Daily Prelims Notes 25 January 2024

Daily Prelims Notes

25 January 2024

Table Of Contents

1. There is serious concern about whole construct of safe harbour
2. Turkey’s parliament approves Sweden’s NATO membership
3. The issue of genocide and the world court
4. Zee asks Sony to withdraw termination of merger, urges NCLT to act
5. The urgent need for data to make personalised medicine equitable
6. Nepal explores tapping flood-risk glacial lakes for clean power
7. Odisha to establish a melanistic tiger safari – a first of its kind in the world
8. No food in forests: Bears, langurs throng Uttarakhand apple orchards as native vegetation gets taken over by invasives
9. Albatrosses are threatened with extinction — and climate change could put their nesting sites at risk
10. Cabinet approves ₹8500 crore incentive scheme for coal gasification projects
11. Centre releases new regimen for leprosy treatment
12. Senegal’s pink lake is on the verge of disappearing — how to protect it
13. Indian Air Force Conducts Exercise Desert Knight With France, UAE Over Arabian Sea
14. Tension in Manipur as radical group Arambai Tenggol ‘summons’ all 40 Valley-based MLAs to Kangla Fort
15. Govt permits direct listing by Indian firms on GIFT-IFSC’s international markets
16. Capex-led Growth Strategy from Industry Chambers’ Recommendations
17. India’s Stance on Fisheries Subsidies at WTO
18. RBI to Infuse ₹2.50 Lakh Crore Liquidity

1. There is serious concern about whole construct of safe harbour

Subject: Economy

Section: External sector

Context:

• Ashwini Vaishnav, the Minister for Electronics and Information Technology, discussed significant aspects of the Telecommunications Act, 2023.

Telecommunications Act, 2023

• Structural Reforms: Transition from a license permit regime to a calculated authorization system for telecom operations.
• Spectrum Auction: Following Supreme Court judgment, spectrum to be auctioned except for certain sectors like defense.
• Spectrum Sharing and Harmonisation: Provisions for sharing and harmonizing different spectrum bands.
• Innovation and Research: Introduction of ‘sandbox’ for academic experimentation with new technologies.
• Right of Way Reform: Empowerment of district judges to resolve disputes related to telecom infrastructure construction.
• Digital Connectivity Expansion: Target to triple digital connectivity, with a focus on integrating new technologies like 6G.
• Dispute Resolution and Self reporting: A four-tier structure for dispute resolution and provisions for telecom companies to self-report violations.
• Universal Services Obligation Fund: Expanded into Digital Bharat Nidhi to support research, development, and connectivity in underserved areas.
• Interception Framework: Adherence to the 1996 Supreme Court framework for lawful interception of communications.
• Digital Governance and Policy OTT Regulation: No specific provision to regulate OTT apps like WhatsApp; digital domains like fintech and medical electronics regulated by respective ministries.
• Safe Harbour Concerns: Global reevaluation of the safe harbour principle due to ubiquitous internet access and the need for accountability on social media platforms.
• Biometric Authentication for Telecom Services: Provision for biometric authentication (e.g. Aadhaar) for obtaining telecom services, emphasizing the importance of KYC.
• International Collaboration: MOUs signed with various countries for sharing India Stack technologies, reflecting India’s democratic and transparent standards.

2. Turkey’s parliament approves Sweden’s NATO membership

Subject: IR

Section: Int Groupings

Context:

• Sweden’s attempt to join NATO cleared a major hurdle after Turkey’s parliament supported its membership.

More About News

• For a new country to join the North Atlantic Treaty Organization (NATO), all the existing members have to approve it.
• Turkey and Hungary had been opposing Sweden’s entry for almost the past two years.

About NATO

• Formed in 1949 with the signing of the Washington Treaty, NATO is a security alliance of 31 countries from North America and Europe.
• In April 2023, Finland joined the alliance as its 31st member.
• NATO’s fundamental goal is to safeguard the Allies’ freedom and security by political and military means.
• It is a system of collective defence where independent member states agree for mutual defence in case of any attack by external party.
• Article 5 of the Washington Treaty states that an attack against one Ally is an attack against all. This article forms the core of the Alliance, a promise of collective defense.
• Headquarter – Brussels, Belgium.

Functions

• Political: NATO promotes democratic values and enables members to consult and cooperate on defence and security-related issues to solve problems, build trust and, in the long run, prevent conflict.
• Military: NATO is committed to the peaceful resolution of disputes.
• If diplomatic efforts fail, it has the military power to undertake crisis-management operations.

3. The issue of genocide and the world court

Subject: IR

Section: Int Org

Context:

• On December 29, 2023, the Republic of South Africa instituted proceedings against Israel in the International Court of Justice (ICJ).

About International Court of Justice

• The ICJ is the principal judicial organ of the United Nations (UN).
• It is the only one of the six principal organs of the UN that is not located in New York City.
• Establishment: It was established in June 1945 by the Charter of the UN and began work in April 1946.
• Precursor: The court is the successor to the Permanent Court of International Justice (PCIJ), which was brought into being through, and by, the League of Nations.
• After World War II, the League of Nations and PCIJ were replaced by the UN and ICJ respectively.
• Role of ICJ: Its role is to settle, in accordance with international law, legal disputes submitted to it by States and to give advisory opinions on legal questions referred to it by authorized UN organs and specialized agencies.
• Official Languages: English and French.
• ICJ Jurisdiction: All members of the UN are automatically parties to the ICJ statute, but this does not automatically give the ICJ jurisdiction over disputes involving them.
• The ICJ gets jurisdiction only if both parties consent to it.
• The judgment of the ICJ is final and technically binding on the parties to a case.
• However, the ICJ has no way to ensure compliance of its orders, and its authority is derived from the willingness of countries to abide by them.

What is Genocide Convention?

• The Convention on the Prevention and Punishment of the Crime of Genocide (Genocide Convention) is an instrument of international law that codified for the first time the crime of genocide.
• The Genocide Convention was the first human rights treaty adopted by the General Assembly of the UN on 9 December 1948.
• It signified the international community’s commitment to ‘never again’ after the atrocities committed during the Second World War.
• Its adoption marked a crucial step towards the development of international human rights and international criminal law as we know it today.
• According to the Genocide Convention, genocide is a crime that can take place both in time of war as well as in time of peace.
• The definition of the crime of genocide, as set out in the Convention, has been widely adopted at both national and international levels, including in the 1998 Rome Statute of the International Criminal Court (ICC).

4. Zee asks Sony to withdraw termination of merger, urges NCLT to act

Subject: Economy

Section: Capital market

Context:

• Zee Entertainment Enterprises Ltd. (ZEEL) asked Culver Max Entertainment Pvt. Ltd (formerly  Sony Pictures Networks India Private Ltd.) (Culver Max) and Bangla Entertainment Pvt. Ltd. (BEPL) to immediately withdraw their termination of the Merger Co­operation Agreement (MCA) and confirm that they would perform their obligations to give effect to and implement the Merger Scheme that had been sanctioned by the National Company Law Tribunal.

5. The urgent need for data to make personalised medicine equitable

Subject: S&T

Section: Biotech

Context:

• Medical research is biased, meaning some would be helped far more than others by genetically informed personalised medicine; there are problems across the clinical trials, ranging from which questions get asked in the first place, to who participates in trials and who gets their genomes sequenced.

Genome Sequencing

• A genome is an organism’s complete set of DNA, including all of its genes.
• Genome sequencing is figuring out the order of DNA nucleotides, or bases, in a genome—the order of As, Cs, Gs, and Ts that make up an organism’s DNA.
• It is a method of isolating and identifying variable elements within the base-pair sequence of DNA (deoxyribonucleic acid) as it shows high degree of polymorphism (variation) at genetic level.
• Polymorphism forms the basis of genome sequencing since DNA from every tissue (such as blood, hair-follicle, skin, bone, saliva, sperm etc.) from an individual show the same degree of polymorphism.

Precision/personalised Medicine

• Precision medicine is an emerging approach for disease treatment and prevention that takes into account individual variability in genes, environment, and lifestyle for each person.
• Precision medicine, also known as personalized medicine, is a new frontier for healthcare combining genomics, big data analytics, and population health.
• This approach will allow doctors and researchers to predict more accurately which treatment and prevention strategies for a particular disease will work in which groups of people.
• It is in contrast to a one-size-fits-all approach, in which disease treatment and prevention strategies are developed for the average person, with less consideration for the differences between individuals.

6. Nepal explores tapping flood-risk glacial lakes for clean power

Subject: Geography

Section: Climatology

Context:

• In an effort to turn a risk into a gain, Nepal aims to drain burgeoning glacial lakes and produce hydropower from the flow.

Details:

• In Langtang, Nepal, two villages near the Tibet border are utilizing a glacial lake as an innovative power source.
• Due to climate change, the melting of mountain ice is accelerating, creating a threat of catastrophic flooding from rapidly filling glacial lakes. However, this situation presents an opportunity for clean energy production.
• By draining excess water from these lakes to reduce disaster risk, small hydropower generators have been installed in the drainage channels.
• Since 2017, 175 households in Langtang and Kyanjin have gained access to clean hydropower for cooking, lighting, and other energy needs, significantly reducing their reliance on firewood.
• The Kadoorie Charitable Foundation funded the $448,000 hydropower project. Despite its success, expanding such solutions in Nepal is challenging due to limited funding and the difficulties of working in high-mountain environments.

Power from risk:

• In the Himalayas and other high mountain regions, communities face increasing risks from glacial lakes that are filling rapidly and can burst, causing devastating flash floods. For example the bursting of Lhonak Lake in Sikkim.
• Nepal has taken steps to mitigate such risks by channelling water from high-risk lakes like Tsho Rolpa and Imja.
• Thulagi Lake(Nepal) holds a massive volume of water. By channelling water from Thulagi to hydropower equipment, it’s possible to generate 50 megawatts of electricity consistently and reduce the lake’s water level, significantly lowering the risk of a catastrophic burst.

Funding dilemma:

• Nepal, in collaboration with the UNDP, is seeking $50 million from the Green Climate Fund, with additional support from the government, UNDP, and the private sector, to reduce the risk of floods from the Thulagi, Lower Barun, Lumding Tsho, and Hongu-2 lakes.
• However, this proposal does not include hydropower generation plans.

What are glacial lakes?

A glacial lake is a body of water that originates from a glacier. It typically forms at the foot of a glacier, but may form on, in, or under it. As Earth’s climate warms, the world’s glaciers are shrinking, increasing freshwater outputs to all kinds of glacial lakes. Some communities depend on glacial meltwater for seasonal irrigation or domestic use, but as the balance shifts toward more melt, this water source may not be reliable in the long term and comes with new risks

How glacial lakes form?

As glaciers move, they erode the terrain under them, leaving depressions and grooves on the land. When they churn up rock and soil, they etch ridges of debris known as moraines. Most glacial lakes form when a glacier retreats and meltwater fills the hole left behind. However, natural dams, formed out of ice and terminal moraines, can also form glacial lakes. An ice dam forms when a surging glacier, which can move up to 100 times faster than an average glacier, may dam up meltwater as it closes off a valley or fjord and prevents it from draining. Dams formed by moraines can be dense and stable, holding sizable lakes behind them for years. They can also be leaky, allowing the lake to drain slowly into nearby rivers. However, prolonged melting or abrupt bursts of intense melting can wreak havoc. Too much meltwater in a short period of time might overflow a lake or burst through natural barriers, flooding lands downstream, washing away communities, and damaging roads and infrastructure. Lakes held back by moraines pose a serious threat because the porous moraine walls can destabilize easily. A rise in the amount of meltwater from glaciers increases the water pressure on the moraine barriers, which can quickly give way and threaten inundation.

7. Odisha to establish a melanistic tiger safari – a first of its kind in the world

Subject: Environment

Section: Protected Area

Context:

• The Odisha Government in India announced the establishment of the world’s first melanistic tiger safari near Baripada, the district headquarters town of Mayurbhanj. 

Details:

• This safari, to be set up adjacent to National Highway-18, will cover an area of 200 hectares, with 100 hectares dedicated to displaying the tigers and the rest for veterinary care facilities, a rescue centre, staff infrastructure, and visitor amenities.
• The safari will be located near the Similipal Tiger Reserve (STR) in Mayurbhanj, which is home to the world’s only wild melanistic tigers.
• This initiative aims to elevate wildlife tourism in Odisha and promote awareness about the conservation of these rare animals.
• The safari will house surplus tigers from the Nandankanan Zoo and rescued or orphaned tigers in open enclosures.

Added attraction:

• The State Government’s proposal for this safari has received in-principle approval from the Technical Committee of the National Tiger Conservation Authority (NTCA).
• A committee appointed by the NTCA will conduct a feasibility study on-site before granting final approval.
• Additional statutory clearances, including approval from the Central Zoo Authority (CZA), will be sought subsequently.
• According to the ‘All India Tiger Estimation’ report, there are about 20 tigers in Odisha as of 2022.

About Similipal National Park:

• Simlipal is a tiger reserve in the Mayurbhanj district in the Indian state of Odisha
• It is part of the Mayurbhanj Elephant Reserve, which includes three protected areas -Similipal Tiger Reserve, Hadgarh Wildlife Sanctuary and Kuldiha Wildlife Sanctuary.
• Simlipal National Park derives its name from the abundance of red silk cotton trees growing in the area.
• The vast terrain of Similipal with wide altitudinal, climatic and topographic variations, criss-crossed by large number of perennial streams, harbours a unique blend of Western Ghats, Eastern Ghats and Sub-Himalayan plant species.
• The floristic composition indicates a connecting link between South Indian and North Eastern Sub-Himalayan Specie
• Forest is predominantly moist mixed deciduous forest with tropical semi-evergreen forest in areas with suitable microclimatic conditions and sporadic patches of dry deciduous forests and grasslands. It forms the largest watershed of northern Odisha.
• It holds the highest tiger population in Odisha, and harbours the only population of melanistic tigers in the world.
• Other carnivores found here are leopard, leopard cat, fishing cat, jungle cat and wolf. The active management of mugger has revived its population on the banks of the rivers Khairi and Deo.
• Similipal Tiger Reserve is also home to the largest population of elephants in Odisha.
• This protected area is part of the UNESCO World Network of Biosphere Reserves since 2009.

Source: TH

8. No food in forests: Bears, langurs throng Uttarakhand apple orchards as native vegetation gets taken over by invasives

Subject: Environment

Section: Biodiversity

Context:

• In Uttarakhand, invasive plant species are significantly impacting the forest ecosystem, affecting the food availability for wild animals and causing increased human-wildlife conflicts.
• A study by the Wildlife Institute of India highlights the widespread invasion of non-native plants across two-thirds of India’s natural areas, posing a significant threat to ecosystems.

Details:

• Horticulture farmers, particularly apple orchardists in Sukhi Top village, report rising incidents of bear and langur invasions into their orchards.
• The lack of natural food sources in the forest is driving wildlife towards human settlements.
• Other invasive wildlife include monkeys, Himalayan goral, barking deer, blue sheep and Himalayan tahr.
• The increase in tiger population in Uttarakhand, from 442 in 2018 to 560 in 2023, has led to more tiger attacks on human settlements, particularly in the Terai region, which is rich in biodiversity.
• The Ramnagar Forest Department faces challenges in managing human-wildlife conflict and controlling invasive plant species like Lantana camara and Congress grass. These species are replacing native grasses, forcing herbivorous wildlife to adapt by consuming lantana, which is harmful to their health.
• Efforts to eradicate lantana include the ‘cut rootstock method’ and replacing it with local plant species.

WPA 1972:

• The Wildlife (Protection) Act, 1972, states that the central government can “declare any wild animal other than those specified in Schedule I and Part II of Schedule II to be vermin for any area and for such period as may be specified therein and so long as such notification is in force, such wild animal shall be deemed to have been included in Schedule V.”

The vermin conflict:

• The damage to the national economy due to crop depredation by wild animals has never been computed. But for lakhs of farmers around India’s many protected forests, it is the biggest challenge to livelihood (not to mention the occasional threat to life).
• Since 1972, the WLPA has identified a few species — fruit bats, common crows and rats — as vermin.
• Killing animals outside this list was allowed under two circumstances:
  • Under Section 62 of WLPA, given sufficient reasons, any species other than those accorded the highest legal protection (such as tigers and elephants but not wild boars or nilgais) can be declared vermin at a certain place for a certain time.
  • Under Section 11 of WLPA, the chief wildlife warden of a state can allow the killing of an animal, irrespective of its status in the Schedules, if it becomes “dangerous to human life”.
• The state governments took the decisions under Section 62 until 1991 when an amendment handed over the powers to the Centre.
• The purpose was apparently to restrict the possibility of eliminating a large number of animals at a species level as vermin. Under Section 11, the states could issue culling permits only locally and for a few animals.
• In recent years, however, the Centre has started using its powers under Section 62 to issue sweeping orders declaring species as vermin at even state levels, often without any credible scientific assessment.

Source: DTE

9. Albatrosses are threatened with extinction — and climate change could put their nesting sites at risk

Subject: Environment

Section: Species in news

Wandering albatross (Diomedea exulans):

• The wandering albatross (Diomedea exulans) is the world’s largest flying bird, known for its immense wingspan of up to 3.5 meters. These birds, which can live up to 60 years, are oceanic nomads (pelagic birds), spending most of their life at sea and only coming ashore to breed roughly every two years after reaching sexual maturity. Their habitat is primarily the Southern Ocean and nearby islands, where they nest.
• Notably, Marion Island and Prince Edward Island, located south of South Africa, are critical for these birds, hosting about half of the global wandering albatross breeding population, estimated at around 20,000 mature individuals.
• The wandering albatross is currently listed as vulnerable due to risks like bycatch from longline fishing, climate change and shrinking habitat.
• The environmental factors influencing their nesting choices on Marion Island:
  • Elevation was a key factor, with albatrosses preferring lower, warmer sites with coastal vegetation for nesting.
  • However, this preference indicates potential threats from climate change.

Variables influencing nest site selection:

• The study on Marion Island, a volcanic island with challenging terrain, aimed to understand the factors influencing nest site selection by wandering albatrosses.
• Key variables examined included elevation, terrain ruggedness, slope, distance to the coast, vegetation type, wind speed, wind turbulence, and underlying geology.
• Elevation was found to be the most critical factor, with most nests located near the coast at lower elevations, providing warmer conditions less harsh for the chicks. Proximity to the coast was also essential, as suitable habitats were more abundant there.

Delicate balance:

• The study on Marion Island reveals how the delicate balance of the wandering albatross’ habitat is threatened by climate change.
• Over the past decades, the island has experienced a significant increase in temperature, decrease in precipitation, reduced cloud cover, and disappearance of the permanent snowline. These changes have led to shifts in vegetation and species distribution patterns.

Places in news:

• Marion Island and Prince Edwards Island: Two small uninhabited islands in the sub-Antarctic Indian Ocean that are part of South Africa.

Source: DTE

10. Cabinet approves ₹8500 crore incentive scheme for coal gasification projects

Subject: Environment

Section: Climate change

Context:

• The Union Cabinet approved a ₹8,500 crore incentive scheme for coal gasification projects.
• The adoption of gasification technology in India is expected to reduce the country’s reliance on imports of natural gas, methanol, ammonia and other essential products.

Coal gasification:

• The Government is targeting to gasify100 million tonnes (MT) of coal by 2030.
• In the gasification process, coal is partially oxidised by air, oxygen, steam, or carbon dioxide under controlled conditions to produce a liquid fuel known as syngas. Syngas or synthesis gas can be used for power generation and to make methanol as well.
  • Syngas is a mixture consisting primarily of methane (CH4), carbon monoxide (CO), hydrogen (H2), carbon dioxide (CO2) and water vapour (H2O).
• In-situ gasification of coal – or Underground Coal Gasification (UCG) – is the technique of converting coal into gas while it is still in the seam and then extracting it through wells.

Source: TH

11. Centre releases new regimen for leprosy treatment

Subject: S&T

Section: Health

Context:

• The Central government of India has approved a new three-drug treatment regimen for Pauci-Bacillary (PB) leprosy cases, replacing the existing two-drug regimen.

Details:

• This initiative is part of the National Leprosy Eradication Programme‘s efforts to stop the transmission of leprosy by 2027, three years ahead of the UN’s Sustainable Development Goals.
• The World Health Organization (WHO) has agreed to supply the revised drug regimen starting April 1, 2025. Consequently, all States and Union Territories in India are required to submit their requisitions for anti-leprosy drugs 12 months in advance.

About Leprosy:

• Leprosy, caused by the Mycobacterium leprae bacteria, primarily affects the skin and peripheral nerves and can lead to progressive and permanent disabilities if left untreated.
• The disease is transmitted through droplets from the nose and mouth during close contact with untreated cases. Leprosy is curable with multi-drug therapy (MDT), which the WHO has been providing free of charge.
• The WHO’s recommended MDT consists of dapsone, rifampicin, and clofazimine. Treatment duration is six months for PB cases and 12 months for multi-bacillary (MB) cases.
• The new ‘Uniform MDT’ regimen, using a single three-pack kit for all patients, simplifies administration and manufacturing processes.
• However, there is some debate over the necessity of the three-drug regimen, as the two-drug regimen has shown adequate efficacy and low relapse rates in PB cases. Additionally, the third drug, clofazimine, can cause side effects like skin discoloration.

Source: TH

12. Senegal’s pink lake is on the verge of disappearing — how to protect it

Subject: IR

Section: Msc

Lake Retba:

• Lake Retba, also known as Lac Rose, is situated approximately 35km from Dakar, Senegal, and is famous for the pink colour of its waters.
• It lies north of the Cap Vert peninsula.
• The lake, 6.5 meters below sea level, is separated from the sea by about 1km of dunes.
• Its water, primarily sourced from the sea, is highly saline and supports only a few microscopic algae and bacteria.
• The Pink Lake is a major tourist attraction in the Dakar region, but its appeal is declining.
• Additionally, the lake is a site for artisanal salt mining, involving 1,500 to 3,000 people and producing an estimated 140,000 tonnes of salt annually, distributed nationally and in neighbouring countries.

Why does the water turn pink?

• The pink colouration of Lake Retba’s water is due to the presence of the halophilic green algae Dunaliella salina, which thrives in salty environments.
• This algae contains red pigments and is often found alongside halophilic bacteria of the genus Halobacterium.
• Dunaliellasalina’s ability to withstand high salt concentrations is attributed to its high levels of carotenoid pigments, which protect it from light, and its significant glycerol content.
• This algae also contains at least four antioxidant pigments:beta-carotene, astaxanthin, lutein, and zeaxanthin, all of which are rich in vitamins and trace elements.
• The lake’s pink hue intensifies when the salinity is high, promoting the proliferation of algae with red pigments, while lower salinity levels favour the growth of other algae with green pigments.

Challenges:

• Salt accumulation at Lake Retba is causing significant challenges on both its southern and northern shores.
• On the southern shore, the introduction of a drainage channel in August 2022, meant for wastewater and rainwater disposal from nearby suburbs, has led to two major issues: first, the accumulation of solid particles is contributing to the filling in of the lake, and second, the dilution of the lake’s water has resulted in lower salinity. This reduced salinityhinders salt harvesting and is not conducive to the growth of the green alga Dunaliella salina, which requires high salinity for development.
• The northern shore faces different challenges. Motorized traffic is threatening the stability of dunes, which are anchored by ageing casuarina trees. The destruction of these trees could lead to the spread of quicksand into the depression. Additionally, the lake’s water supply through the dunes is at risk due to the shallow nature of the aquifers (both fresh and saltwater) and the rapid urbanization in the northern area.
• The northern part of the lake features ponds scattered across the area, located where a former channel once connected the lake to the sea. Now filled in by sand from the dunes, the northern part of these ponds has been lost, while the southern part remains.

Source: DTE

13. Indian Air Force Conducts Exercise Desert Knight With France, UAE Over Arabian Sea

Subject: IR

Section: Msc

Context:

• On 23 Jan 24, the Indian Air Force (IAF) conducted Exercise Desert Knight along with the French Air and Space Force (FASF) and United Arab Emirates (UAE) Air Force.

More on news:

• India, UAE, and France conducted the Desert Knight exercise over the Arabian Sea.
• French President Emmanuel Macron is scheduled to be in India as the Chief Guest for India’s 75th Republic Day celebrations from January 25-26.

About various contingents:

• The participation of the French included the deployment of Rafale fighter aircraft and a Multi-Role Tanker Transport, while the UAE Air Force contributed the F-16.
• These aircraft operated from the Al Dhafra air base in the UAE.
• The IAF contingent comprised Su-30 MKI, MiG-29, Jaguar, AWACS, C-130-J, and Air to Air Refueler aircraft. 

Desert Knight Exercise:

• The main focus of the Desert Knight exercise was on enhancing synergy and interoperability among the three air forces.
• It was a large force engagement roughly equidistant from the coastlines of India and the UAE.
• This joint exercise took place amid growing global concerns regarding Houthi rebels attacking commercial vessels in the region’s vital waterways.
• The exercise was conducted within the Indian FIR (Flight Information Regions), with IAF aircraft operating from various bases in India.
• The global airspace is divided into Flight Information Regions (FIRs).
• Each FIRs is  overseen by a controlling authority tasked with ensuring the provision of air traffic services for aircraft operating within its jurisdiction.

Other Defence Exercises between India and France:

• Varuna – Naval exercise
• Garuda – Air exercise
• Shakti – Army exercise.

Defense exercise between Indian and UAE:

• Desert cyclone – Military exercise
• The first edition of the India-UAE military exercise aims to enhance interoperability through exchanging knowledge and sharing best practices in military operations.
• The Exercise is scheduled to be conducted in Mahajan, Rajasthan from 2nd to 15th January 2024.

14. Tension in Manipur as radical group Arambai Tenggol ‘summons’ all 40 Valley-based MLAs to Kangla Fort

Subject: Geography

Section: Human geography

Context:

• Kuki groups claim that Arambai Tenggol has been involved in the killing of Kuki-zos since May last year.

More on news:

• A team of the Ministry of Home Affairs (MHA) reached Manipur and camped in the state to keep watch on the situation.
• Kuki groups, however, expressed concern over reports about a meeting of the MHA team with Arambai Tenggol in Imphal. 
• They claim that the BJP government in the state is in cahoots with Arambai Tenggol and another similar radical group MeeteiLeepun.
• Radical Meitei group Aarambai Tenggol “summoned” all 40 MLAs of Meitei-dominated Imphal Valley for a meeting on Wednesday morning at the historic Kangla Fort in Imphal. 

About Arambai Tenggol: 

• Arambai Tenggol is a Meitei organization of around 50,000 people engaged in guarding villages in the valley areas of the state.
• It  is a Meitei activist organization in the Indian state of Manipur.
• It is often described as a radical organization, or as a radicalized armed militia.
• Starting as a cultural outfit, it soon turned into a radical organization.

About Meitei:

• The Meitei people, Meetei people, or Manipuri people are an ethnic group native to Manipur. They form the largest and dominant ethnic group of Manipur in Northeast India.
• Meitei officially known as Manipuri is a Tibeto-Burman language of northeast India. 
• The Meiteis primarily settled in the valley areas in modern-day Manipur, though a sizable population has settled in the other Indian states of Assam, Tripura, Nagaland, Meghalaya, and Mizoram.
• There is also a notable presence of Meitei people in the neighboring countries of Myanmar and Bangladesh.
• The Meitei ethnic group represents about 53% of Manipur’s population.
• It is the official language and the lingua franca of Manipur.
• It is one of the 22 official languages of the Indian Republic, included in the 8th Schedule to the Indian Constitution.

About Kuki tribe:

• The Kuki people are an ethnic group in the Northeastern Indian states of Manipur, Nagaland, Assam, Meghalaya, Tripura and Mizoram, as well as the neighboring countries of Bangladesh and Myanmar.
• The Kuki constitute one of several hill tribes within India, Bangladesh, and Myanmar. In Northeast India, they are present in all states except Arunachal Pradesh.

The Zou people or Zomi:

• They  are an indigenous community living along the frontier of India and Burma. 
• They are a subgroup of the Zo people (Mizo-Kuki-Chin).
• In India, they live with and are similar in language and habits to the Paite and the Simte peoples.
• In India, the Zou are officially recognized as one of the thirty-three indigenous peoples within the state of Manipur, and are one of the Scheduled tribes.
• According to the 2001 Census, the Zou/Jou population in Manipur is around 20,000, less than 3% of the population.
• The community is concentrated in Churachandpur and Chandel districts of Manipur.

15. Govt permits direct listing by Indian firms on GIFT-IFSC’s international markets

Subject: Economy

Section: Monetary policy

Context:

• The government on Wednesday allowed direct listing of securities by public Indian companies on the international exchanges of GIFT International Financial Services Centre (GIFT-IFSC).

More on news: 

• In July, Finance Minister Nirmala Sitharaman announced that the government had decided to enable direct listing of listed and unlisted companies on the IFSC exchanges.
• The move is expected to give Indian companies access to cheaper foreign capital, boost foreign investment, and broaden investors.
• Direct listing of Indian companies’ shares on GIFT City exchanges is the first step in allowing them to list overseas.
• Until now Indian companies have not been permitted to list directly overseas markets, and instead use depository receipts i.e. American Depository Receipts or Global Depository Receipts  to do so.

Amendments made:

• The Department of Economic Affairs of the Finance Ministry has amended Foreign Exchange Management (Non-debt Instruments) Rules, 2019, and notified the Direct Listing of Equity Shares of Companies Incorporated in India on International Exchanges Scheme.
• The Ministry of Corporate Affairs (MCA) has issued Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024.
• This will provide an overarching regulatory framework to enable public Indian companies to issue and list their shares in permitted international exchanges.

Benefits of the decision:

• Public Indian companies will have the flexibility to access both markets—domestic for raising capital in rupees and international market at IFSC for raising capital in foreign currency from the global investors.
• This initiative will particularly benefit Indian companies going global and having ambitions to look at opportunities for expanding their presence in other markets.
• It is also expected to provide a boost to the capital market ecosystem at GIFT IFSC by provision of new investment opportunities for investors, diversification of financial products and by enhancing liquidity.
• The framework allows unlisted public Indian companies to list their shares on an international exchange.

About GIFT-IFSC:

• GIFT (Gujarat International Finance Tec-City) is located in Gandhinagar is India’s first International Financial Services Centre.
• GIFT-IFSC is set up with the objective of connecting India with global opportunities while helping the Indian economy connect with the global financial system and facilitating seamless flow of global capital into India.
• IFSCs are intended to provide Indian corporates with easier access to global financial markets, and to complement and promote further development of financial markets in India.
• The international stock exchanges at GIFT-IFSC—India International Exchange and NSE International Exchange—are currently prescribed as the permitted stock exchanges.
• These exchanges are under the regulatory supervision of the International Financial Services Centres Authority (IFSCA).

About International Financial Services Centres Authority(IFSCA):

• The (IFSCA) was established on April 27, 2020 under the International Financial Services Centres Authority Act, 2019.
• It is a regulatory body established by the Government of India.
• It is headquartered at GIFT City, Gandhinagar in Gujarat..
• The primary objective of IFSCA is to develop and regulate the financial products, financial services, and financial institutions in the IFSCs to promote ease of doing business.
• IFSCA has a broad regulatory scope covering various financial services, institutions, and activities within the IFSCs.
• Prior to the establishment of IFSCA, the domestic financial regulators, namely, RBI, SEBI, PFRDA and IRDAI regulated the business in IFSC.

16. Capex-led Growth Strategy from Industry Chambers’ Recommendations

Subject: Economy

Section: Fiscal policy/Public finance

Capex-led Growth Strategy:

• Suggested maintaining a capex-led growth strategy in the upcoming Vote on Account to sustain the ongoing economic growth momentum.
• Urged an increase of at least 20% in the Centre’s capital expenditure to ₹12 lakh crore.

Central Support to State Capex:

• Proposed expanding Central support to State capex through interest-free 50-year loans, recommending an increase by about ₹30,000 crore to ₹1.6 lakh crore.

Corporate Tax Rate:

• Advocated for retaining the corporate tax rate at the current level for tax certainty.
• Appreciated the government’s efforts to maintain stability in tax rates despite economic and political challenges.

Buyback Tax (BBT):

• Recommended exempting buyback tax (BBT) for listed shares using the open market through the stock exchange method.
• Proposed that the exemption under section 10(34A) should not be applicable, and transactions should continue to be subject to capital gains tax.

Extension of Sunset Date for Concessional Tax Rate:

• Advocated for extending the sunset clause for the concessional tax rate of 15% under Section 115BAB by one year, from March 31, 2024, to March 31, 2025.
• Suggested that this extension would encourage more investment in the manufacturing sector and exports.

Recommendations by FICCI:

Focus on Public Capex:

• Emphasized the importance of public capex (on physical, social, and digital infrastructure) in the upcoming Budget.
• Urged the government to lay a major thrust on public capex considering the current global developments and associated challenges.

Buyback Tax (BBT):

• Recommended exempting BBT for listed shares involved in buybacks using the open market through the stock exchange method.
• Stated that the justification for BBT levy does not exist in such cases where the promoter group cannot participate in the buyback.

Extension of Sunset Date for Concessional Tax Rate:

• Proposed extending the concessional tax regime for manufacturing operations for at least five years.
• Argued that extending the tax regime would provide stability and certainty, boosting the confidence of investors considering investments in India.

Sunset clause

A “sunset clause” refers to a provision in a law or regulation that specifies a termination date or conditions under which the law or regulation will expire or no longer be in effect. Essentially, it sets a deadline for the validity or applicability of certain provisions.

In the context of taxation or economic policies, a sunset clause may be included to provide a temporary benefit, concession, or special treatment. After the specified period or under certain conditions, the benefits or provisions automatically come to an end unless the government decides to extend or renew them.

For example, in the case of tax incentives for a specific industry introduced to encourage investment, the sunset clause might determine that these incentives will expire after a certain number of years unless the government decides to extend them.

This approach allows for periodic reviews and adjustments to policies based on evolving economic conditions or policy priorities.

“Buyback Tax” (BBT)

The term “Buyback Tax” (BBT) generally refers to the tax implications related to share buybacks undertaken by companies. A share buyback, also known as a stock repurchase, occurs when a company repurchases its own outstanding shares from the open market or directly from shareholders.

Tax on Distributed Income: In the Indian context, the Buyback Tax is essentially a tax on distributed income by the company undertaking the buyback. It is applicable under Section 115QA of the Income Tax Act.

Introduced to Curb Tax Avoidance: The Buyback Tax was introduced to prevent tax avoidance by companies through the buyback route. It ensures that companies cannot use buybacks as a tax-efficient means of returning money to shareholders, especially in comparison to dividends.

Applicability: The tax is levied on the distributed income arising from the buyback of unlisted shares by a company. It is not applicable to buybacks through stock exchanges for listed shares.

Tax Rate: The distributed income through buyback is taxed at a specified rate, and the tax is paid by the company. The tax rate and other details are subject to the provisions of the Income Tax Act prevailing at the time.

Interim Budget, and Vote on Account:

Constitutional Mandate (Article 266):

• Article 266 of the Constitution of India mandates that parliamentary approval is necessary to withdraw money from the Consolidated Fund of India.

Legal Requirement (Article 114 (3)):

• Article 114 (3) of the Constitution specifies that no amount can be withdrawn from the Consolidated Fund without the enactment of a law, i.e., an appropriation bill.

Vote on Account:

• A vote on account is a parliamentary approval sought by the government to meet expenditure, such as salaries and ongoing programs, without altering the taxation structure. This is done until a new government presents a revised full Budget for the entire fiscal year. It allows the new government to signal its policy direction through the subsequent full Budget presentation.

Difference with Full Budget:

• While a full Budget addresses both expenditure and revenue, a vote on account deals exclusively with the expenditure side of the government’s budget. The vote on account is typically valid for two months, while a full budget covers the entire fiscal year.
• As a convention, a vote-on-account is treated as a formal matter and passed by the Lok Sabha without extensive discussion. Conversely, passing a full budget involves detailed discussions and voting on demands for grants.

Interim Budget Distinction:

Scope of an Interim Budget:

• An Interim Budget is not equivalent to a ‘Vote on Account.’ While a vote on account addresses only the expenditure side, an Interim Budget encompasses a complete set of accounts, covering both expenditure and receipts.

Financial Statement Similarity:

• An Interim Budget provides a comprehensive financial statement, much like a full budget, offering details on both expenditure and revenue.
• Unlike a vote on account, an Interim Budget considers both the spending and revenue aspects, providing a broader financial overview.

17. India’s Stance on Fisheries Subsidies at WTO

Subject: IR

Section: Int Org

Asymmetrical Agreement Rejection:

• India refuses to agree to an “asymmetrical” agreement on reducing fisheries subsidies that lead to overfishing. Specific carveouts are insisted upon to protect resource-poor fishers and preserve the space for capacity development.

Protection of Livelihood:

• The livelihoods of 9 million people, mainly resource-poor and dependent on fishing, need protection. India demands exemption for poor fishers from subsidy cuts, regardless of their fishing locations.

Exemption for Developing Nations:

• India seeks exemption for all fishers in developing nations from subsidy cuts within the exclusive economic zone (EEZ) of 200 nautical miles. A 25-year exemption from subsidy cuts for fishing in waters beyond EEZ is also requested.

Special & Differential Treatment:

• These demands align with the concept of special and differential treatment for developing nations. India emphasizes the need to safeguard the interests of developing countries in WTO negotiations.

Upcoming WTO Meeting:

• Trade Ministers from 164 WTO nations will convene in Abu Dhabi on February 24-29 to negotiate various agreements, including curbing fisheries subsidies contributing to overcapacity and overfishing.

Partial Agreement Status:

• While a partial agreement on curbing harmful fisheries subsidies was reached at the previous WTO MC12 in 2021, only about 55 nations have adopted it so far, falling short of the required 110.

Concerns about Developed Nations:

• India criticizes developed nations, including the EU, Japan, Norway, the US, and even non-developed nations like China, for their distant water fishing practices and extensive subsidies to their fishing communities.

Equitable Resource Sharing:

• India asserts that environmental concerns should be shared equitably. Developed nations, having different capacities, should bear more substantial cuts to create space for others’ development.

Challenges in Global Fishing Dynamics:

• Developed nations, having historically developed deep-sea capacities, now limit entry to protect their positions, creating challenges in international fishing dynamics.

Call for Equitable Responsibility:

• India maintains that if there are environmental concerns, responsibilities should be shared equitably, with developed nations taking on more significant cuts to accommodate the development of others.

Adoption of Agreement on Fisheries Subsidies (AFS) at WTO Ministerial Conference:

About the Agreement:

• Prohibits subsidies for Illegal, Unreported, and Unregulated (IUU) fishing and overfished stocks.
• Restricts subsidies for fishing on high seas beyond coastal jurisdictions.
• Special and Differential Treatment (S&DT) allows Developing and Least Developed Countries a two-year transition period without obligations.

Exempted Areas:

• No prohibition on subsidies for vessels not engaged in IUU.
• Permits subsidies for overfished stocks if aimed at rebuilding to a sustainable level.

Global Fisheries Subsidies:

• Estimated at $35.4 billion in 2018; $22.2 billion for capacity-enhancing subsidies.
• UN General Assembly tasked WTO to deliver an agreement against harmful fisheries subsidies.

India’s Demand:

• India seeks a 25-year transition period to end over-capacity and over-fishing (OCOF) subsidies within its EEZ.
• Rooted in national interest due to India’s extensive coastline and the importance of the blue economy.
• Aims to protect livelihoods, especially of small-scale artisanal fishers.

Fisheries Sector in India:

• Recognized as a powerful income and employment generator.
• 3rd largest fish-producing and 2nd largest aquaculture nation globally.
• Pradhan Mantri Matsya Sampada Yojana (PMMSY) focuses on the sustainable development of the fisheries sector.

Related Government Initiatives in India’s Fisheries Sector:

Fishing Harbours:

• Development of major Fishing Harbours (Kochi, Chennai, Visakhapatnam, Paradip, Petuaghat).
• Transformation into hubs of economic activity to support the fisheries industry.

Seaweed Park in Tamil Nadu:

• Establishment of a Multipurpose Seaweed Park in Tamil Nadu.
• Center for the production of high-quality seaweed-based products, utilizing a hub-and-spoke model.

Pradhan Mantri Matsya Sampada Yojana (PMMSY):

• Objective: Creation of direct employment for 15 lakh fishers, fish farmers, etc.
• Indirect employment opportunities expected to be three times the direct employment.
• Aims to double the incomes of fishers, fish farmers, and fish workers by 2024.

Palk Bay Scheme:

• Launched in 2017 as a Centrally Sponsored Scheme.
• Part of the umbrella Blue Revolution Scheme.
• Focus on diversification of trawl fishing boats from Palk Straits into deep-sea fishing boats.

Special and Differential Treatment (S&DT):

Definition:

• S&DT is a set of provisions in international trade agreements that offers preferential treatment to developing countries, recognizing their unique challenges and needs.

Objective:

• To address the developmental, financial, and trade-related constraints faced by developing nations.

Key Features:

• Flexibilities: Provides flexibility in meeting certain commitments or obligations, considering the developmental stage of the country.
• Transitional Periods: Allows extended timelines or transition periods for implementing certain provisions.
• Technical Assistance: Includes support in capacity building, technology transfer, and financial assistance.
• Market Access: Grants preferential market access, including tariff reductions and exemptions.

18. RBI to Infuse ₹2.50 Lakh Crore Liquidity

Subject: Economy

Section: Monetary policy

Infusion Details:

• The Reserve Bank of India (RBI) will inject liquidity amounting to ₹2.50 lakh crore via a 15-day variable rate repo (VRR) auction.

Liquidity Scenario:

• The overall funds deficit in the banking system widened to ₹3.34 lakh crore as of January 23, compared to ₹1.29 lakh crore on January 1.

Centre’s Cash Balances:

• Despite the Centre accumulating substantial cash balances with the RBI from GST and advance tax, liquidity pressure in the banking system persists.

Factors Contributing to Pressure:

• Banks are facing liquidity challenges due to outflows in the previous month related to GST payments and advance tax, while non-banking finance companies offer competitive returns.

RBI’s Liquidity Management:

• The RBI has been addressing liquidity concerns through various measures, including VRR auctions and long-term repo operations during the Covid-19 period.

Competition with NBFCs:

• Banks are encountering competition from non-banking finance companies as NCDs floated by NBFCs offer relatively higher returns compared to bank term deposit rates.

Investor Behavior:

• Retail investors are shifting from bank deposits to invest in mutual funds or equity markets, drawn by the bull phase in the stock market and IPO opportunities.

Expert Opinion:

• Experts suggest that liquidity pressure could ease if the government utilizes the accumulated balances with the RBI. Additionally, the RBI’s absorption of foreign portfolio investors’ dollars could enhance liquidity.

RBI’s Statement:

• RBI, in a December Monetary Policy statement, attributed liquidity tightening to factors like higher currency leakage, government cash balances, and RBI market operations.

MPC Stance Change:

• India Ratings and Research (IndRa) opines that sustained tightness in banking system liquidity could impact borrowers. It suggests a change in the Monetary Policy stance to ‘neutral’ to maintain consistency in stance and action.

Variable Reverse Repo Rate (VRRR):

Introduction:

• VRRR is the rate at which the Reserve Bank of India (RBI) borrows money from banks for a variable period, typically ranging from 14 days to 56 days.

Liquidity Management Tool:

• It serves as a tool for the RBI to manage liquidity in the banking system and influence short-term interest rates.

Auction Process:

• Regular VRRR auctions are conducted by the RBI to absorb excess liquidity from banks.
• Banks participate by bidding for the amount and specifying the interest rate at which they are willing to lend money to the RBI.
• The RBI determines the cut-off rate and the allotted amount based on received bids.

Interest Payment:

• Banks that bid at or above the cut-off rate are allotted funds, and the RBI pays interest to these banks for lending money.

Market Forces Determination:

• The interest rate paid is influenced by market forces, particularly the demand and supply dynamics of liquidity.

Implications of VRRR Auctions

Money Market Impact:

• Affects overnight money market rates like call money, CBLO, and market repo rates.
• VRRR rates’ increase leads to higher money market rates, reflecting tighter liquidity conditions.

Bond Market Impact:

• Influences bond yields, especially in the short end of the yield curve.
• Higher VRRR rates result in increased bond yields, indicating higher borrowing costs and reduced demand for bonds.

Banking Sector Influence:

• Affects the profitability and liquidity management of banks.
• Higher VRRR rates mean banks earn more on excess funds parked with the RBI.
• Balancing liquidity needs and returns becomes crucial for banks participating in VRRR auctions.

Variable Repo Rate:

1. Introduction:
   • Similar to Variable Reverse Repo Rate, the Variable Repo Rate is employed when the RBI aims to infuse liquidity into the economy.
2. Low Interest Rates Scenario:
   • Used when banks are reluctant to borrow from the RBI at Repo Rates due to existing lower interest rates in the economy.
3. Market-Determined Rate:
   • Banks are allowed to borrow at a rate determined by the market, usually lower than the Repo Rate, but not less than the Reverse Repo Rate.
4. Duration of Borrowing:
   • The borrowing period under the Variable Repo Rate is more than one day, providing flexibility to banks.
5. Liquidity Infusion Strategy:
   • RBI adopts this strategy to facilitate liquidity infusion even when banks may not find borrowing at standard Repo Rates attractive.

Repo Normalisation in India:

1. Repo and Reverse Repo as Control Tools:
   • The Reserve Bank of India (RBI) uses Repurchase Agreement (Repo) and Reverse Repo Agreement to manage money supply.
2. Quantitative and Qualitative Control:
   • Central banks employ quantitative or qualitative tools to control money supply.
3. Repo Rate Definition:
   • Repo rate is the rate at which the RBI lends money to commercial banks in case of fund shortfalls, involving the purchase of securities.
4. Reverse Repo Rate:
   • It is the interest rate paid by the RBI to commercial banks when they park excess liquidity with the central bank, serving as the opposite of the repo rate.
5. Repo Rate as Benchmark:
   • Under normal economic growth, the repo rate becomes the benchmark interest rate, influencing various interest rates in the economy.
6. Shift to Reverse Repo Rate:
   • When excess liquidity is pumped into the market without an uptake in fresh loans, the focus shifts from the repo rate to the reverse repo rate.

Reverse Repo Normalisation:

• Implies an increase in reverse repo rates, possibly in stages, aiming to curb inflation.

7. RBI’s Expected Action:
   • RBI may raise the reverse repo rate before the repo rate to narrow the gap between the two rates.
8. Inflation Control and Impact:
   • The normalisation process aims to curb inflation, reducing excess liquidity and leading to higher interest rates across the economy.

Monetary Policy Normalisation: The RBI adjusts the total money in the economy for smooth functioning, employing loose or tight monetary policies.

Loose Monetary Policy: Involves injecting liquidity and lowering interest rates to stimulate economic activity, encouraging consumption and production.

Tight Monetary Policy: As a countermeasure, it includes raising interest rates and withdrawing liquidity when a loose policy becomes counterproductive, aiming for policy normalisation.