. RTGS (Real time gross settlements) and NEFT(National Electronic Fund transfer) that accounted for 90% of total payments have contracted by 46.5% and 42.7% respectively.
4. Cash withdrawals from ATM reduced by 49%, UPI transactions by 27% and IMPS transactions by 40%.
5. There was a rise of 138% in digital payments via Aadhaar enabled payment systems.
Reasons
1. The lockdown has stalled the Indian economy and severely impacted the quantity and value of payment transactions.
2. The intensity of lockdown was also seen through the contraction of Industrial output by 55% in April.
3. The cash requirement had dropped as money was used mainly for buying essential items and not for other purposes.
4. Aadhaar payment bridge system used by the government to transfer various funds/subsidies rose because of the Pradhan Mantri Garib Kalyan Yojana (PMGKY).
5. Government announced 1.7 Lakh Crore relief package under PMGKY for the poor to address the problems arising from coronavirus
a. Cash transfer of 500 rupees per month for 3 months to 20 crore women Jan Dhan account holders.
b. Food support of 5kg wheat, 1kg pulses per month for 3 months to 80 crore poor people.
c. An ex-gratia of Rs.1000/- to 3 crore poor senior citizens, poor widows and poor disabled.
Source: Indian Express
Market Economy Status
India rejected to grant market economy status to China as their companies could not prove it and so, it has been treated as a non-market economy.
Market Economy Status
1. China joined WTO (World Trade Organization) in 2001 after the negotiations on the condition that it’ll be treated as a non-market economy by other countries.
2. In a non-market economy, the state has complete monopoly over trade and prices of goods are decided by the state itself instead of market forces.
3. China was to be treated as a non-market economy for 15 years from 2001 after which all countries irrespective of domestic laws need to grant market economy status to China.
4. USA, EU and India are hesitant to grant to this status, as it reduces their ability to impose steep anti-dumping duties on imports from China because of
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a. Wide ranging price control on export commodities by China.
b. 80% of companies in China are believed to be controlled by the state and banks in China are controlled by Chinese Communist Party.
c. India instituted 18 anti-dumping cases in 2019, most of them against China.
5. China is one of the largest trading partners for India with combined bilateral trade of $85.4 billion in 2019. Imports from China contribute to $68.3 billion and exports contribute $17.1 billion.
6. Granting market economy status reduces India’s potential to impose huge anti-dumping duties and protect domestic industry from cheap Chinese imports.
Anti-Dumping Duties
1. These are present in the WTO GATT (General Agreement on Tariff and Trade) agreement.
2. These duties are imposed on an exporting country if the price of product exported is less than the price in the host country and if the product imported impacts the local industry.
Source: Livemint
De-coupling from Chinese Manufacturing
The question of India decoupling itself from Chinese manufacturing arises following the Galwan standoff and COVID-19 situation.
What is the current situation?
1. India has a trade deficit of $65 billion with China and is dependent on China for a number of raw materials and intermediate goods.
2. Due to COVID-19, companies in China are looking to set up manufacturing bases in other countries and India is trying to attract these companies.
3. The Government of India had already constituted a high-level committee under the Cabinet Secretary to attract new investments into India and some states like Uttar Pradesh had relaxed labor norms to attract companies.
Why is India more dependent on China?
1. Due to Make in India, the dependency on China has increased in terms of requirement of intermediate goods.
2. For Example, the pharma sector is dependent on China for Active Pharmaceutical Ingredients.
3. Similarly, in case of capital goods, Indian manufacturing is dependent on electrical machinery, semiconductor machinery, fertilizer, etc.
How different is the Global Value Chain?
1. After the 2008 global financial crisis, Global value chains have become more local, i.e., countries are depending on their own economies rather than global markets.
2. China had the advantage of agglomeration effect, where the forward and backward linkages of products are integrated. So, supply chains moving out of China could be rare.
Where does India need to focus?
1. The Skill India programme should be fast-tracked on a priority basis as Foreign investors look into sectors that have a good skill base.
2. Expedite infrastructure projects such as Sagarmala and Bharatmala to enable port-led development.
3. Need to direct FDI investments into manufacturing sector as so far much of the FDI has been in service sectors. For example, Sale of Flipkart to Walmart, Facebook-Jio deal.
4. Green field investment has capability to create substantial jobs and additional capacities within the economy.
5. The lack of India focused FTA (Free Trade agreements) have been detrimental to the manufacturing sector, whose market is now being captured by Vietnam, Bangladesh etc.
6. Huge unemployment led to loss of demand in the domestic market.
7. So, expediting Free trade agreements can boost the local employment levels and the demand in the local economy.
Source: The Hindu
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PM SVANidhi
1. Pradhan Manti Street Vendors Atma Nirbhar Scheme (PM SVANidhi) is a micro credit facility scheme for street vendors, launched by the Ministry of Housing and Urban Affairs.
2. This scheme provides working capital loans to street vendors to resume their livelihood that has been adversely affected due to COVID-19.
3. The scheme aims to cover 50 lakh street vendors for availing loan of up to Rs. 10,000/- repayable for a tenure of 1 year.
4. It also provides an interest subsidy of 7% to ensure timely repayment of loans.
5. It provides incentives for using digital transactions in the form of cashback of Rs.100 per month.
6. Small Industries development bank of India (SIDBI) has been chosen by the Ministry of Housing as the implementing agency for this scheme.
7. SIDBI will manage the credit guarantee to the lending institutions such as banks, NBFC, etc through Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).
8. It will develop and maintain an integrated IT platform that provides:
A. Documentation of all processes and workflows for end to end solution through a portal and mobile application.
B. This ensures engagement and information flow between Urban Local bodies, Lending institutions, Digital payment aggregators and others.
About SIDBI
1. SIDBI is a statutory body established in 1990, headquartered at Lucknow, Uttar Pradesh.
2. It acts as the principal financial institution for promoting, financing and development of Micro, Small and Medium (MSME) industries sector
3. Government of India holds 16% share in SIDBI and the rest is shared by Public and Private sector banks, Insurance companies etc.
Source: PIB
Ruling on Liquidation
1. NCLAT (National Company Law Appellate Tribunal) had ruled against NCLT (National Company Law Tribunal) giving arbitration proceedings an upper hand over liquidation process under IBC (Insolvency and Bankruptcy Code).
2. BHEL had won an arbitration award against a debtor in NCLT when the liquidation of the debtor’s company was in process.
3. NCLAT reversed the orders of NCLT and made BHEL equal in respect of other financial creditors on having a claim on the debtor’s assets.
4. NCALT held that in order to claim priority over other financial creditors BHEL should have had at least 60% share value which it was not in possession of.
5. NCLAT resorted to the waterfall mechanism of liquidation while giving judgment in this case.
Waterfall mechanism
1. According to this, during the liquidation of a company priority is given to secured financial creditors over unsecured financial creditors.
2. The mechanism does not give precedence to one secured financial creditor over others in the same category, and gives them an equal opportunity.
3. In the waterfall mechanism in IBC, the sequence to be followed is
A. Costs related to liquidation process
B. Secured financial creditors
C. Employees’ salaries
D. Unsecured financial creditors or Operational creditors
E. Government dues
F. Remaining dues and debts
G. Equity
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4. IBC Process
Source: Indian Express
Power Sector Overhaul
As resistance to Chinese Imports is growing, Ministry of power is overhauling the power Industry that is dependent on China for most of its intermediate and final goods.
Situation
1. India had already cancelled key projects given to Chinese firms and also barred BSNL from procuring telecom equipment from China.
2. India’s power sector is facing cyber-attacks and majority of the equipment originates from China, Singapore, etc. So, any grid-collapse in the future could destabilize the Indian economy.
3. India has a huge trade deficit with China of about $68 billions in 2019 which is a cause of concern for India.
Reforms Proposed
1. Government is categorizing some countries as ‘prior reference countries’ that require prior permission from the Government before importing any equipment from such a country.
2. This ruling will be applicable to the whole supply chain of the power sector including the renewable energy sector.
3. This is to deny revenue and job creation activities in the countries that are India’s adversaries, as military power is directly linked to economic power.
4. So, all imported solar cells, modules and inverters will attract basic customs duty which makes Chinese imports expensive.
5. A list will be created that’ll only allow manufacturers approved by the Bureau of Indian Standards and Ministry of Power to participate in government-supported schemes and projects.
6. Also, financing from Power Finance Corporation, Rural Electrification Corporation and Indian Renewable Energy Development agency (IREDA) will be structured in a way to promote domestic manufacturing of electrical equipment.
7. The government will also do away with providing certificates that allow imports at lower duties.
8. These measures help in encouraging Atma Nirbhar Bharat or Self-Reliant India strategy.
Source: Livemint
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Economy of India & China
According to the World Bank, until 1990 India’s per-capita income was more than China and now it is one-fifth of China’s.
What was China’s per-capita income in 1990?
1. Per-capita income is the average income of a citizen of a country. It is obtained by dividing GDP of a country with its population.
2. China’s per-capita income was $318 while that of India was $368 at the same time.
3. After Liberalization in China’s economy, it is $10,276 in 2019 while India’s is one-fifth of it.
How did the gap grow?
1. China liberalized its economy in 1990 and its exports rose in 1990.
2. It emerged as a major outsourcing player for manufacturing for large western companies that allowed them to drastically cut costs.
3. China was integrated into the Global value chain and it led to transition from a largely agrarian economy to an Industrialized nation.
4. In 2018, China’s exports stood at $2.64 trillion against India at $0.54 trillion.
5. The infrastructure provided in China was better than other countries that made companies choose China as their manufacturing base.
Which sector did India perform better?
1. India performed fairly well in services exports. In 2018, India’s service exports stood at $205 billion against China at $233 billion.
2. India is slowly catching up with China in services front and the difference has been reducing since the last decade.
Why did India's service exports grow?
1. This is primarily attributed to software exports that grew consistently in the last few years.
2. The visionary leadership in some companies, global demand for software services and lack of government interference helped this sector grow.
3. In a few states, the government also supported some software entrepreneurs.
What went wrong for India’s manufacturing sector?
1. Barring the 2-wheeler sector, much of the manufacturing industries was struck in the import substitution era before 1990.
2. So, they could not compete with the Global market and demand, even with foreign firms within India.
3. This made India import even basic products. In the first 11 months of 2019-20, 97% of imports from China were manufactured products.
Source: Livemint
New Infrastructure Projects
The Union Cabinet under Chairmanship of the Prime Minister had approved new infrastructure projects across 3 sectors.
AHIDF
1. GoI (Government of India) has set up Rs. 15,000 crores worth Animal Husbandry Infrastructure Development Fund (AHIDF) to stimulate infrastructure development by the private sector in diary, meat processing, and animal feed plants.
2. The eligible beneficiaries would be Farmer Producer Organizations (FPOs), MSMEs, Private companies, Section 8 Companies, and individual entrepreneurs contributing a minimum 10% margin money.
3. The companies would be given 90% of funds required as loans from the banks and only 10% is to be contributed by them.
4. GoI will also provide interest subvention of 3% to eligible beneficiaries.
5. GoI will also set up an Rs.750 crore credit guarantee fund under NABARD to provide guarantee cover up to 25% of the credit facility of the borrower.
6. Benefits
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A. It will incentivize private entrepreneurs in the animal husbandry sector and also promote good returns to farmers and boost exports.
B. It would also motivate farmers to invest more on inputs to increase their productivity leading to rise in farmer’s income.
C. The scheme helps in livelihood creation for about 35 lakh persons.
Kushinagar International Airport
1. Kushinagar is an important Buddhist site. Gautam Buddha attained Mahaparinirvana at this place.
2. It is surrounded by other important Buddhist sites such as Sravasti, Kapilavastu, Lumbini and makes it an attraction for followers and tourists.
3. Benefits
A. The Buddhist circuit scheme by GoI is recognized as a key pilgrimage destination by people practicing Buddhism.
B. Declaring Kushinagar, a part of Buddhist circuit, as an International Airport improves connectivity, offers wide choice of services at competitive costs and economic development of the region.
Shwe oil and Gas Project
1. ONGC Videsh Limited (OVL) has been associated with exploration and development of Shwe gas project in Myanmar since 2002 along with South Korea and Myanmar.
2. The project has been yielding returns since 2014-15 and GAIL is also a co-investor in this project.
3. GoI approved additional investment for further development of the project.
4. Benefits
A. It helps in strengthening India’s energy security.
B. It gives a boost to India’s Act East policy by developing energy bridges with neighboring countries.
Source: PIB
Bharat Savings
With the contraction in Urban savings and expenditure, the ability of rural India to revive the Indian economy is being focused.
What is the current situation?
1. Urban India is witnessing job losses, declining incomes and reduction in non-essential expenditure.
2. In such a scenario, Rural India can perform better than Urban India because
A. Higher consumption of essential products,
B. Government subsidies,
C. Eased restriction on agricultural activities.
How is the situation in rural India?
1. Agriculture sector grew by 4% in 2019-20 that led to record production of food grains, recovery in prices of non-perishables.
2. India’s farm sector is expected to rise by 2.5% in 2020-21 despite the pandemic.
3. Rural India shows signs of recovery as the sale of fertilizers increased by 74% compared to last year, tractor increased by 4% that contracted by 79% last month and rural lending has improved.
4. The reversal of the deflationary phase in food prices, record production and MSP based procurement can improve rural consumption.
5. Centre’s rural jobs scheme of 1 trillion rupees, doubled food subsidy entitlement is also expected to increase rural disposable incomes.
Why rural India may not revive the economy?
1. Agriculture sector is facing risks such as
A. Locust attacks that may rise in July
B. Lack of storage for perishable items leading to distress sale,
C. Lack of demand for milk producers due to drop in urban demand.
2. Consumption of discretionary items is at 50-60% of their normal levels and drop in marriages is resulting in lower purchases of Jewellery, watches and apparel.
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3. Loss of income of 30 million migrant workers also impacts rural India as they contribute to about 80% of rural incomes.
Where to focus?
1. Government can increase the food subsidy for an additional 3 months as FCI has a massive stock of 90 million tons of food grains.
2. It should provide for additional 1 trillion rupees for rural schemes to revive the economy.
Source: Livemint
Air Travel Bubbles
India proposed setting up of air travel bubbles or COVID safe travel zones with countries like USA, Germany and France
Air travel bubbles
1. Under this concept countries have mutual understanding between them in terms of travel restrictions, quarantining or testing.
2. There would be no restrictions in terms of quarantining or testing between the departure and arrival points in this bubble.
3. This is based on trust between the countries in each other’s numbers and testing.
4. Baltic countries like Estonia, Lithuania and Latvia have formed a bubble allowing free travel among themselves while restricting people from other countries.
India’s proposal
1. India is planning to propose bilateral arrangements with countries such as USA, Germany, France, UK for resuming international air travel that has been halted.
2. The demand for these destinations has not reduced.
3. The recent action of allowing commercial flights by India to other countries and restricting the same to other country’s airlines to operate in India has concerned countries like USA, France.
4. This proposal will help airline operators from other countries to resume their operations in India and also improve bilateral relations with those countries.
Challenges
1. The destination country may be concerned in signing the agreement as COVID-19 cases in India are increasing.
2. New Zealand after successfully controlling the spread of coronavirus witnessed a rise in cases because of the relaxation of travel restrictions.
Source: Indian Express
Urban Development Missions
Atal Mission for Rejuvenation and Urban Transformation
1. It is a centrally sponsored scheme that adopts a project-based approach to ensure basic infra related to water supply, sewerage, transport and development of green spaces.
2. These activities are planned in 500 cities and towns in India.
3. Funding pattern
A. Central assistance will be 50% of project cost if the population in the city is less than 10 lakhs and
B. One-third of the project cost in case the population is more than 10 lakhs.
4. The scheme completed its 5 anniversary and had provided water tap connections to 79 lakh households and 45 lakh sewer connections.
Smart Cities Mission (SCM)
1. SCM was launched in 2015 to develop 100 smart cities across India.
2. The main objective of this mission is to provide core infrastructure and a decent quality of life to its citizens, a clean and sustainable environment.
3. The mission is implemented by a Special Purpose Vehicle (SPV), where the state government and Urban Local body will have 50:50 equity shareholding.
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4. It is a centrally sponsored scheme where the centre provides Rs. 500 crore per city and the states and ULBs will have to contribute the same amount.
5. So far 47 Integrated Command and Control centers established under this scheme played an effective role in combating COVID-19.
Pradhan Mantri Awas Yojana – Urban (PMAY-U)
1. This scheme intends to provide Housing for all in urban areas by 2022. Government aims to provide central assistance to nodal agencies to build 1.12 crore houses.
2. The mission provides financial assistance to people depending on their income, finance and land availability under these 4 options
A. In-situ Slum redevelopment: Central assistance of 1 lakh is given to each slum dweller for building a house
B. Credit Linked Subsidy Scheme: Interest subvention is given to eligible households falling under different income groups
C. Affordable Housing in partnership: Central Assistance of Rs.1.5 Lakh per EWS house is provided where at least 35% of minimum 250 houses in a project are for EWS category.
D. Beneficiary linked Individual house construction: Central assistance of 1.5 lakh is given to each family belonging to EWS category.
3. So far 1.05 crore houses have been approved for construction of which 35 lakh have been completed and delivered.
All the above schemes are under the Ministry of Housing and Urban Affairs.
Source: PIB
Country of Origin
1. GoI (Government of India) made it mandatory for sellers in GeM (Government e-marketplace) to notify the Country of Origin while registering their products.
2. The GeM portal will also have a Make in India filter for officials to determine the products that have higher indigenous content.
3. This helps GoI to ensure that it procures products that have a minimum of 50% local content criteria while selecting bidders as per the new norms.
4. This process helps in achieving the GoI’s push for Atmanirbhar Bharat and promoting domestic industry.
5. Currently, India is procuring most of its goods from China and this new norm ensures that our imports get reduced.
6. GoI is also exploring ways to introduce this norm to private marketplaces such as Flipkart, Amazon, etc so that consumers can get clarity on where their goods are produced.
GeM
1. It is the National Public procurement portal to facilitate online procurement of common goods and services by various government departments/ organizations/ PSU etc.
2. The portal has been developed by DGS&D (Directorate General of Supplies and Disposal) and National e-Governance division of Ministry of Electronics and Information Technology.
3. The portal operates under the Ministry of Commerce and Industries.
4. It facilitates e-bidding, reverse auction and demand aggregation to ensure efficient usage of resources by the government users.
Source: Indian Express
World Economic Outlook
1. This report is released by IMF (International Monetary Fund) and provides an assessment of the Global economy based on developments in member countries.
2. It forecasts that the world economy would grow at -4.9% and projects a deeper recession in 2020 followed by gradual recovery.
3. $12 trillion worth of economic activity could be lost in the Financial Year 2021 and 2022.
4. This increases the global debt to GDP ratio beyond the World War-2 level across emerging and developing economies.
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5. China is estimated to grow at 1% in 2020 and 8% in 2021, and will remain the fastest-growing economy for the 3rd time.
India’s forecast
1. India’s economy is to grow at -4.5% in 2021 and could grow at a 6% growth rate in FY 2022.
2. This because 65% of the economy was shut for a quarter leading to drag in the economic output.
3. The disruption in production, breakdown of supply chain, trade tension with China, may not allow the economic activity to return to normalcy in 2021.
4. There are signs of economic revival in India,
A. Petrol consumption reached 77% of last year value in May-2020
B. Electricity generation is reaching the pre-lockdown levels, and increased collection in tolls and e-way bills.
5. Countries having very limited fiscal space are needed to reorient their spending and revenue to increase and incentivize productive investment.
Source: Livemint
Oil Production
What is the situation?
1. India meets 12% of its crude oil requirement through domestic production and the rest through imports.
2. India’s crude oil production domestically has been decreasing every year since 2012.
3. It has fallen at a compounded annual rate of 2.1% since 2012 and this led to an increase in imports of crude oil thus affecting our Current Account Deficit.
Why is the crude oil production decreasing?
1. It is because most of the oil wells in India are old and have become less productive over a period of time.
2. The lack of new discoveries and long lead time to start production led to lower production levels.
3. India’s upstream sector (exploration and production of crude oil) is dominated by state owned companies like ONGC and Oil India limited and has the participation of very few private players.
4. The lack of efficiency and competition in the upstream sector also contributes to the low production of crude oil.
Why are there not many private players?
1. Main reason is the delay in awarding projects and the difficulties in operationalization of production.
2. The reasons for delay include,
A. Delay in identifying and tendering of oil blocks
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B. Environmental clearances
C. Delay in approving Field Development plan by allottee from Directorate General of Hydrocarbons.
3. The best-case scenario from allotment to production is 5-7 years during which the cost escalation of the project hinders many private players from undertaking the project.
Where should the Government should focus?
1. GoI (Government of India) came up with OALP (Open Acreage Licensing Programme) to allow private players to bid for blocks they are interested in rather than the government calling for bidding.
2. This ensures that the government may not sit idle in awarding the oil blocks.
3. GoI also provided for lower royalty and oil cess after starting the production, private players have asked for their relaxation during the crash in global crude oil prices as it affects their viability.
4. The new OALP and HELP (Hydrocarbon Exploration and Licensing Policy) policies can help in inducing competition in this sector and increase our production levels.
Source: Indian Express
Cash Transfers & PDS
1. The current Public Distribution System (PDS) under NFSA (National Food Security Act), 2013 provides food grains to 67% of India’s population at subsidized prices.
2. PDS has been an effective tool to eliminate the hunger crisis during the current COVID-19 pandemic.
3. A recent survey reported that during lockdown 89% of rural and 69% of urban respondents said that they were able to get food grains from government shops compared to only 30% of people who received Jan dhan transfers.
4. Economic survey has pointed out inefficiencies in PDS and increasing food subsidy leading to higher fiscal deficit and proposed cash transfers instead of directly providing food grains.
Benefits of Cash transfers
1. Enables households to invest in better diets than the conditional allotment of food grains in PDS.
2. It can reduce the fiscal deficit and food subsidy bill of the Government.
3. Currently FCI (Food Corporation of India) has an outstanding loan of Rs. 2.5 lakh crore, thus further stressing FCI could lead to collapse of FCI.
4. Cash transfers provided good results in reducing maternal deaths and also provided livelihood support to old age people, widow and divyangs.
Benefits of PDS
1. The financial mess in FCI is due to mis-management and off-budget accounting by the government to show a lower fiscal deficit but not due to increasing food subsidy bill.
2. Excluding the off-budget borrowing, the food subsidy bill is between 0.53-0.59% of GDP, prior to PDS it was 0.8-0.85% of GDP.
3. The cost of transacting in bank increases than directly procuring food grains from a fair price shop because,
A. There are more fair price shops than bank branches throughout India.
B. Many of the Jan dhan accounts are dormant and transaction costs of withdrawing money are higher.
B. Time lost in withdrawing money from banks and purchasing food grains leads to loss in wages.
4. Farmers may not get MSP (Minimum Support price) for their food grains if the PDS system is abolished.
5. Cash transfers introduced in certain places like Puducherry, Chandigarh, Daman and Diu had not yielded good results.
6. Puducherry had to roll back the cash transfer to in-kind transfer due to local protests.
Way Forward
1. Currently food grain stocks are more than 100 million tons and are at the highest levels since 2001-02, thus the government can universalize PDS which eliminates leakages.
2. The pandemic had left many people jobless (especially migrants) and PDS could act as a tool to reduce hunger related problems.
Source: Indian Express
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Government Expenditure
In the wake of the pandemic, GoI (Government of India) is rationalizing its expenditure due to less revenue collections.
What is the situation?
1. GoI in April categorized ministries into 3 groups to ensure that Ministries limit their spending activities.
A. Ministries such as health and other important ministries have no limits on spending, while others have been limited to 15-20% of their budget.
2. Lower revenues and rising expenditures to tackle COVID-19 are straining the government finances and increasing its fiscal deficit.
Why is the government resorting to expenditure rationalization?
1. It is predicted that the debt-GDP ratio which was in the levels of 70% will rise to beyond 80% thus raising the question of debt sustainability and fiscal consolidation.
2. The direct tax collections have been declined by 25% in the first quarter, while GST collections are only 45% of the normal monthly targets.
3. Relaxation of fiscal deficit may lead to rating agencies downgrading our credit rating, it may increase our cost of borrowing.
4. Moody’s rating agency had already downgraded India’s rating and raised warning about India’s rising Fiscal deficit, Debt-GDP ratio and the prolonged slowdown in Indian economy as worrying indicators.
How is the government spending now?
1. The expenditure is routed towards the Atmanirbhar Bharat package rather than regular expenditure on the Ministry's schemes.
2. Despite focusing on Atma Nirbhar package there are some problems like,
A. Credit offtake to MSMEs under Emergency credit line Guarantee scheme is poor as so far only 7% of the funds have been disbursed by banks.
3. This is further worsening the impact of government's expenditure rationalization plan.
Where should the government focus?
1. Some of the Economists emphasized on the need to concentrate on economic growth and revival rather than focusing on fiscal deficit in this pandemic time.
2. The economic costs of concentrating on debt numbers can take a toll on rising unemployment levels and loss of lives and livelihood.
Source: Indian Express
PM-FME scheme
1. The Ministry of the Food processing Industries launched a new scheme called PM Formalization of Micro Food Processing Enterprises (PM FME).
2. Unorganized food processing units comprise nearly 25 lakh units and provide employment to 74% in the food processing sector.
3. This scheme aims to provide financial, technical and business support for upgrading existing micro food processing enterprises.
Features
Funding
1. The scheme is implemented over a period of 5 years from 2020-21 to 2024-25 with an outlay of Rs.10,000 crores.
2. The funding pattern is 60:40 between centre and states, 90:10 for North Eastern States and Himalayas and 100% by centre for UTs.
Approach
1. The scheme adopts a One District One Product (ODOP) approach to avail benefits such as procurement of inputs, availing common services and marketing of products.
2. States would identify the food product for a district based on the existing supply chain network, Non-ODOP products are also supported in this scheme but preference is given to ODOP products.
3. Support for common infrastructure, branding and marketing would be available for ODOP products.
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Support pattern
1. Each micro enterprise can avail credit linked capital subsidy@ 35% of the eligible cost with maximum of Rs. 10 lakhs for upgrading their unit.
2. FPOs (Farmer Producer Organization)/ SHGs (Self Help Groups) can receive a credit linked grant of 35% for capital investment along the value chain.
3. The enterprises will be supported with capacity building training through National Institute of Food Technology, Indian Institute of Food Processing and Technology and other institutes.
Benefits
1. Nearly 8 lakh units will benefit from this scheme.
2. It enables the micro enterprises to formalize, grow and become competitive in future.
3. The project is likely to generate 9 lakh skilled and semi-skilled jobs.
Source: PIB
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Environment
Organic Livestock Farming
1. As per a report by FiBL and IFOAM-Organic Internationals, organic activities and organic farmland in 186 countries cover an area of more than 71.5 million hectares.
Top ten countries with the highest increase of organic land 2018
2. This increase suggests that farmers are aware of the benefits and restrictions of organic farming.
3. Though there are restrictions like the prohibition on the use of any synthetic compound, it will help them cut off extra expenses and curb pollution levels in the environment.
4. This will increase the income of producers and ensure safe food and surroundings for the consumer.
Organic Livestock Farming
1. Traditionally, mixed farming integrates farming with the rearing of livestock to produce economic commodities.
2. Organic farming is further positively influenced to rear livestock as
a) Integrated livestock organic farm will never need extra soil-incorporation materials and saves money.
b) Livestock waste like the faecal matter can be utilized as manure and pesticides on the farm.
c) For instance, cow urine can be used as a pest repellent as well as a growth promoter.
Benefits of organic manure
1. Counteract acidification, helps in improving soil structure and leads to increased water infiltration.
2. Better water-holding capacity, good nutrient retention and improves microbial diversity. Cat-ion exchange capacity and soil pH get influenced positively.
3. Increased soil-carbon, reduced atmospheric carbon levels, reduced nitrate leaching and reduced soil erosion.
4. Manure can coat the soil surface and reduce erosion inflicted by raindrops similar to crop residues.
5. Carbon and other essential nutrients present in the manure can increase the microbial biomass and soil respiration rate by two-three times.
6. Enhances the functional diversity of the microbial population, which is key to soil nutrient cycling.
Mean yield response to organic amendments relative to a non-fertilized control among crop types:
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Reclamation of soil diversity
1. Effective manure amendment results in the development of soil biological system that comprises larger soil organisms, such as protozoa, and invertebrates including nematodes, mites and earthworms.
2. This will help in suppressing the disease-causing soil-borne pathogens and pests.
3. Active manuring helps in expanding the all-important nutrient pool, in eradicating pathogens and in improving crop yield.
Organic Mixed farming business
1. The global organic market in the world is estimated to be worth 97 billion euros in 2018.
2. The USA is the largest market, followed by the EU and China. By region, North America leads, followed by Europe and Asia.
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Overall benefits of Organic Farming
1. It has long-term sustainability in terms of production and productivity.
2. But for the best possible return from organic livestock farming, the balance between soil and livestock must be ensured. Or else, it can create insecurity among potential farmers.
3. Minimizing the exposure to hazardous chemicals and persistent monitoring on the growth benefits both the farmer community and consumers.
4. It also ensures high animal safety welfare standards as per Codex Alimentarius commission, 2007.
5. Organic produces are priced higher than conventional produce because of nutritional quality and freshness of the produce.
6. It is an important pillar of sustainable rural development as it generates more positive and sustainable externalities than the conventional model.
7. Farmers experience job opportunities, farm profitability, and long-term income due to low input and high prices for produces than conventional farming produces.
8. It actively contributes towards building a stronger economy with the focus on the livelihood of rural communities.
9. Pasture-based livestock farming benefits the ecosystem, such as increased carbon sequestration, enhanced quality of pastures and lowering the risk of fire.
10. Organic farming models are more water-efficient in terms of usage and retention on the field leading to the development of resistance against drought.
11. Organic agro-ecosystems possess greater agro-biodiversity. So they exert more resilience to various pests, diseases and climate change.
12. It provides an ideal way to overcome the obstacles pertaining to global food security and sustainability.
13. It will also enable the system to renew all the existing natural resources around, such as water and soil with low GWP (global warming potential) compared to the conventional model.
Source: Down To Earth
Climate Change in India
1. According to a study by Earth Systems and Environment, India’s economy, ecosystem and population are extremely vulnerable to climate.
2. The greenhouse gas emissions could cause extreme weather events such as severe flooding and killer heatwaves in the decades ahead.
3. The study forecasts a rise of 4.2°C in annual mean temperatures across India by century-end in case of high-emissions.
4. India’s northwest is particularly at high risk of flooding as a result of melting Himalayan snow and glaciers.
5. It also projects higher annual rainfall, during winter and summer both, and warmer winters overall, that would reduce snow accumulation at high altitudes.
Consequences
1. India’s weather patterns have turned erratic, heat waves have become common, and unseasonal events have grown in frequency.
2. Cyclonic storms are frequent and atmospheric disturbances of other parts of the globe also disturbing long-settled agrarian cycles.
Shift to Renewable Sources
1. India is gradually shifting its power generation away from hydrocarbons toward renewable sources.
2. Such a slow transition will not help much unless other countries also act to contain gas emissions as well.
3. The US has opted out of its global commitments to cut back emissions and help stop global warming and China also has a poor record on the issue.
Source: Live Mint
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Environment Performance Index
1. India secured 168 rank in the 12th edition of the biennial Environment Performance Index 2020.
2. The index released by Yale University, measures the environmental performance of 180 countries.
3. India’s rank was 177 (with a score of 30.57 out of 100) in 2018. India has scored 27.6 out of 100 in the 2020 index.
4. The index considered 32 indicators of environmental performance and gives 10-year trends in environmental performance at the national and global levels.
South Asian region
1. India needs to re-double national sustainability efforts on all fronts.
2. India needs to focus on a wide spectrum of sustainability issues, with a high-priority to critical issues such as air and water quality, biodiversity and climate change.
3. The 11 countries lagging behind India were — Burundi, Haiti, Chad, Soloman Islands, Madagascar, Guinea, Côte d’Ivoir, Sierra Leone, Afghanistan, Myanmar and Liberia.
4. All South Asian countries, except Afghanistan, were ahead of India in the ranking.
5. Also as per State of India’s Environment 2020 released by Centre for Science and Environment and Down to Earth, India’s rank on Sustainable Development Goals (SDGs) among the South Asian countries is low.
6. India scored below the regional average score on all five key parameters on environmental health, including air quality, sanitation and drinking water, heavy metals and waste management.
7. It has also scored below the regional average on parameters related to biodiversity and ecosystem services.
8. Among South Asian countries, India was in 2nd position (rank 106) after Pakistan on ‘climate change’. Pakistan’s score (50.6) was the highest under the category.
9. A ten-year comparison progress report in the index showed that India slipped on climate-related parameters.
10. The performance on climate change was assessed based on
a) adjusted emission growth rates
b) composed of growth rates of four greenhouse gases and one pollutant
c) growth rate in carbon dioxide emissions from land cover
d) greenhouse gas intensity growth rate
e) greenhouse gas emissions per capita.
11. Black carbon, carbon dioxide emissions and greenhouse emissions per capita increased in 10 years and resulted in overall score under climate change of 2.9 points.
Source: Down to Earth
Urban Forests
1. The Ministry of Environment, Forest and Climate Change (MoEFCC) chose Nagar Van (urban forest) as the theme of World Environment Day 2020, with a view to enhance biodiversity in urban landscapes.
2. Development of Urban Forests will contribute to India's decision to sequester 2.5 to 3 billion tonnes of carbon dioxide equivalent in the forests and will function as urban lungs.
3. Warje City Forest in Pune is an example of Private-Public Partnership for developing urban forests and can act as a model for building urban forests under MoEFCC’s Nagar Van scheme in 200 cities across the country.
4. Assistance under CAMPA Fund will be provided for this initiative.
5. The Environment Ministry is also considering to introduce prizes for good city forests created by public participation.
6. India has 16% of the world's human & cattle population, both require land, water & food, with only 2.5% of the world's landmass & 4% of natural water resources. Still, India is able to preserve 8% of the world's biodiversity.
7. MoEFCC, in coordination with state governments, has planned to enhance the target for tree plantation to 145 crores with people's participation.
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8. The Government has also decided to take up the regulation of major river basins in the country, with forestry interventions, tree plantations and soil moisture conservation.
Warje Urban Forest
1. The Warje Urban Forest in Pune can become a role model for the country in the implementation of the Nagar Van scheme.
2. Warje Forest Area within Pune Municipal Limit, has been developed over about 22 hectares of forest land amounting to about 9000 acres.
3. With the expansion of urbanization and population explosion, Warje that was once outside municipal limit has now come almost at the centre of the city.
4. In the 25 acres of Warje, the forest department pioneered a project to develop the forest area into an urban forest park in 2015.
5. A stake of local people was developed in this forest land by converting the area into a recreational, ecological and environmental green spot for the people around, which also helped to take care of their physical and mental health.
6. This can be replicated all over India to secure and protect the forest lands within the limits of a city to provide them with green areas.
7. Warje City Forest controls air pollution and helps to fight climate change.
8. Warje, situated on the bank of the Mutha river has a catchment area in the western hills that brings along fertile soil and sufficient water.
9. In order to increase the green cover on barren lands, MoEFCC started the project 'Urban Forest' with assistance from the Forest Department, Government of Maharashtra.
10. The total area of the hill is about 16.8 hectares and until some years ago, it was totally barren and used as a dump yard by the residents in the vicinity.
PPP model
1. For creating a balance between development and environment conservation, corporates and NGOs extended their support.
2. Public Private Participation as seen in Warje is one of its best examples.
3. Residents have planted and adopted trees in memory of their loved ones at Smriti Van in Warje and also a total of 9500 trees were planted under CSIR initiative between 2015 to 2017.
4. The neglected land has now been transformed into an area of rich biodiversity of various species of plants, birds, butterflies, reptiles and mammals.
5. The project also helps in absorbing approximately 129,000 Kg carbon-dioxide and producing about 5,62,000 Kg oxygen per year.
6. Presently, water is supplied from five water ponds located within the project area and with water tankers that supplement water supply in the dry season.
7. The groundwater level in the area is on the rise and the surplus will be useful for others also in the near future.
8. The Project Urban Forests is helping in maintaining the ecological balance, serving both environmental and social development goals.
Source: PIB
Oil Spill in Russia
1. The pillars supporting an oil tank in a power plant situated in Norlisk region of Russia had sunk due to thawing (ice converting to liquid) of permafrost.
2. This led to an oil spill in the nearby Ambarnaya river disturbing the ecosystem in that marine area.
What is Permafrost?
1. Permafrost is the ground that remains completely frozen at 0 degree celsius or below for a period of at least 2 years.
2. The frozen ground consists of soil, sand and rock held together by ice and is believed to have formed since the glacial period.
3. It is covered by a surface layer or active layer which is normally a vegetation cover of tundra.
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4. The thickness of permafrost reduces progressively towards the south.
5. Factors like Earth’s interior heat, snow and vegetation cover, presence of water bodies, and topography affect its thickness.
Where are they found?
1. Permafrost occupy 22% of the earth’s landmass and are found in polar regions and regions with high mountains.
2. At lower latitudes, permafrost regions are found in the Alps and Tibetan plateau.
3. But the thickness of the permafrost varies from region to region. For example, in northern Siberia it is 1500m while in Alaska it is 740m.
Why did the pillars sink?
1. Melting of the permafrost in the region has resulted in the collapse of the pillars.
2. Climate change led to the intense warming of arctic regions resulting in the melting of permafrost.
3. As per the data of US National Oceanic and Atmospheric Administration, temperatures in Arctic regions are warming twice as fast as compared to the rest of the planet.
4. The Earth’s polar and high altitude regions that are principal permafrost reservoirs are the most threatened by climate change.
Which are the threats?
Infrastructure
1. As permafrost melts, the ground becomes unstable and leads to massive potholes, landslides, and floods.
2. This can cause damage to roads, railway lines, buildings etc that were built on them and endangers the lives of people living in these regions.
3. These changes also threaten the survival of indigenous people, as well as Arctic animals.
Biological
1. Under the permafrost, layers of organic material of dead plants, animals and microorganisms are frozen.
2. So, melting of permafrost would result in the decomposition and release of greenhouse gases that would further warm the region and the world.
3. As permafrost ground also contains pathogens like viruses and bacteria, its melting could result in an outbreak of the disease.
Source: The Indian Express
GM seeds
Shetkari Sanghatana — the farmers’ union founded by Sharad Joshi — announced fresh plans for using of genetically modified seeds.
What are genetically modified seeds?
1. Conventional plant breeding involves crossing species of the same genus to provide the offspring with the desired traits of both parents.
2. Genetic engineering aims to transcend the genus barrier by introducing an alien gene in the seeds to get the desired effects.
3. The alien gene could be from a plant, an animal or even a soil bacterium.
4. Bt cotton, the only GM crop that is allowed in India, has two alien genes from the soil bacterium Bacillus thuringiensis (Bt) that allows the crop to develop a protein toxic to the common pest pink bollworm.
5. But Ht Bt cotton is derived with the insertion of an additional gene, from another soil bacterium that allows the plant to resist the common herbicide glyphosate.
6. In Bt brinjal, a gene allows the plant to resist attacks of fruit and shoot borers.
7. In DMH-11 mustard, developed by University of Delhi, genetic modification allows cross-pollination in a crop that self-pollinates in nature.
8. Across the world, GM variants of maize, canola and soybean, too, are available.
Where does the law stand?
1. In India, the Genetic Engineering Appraisal Committee (GEAC) is the apex body that allows for the commercial release of GM crops.
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2. In 2002, the GEAC had allowed the commercial release of Bt cotton.
3. More than 95% of the country’s cotton area has since then come under Bt cotton.
4. But use of the unapproved GM variant can attract a jail term of 5 years and fine of Rs 1 lakh under the Environmental Protection Act ,1989.
Why are farmers demanding GM crops?
1. In the case of cotton, the high cost of weeding goes down considerably if Ht Bt cotton is grown and glyphosate is used against weeds.
2. Bt brinjal reduces the cost of production by cutting down on the use of pesticides.
3. So, unauthorised crops estimating about 50 lakh of the unapproved Ht Bt cotton out of 4-4.5 crore packets (each weighing 400 gm) of cotton were sold.
4. Haryana has reported farmers growing Bt brinjal in pockets, causing a major agitation.
How are farmers agitating?
1. In the current kharif season, farmers would undertake mass sowing of GM seeds for maize, soyabean, mustard brinjal and herbicide tolerant (Ht) cotton, although these are not approved.
2. Farmers who plant such variants will put up boards on their fields proclaiming the GM nature of their crop.
3. According to the farmers, this action will draw attention to the need for introduction of the latest technology in the fields.
4. Farmers had carried out a similar movement last year, too.
Environmentalists argument
1. The long-lasting effect of GM crops is yet to be studied and so they should not be released commercially.
2. Genetic modification brings about changes that can be harmful to humans in the long run.
Source: Indian Express
Lion Census
1. Gujarat forest department declared that the total population of Asiatic lions was 674, a 28% increase compared to the 2015 census.
2. Lion census is conducted once in every 5 years through the Block counting method or Direct beat verification.
3. In this method, the people carrying out the census are stationed at water points where lions come to drink water atleast once in 24 hrs.
4. The lions are counted based on direct observation.
Issues
1. Direct beat verification is a 100-year-old method, and so there is a possibility of under/over counting of the lion population.
2. Number of personnel from forest department, NGO’s, Wildlife experts, etc involved in the census was lower than the normal because of travel restrictions imposed for the pandemic.
3. The census provides an inaccurate estimate of the population as the death of lions from the recent outbreak of CDV (Canine Distemper Virus) has not been updated.
Solution
1. Newer methods of census enumeration can be carried out on the lines of tiger census like
a. Camera trapping and identification of lions based on permanent marks on their bodies.
b. Statistical estimates of animals predatory pattern and numbers of their prey base
2. These measures can help in the accurate estimation of the number of lion’s population in the country.
Source: The Hindu
Desertification & Draught
1. The World Day to Combat Desertification and Draught was observed with the theme “ Food.Feed.Fibre”- that links consumption and land.
2. This year’s observance is focused on changing public attitudes who are the main cause of desertification and land degradation.
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3. As populations become larger, wealthier and more urban, demand for land to provide food, animal feed and fibre for clothing has drastically increased. The health and productivity of existing land is also declining and worsened by Climate change.
Effects of Desertification
1. According to the Intergovernmental platform on Biodiversity and Ecosystem Services (IPBES) over 70% of all natural, ice-free land in the world is affected by human use.
2. Agricultural land for food, animal feed and fibre is the main reason for land use change according to the Intergovernmental Panel on Climate Change (IPCC). And FAO has projected that by 2050 over 500 mha of land will be needed to meet the global food demand.
3. According to Economics of Land degradation, ecosystem services worth $10.6 trillion are lost annually. Switching to sustainable land management could add up to $1.4 trillion in increased crop production.
4. Land use degradation creates ground for zoonotic disease like COVID-19 as the interaction and physical distance between animals and humans get closer. UNCCD states that land use change needs to be reversed urgently.
UNCCD
1. United Nations Convention to Combat Desertification (UNCCD) is one of the 3 outcomes of the Rio earth summit in 1992.
2. The other 2 are UNFCCC (United Nations Framework Convention on Climate Change) and UNCBD(United Nations Convention on Biodiversity).
3. UNCCD was established in 1994 and is the sole legally binding document linking environment and development to Sustainable land management.
4. The convention specifically addresses the arid, semi-arid and dry-sub humid areas known as drylands where ecoystems are more vulnerable.
5. The convention seeks to
a. Improve the living conditions of people in drylands
b. Mitigate and restore land and soil productivity
c. Mitigate the effects of draught.
6. The convention works on a bottom up approach, encouraging the participation of local people in combating desertification and land degradation.
7. The new 2018-2030 strategic framework aims to achieve Land degradation Neutrality (LDN) in order to restore the productivity of degraded land and improve the livelihood of more than 1.3 billion people.
8. COP-14 of the UNCCD has been recently concluded in 2019 in New Delhi.
Source: UNCCD website & Down to Earth
Macaws
1. Directorate of Revenue Intelligence (DRI) and Wildlife Crime Control Bureau (WCCB) has arrested a few people involved in smuggling Macaws from Bangladesh.
2. The birds were identified as Hyacinth Macaw, Pesquet’s parrot, Severe Macaw and Hahn’s Macaw. All these species are protected under CITES (Convention on International Trade in Endangered species of Wild Fauna and Flora).
3. The Hyacinth Macaw, Pesquet’s parrot are categorized as Vulnerable and Severe Macaw, Hahn’s Macaw as Least Concern by IUCN (International Union for Conservation of Nature).
4. They are also covered under provisions of Customs act and Wildlife Protection act, 1972.
About DRI
1. DRI is an apex anti-smuggling agency of India under the Central Board of Indirect Taxes and Customs, Ministry of Finance.
2. Its main functions are
A. Detecting and curbing smuggling of drugs, illicit International trade in Wildlife and Environmentally sensitive items and
B. Combating commercial frauds related to International trade, evasion of Customs duty.
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About WCCB
1. WCCB is a statutory body established under the Wildlife Protection act and is currently under the Ministry of Environment, Forest and Climate Change.
2. It is headquartered in New Delhi it is mandated to
A. Collect and collate intelligence related to organized wildlife crime and disseminate the same to enforcement agencies for action.
B. Establish a centralized wildlife crime data bank
C. Assist foreign authorities and International Organizations in facilitating wildlife crime control.
3. Operation Clean Art is one of the operations conceived by WCCB to combat the trade of Mongoose hair.
4. WCCB has recently won the Asia Environment Enforcement Award given by UN-Environment.
Source: The Quint, WCCB and DRI website
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Science & Technology
Indian National Supermodel
1. The Department of Science and Technology (DST) under the Union Ministry of Science and Technology has begun work on the creation of a Covid -19 Indian National Supermodel.
2. It will forecast the coronavirus spread and monitor the future transmission of infection with the aim to assist governments in decisions involving the readiness of the national health systems and other mitigation measures.
Why there is a need for such Model?
1. The government was monitoring and taking measures to control infectivity and mortality related to Sars-Cov-2.
2. It was imperative to bring together the analytics harvested by the numerous mathematical models being developed for Covid-19 forecasting and surveillance
3. There was also a need for a robust forecasting model for predicting the spread of the disease and for enhancing disease surveillance measures.
Who is involved in creating such a model?
1. It will be funded by DST-SERB (Science and Engineering Research Board) and other agencies.
2. Jawaharlal Nehru Centre for Advanced Scientific Research (JNCASR) and IISc, Bangalore have been tasked to coordinate and work with all Covid-19 modelling projects and programs in the country.
3. The Coordination team will consult and work with the research groups active in modelling, various software developers, and reputed companies to ensure delivery of a suitable user interface and software.
How it will work?
1. The model will rely only on the data that is relevant to Covid-19 and will also have a built-in component to adapt and learn from the newer data trends.
2. It will aggregate successful evidence-based mathematical and statistical forecasting models and include the best predictive analytics for robust forecasting of infectious disease spread.
3. It could be useful not only for policymakers in India but also around the world for the purpose of overcoming difficulties in predicting the rate of spread of infection.
4. This will help develop a set of benchmarks to assess various models and to finally deliver the Covid-19 India National Supermodel.
Source: Hindustan Times
Origin of the COVID-19 Pandemic
1. A number of studies have found that the novel coronavirus was well-suited to jump from animals to humans by shapeshifting and gaining the ability to infect people.
2. The genetic analysis of the novel coronavirus and its similar variants in animals and confirmed that its closest relative is a coronavirus that infects bats.
From Pangolin to Humans
1. The ability of the virus, SARS-CoV-2, to infect humans was gained by exchanging a critical gene fragment from a coronavirus that infects a mammal called a pangolin.
2. However, typical pangolin coronaviruses are too different from SARS-CoV-2 for them to have directly caused the human pandemic.
3. But, the pangolin coronaviruses contain a receptor-binding site -- a part of the spike protein necessary to bind to the cell membrane -- that is important for human infection.
4. This binding site makes it possible to affix to a cell surface protein that is abundant on human respiratory and intestinal epithelial cells, endothelial cell, and kidney cells.
Ancestor with Bats
1. The viral ancestor in the bat is the most closely related coronavirus to SARS-CoV-2, but its binding site is very different.
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2. On its own the virus cannot efficiently infect human cells with this binding site, the novel coronavirus could be a hybrid between bat and pangolin viruses to obtain the "key" necessary receptor-binding site for human infection.
3. The "key" is a spike protein found on the surface of the virus, which it uses to attach to cells and infect them.
4. It is very much like the original SARS that jumped from bats to civets, or MERS that went from bats to dromedary camels, and then to humans.
5. The progenitor of the coronavirus underwent evolutionary changes in its genetic material that enabled it to eventually infect humans.
6. This jump from species-to-species was the result of the ability of the virus to bind to host cells through alterations in its genetic material.
7. There are regions of the virus with a very high degree of similarity of amino acid sequences among divergent coronaviruses that infect humans, bats and pangolins, suggesting that these viruses are under similar host selection and may have made the ancestor of SARS-CoV-2 able to readily jump from these animals to humans.
Conclusion
1. SARS-CoV-2 has a rich evolutionary history that included a reshuffling of genetic material between bat and pangolin coronavirus before it acquired its ability to jump to humans.
2. Tracing the evolutionary pathway of the virus can help deter future pandemics arising from the virus, and possibly guide vaccine research.
Source: The Economic Times
Banning animal test for Vaccines
1. The Indian Pharmacopoeia Commission (IPC), responsible for setting standards for drugs, has proposed ending animal test – Abnormal Toxicity Test (ATT) — for human vaccines.
2. Earlier, there was a waiver for ATT on a case-to-case basis. But now, the test has been removed for 33 vaccines where ATT was mandatory earlier.
3. The ATT was originally developed in the 1950s to detect external contaminants in vaccines and has remained the de-facto standard despite various scientific evidence against its reliability and value.
4. ATT is an obsolete test which does not contribute to the quality control of the vaccine and vaccine industry also wants it to be removed as it is resource-intensive.
6. ATT removal has been proposed for the following vaccines:
a. Diphtheria,
b. Tetanus and pertussis (whole cell),
c. Hepatitis B (rDNA) and Haemophilus influenza,
d. Japanese encephalitis,
e. measles and rubella,
f. Mumps, meningococcal, plague, rabies, typhoid and yellow fever.
7. The European Union and United States pharmacopoeia deleted the ATT on the World Health Organisation’s recommendations in November 2018.
Indian Pharmacopoeia Commission (IPC)
1. IPC is an Autonomous Institution of the Ministry of Health and Family Welfare, Govt. of India. IPC is created to set standards of drugs in the country.
2. Its basic function is to regularly update the standards of drugs commonly required for treatment of diseases prevailing in India.
3. It publishes official documents for improving Quality of Medicines by way of adding new and updating existing monographs in the form of Indian Pharmacopoeia (IP).
4. It further promotes rational use of generic medicines by publishing National Formulary of India.
5. IP prescribes standards for identity, purity and strength of drugs essentially required from the health care perspective of human beings and animals.
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6. IPC also provides IP Reference Substances (IPRS) which act as a fingerprint for identification of an article under test and its purity as prescribed in IP.
Source: Down To Earth
Arsenicum Album 30
1. Ministry of AYUSH has listed Arsenicum Album 30 among ‘preventive and prophylactic simple remedies’ against Covid-19.
2. So, several states also have recommended it for prophylactic (preventive) use against Covid-19 without scientific evidence.
What is Arsenicum Album 30?
1. Arsenicum Album 30 is a homoeopathic drug.
2. Arsenicum album is considered to correct inflammation in the body.
3. It cures diarrhoea, cough and cold and also used to treat anxiety, restlessness, cold, ulcerations and burning pains.
4. It is made by the process of heating arsenic with distilled water for several times over three days.
5. Arsenic contamination in water and long-term exposure to the metal can cause skin cancer, pulmonary and cardiovascular diseases. But this drug has less than 1% arsenic.
Why it was recommended by the Ministry?
1. Ayush Ministry recommended the medicine following the opinion of the Scientific Advisory Board of the Central Council for Research in Homoeopathy (CCRH).
2. CCRH opined Arsenicum album 30 could be taken as prophylactic medicine against Coronavirus infections and only a ‘possible prevention’ against flu.
3. For symptom management, various homoeopathic treatments including Bryonia alba, Rhus toxico dendron, Belladona and Gelmesium have been recommended.
4. Also, Homeopathy has been used for prevention during the epidemic of cholera, Spanish influenza, yellow fever, scarlet fever, typhoid, etc.
5. During the 2014 Ebola outbreak, the World Health Organization (WHO) observed the use of unproven interventions as a potential treatment on prevention to be ethical in case of absence of vaccines or anti-virals.
6. The Ministry has based its recommendation on the existing use of medicine for respiratory illness and influenza.
7. Central Drug Standard Control Organisation also allowed private practitioners to try alternative remedies like Ayurveda and homoeopathy to treat Covid-19.
Where lies the issue?
1. The Indian Council of Medical Research or WHO hasn’t issued any guidelines regarding medicines and there is no evidence of its efficiency.
2. Massive demand for medicine is a concern as there is no clinical trial or large-scale study to validate the use of Arsenicum album 30 as a preventive medication.
3. CCRH has also questioned the Ministry for not conducting trials to assess its efficacy before recommending it.
4. Also, each individual reacts differently to homoeopathic medicines and one medicine cannot be universally held as a prophylactic for all.
Source: The Indian Express
Crystalline rubrene
1. Scientists at the Institute of Advanced Study in Science and Technology (IASST) have found a new process for synthesizing crystalline rubrene, a polycyclic aromatic hydrocarbon-based thin film.
2. This can be useful for the development of optoelectronic devices and also for preparation of Electronic Skin (E-Skin).
3. The new synthesis is a water-free, solvent-free, environmentally friendly one-step plasma process.
4. The resultant crystalline rubrene based film demonstrated optoelectronic properties.
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5. A highly uniform pin-hole-free thin film, that is useful for fabrication of high-end devices, can be deposited by this process.
6. IASST is an autonomous institute of the Department of Science & Technology.
Pyro-electric and Piezoelectric
1. Devices made of pyro-electric materials (generates electric charge when heated or cooled) and piezo-electric materials (generates electric charge under the effect of mechanical pressure), can help detect change in temperature and pressure.
2. Pyro-electric materials also show a pyro-phototronic effect where pyro-electricity is associated with the change in temperature of a material when it absorbs photons.
3. These kinds of materials are available in biological systems such as human skin, plant cellulose. This necessitates the understanding of basic science of biological systems and their application prospect.
4. The study revealed that the centro-symmetric rubrene crystal has a thin amorphous oxide layer formed over the crystalline film.
5. This induces surface layer polarization effect leading to pyro-phototronic effect.
6. This resulted in a new approach for synthesis of crystalline rubrene film and realization of pyro-phototronic effect on a fully organic crystalline medium with rubrene.
7. It also circumvents the essentiality of materials to be non-centrosymmetric to show pyroelectric behaviour.
Challenges
1. Since the last few years, scientists from around the world have been working on the synthesis of organic materials for electronic applications.
2. Conventional process for synthesis of organic electronic materials based on chemical processes provides quality materials, but lacks stability, and requires use of solvents.
3. Multiple steps are required for material synthesis and film deposition.
Applications
1. Plasma-based processes offer unique advantages over the conventional processes of organic electronics.
2. This novel process is useful for developing advanced optoelectronic devices and preparation of Electronic Skin (E-Skin)
3. It may be useful as a tool for laboratory simulation of different biological systems for probing the organization and dynamics of those systems.
Source: DD news
Cholesteric Liquid Crystals
1. Scientists from Centre for Nano and Soft Matter Sciences (CeNS), Bengaluru have synthesized a series of novel photo-sensitive cholesteric liquid crystals at room temperature for the widest thermal range.
2. This can be used to make optical storage devices such as optically rewritable boards, advertising boards, etc.
3. Liquid crystals are used in most of the modern display devices such as computers, mobiles, TV screens, and so on.
4. CeNS is an autonomous institute of the Department of Science & Technology.
About Crystals
1. Cholesteric liquid crystals are special kinds of materials with the property of reflecting the light of wavelength equal to its pitch length that is temperature-sensitive.
2. So, they are generally used as thermal sensors.
3. If such cholesteric liquid crystals are made photo-sensitive, then these materials can be used for optical storage devices and other related applications.
4. CeNS synthesized these novel photo-sensitive cholesteric liquid crystals for temperatures ranging from -10 to 160 degrees Celcius.
5. So, the devices made using these liquid crystals can be used in regions like Syberia and Saudi Arabia that experience extreme temperatures.
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6. These room-temperature liquid crystals can be used for creating optical storage devices, liquid crystal displays and so on.
Working
1. The phenomena driving such optical storage devices is in tuning the molecules with light.
2. Energetically more stable trans-state of azobenzene based photosensitive molecules turned to metastable cis configuration with the illumination of suitable UV light.
3. Bringing them back to the original trans-state can be done either by shining light of higher wavelength (~ 450nm) or by keeping it in a dark state (thermal back relaxation).
Thermal back relaxation
1. In thermal back relaxation, only room temperature plays a role.
2. The idea behind the phenomena is to increase such thermal back relaxation to retain the optically written images for a long time.
Applications
1. Devices made of these crystals are useful in creating rewritable advertisement boards for storing the images for several hours and can be rewritten. In some cases can be kept as permanent storage devices.
2. They can also be used as optical rewritable boards for schools and colleges.
3. It will help to bring down the cost of the devices with a very simple yet powerful photoisomerization concept.
Source: DD news
Corona Glossary
The scientific terms associated with CoronaVirus are explained below.
COVID-19
1. A term coined by the World Health Organization (WHO) to denote the disease that has led to a pandemic.
2. Coronavirus disease 2019, abbreviated as COVID-19. CO stands for corona, VI for virus, and D for disease, while the numerals – 19 refer to the year the first case was detected.
4. The name avoids reference to the place of origin of the disease to avoid stigmatising that country/area.
5. The International Committee on Taxonomy of Viruses (ICTV) named it “severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2)”.
6. This was because the virus is genetically related to the coronavirus responsible for the Severe Acute Respiratory Syndrome (SARS) outbreak of 2003.
Epidemic vs. pandemic
1. Epidemic — When the incidence of a disease rises above the expected level in a particular community or geographic area, it is called an epidemic. The outbreak started in Wuhan city in Hubei province in China, and seemed then as a cluster of pneumonia-like cases.
2. Pandemic — A global epidemic. When the epidemic spreads over several countries or continents, it is termed a pandemic. WHO initially stated COVID-19 as a Public Health Emergency of International Concern and later as a pandemic.
R0- Reproduction number
1. R0 — R-Naught is the basic reproduction number. This is the number of new infections caused by one infected individual in an entirely susceptible population.
2. It helps determine whether an epidemic can occur, the rate of growth of the epidemic, the size of the epidemic and the level of effort needed to control the infection.
3. If R0 is 2, then one individual will infect two others.
Co-morbidities
1. Several health conditions including uncontrolled diabetes and hypertension, cancer, morbid obesity, lung diseases, compromised immune systems put patients at greater risk for contracting the infection, and also have poor clinical outcomes.
2. Special attention to prevent the disease and prevent mortality in these groups is the concern of health managers.
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Transmission
1. Transmission — The method by which the disease spreads. In COVID-19 it is through respiratory droplets, expelled while talking, laughing, coughing and sneezing.
2. This makes mask wearing and physical distancing the main tools for protection against the virus.
3. Washing hands with soap and water is an effective way to kill the virus.
Community transmission
In this situation, it is not possible to tell how someone contracted the disease, or who the source of infection was. This makes tracing also difficult.
Contact tracing
Identifying and monitoring people who may have come into contact with an infectious person. In the case of COVID-19, monitoring usually involves self-quarantine as an effort to control the spread of disease.
Super spreader
Some individuals seem to have the capacity to cause more infections in a disproportionately large number of people, than others. The current pandemic has recorded some super spreaders who have had a huge role in the transmission.
Positivity rate
1. The percentage of people who test positive among all those who are tested.
2. If positivity rate is high, it is possible that only high risk groups are being tested. A low positivity rate can also indicate that not enough testing is being done.
Infection fatality rate
It is the number of deaths occurring in all infected people in a particular population. This includes those who might have the COVID-19 infection, but have not been tested for it.
Case fatality rate
This is the number of deaths occurring among confirmed cases of COVID-19. Since these two figures are available with a certain amount of reliability, it is actually CFR that is being referred to when there is a loose reference to fatality rate.
Severe Acute Respiratory Infection (SARI)
1. A respiratory disease also caused by a coronavirus, and spread through the same transmission method, i.e. respiratory droplets.
2. The symptoms (fever, cough, body ache, difficulty in breathing) are also similar. The government has begun surveillance of SARI patients as also patients with Influenza-like Illness (ILI) admitted in hospitals too.
Cytokine storm
1. An immune reaction triggered by the body to fight an infection is known as a cytokine storm when it turns severe.
2. The body releases too many cytokines, proteins that are involved in immunomodulation, into the blood too quickly.
3. Normally they regulate immune responses, in this case they cause harm and can even cause death.
4. Experts have noticed a violent cytokine storm in several individuals who are critical with COVID infection.
5. These cytokines dilate blood vessels, increase the temperature and heartbeat, besides throwing bloodclots in the system, and suppressing oxygen utilisation.
6. If the cytokine flow is high and continues without cessation, the body’s own immune response will lead to hypoxia, insufficient oxygen to the body, multi-organ failure and death.
7. It is regarded that the cytokine storm kills and not the virus .
RT- PCR
1. RT- PCR (Reverse Transcription-Polymerase Chain Reaction) — It is the primary test to detect COVID-19 infection across the globe.
2. It is a sensitive test that uses swab samples drawn from the nasal/oral cavity to test for the presence of viral RNA (ribonucleic acid).
3. It has got better sensitivity (ability to correctly identify those with the disease) and specificity (ability to correctly identify those without the disease) rates in current diagnostic tests for COVID.
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Antibody tests
1. Antibody tests — These tests check your blood by looking for antibodies, and that just means you have had a past infection of SARS-CoV-2.
2. Antibodies are proteins that help fight off infections, and are specific to every disease, granting immunity against getting that particular disease again.
3. An antibody test, with poor specificity, is not believed to be effective in detecting new infections.
4. States have been asked to commence testing seroprevalence in the community, using antibody tests, that are blood tests.
Convalescent plasma therapy
1. Convalescent plasma therapy — Researchers are examining the efficacy of using convalescent plasma, that is, using neutralising antibodies from the blood of people who have recovered from the COVID-19 infection to treat patients with COVID-19.
Other terms
1. Hydroxychloroquine (HCQ) — An antimalarial oral drug that is being repurposed for treatment in COVID-19. It has also been used successfully in the treatment of some autoimmune conditions. Its value in COVID-19 has not been resolved entirely.
2. Flattening the curve — Reducing the number of new COVID-19 cases, day on day. The idea of flattening the curve is to ensure that the health infrastructure is not overwhelmed by a large number of cases.
3. Herd immunity — This is also known as community immunity, and constitutes the reduction in risk of infection within a population, often because of previous exposure to the virus or vaccination.
4. PPE — Personal protective equipment, or PPE, is specialised clothing and equipment used as a safeguard against health hazards including exposure to the disease.
Source: The Hindu
Nature Index 2020
1. Three autonomous institutions of the Department of Science and Technology (DST) have been ranked among the top 30 in India as per Nature Index 2020.
2. The ranking is given based on the research quality that is the articles published in top journals.
3. The institutes among the top 30 are
a. Indian association for cultivation of Science, Kolkata (7th position)
b. Jawaharlal Nehru Centre for Advanced Research, Bengaluru (14th position) and
c. S.N.Bose National Centre for Basic Sciences, Kolkata (30th position).
4. The list was topped by Council of Scientific and Industrial Research (CSIR) and includes other institutes like IISC, Bengaluru, Tata Institute of Fundamental Research(TIFR) etc.
Nature Index
1. It is a database of information collected from articles published in 82 high-quality science journals.
2. It provides a comparison between Institutions, Countries on how much quality scientific research is published by them.
3. It also provides which Institutions and countries are collaborating with each other in high quality research, the strength of their collaboration.
Source: PIB
Mobile COVID Testing Lab
1. India’s first mobile testing lab has been developed by a team from Andhra Pradesh MedTech zone limited.
2. It is a mobile van that can be deployed in remote and inaccessible areas in the country where the testing infra is negligible or not present.
3. The lab belongs to the Bio-safety level 2 (BSL-2) category.
4. The lab is equipped with on-site ELISA, RTCPR and Bio-Chem analysers.
Bio-safety Levels
1. These are the protective measures needed in a lab setting to protect workers, environment and the public.
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2. These are categorized into 4 levels based on the threat and risk profile attached to the working objects like viruses, bacteria, fungi, parasites etc.
A. Bio-Safety Level-1
1. These are used to study infectious agents or toxins not known to consistently cause disease in healthy adults.
2. Standard engineering controls include easily cleaned surfaces that are able to withstand the basic chemicals used in the laboratory.
B. Bio-Safety Level-2
1. They are used to study moderate risk infectious agents or toxins that pose a risk if accidentally inhaled, swallowed or exposed to the skin.
2. BSL-2 labs must have access to equipment that can decontaminate laboratory waste, including incinerator and an autoclave.
C. Bio-Safety Level-3
1. They are used to study infectious agents or toxins that may be transmitted through the air and cause potentially lethal infection through inhalation exposure.
2. The airflow must be given due importance to ensure that airflow from lab does not pass to non-laboratory areas.
D. Bio-Safety Level-4
1. This is the highest level of bio safety labs and are used to study agents or toxins that pose a high risk of aerosol-transmitted laboratory infections and life-threatening disease for which no vaccine or therapy is available.
2. Access to these labs is carefully controlled due to the high risk attached to them
Source: Hindustan Times
Gateway Lunar Orbiting Outpost
1. NASA had awarded the contract of the initial crew module of the Gateway lunar orbiting outpost to a private agency.
2. It is part of NASA’s ARTEMIS mission aimed at sending the first women and next man to moon by 2024.
3. The contract awarded is to design HALO (Habitation and logistics) support to the gateway. HALO refers to pressurized living quarters for astronauts to spend their time while visiting the gateway.
4. The gateway is a small spaceship similar to ISS (International Space Station), but orbits the moon and stay idle at different orbits.
5. The gateway consists of living quarters, laboratories for science research and docking ports for visiting spacecraft.
6. It acts as an airport where
a. Spacecraft bound for the lunar surface of Mars can refuel or replace parts,
b. Resupply things like food and oxygen,
c. Allows astronauts to take multiple trips to the Lunar surface,
d. Exploration of new locations across the Moon
7. Unlike ISS, it is smaller in size and Astronauts visit the spacecraft once in a year and not stay permanently as in case of ISS.
8. NASA plans to complete the gateway by 2026.
Significance of the mission
1. It is a key to the new era of space explorations.
2. It will augment space research and can be moved to other orbits around the moon, Mars in the future.
3. It will act as a science platform to observe the earth, sun and get unobstructed views of the universe.
Source: Indian Express
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TrueNat Test
ICMR (Indian Council of Medical Research) had approved the use of TrueNat machines for confirmatory tests of COVID-19 disease.
What is a TrueNat Test?
1. It is a test performed on a TrueNat machine that was developed initially for detecting tuberculosis in patients. The design of this machine has been changed to detect SARS-COV-2 virus that causes COVID-19.
2. The test works on a chip-based format, where a chip inserted into the TrueNat machine discovers the presence of a virus.
How is the test conducted?
1. Swab samples from the patient are taken similar to RT-PCR test and the swab is transferred to a viral transmission medium for neutralizing the virus.
2. It is then transferred to another liquid that breaks the cells and the impurities are removed.
3. This clean liquid is sent to a gene extractor machine for extracting the RNA.
4. The extracted RNA is fed into the TrueNat machine and the chip calculates the viral load in the sample (RNA) and confirms the presence of SARS-COV-2.
5. The machine is battery operated that can last for 10 hours and an 8-hour shift gives test results for 45 samples.
Why is it preferable over RT-PCR test?
1. The SARS-COV-2 virus has an RNA molecule that must be converted to DNA to detect the presence of the virus. This process is called reverse transcription (RT).
2. In the TrueNat test, the virus is detected by the RNA itself and the reverse transcription step is not required.
3. The TrueNat machine is portable and the cost for testing the sample is much less compared to the RT-PCR test.
4. While the RT-PCR test requires cold storage and trained experts for carrying out the test, TrueNat does not require it. So, RT-PCR is termed as ‘last mile diagnostics.’
Source: Indian Express
IN-SPACe
What is IN-SPACe?
1. GoI (Government of India) approved the creation of a new body IN-SPACe (Indian National Space Promotion and Authorization Centre) to open up the space sector to private agencies.
2. Functions of INSPACe will be to
A. Assess the demands of private agencies including Educational and Research Institutions in the space sector.
B. Look into ways to facilitate utilization of assets of ISRO (both space and ground based) by the private sector.
C. Enable private players to carry out their own space related activities.
D. Act as a regulator and also as an interface between ISRO and private players to help utilize space-based assets.
Why is the private sector needed in Space?
1. Space sector worldwide is valued at $360 billion and Indian Industry has only 3% market share.
2. While only 2% of this market is for satellite and rocket launch service, the rest 95% is occupied by satellite-based services and ground based systems.
3. Indian Industries are unable to compete in global market as they’ve mainly been suppliers of components and sub-systems and do not have the resources to undertake independent space programs like SpaceX.
4. Now, demand for space-related applications has been increasing in India ranging from weather, agriculture, transport, urban development etc.
5. ISRO needs to expand 10 times more to cater to all the needs of the Industry. Private players can fill this vacuum.
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How will ISRO be benefitted?
ISRO has commercial and strategic benefits,
1. Commercial
A. ISRO can earn revenue by making its facilities and data available to private players.
B. Private players can even build their launch stations in Sriharikota, where ISRO can provide land and necessary consultancy services.
C. This helps in optimum utilization of space-based assets of ISRO and increase space-based activities.
2. Strategic
A. This allows ISRO to concentrate on science, research and development, interplanetary exploration and strategic launches.
B. The launch of commercial satellites by private players helps ISRO to concentrate on further strategic missions like Aditya L-1, human spaceflight, etc.
Where INSPACe and NSIL can coordinate?
1. NSIL (New Space India limited) has similar objectives of ANTRIX (commercial arm of ISRO) in selling satellite launches to commercial players.
2. NSIL will be remodeled to have a demand-driven approach. It will look into requirements of private players and ask ISRO to fulfill it unlike the current supply driven approach of marketing products of ISRO.
3. IN-SPACe, NSIL will work in tandem with ISRO to ensure that space-based activities have the role of private agencies in it.
Source: Indian Express
Green Energy Solutions
1. IIT Madras has been collaborating with University of Cologne, Germany to develop a novel method of producing Hydrogen for its use in developing green energy solutions.
2. The project has been taken up under SPARC (Scheme for Promotion of academic and Research Collaboration) scheme of Ministry of Human Resources and Development (MHRD).
3. The conventional method of producing Hydrogen results in generating large quantities of carbon dioxide increasing the Greenhouse gas emissions.
4. Electrochemical splitting of water called ‘Water electrolysis’ is a clean, simple and highly efficient method of producing large scale hydrogen with high purity.
5. This collaboration works on developing low cost electrocatalysts for hydrogen evolution reactions.
6. This team will explore the possibilities for transforming lab scale research to commercially viable reactors/devices.
7. Hydrogen has important applications in generating renewable electricity, fuel cell cars.
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SPARC
1. SPARC scheme is an initiative by MHRD aimed at improving India’s research ecosystem in Higher Educational Institutions by facilitating collaborations between Indian institutions and the best institutions in the world.
2. IIT Kharagpur is the National coordinating Institute in implementing this scheme.
3. This scheme focuses on 5 thrust areas
A. Fundamental Research
B. Emergent areas of Impact
C. Convergence
D. Action Oriented research and
E. Innovation driven
Source: The Hindu
Plasma Bank
The Delhi Government is planning to set up a plasma bank to collect plasma from recovered COVID-19 patients.
Plasma bank
1. This bank contains plasma collected from patients who recovered from COVID-19 as the plasma contains antibodies to combat the virus (SARS-COV-2).
2. It is set up at Institute of Liver and Biliary sciences and the plasma collected will be available to patients suffering from coronavirus.
3. The conditions for donor are
A. A healthy person between 18-60 years with no comorbidities,
B. He should have recovered at least 3 weeks before donating and
C. He should have tested negative for COVID-19 twice can be a donor
Working mechanism
1. Once a person contracts coronavirus, his blood produces antibodies and certain cells remember the antigen (virus).
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2. The blood produces antibodies when they come in contact with the same virus again.
3. The antibodies are stored in the plasma component of blood and when this plasma is injected to a patient suffering from coronavirus, antibodies will be produced in the new person’s blood and these antibodies fight against the antigen (virus).
4. This treatment is called convalescent plasma therapy (CPT).
Performance of CPT
1. The CPT has improved the breath rate of patients suffering from coronavirus.
2. Improvement was also observed in oxygen saturation levels in patients administered with CPT.
3. The therapy was effective in patients with moderate symptoms and not so effective in critical patients.
Source: Indian Express
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International Relations
India – Nepal Bilateral Relations
1. The parliament in Nepal gets ready to approve a new map that will include parts of Indian territory in Uttarakhand.
2. It is believed that the current territorial dispute was avoidable but others could have emerged.
3. The territorial dispute is merely a symptom of the structural changes unfolding in the external and internal context of the bilateral relationship.
4. So, it is not what India could have done to prevent the current crisis but looking ahead to build more sustainable ties with Kathmandu.
5. Any new framework for engaging with Nepal must involve two important departures from the past in India –
a. Coming to terms with Nepal’s natural politics of balance,
b. Recognition that India’s “special relationship” with Nepal is part of the problem.
History of Nepal’s Geopolitics
1. The foundation of modern Nepal state was found between the geographic condition of dominant power in the Gangetic plains in one hand and Tibet and the Qing empire on the other.
2. China has long been part of Nepal’s international relations. As the East India Company gained ground in the 19th century, Nepal’s rulers made offers to China to act as a frontline against Calcutta’s expansion into the Himalayas.
3. Nepal also sought to build a coalition of Indian princes to counter the Company. Even after it lost the first Anglo-Nepal war in 1816, Nepal kept up a continuous play between Calcutta and Beijing.
4. After the First Opium War (1839-42) the Company was dominating China’s external affairs, so, Nepal’s rulers warmed up to Calcutta.
5. When 1857 Mutiny shook the Company, Nepal backed it and regained some of the territories it lost when the Raj replaced the Company.
6. As the fortunes of the Raj rose, Nepali rulers enjoyed the benefits of being Calcutta’s protectorate. India inherited this framework but has found it impossible to sustain.
7. The 1950 Treaty of Peace and Friendship gave the illusion of continuity in Nepal’s protectorate relationship with the Raj and its successor, independent India.
8. That illusion was continuously chipped away amid the rise of mass politics in Nepal, growing Nepali nationalism, and its acquisition of an international personality.
9. Once the Chinese Communist Party consolidated its power in Tibet and offered assurances to Nepal, its balancing impulses were back in play.
10. Nepal’s foreign policy since the 1950s has been about weakening the “special relationship” with India and building more cooperation with China.
11. Nepal has used different means between its two giant neighbours, such as non-alignment, diversification, “zone of peace”, equidistance, and a Himalayan bridge between India and China, for its own favour.
12. The stronger China has become, the wider have Nepal’s options with India become.
India’s Course of Action
1. India, which mention of “strategic autonomy” need to recognise where Nepal is coming from.
2. The quest for autonomy is not a unique Indian trait. All countries, big or small, try to maximise their freedom of action within the circumstances they find themselves in.
3. The 1950 Treaty, which proclaims an “everlasting friendship” between the two nations, has become the symbol of Indian hegemony in Nepal.
4. However, its security value for India has long been hollowed out but India is unwilling to shed for the fear of losing the “special relationship”.
5. India has been trapped into a perennial political play among Nepal’s different factions and responding to Nepal’s China card.
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6. If India wants a normal and good neighbourly relationship with Nepal, it should put all major bilateral issues for renegotiation — including the 1950 treaty, national treatment to Nepali citizens in India, trade and transit arrangements, the open border and visa-free travel.
7. India should make it a priority to begin talks with Nepal on revising, replacing, or simply discarding the 1950 treaty and negotiate a new set of mutually satisfactory arrangements.
8. India had conducted a similar exercise with Bhutan to replace the 1949 treaty during 2006-07. However, the issues and political context are more complicated in the case of Nepal.
9. No bilateral relationship between nations can be built on sentiment — whether it is based on faith, ideology or inheritance. Only those rooted in shared interests will endure.
10. Rather than object to Nepal’s China ties, India must focus on how to advance India’s relations with Nepal.
11. Nepal’s economic geography, its pursuit of enlightened self-interest, and natural balancing politics will continue to provide a strong framework for India’s future engagement with Nepal.
12. Discarding the “special relationship” might make it easier for India to construct a more durable and interest-based partnership with Nepal that is rooted in realism and has strong popular support on both sides.
Inauguration of Link Road to Mansarovar Yatra
1. The inauguration of the Link Road to Mansarovar Yatra by India has impacted the bilateral relations between India and Nepal.
2. The Border Roads Organisation (BRO) achieved road connectivity from Dharchula to Lipulekh (China Border) known as Kailash-Mansarovar Yatra Route.
Nepal’s objections
1. As per the Sugauli Treaty (1816), Nepal observes all the territories east of Kali (Mahakali) River, including Limpiyadhura, Kalapani and Lipu Lekh, belong to Nepal.
2. Nepal has opposed the Indian government for carrying out any activity inside its territory.
3. Nepal expressed its disagreement in 2015 after both India and China agreed to include Lipu Lekh Pass as a bilateral trade route without Nepal’s consent.
India’s stand
1. The new road section in Pithoragarh district in the State of Uttarakhand lies completely within the territory of India.
2. The road follows the pre-existing route used by the pilgrims of the Kailash-Mansarovar Yatra.
3. India and Nepal have established mechanisms to deal with all boundary matters and the boundary delineation exercise with Nepal is going on.
4. India is committed to resolving outstanding boundary issues through diplomatic dialogue and in the spirit of close and friendly bilateral relations with Nepal.
Cultural Ties
1. Both countries are interdependent through shared social, cultural, economic and other civilisational links, taking the ties beyond the governments.
2. Over three million Nepalese live in India and lakhs of Indians live in Nepal.
3. The Gurkha Rifles in the Indian Army are incomplete without the Nepalese.
4. The people of Nepal like B.P. Koirala and many more have fought and sacrificed for India’s independence.
5. Both countries have unique ties with open borders, shared interests and respect for each others’ sovereignty.
Treaties and Agreements
1. Nepal’s monarchy had neglected the territories of Lipulekh, Kalapani and Limpiyadhura for decades.
2. The area attained prominence only after the rise of Nepal’s parliamentary democracy that began in 1990.
3. Article 8 of the India-Nepal Friendship Treaty, 1950 cancels all previous treaties, agreements and engagements entered into on behalf of India between the British Government and the Government of Nepal. But, this treaty does not define the India-Nepal boundary.
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4. To define the boundary, the Treaty of Sugauli (1816) and the 1960 agreement between India and Nepal on the four Terai districts are used.
5. While the Sugauli Treaty outlines the east of Mahakali River as Nepal’s territory, and the west of it as India’s territory, the dispute is with regard to the origin of the Kali River.
6. Nepal claims the origin to be in the higher reaches of the hilly territory which would establish its claim on Kalapani and Lipulekh.
7. The Boundary Committee constituted in the year 2000 failed to resolve the issue.
Way forward
1. There is a need to renew it to end the cartographic issue between the two countries.
2. Both countries have to exercise caution and restraint, without a ‘big brother’ attitude.
3. Constructive dialogue with empathy is needed to resolve any matter that affects bilateral relations.
4. Diplomatic dialogue should be resumed at the earliest possible and India should ideally lead in creating momentum for deeper regional and sub-regional cooperation in South Asia.
Nepal’s Parliament amending its Constitution
Nepal’s parliament amended its constitution to include a new map that contains territories of India such as Limpiadhura, Lipulekh and Kalapani.
History
Nepal had always supported India during conflicts between India and China on the issue of Nepal. For example
1. In 1960 a road was built to connect Nepal with Tibet. Nepal assured India that the road has only developmental significance and no strategic importance.
2. In 1980, Nepal annulled a contract signed to build a road in Nepal after India raised security concerns.
Turning point
1. India’s influence in Nepal’s politics resulted in a negative response as
a. 12-point understanding among Nepal’s 8 political parties in Delhi led to the oustering of Monarchy in Nepal.
b. India’s and EU’s role in transforming Hindu kingdom to a secular country was seen forcing of secularism in Nepal.
2. To counter the influence of India, USA and EU, China increased its presence through increased investments in tourism, post-earthquake reconstruction, trade and energy.
3. China’s influence also shifted the leaning of Nepal parties that were supporters prior to 2005, away from India.
Relations now
1. India’s efforts in ousting the Monarchy from Nepal became detrimental as it paved the way for China to increase its influence.
2. India’s approach to Nepal now is focused more on security concerns and threat perception compared to soft powered approach earlier.
3. Now, the 12 point understanding needs to be reviewed and our cultural and civilizational ties are to be restored with Nepal people.
Source: Indian Express and The Hindu
India – Australia Bilateral Relations
Prime Ministers of India and Australia had the first virtual summit and nine agreements were signed.
The outcome of the Summit
1. India and Australia elevated their ties to a ‘comprehensive strategic partnership’.
2. The Mutual Logistics Support Agreement (MLSA) that allows the navies to cooperate closely was signed.
3. India has such arrangements with the US, France, Japan also. It allows India strategic access deep into the Indo-Pacific region.
4. It indicates the strategic confluence between India and Australia to cooperate against an aggressive and expansionist China.
5. Also, the elevation of the 2+2 dialogue from the secretary level to the ministerial level was discussed.
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6. India has promised to assist Australia with its space programme and also signed an agreement to cooperate on “critical and strategic minerals”.
7. India will be importing lithium and cobalt in an effort to diversify both sources and markets from an over-dependence on China.
8. Australia and India co-sponsored, along with other countries, a resolution in the WHO for an independent investigation into the origin of the coronavirus pandemic.
Joint Statement on Partnership
India and Australia share a vision of
1. Free, open, inclusive and rules-based Indo-Pacific region to support the freedom of navigation, over-flight.
2. Peaceful and cooperative use of the seas by adherence of all nations to international law including the United Nations Convention on the Law of the Sea (UNCLOS).
3. Peaceful resolution of disputes rather than through unilateral or coercive actions.
4. Work cooperatively through multilateral, regional and plurilateral mechanisms to strengthen and diversify supply chains for critical health, technology and other goods and services.
Maritime Partnership
1. India announced the ‘Indo-Pacific Oceans Initiative (IPOI)’ at 14th East Asia Summit in 2019. In this regard, India and Australia have announced ‘Shared Vision for Maritime Partnership’.
2. Both will work with all interested partners, to improve the management of the shared oceanic domains.
3. It includes key areas of cooperation such as preserving maritime ecology, reducing the impact of marine pollution (especially plastics) and maritime security.
Chinese Aggressive Activities
1. The India-Australia summit comes in the backdrop of both countries dealing with Chinese subversive activities.
2. India with Chinese intrusions in Ladakh and Australia with Chinese influence-peddling operations, which have led to China stopping commodities imports from Australia.
3. Australia was among the first countries to bar China’s Huawei from 5G operations on its territory.
Source: Times of India
Daulat Beg Oldie
Why is the road to DBO important?
1. The Daulat Beg Oldie (DBO) is a strategic all-weather road built by Border Roads Organisation (BRO) connecting Darbuk-Shyok-Daulat BegOldie(DSDBO).
2. This road runs parallel to Line of actual control (LAC) with elevations ranging from 13000 feet to 16000 feet.
What is the strategic importance?
1. The road connects Leh to DBO, which is at the base of Karakoram pass separating China’s Xinjiang region from Ladakh.
2. DBO is the northernmost corner of Indian territory in Ladakh, and has the world’s highest airstrip that can facilitate movement of supplies to Army.
3. The DSDBO highway provides Indian military access to Tibet-Xinjiang highway that passes through Aksai Chin.
4. The Gilgit Baltistan region is to the west of DBO, where China is currently constructing the China Pakistan Economic Corridor.
5. This region also contains Shaksgam valley that Pakistan ceded to China in 1963 under a Sino-Pakistan boundary agreement, which was objected to by India.
6. Recently, the Defence Minister of India inaugurated the world’s highest bridge on this road named Col.Chewang Rinchen setu on the shyok river.
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Source: Indian Express
G-7 Summit
The G-7 summit has been postponed following the travel restrictions on account of COVID-19.
How did the G-7 emerge?
1. After the Arab-Israeli war of 1973, the oil prices increased by 4 times due to sanctions imposed by OPEC (Organisation of the Petroleum Exporting Countries) on Canada, USA, Japan, Netherlands.
2. Following this, in 1975, France convened an informal meeting of Finance ministers of 5 OECD (Organisation for Economic Co-operation and Development) countries (USA, Germany, Japan, Italy, UK) to discuss global issues.
3. This later transformed into G-7 in 1976 with the joining of Canada.
4. In 1998, membership expanded with the inclusion of Russia but was later expelled over the issue of annexation of Crimean Peninsula in Ukraine.
What were the limitations of G-7?
1. G-7 failed to address the global recession of 2008-09 that led to emergence of another grouping of G-20.
2. It also could not tackle contemporary issues such as COVID-19 pandemic, Climate change, challenge of Daesh and the state collapse in West Asia.
3. G-7 countries contribute to 59% of historic global CO2 emissions (1850-2010) and have pledged to phase out all fossil fuels and subsidies. But no plan of action has been laid out.
4. 3 of G-7 countries (UK, Germany and France) are contributing volunteers to Daesh (ISIS) that created migrant crisis in Europe and statelessness in West Asian countries.
Why membership need to be expanded?
1. G 7 is outdated, and the current membership doesn’t represent the present world order.
2. US is also demanding inclusion of other countries, including the Five Eyes countries, an intelligence alliance comprising Australia, Canada, New Zealand, the UK and the US.
Economy
1. As per PwC report, contribution of G7 countries to the global GDP on Purchasing Power Parity (PPP) terms will reduce from current 2/3rd share to less than 1/3rd by 2050.
2. The Emerging 7 (E7) economies of Brazil, China, India, Indonesia, Mexico, Russia and Turkey will contribute over 1/3rd of global GDP in PPP terms by 2050.
3. India’s economy, the third largest in the world in PPP terms, could become second largest next to China by 2050.
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Multilateralism
1. Existing international institutions have failed to effectively handle COVID-19 crisis and stalling of global economy.
2. Establishment of G20 after 2008 recession promoted open markets, stimulus, and prevented a collapse of the global financial system.
3. So, only a new international mechanism focusing on key global issues can revive multilateralism and solve current problems at national level.
Where will India be focusing?
1. India’s primary focus will be on international trade, climate change, COVID-19 crisis, upholding of international law and liberal ideas.
2. The other priorities would include counter-terrorism, counter-proliferation and effective implementation of 1975 Biological weapons convention.
3. India also would persuade Iran not to acquire nuclear weapons, ensure peace and stability in Afghanistan and West Asia.
Source: The Hindu
India-West Asia
The rise of the pandemic stalled many infrastructure projects in West Asia and also led to reverse migration from countries like Saudi Arabia, UAE to India.
What is the importance of West Asia to India?
1. India has strategic, economic, political engagements with countries like UAE, Saudi Arabia, Iran, Oman, etc ranging from migration to energy security issues.
2. Strategic reasons
a. The construction of Chabahar port in Iran provides direct connectivity to Afghanistan bypassing Pakistan.
b. India procures more than 50% of crude oil from countries like Iran, Iraq, Saudi Arabia, making them important for our energy security.
3. Economic reasons
a. UAE and Saudi are the largest trading partners for India and India has trade surplus with UAE.
b. Saudi Aramco is planning to bring huge FDI in Ratnagiri oil refinery in Maharashtra and also invest in Reliance Industries to obtain a stake in it.
4. Huge numbers of India’s diaspora work in these countries and are contributing to India’s and West Asian country’s growth.
How did COVID-19 affect the economies?
1. The pandemic had impacted lives, economies and also global and political institutions.
2. For the first time, the oil prices have crashed to the levels of the first Gulf war in 1991, due to
a. Crash in demand because of COVID-19,
b. Oversupply of crude due to dispute of output caps between Saudi Arabia and Russia.
3. This led to joblessness in these countries, prompting reverse migration of blue-collar employees to India.
4. According to Dubai’s chamber of commerce, 70% of small and medium-sized industries in Dubai (many owned by Indians) may not survive due to crash in tourism, conventions, hospitality and airline industries.
5. Many sovereign wealth funds like UAE wealth fund and others have also affected due to crash in economy.
6. Plans to diversify the Saudi economy to reduce dependence on crude oil business by building a futuristic mega city of Neom on the coast of Red sea is also stalled.
Why will this affect India?
1. The migrants in these countries are responsible for 56% of India’s remittances of $80 billion annually.
2. These countries contribute to huge FDI in India and some of them are also the largest trading partners.
3. These countries play an important role in India’s economic development, hard and soft diplomacy and strategic engagements.
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Where does India need to focus?
1. India needs to expedite the land acquisition process for the Ratnagiri refinery to start the construction of the plant.
2. Government needs to make good use of the database of skill sets collected from returning migrants through the SWADES scheme (Skilled Workers Arrival Database for Employment Support).
3. Fast track the resolution of stake sale of Mumbai airport by GVK to Abu Dhabi investment authority (ADIA) to send out a positive signal about the economy.
Source: The Hindu
Trade with China
1. The Galwan standoff has raised the demand from Indians to boycott Chinese goods including Chinese items in Indian restaurants.
2. But banning trade with China abruptly is not a good approach.
A. Trade deficits
1. India has a huge trade deficit with China, but this does not mean that the Indian economy is weaker.
2. At the same time, India has a trade surplus with the US, UK. This does not imply India’s economy is stronger.
3. Trade deficits imply that India is not capable of producing the needs of its people efficiently.
4. Running huge trade deficits could be a problem if a country does not have enough forex reserves to import the goods. But India has $500 billions in its forex reserves.
B. Indian producers and exporters
1. Indian producers import a huge proportion of intermediate goods such as electrical machinery, fertilizers, organic chemicals etc.
2. These imports become part of final goods that are used by India or exported.
3. A blanket ban on imports will hurt these Industries that are already affected by the slump in the economy due to COVID-19.
C. Policy Credibility
1. Imposing huge duties on imports from China or a blanket ban will lead to policy uncertainty.
2. Investors look for policy predictability and credibility in the investing country. So, this could impact India’s ability to attract new Investors.
D. impact on China
1. While China’s imports from and exports to India constitute only 1% and 3% in its total trade, India’s imports from and exports to China constitute 14% and 5% respectively.
2. So, India will be more affected as it would lose 14% of imports and 5% of exports to China, and increases the prices of final goods in India.
3. Imposing a blanket ban could create more problems in India, as India is currently experiencing slow growth rate.
4. India needs to aggressively increase its share in global trade by becoming more competitive.
Source: The Indian Express
Debt Trap Diplomacy
Mains- GS-2-International Relations
What is debt-trap diplomacy?
1. It is using of the financial power of a country to gain concessions/ advantages in exchange for debt relief in another country.
2. If a country borrowing (debtor) money from another country (creditor) is unable to pay back, the creditor seeks concessions/ advantages in the debtor’s country in exchange for the debt.
3. China uses this diplomacy to further its political and economic influence across the Globe.
How has China been using this tool?
1. China generally provides billions of dollars in the form of concessional loans to developing countries to fund large scale infrastructure projects in these countries.
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2. The concessions can be in the form of lower interest rates below the market rate or leniency in the grace period to repay the loan or a combination of both.
3. These loans generally have longer grace periods.
4. The developing countries accept the loans and default at a later date for which China demands concessions/advantages in exchange for debt.
Which countries have been affected?
1. Sri Lanka:
a. It was forced to hand over control over the Hambantota port project to China for 99 years.
b. This allowed China to occupy a strategic location in the Indian ocean and pose a challenge to India in the neighborhood.
2. Djibouti: In exchange for relief, China constructed its first military base at Djibouti and controlled the strategic strait of Bab-el-Mandeb.
3. Angola: It is repaying millions of dollars in debt in the form of crude oil to China, thus destabilizing its economy.
Where does India stand?
1. India did not borrow any money directly from China, but from AIIB (Asian Infrastructure and Investment Bank). China is the largest shareholder (27% voting rights), in AIIB and India second (7.6% voting rights).
2. China’s huge vote share allows it to veto any major decision that can impact India indirectly.
3. Loans provided to India could also pave the way for Chinese firms to enter and gain experience in the Indian infrastructure market.
4. The world’s largest connectivity project, OBOR (One Belt One Road) initiative poses challenges to India’s neighborhood.
a. CPEC (China Pakistan Economic Corridor) road passing through the Gilgit Baltistan region affects India’s sovereignty over the region.
b. The infrastructure project in Kyaukpyu port, Myanmar, could pose a threat to India’s IMT (India-Myanmar-Thailand) highway project.
5. So, China through its OBOR is increasing India’s political cost of dealing with its neighbors.
Source: Livemint
Financial Action Task Force
1. Countries have decided to maintain Pakistan in ‘Grey list’ of countries that do not comply with FATF’s money laundering and terrorist financing norms.
2. The Country report by USA on ‘Terrorism’ stated that Pakistan continues to be a safe haven for terrorists and its groups.
3. Also, Pakistan had allowed groups like Afghan Taliban and Haqqani Network to target countries like Afghanistan and Lashkar-e- Taiba (LeT) to target India.
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Money Laundering and Illegal Wildlife Trade
1. This is the first such report by FATF that describes illegal wildlife trade as Global threat linked with other organized crimes like modern slavery, drug trafficking and arms trade.
2. The illegal trade is estimated to generate $23 billion annually.
3. The report states that syndicates are misusing the legitimate wildlife trade as a disguise to hide illegal proceeds from wildlife.
4. It recommended countries to implement good practices, cooperating with other countries and making necessary legislative changes to make the applicability of money laundering laws to illegal wildlife trade.
Financial Action Task Force
1. It is a Global Money laundering (ML) and terrorist financing watchdog.
2. It sets international standards that aim to prevent these illegal activities, and also persuade countries to adopt anti-money laundering legislations.
3. It maintains a Black list and Grey list of countries that have not taken significant measures to counter ML. Currently, North Korea and Iran are in Black list.
4. FATF secretariat is located at the OECD headquarters in Paris.
5. India joined in 2010 as a member country of FATF.
Source: The Hindu
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Defence & Internal Security
Line of Actual Control
What is the Line of Actual Control?
1. The LAC is the demarcation that separates Indian-controlled territory from Chinese-controlled territory.
2. India considers the LAC to be 3,488 km long, while the Chinese consider it to be around 2,000 km.
3. It is divided into three sectors
a) Eastern sector- Spans Arunachal Pradesh and Sikkim,
b) Middle sector- In Uttarakhand and Himachal Pradesh, and
c) Western sector- In Ladakh.
Where is the disagreement?
1. Eastern Sector
a) Alignment of the LAC in the eastern sector is along the 1914 McMahon Line.
b) It has disputes regarding the positions on the ground as per the principle of the high Himalayan watershed.
2. Middle Sector- It is the least controversial. But the need for following precise alignment in the Barahoti plains is an issue.
3. Western Sector- Major disagreements are in this sector.
China’s Position
a) In 1959, LAC consisted of the McMahon Line in the east and the line up to actual control exercised by both countries in the west.
c) After the 1962 War, China claims to have withdrawn 20 km behind the LAC of 1959.
d) During the Doklam crisis in 2017, China urged India to abide by the 1959 LAC.
India’s Position
India rejected the concept of LAC in both 1959 and 1962 because
a. Chinese line was a disconnected series of points on a map that could be joined up in many ways
b. Line should omit gains from aggression in 1962 and should be based on the actual position before the Chinese attack
c. Vagueness in Chinese definition left it open for China to continue its attempt to change facts by military force.
When did India accept the LAC?
1. In 1991, India and China reached an understanding to maintain peace and tranquillity at the LAC.
2. India formally accepted the concept of the LAC and the two sides signed the Agreement to Maintain Peace and Tranquillity at the LAC.
3. But it wasn't clear on stating that the LAC to be as at the time signing of agreement and not based on 1959 or 1962.
4. To reconcile the differences about some areas, the two countries agreed to set up a Joint Working Group on the border issue to clarify the alignment of the LAC.
5. The process of clarifying the LAC has stalled since 2002 as formally the maps were exchanged between two sides only for the middle sector.
6. Also, there is no map depicting India’s version of the LAC publicly available. And in 2015, India’s proposal to clarify the LAC was rejected by China.
Why did India change its stance?
1. Indian and Chinese patrols were coming in more frequent contact during the mid-1980s.
2. Following the Sumdorongchu standoff in1988, the two sides agreed to negotiate a border settlement, and maintain peace and tranquillity along the border.
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Which are the reasons for controversial claims?
1. India’s claim line is the line seen in the official boundary marked on the maps as released by the Survey of India, including both Aksai Chin and Gilgit-Baltistan.
2. While China corresponds mostly to its claim line, in the eastern sector, it claims the entire Arunachal Pradesh as South Tibet.
Reason for Controversial claim lines in Ladakh
1. While Independent India acquired the treaties from the British, the Shimla Agreement on the McMahon Line was signed by British India.
2. Aksai Chin in Ladakh province of the princely state of Jammu and Kashmir was not part of British India, although it was a part of the British Empire.
3. So, the eastern boundary was well defined in 1914 but not in Ladakh.
4. In 1948, Indian government has released two white papers that had two maps:
a. One had no boundary shown in the western sector, only a partial colour wash,
b. The second one extended the colour wash in yellow to the entire state of J&K but mentioned “boundary undefined”.
5. The map published in another White Paper by India in 1950 after becoming a Republic also had undefined boundaries.
4. Following a government directive in 1954 a new map was published showing India’s Northern and North Eastern frontier without any reference to any line.
5. This new map has been used for dealings with China and also led to the 1962 War.
How is LAC different from Line of Control (LoC)?
1. LoC with Pakistan emerged from the 1948 ceasefire line negotiated by the UN after the Kashmir War.
2. The LoC was designated in 1972, following the Shimla Agreement between the two countries.
3. It is delineated on a map signed by DGMOs of both armies and has the international sanctity of a legal agreement.
4. The LAC, in contrast, is only a concept – it is not agreed upon by the two countries, neither delineated on a map or demarcated on the ground.
Source: The Indian Express
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Law Enforcement post-COVID-19
For a society affected by a deadly virus, strict maintenance of public order is most essential to protect and provide medical care for those affected.
Enforcing lockdown
1. Next to healthcare, Law enforcement is one of the critical services.
2. Police have taken enormous risks to ensure strict observance of guidelines, including physical distancing, that is the most difficult rule to enforce.
3. Public cooperation has also helped police to manage despite the lack of resources such as manpower and material.
4. Despite some disorderly sections, the majority of the population cooperated. This can be a guide for future police-public relations.
5. Police also skillfully used social media to disseminate all relevant information to a majority of the population, both in urban and rural areas.
Overall drop in crime
1. Nearly zero traffic on major highways and within cities ensured a sharp reduction in traffic accidents and fatalities caused by such accidents.
2. Confinement of anti-social elements to their homes, trespass and burglary became more difficult crimes to commit.
4. Despite considering wilful non-registration of cases by the police, there was an overall significant drop in crime rates.
Increase in Domestic Violence
1. There was a rise in domestic violence cases because of two major factors
a. Most men are at home, either without work or in fear of losing their jobs. As per data, domestic violence increases with greater unemployment.
b. Fear and insecurity of men cause tension at home and make women victims of it.
c. Non-availability of liquor during the lockdown causes frustration among habituated drinkers.
d. This shows women and girls more vulnerable to violence during epidemics.
Organized Crime
1. The Global Initiative Against Transnational Organized Crime is a network of prominent law-enforcement, governance and development based in Geneva.
2. It believes that the pandemic is both a threat and an opportunity for, organized crime, especially illicit drug trade.
3. Travel restrictions across borders, especially in Africa, have made international trade in drugs extremely difficult.
4. So, organized gangs have to innovate and adapt to the changing nature of the illicit market.
5. They are expected to infiltrate health services and make profits through the sale of prescription drugs that are not otherwise easily available to the public.
Cybercrime
1. There is a rise in cybercrime. New portals have been launched to get people to donate money for the cause of combating COVID-19.
2. Many fraudulent sites are designed so well that a large number of people are easily taken for a ride.
3. Besides this, there is large-scale manufacture of ineffective masks and hand sanitizers.
Challenges in Prisons
1. A major challenge for public officials is keeping prisons free of the virus. Many prisons have taken steps to insulate prisoners who reported positive for the virus from the rest of the inmates.
2. A number of human rights activists have said to consider the premature and temporary release of prisoners.
3. This is a tricky issue as a question arises that should prisons be totally emptied, or should they adopt a selective approach.
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4. Some human rights activists ask for complete evacuation, but such a move will make a mockery of the criminal justice system and expose society to many unrepentant violent offenders.
5. The Supreme Court directed the States and Union Territories to constitute high-powered committees to consider releasing convicts who have been jailed up to seven years on parole, to decongest prisons.
Way Forward
1. The virus is to stay for a long time, so apart from policymakers, the police leadership will have to introspect on its recent experience.
2. Police leadership must draft a comprehensive Standard Operating Procedure that will educate all policepersons in the country. This will take care of future virus waves if any.
3. During lockdown, many crimes have gone done but many others have gone up or will assume new forms in the near future.
4. As we enter unlock mode, it is incumbent on law-enforcement officials to think of ways of dealing with new challenges in maintaining law and order.
Source: The Hindu
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Society
Covid-19 & Poor
1. A new study found that around 90% of families in developing countries lack the facilities needed to follow the World Health Organization’s (WHO) directives for protection against the coronavirus.
2. Preventive practices require suitable infrastructure, sanitation and reliable information source.
What is needed to follow the directives?
1. Each family require 6 things to follow WHO’s directive. Out of six, five are related to hygiene and social distancing
a. Pucca house, a toilet within the premises, a private water source, a place to use soap to wash hands, and enough space to accommodate no more than two people per room.
b. The sixth aspect is access to at least one information source, such as a television or the internet.
Who can comply with recommendations?
1. Across 40 developing countries including India, only 10% of households overall had all the six features.
2. Among the poorest one-fifth of these households, only 4% could comply with all the WHO’s recommendations.
3. Even among the richest, 70% do not fulfil all six conditions.
4. In sub-Saharan Africa, the index for the poorest people is found to be zero.
5. In nine countries with data on distance to the nearest public health facility, only 50% of households had one within 5 km.
6. No such facility is found within 5 km for the poorest 40% households in these countries.
Poor are more affected in the fight against the coronavirus. Even the preventive measures taken in the rich world is not affordable for families in the developing world.
Source: Live Mint
Task Force on MMR
1. The Ministry for Women and Child Development (WCD) has set up a task force to look into factors that affect Maternal Mortality Rate (MMR) among Indian women.
2. The task force will be headed by Jaya Jaitley and comprises 10 members.
3. It has been mandated with inquiring into matters pertaining to age of motherhood, imperatives of lowering MMR, improvement of nutritional levels and related issues.
4. It will examine the correlation of the age of marriage and motherhood with the health, medical wellbeing and nutritional status of the mother and baby during pregnancy, childbirth and afterwards.
5. It will also suggest measures for promoting higher education among women and suggest suitable legislation or amendments in existing laws to support its recommendations.
6. It will also have to submit a detailed roll-out plan with timelines to implement its recommendations.
7. It will also examine Infant Mortality Rate, Chid Sex Ratio, Total Fertility Rate and Sex Ratio at birth- factors impacting a mother's health.
8. The task force will be assisted by the Niti Aayog.
India’s progress in MMR
1. India has reduced its MMR in recent years, with a 77% dip between 1990 (556 deaths per live births) and 2016 (130).
2. As per 2019 data, a further decline to 122 was observed.
3. Improvement has been because of better access to health facilities, institutional deliveries, and improved maternal health and nutrition through programs like the Janani Suraksha Scheme.
Regional disparities
1. There are various regional disparities within the country.
2. Rajasthan with poor demographic indices has shown remarkable improvement in reducing maternal deaths.
3. Uttar Pradesh and Madhya Pradesh are the worst performers in this sector.
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Causes of MMR
1. There are various factors that cause women to die at or after childbirth.
2. The age of marriage, age at motherhood, general health, hygiene, and access to healthcare are important factors.
3. Women also die of complications like preeclampsia, bleeding, infection and unsafe abortions.
Source: The Week and PIB
COVID-19 in Rural India
What is the current situation?
1. The rapidly increasing number of cases and deaths because of corona shows India is not immune to the pandemic.
2. Doctors, healthcare workers, planners and policymakers are all focused on the cases in urban areas especially Delhi, Mumbai and Chennai.
3. But 65% of India’s population lives in rural areas. Though relatively underexposed, they are a vulnerable majority.
4. While rural India was believed to escape from the virus with minimal causality, the restoration of transportation is making them vulnerable to corona.
5. Rural wave of corona outbreak has just started while it is about to peak in urban areas.
How is the health infrastructure in rural areas?
1. In terms of human development, there was always a rural-urban divide in India in healthcare and education.
2. The deficiency was noticed both in terms of rural lives and livelihoods lost and in overall nation wealth creation.
3. Underdeveloped Primary health centres (PHC), deficiency of healthcare workers, equipment, testing facilities in rural areas act as a major deterrent in saving lives in these places.
4. Also, laxity of people in rural areas like roaming without masks, not following social distancing norms, congregating in market places, places of worship adds to the problem.
Where India needs to focus?
1. Administering social vaccine
a. It comprises of a decentralized approach with the participation of stakeholders from all 3 levels of local self-government like Panchayat, Mandal and Zilla Parishad.
b. Print, radio, electronic radio, messages through mobile phones are to be used to educate people regarding safety precautions.
c. Imbibe new behaviours of mandatory wearing of a cotton cloth mask in public places and observing strict hand hygiene
2. Administrative efforts at the state and district level
a. Block unnecessary urban-rural movements
b. Quarantine those moving from red zone to green zone
c. Provide field hospitals exclusively for isolating and managing COVID-19 cases.
3. Restrict the usage of PHCs by COVID-19 patients by adopting home isolation and by delivering essentials like oxygen and medical supplies at home.
4. Each patient to be monitored by a medical professional and only the high risk cases are to be shifted to hospitals instead of all COVID-19 patients.
5. This ensures that PHCs can be used for other medical, surgical and obstetric emergencies.
Source: The Hindu
Double Pandemic
What is the situation?
1. The pandemic has resulted in an increase of domestic and gender-based violence.
2. There is an increase in the number of calls received by emergency helplines by 25% to 300% and in internet searches for those affected by domestic violence.
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Why is there an increase?
1. Historically, women are always at a disadvantage during crisis, epidemics and now pandemics. For example,
a. 60% of deaths due to Ebola virus in Africa were contributed to women.
b. Domestic violence against women rose by 53% in New Zealand after it was struck with an earthquake.
2. Gender roles and harmful practices including customs such as early and forced marriage limit women’s access to help from society and make them victims of domestic violence.
3. Women do 3 times as much unpaid care work compared to men and makeup 70% of workers in the health and social care sectors. Still, they are more prone to infection.
How the pandemic heightened the crisis?
1. The crisis had led to an escalation of violence at home as women endure the negative effects of frustration and anger.
2. Learning gaps between girls and boys are increasing due to mass school closures. This also puts girls at the risk of sexual exploitation, early pregnancy and early or forced marriage.
3. Children are unable to report abuse to a trusted teacher due to closure of schools.
4. Victims are unable to receive help due to restrictions on home visits by police and health workers. Violence shelters are also being converted to health facilities and courts being forced to close.
Where to focus?
1. Access to health care and vulnerabilities to domestic violence are interlinked. So, victims of abuse are to be ensured access to health care facilities.
2. Financial assistance to women-led MSMEs and the informal sector may help them escape from domestic violence as they become financially independent.
3. According to a study by the Commonwealth project, gender-based violence leads to an estimated cost of 4.625% of GDP. So, care must to taken to reduce the economic effects in a country.
5. Innovations such as virtual hearings and legal advice allows survivors to access justice.
6. Engage with commonwealth countries to find solutions to reduce the increase in gender-based violence.
Source: The Hindu
Global Education Monitoring Report
1. Global Education Monitoring (GEM) report is released by UNESCO (United Nations Education Scientific and Cultural Organization).
2. It is mandated to monitor and report on
A. Progress in achieving SDG 4 (Quality Education)
B. Review the implementation of National and International strategies to hold the relevant parties accountable in achieving the above goal.
Highlights of the report
1. The pandemic has increased the gaps in education systems across the world.
2. About 40% of the low- and middle-income countries have not supported learners such as Poor, Linguistic minorities and learners with disabilities.
3. During the peak period of pandemic in April-2020 almost 91% of students around the world were out of school.
4. Imperfect substitutes
A. Many countries were unable to provide proper substitutes for classroom teaching Eg: many poor countries resorted to radio and television lessons.
B. 55% of low income, 79% of middle income and 93% of upper middle-income countries adopted for online learning platforms for primary and secondary education.
C. Not all students and teachers have access to adequate internet connections, equipment, skills and working conditions to opt for online education.
5. The online mode is difficult for students with learning disabilities, autism affected students, deaf and blind students as resources for them may not be available outside schools.
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6. Higher drop-out of girls is a concern in low income countries as in the case of Ebola epidemic in Africa, many girls never returned to schools despite the subsidence of the disease.
7. In order to combat the situation after reopening of schools, 17% of low- and middle-income countries are planning to recruit more teachers, 22% to increase in school time, 68% to introduce remedial classes.
Source: The Hindu
Pandemic & Education
1. Education system all over the world has been affected drastically by COVID-19.
2. Many educational institutions turned online as schools, colleges, Research institutions and universities have been shut.
Problems in Online education
1. Transforming laboratory related courses or which require practical components online would be difficult.
2. There is a high digital divide in terms of access to reliable connectivity, hardware, access to electricity especially in developing countries like India and this is more pronounced in rural areas.
3. The technical know-how of operating electronic gadgets is limited in rural areas for both students as well as teachers.
4. Research activities require close personal interaction and discussion between researchers/scientists which is not possible to conduct online.
5. There could be reduction in funding for both research work and maintenance of research infrastructure due to collapse of economies.
Way forward
1. GoI (Government of India) is encouraging usage of Massive Open Online Courses (MOOCs) via NPTEL and Swayam platforms so that students can have access to quality lectures online.
2. Democratization of Knowledge: Higher education in India has been elitist and exclusionary, moving online helps in wide distribution of learning opportunities.
3. Digital tools such as Artificial Intelligence (AI) can be used to provide personalized instructions based on student needs.
4. The government needs to work on improving digital infrastructure and ensure that students have access to mobile phone or laptop.
Source: The Hindu
STARS Scheme
1. STARS (Strengthening Teacher Learning and Results for States Program) scheme is to improve the learning outcomes of students and governance of government schools in India.
2. This project is implemented through the Samagra Shiksha Abhiyaan (SSA) and the World Bank has approved $500 million for this project.
3. This is implemented in 6 states of Himachal Pradesh, Kerala, Madhya Pradesh, Maharashtra, Odisha and Rajasthan.
4. The main areas of focus include
A. Improving learning assessment systems.
B. Strengthening classroom instruction and remediation.
C. Facilitating school to work transition.
D. Strengthening governance and decentralized management.
4. This program will address the learning outcome and prepare students for the jobs in the future.
5. STARS will also strengthen the implementation at local level and invest in building teacher capacity for effective implementation of SSA.
6. The World Bank said that the curriculum in this project will be kept in tandem with the evolving job market.
Samagra Shiksha Abhiyaan
1. It is the flagship scheme for education in India, it treats school education holistically without segmentation from pre-nursery to class-12.
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2. It subsumes the 3 earlier schemes of Sarva Shiksha Abhiyaan , Rashtriya Madhyamik Shiksha Abhiyaan and Teacher Education.
3. The main outcomes of the scheme envisaged are Universal access, Equity and Quality, promoting vocationalisation of education and strengthening of Teacher Education Institutions.
Source: Livemint
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Geography
Cyclone Nisarga
Following the cyclone Amphan that passed on the eastern coast, a potential cyclone is heading the Western coast.
Where is it headed?
1. It is headed towards the coastline of north Maharashtra and south Gujarat.
2. The depression is likely to intensify into a deep depression and eventually into a cyclone called Nisarga.
3. It is likely to evolve into a Severe Cyclonic Storm with a strength 2 on a 1-to-5 of the strength of cyclones that arise in the Indian Ocean.
What does that mean?
1. Strength of the cyclones is measured by the wind speeds they generate. At its strongest, Nisarga would be associated with wind speeds in the range 95-105 km per hour.
2. Amphan was classified as a super-cyclone, of category 5 but it has weakened to category 4, ‘Extremely Severe Cyclonic Storm’, with a wind speed of 180 kph.
3. Cyclones formed in the Bay of Bengal side of the north Indian Ocean are more frequent and stronger than those on the Arabian Sea side.
How different are the conditions?
1. Relatively cold waters of the Arabian Sea doesn’t support very strong cyclones as in the Bay of Bengal. Odisha and Andhra Pradesh face such cyclones every year.
2. But 2019 was unusual as the Arabian Sea experienced the most frequent and intense cyclonic activity in more than 100 years.
3. Five cyclones originated in the area in 2019 — Vayu, Hikka, Kyarr, Maha and Pavan – rather than the normal one or two that form.
Why is this a threat?
1. If the system intensifies into a cyclonic storm, coastal districts of Maharashtra will experience heavy to very heavy rainfall.
2. The onset of Southwest monsoon along with this cyclone will intensify the existing rough weather conditions in the Arabian Sea.
3. Consequent rainfall even before the arrival of the southwest monsoon in Maharashtra poses a threat. Normally, monsoon arrives over Maharashtra after June 10.
Source: The Indian Express
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Delhi earthquakes
1. The 11th minor earthquake of magnitude 2.1 was recorded near Delhi, with the most powerful being magnitude 3.4, since May.
2. Detection of earthquakes, especially of smaller magnitude, being recorded in an area also depends on the number of seismic recorders installed in that area.
3. The area around Delhi has the densest concentration of seismometers, even more than the seismically much more active Himalayan region.
4. So, even earthquakes of smaller magnitude, that are not even felt by most people, are recorded, and this information is publicly accessible.
5. Earthquakes of magnitude four or below hardly cause any damage anywhere and are mostly inconsequential for practical purposes.
6. Thousands of such earthquakes are recorded around the world every year, and most of them are uneventful.
Foreshocks
1. When a big event happens, all the smaller earthquakes that have occurred in that region in the near past are classified as foreshocks.
2. Foreshocks are post-event definitions.
3. The description does not apply before any big earthquake has happened.
Prediction of Earthquakes
1. The precursors or symptoms of an earthquake are yet to be found out.
2. Some special earthquakes, the ones that are triggered by volcanic activity, can be predicted to some extent.
3. But predicting earthquakes in regions like Delhi is more difficult as the region does not lie on any faultlines.
Delhi vs Himalayas
1. The Himalayan region, extending from the Hindu Kush to the Northeast and going south to Southeast Asia, is seismically one of the most active regions in the world.
2. The region has experienced several major earthquakes in the past, most recently in 2015 in Nepal.
3. The tectonic activity in the Himalayan region can be understood as two tectonic plates meet each other there.
4. But Delhi does not lie on a plate boundary and is located on a single plate. The seismic activity is generated by internal deformities.
5. By measuring the energy that is getting trapped under the surface as a result of one tectonic plate trying to move beneath the other one, the Himalayan region is expected to experience an earthquake of magnitude 8 or higher.
6. This prediction is based only on the estimate of the energy that is ready to be released.
Magnitude
1. A magnitude 6 earthquake is typically associated with the kind of energy released by the atom bomb in Hiroshima.
2. Since the magnitude of earthquakes is measured on a logarithmic scale, a magnitude 7 earthquake is about 32 times more powerful than a magnitude 6 earthquake.
3. Accordingly, a magnitude 8 earthquake would be almost 1,000 times more powerful than a magnitude 6 event.
Source: Indian Express
Challenger Deep
1. Kathy Sullivan was the first American woman to walk in space in 1984.
2. She was also the first woman and the fifth person to descend to the Challenger Deep in the Mariana Trench of the Pacific Ocean
3. It is the deepest known spot in the world’s oceans.
4. Sullivan is now the only human who has walked in space and reached the deepest point in the ocean.
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What is Challenger Deep?
1. The average depth of the ocean is about 12,100 feet and the deepest part is called the Challenger Deep.
2. It is located below the surface of the western Pacific Ocean. is approximately 36,200 feet deep.
Why are scientists interested in deep ocean areas?
1. As per NOAA, most of the existing knowledge of the oceans comes from shallower waters
2. Deeper waters remain relatively unexplored, humans are relying more on these areas for food, energy and other resources.
3. Ocean exploration is disciplined and organized and includes rigorous observations and documentation of biological, chemical, physical, geological, and archaeological aspects of the ocean.
4. Finding out more about the deep ocean areas can potentially reveal new sources for medical drugs, food, energy resources and other products.
5. Information from the deep oceans can also help to predict earthquakes and tsunamis, and help us understand how we are affecting and getting affected by the Earth’s environment.
How does one reach the deep ocean?
1. Vehicles called Human Occupied Vehicles (HOVs) may be used that carry scientists to the deep sea.
2. Alternatively, there are unmanned Remotely Operated Vehicles (ROVs) that are linked to ships using cables and can be steered by scientists remotely.
Source: Indian Express
Annular Solar Eclipse
The recent solar eclipse is a rare eclipse that occurs once in every 1or 2 years as it coincides with the summer solstice.
Summer Solstice
1. Solstice in Latin means “Sun stands still.”
2. Summer solstice occurs every year on June 20 or 21, where the Northern hemisphere receives greater amounts of energy from the Sun.
3. At this time, the amount of energy received from the Sun at the North Pole is 30% more than at the equator and the northern hemisphere has the longest day as earth’s axis is tilted 23.5 degrees to its rotational axis.
4. So, the Northern hemisphere has the longest day on June 20, while the Southern hemisphere has its longest day in December.
5. During winter in the Northern hemisphere, it is called winter solstice, where the nights are longer than days and vice-versa in Southern hemisphere.
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Solar Eclipse
1. Solar eclipse occurs when the moon is aligned between sun and the earth, blocking the light received by the earth from the sun.
2. Annular Solar eclipse occurs when the moon is at the farthest from the earth. The light from the sun is not completely blocked and looks like a halo around the moon.
3. Since the light is not completely blocked, its appearance gives a ‘ring of fire’ effect.
4. solar eclipse
Source: Indian Express
Ocean Floor Mapping
1. Researchers from the Seabed 2030 project have completed mapping of one-fifth of the world’s ocean floor.
2. The project aims to complete the mapping of the world’s ocean floor by 2030.
3. Bathymetry (measurement of shape and depth of ocean floor) has many significances.
Geography
A. It’ll be helpful in understanding ocean circulation, tides and biological hotspots.
B. It provides key inputs for navigation, forecasting tsunamis, exploration for Oil and Gas projects.
Economy
A. It helps in Building offshore turbines, fishing resources, laying cables and pipelines.
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Disaster Response
A. It is highly valuable in disaster situations. For example, Japan scientists were able to reconstruct the forces behind the 2011 Tohoku Earthquake.
B. The mapping of the ocean floor can be helpful in search and rescue of missing aircraft in the ocean. For example, in MH 370 flight that got missed in the Southern Indian Ocean.
Environment
A. It would be helpful in understanding Climate Change, underwater Volcanoes, vertical mixing of ocean water and ocean currents.
B. It would help in realizing Sustainable Development goals to Conserve and sustainably use oceans, seas and marine resources.
Seabed 2030 Project
1. This project was conceived by Japan’s Nippon foundation and GEBCO (General Bathymetric Chart of the Oceans).
2. GEBCO is the only Intergovernmental Organization having the mandate to map the ocean floor.
3. The project aims to map the ocean floor using Deepwater sonar systems, Underwater Vehicles (AUVs) that provide a minimum resolution of 100m at all spots.
Source: India Express
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History, Art & Culture
History of Ladakh
The standoff at Galwan river raised the question of the significance of Ladakh to India and China.
History
1. Ladakh was initially part of Tibetan empire but later broke off in 742 CE after the assassination of King Langdarma.
2. Until the Dogra invasion in 1834, Ladakh was an independent Himalayan state similar to Sikkim and Bhutan.
3. It was integrated into the state of Jammu and Kashmir by the Dogra ruler Gulab Singh.
4. In 1841, Tibet under the Qing dynasty of China tried to invade Ladakh but was defeated by the Sikhs. This led to the Treaty of Chushul by which Tibet agreed to not invade again.
5. After the Anglo-Sikh war in 1845-46, Ladakh was brought under British suzerainty.
Significance of Ladakh
1. Ladakh served as an entrepot between Central Asia and Kashmir. Tibetan pashmina shawl was traded through Ladakh to Kashmir.
2. Trade flourished from Karakoram pass to Yarkand and Kashgar to Chinese Turkestan.
China’s interest
1. After China invaded Tibet in 1950, political uprising slowly started in Tibet.
2. China started constructing roads across Ladakh in 1956-57 to have better control over Tibet.
3. The uprising erupted into a huge movement in Lhasa in 1959, when Dalai lama fled to India and was given political asylum.
3. The Indian government didn’t approve of these developments as Nehru regarded a relatively independent Tibet would act as a buffer state between China and India.
4. As the diplomatic negotiations failed, it led to the Indo-China war in 1962.
Point of Conflict
1. British tried to delineate the borders of Ladakh, but it became complicated because it came under Tibetan and Central Asian influence.
2. People of Ladakh also did not distinctively recognize themselves with any country.
3. Now, India insists on recognition of the border under the Simla convention (1914) between British and Tibet, China does not accept it.
Recent Conflict
1. The recent conflict is due to 2 reasons
a. Construction of the new DSDBO road (Darbuk -Shyok- Daulat-beg-oldie) in Ladakh region and increasing infrastructure in this region post-2013 by India.
b. Removal of the special status of J&K and making Ladakh a UT is viewed by China as an attempt by India to reassert its control over the entire state.
Source: Indian Express
Variyamkunnath Kunjahammed Haji
A movie is made on the life of Variyamkunnath Kunjahammed Haji to mark 100 years of Malabar rebellion.
About
1. Haji is a rebel leader from the Malabar region (Kerala) who fought against the British.
2. He was born into a rich affluent family in 1870 and grew up listening to stories of torture and injustice meted out by British to local people.
3. His father was deported to Andaman and Nicobar Islands for participation in a rebellion against the British.
4. These factors led Haji to fight against the British.
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Contribution to Freedom movement
1. He made music-based art forms such as Daffumutt and poems like ‘Malappuram Padappattu’ to rally the locals against the British.
2. He participated in the Khilafat movement and decided to take arms against the British with the help of some sepoys.
3. Haji was aware of importance of Hindu-Muslim Unity in the movement and ensured that people of other faiths were given adequate security.
4. He declared some part of the territory in Malabar district as an independent state and ran a parallel Khilafat regime in 1921.
5. This regime consisted of its own separate passport, currency, system of taxation and his army consisted of Hindu men.
Malabar Rebellion
1. This movement is also called the Moplah Rebellion.
2. Mopalah’s were the tenants in the lands of Hindu landlords. These landlords and the British resorted to enhanced rents and eviction of mopalah’s from the land.
3. This led to a rebellion and after the merger of Khilafat movement, this movement was given a communal color and led to widespread casualties of Hindus and Muslims.
4. Haji played a prominent role in the Moplah rebellion.
Source: Indian Express
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