Daily Prelims Notes 5 January 2024

January 5, 2024
Posted by: OptimizeIAS Team
Category: DPN

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Daily Prelims Notes

5 January 2024

Table Of Contents

1. Observation of International Monetary Fund (IMF) on India’s Debt:

Subject: Economy

Section: Fiscal Policy

Debt Sustainability Concerns:
- IMF expressed worries about the long-term sustainability of India’s debts.
- Projected India’s government debt to reach 100% of GDP by fiscal 2028 under adverse circumstances.
- Emphasized the need for concessional financing, private sector investment, and carbon pricing to address climate change challenges.
Exchange Rate Reclassification:
- IMF reclassified India’s exchange rate regime as a “stabilized arrangement” instead of “floating.”
- Possible indication of IMF’s view on “excessive management” of the exchange rate.
Government’s Response:
- Finance Ministry refuted IMF projections as a “worst-case scenario” and not a fait accompli.
Global Context of Rising Debt:
- Highlighted the persistent debt conundrum faced by developing nations globally.
- Countries face the dilemma of choosing between servicing debt and meeting people’s needs.
Challenges for India:
- Challenges in managing public debt and enhancing credit ratings.
- Despite being the fastest-growing major economy, India’s sovereign investment ratings have remained unchanged (Fitch Ratings and S&P Global Ratings: ‘BBB’ with a stable outlook).
Fiscal Concerns:
- Union government’s debt and state governments’ debt remain significant, with the public debt-to-GDP ratio above levels specified by the Fiscal Responsibility and Budget Management Act (FRBMA).
- Concerns about fiscal slippage in FY24, driven by higher expenditures on employment guarantee schemes and subsidies.
Election Year Challenge:
- In an election year, the challenge for India is to stick to the fiscal correction path to avoid worst-case scenarios while addressing short-term challenges.
Importance of Prudent Fiscal Management:
- Observations underscore the importance of prudent fiscal management and sustainable financing strategies to navigate challenges effectively.

Public Debt Overview:

Public debt refers to the total amount borrowed by a country’s government.

Comparison between Private and Public Debt:

Private Debt vs. Public Debt:

Private debt pertains to obligations of private entities, while public debt involves government obligations.
Private debt is incurred by businesses, households, or individuals, whereas public debt is incurred by the government.

Burden of Public Debt:

Debt Burden Concerns:
- Public debt can become burdensome due to high-interest payments and impact on government finances.
- The burden depends on factors like interest rates, economic conditions, and fiscal policies.

Source and Impact of Debt Burden:

Debt obligations include those of the Central Government and State Governments.
Central government debt includes borrowings at the national level, while state government debt pertains to sub-national borrowings.
Sources of public debt include borrowing from domestic and external sources, issuing bonds, etc.
High public debt may impose a burden on future generations if not managed prudently.

Impact of Internal Public Debt:

On Consumption and Investment:
- Internal public debt can influence consumption and investment patterns in the economy.
- Government borrowings may divert funds from private investment.
On Production and Distribution:
- Impact on production and distribution, as government spending affects various sectors.
- Distributional effects may be observed based on the allocation of resources.
On Private Sector:
- Influence on the private sector’s borrowing costs and access to credit.
- High internal public debt may lead to higher interest rates for businesses.
On Resource Allocation and National Income:
- Allocation of resources may be affected as government debt competes for resources.
- Impacts national income through government spending and taxation policies.
On Liquidity and Money Market:
- Internal debt affects liquidity and the money market.
- Government securities and bonds influence market liquidity and interest rates.

Impact of External Public Debt:

External Debt Dynamics:
- External public debt involves obligations to foreign creditors.
- Exchange rate fluctuations and global economic conditions impact the burden of external debt.

Debt-to-GDP Ratio:

The debt-to-GDP ratio assesses a country’s ability to repay its debt, with higher ratios often causing economic concerns.

The NK Singh Committee on FRBM envisioned a debt-to-GDP ratio of 40% for the central government and 20% for states, aiming for a total general government debt-to-GDP ratio of 60%.

Recommendations from N.K. Singh Committee on FRBM Act:

Debt-to-GDP Ratio:
- Central government: 40%
- State governments (combined): 20%
- Fiscal deficit target of 2.5% of GDP by 2022-23.
Flexibility in Deficit Targets:
- Allow flexibility in deficit targets based on economic conditions—downwards in times of good growth and upwards during economic challenges.
New Debt and Fiscal Responsibility Act:
- Enact a new Debt and Fiscal Responsibility Act, replacing the existing FRBM Act.
- Establishment of a fiscal council to oversee the new framework.
Fiscal Council Composition:
- Three-member fiscal council to prepare multi-year fiscal forecasts for both central and state governments.
- Provide independent assessment of the central government’s fiscal performance and compliance with new law targets.
Revenue Deficit-to-GDP Ratio:
- Steady decline by 0.25 percentage points annually, reaching 0.8% in 2022-23.
Deviation for Unforeseen Events:
- Specify deviation in fiscal deficit target (not exceeding 0.5 percentage points) for unforeseen events like war, national calamities, structural reforms, or sharp decline in real output growth.

Crowding-In and Crowding-Out of Investment:

Crowding-In:

It occurs when increased government spending stimulates private sector investment.
Mechanism: Government expenditure boosts demand, leading to increased production and profitability for businesses. This, in turn, encourages private sector investment.
Result: Positive synergy between public and private investment, contributing to overall economic growth.

Crowding-Out:

It happens when increased government spending reduces private sector investment.
Mechanism: Higher government borrowing raises interest rates, making it more expensive for the private sector to borrow. This can lead to decreased private investment as businesses face higher costs.
Result: Competition for financial resources, potentially limiting private sector expansion and economic activity.

Debt Trap:

A situation where a country is trapped in a cycle of borrowing to meet its debt obligations, leading to a continuous increase in debt levels.
Mechanism:
- Excessive borrowing may be driven by the need to service existing debt or fund ongoing budget deficits.
- High-interest payments can consume a significant portion of government revenue, making it challenging to invest in essential public services or reduce debt.
Result: Countries in a debt trap may find it difficult to escape the cycle, as new borrowing is used primarily to service existing debt rather than for productive investments.

2. Key Points Regarding Dividends and Disinvestment in CPSEs

Subject: Economy

Section: Indian Economy and National Income

Dividends in CPSEs:
- Dividends from Central Public Sector Enterprises (CPSEs) are expected to surpass ₹50,000 crore for the third consecutive fiscal year.
- The collections from dividends have already exceeded the Budget Estimate for the current fiscal.
- Dividend and disinvestment proceeds contribute to non-tax revenue and are managed by the Department of Investment and Public Asset Management (DIPAM).
Disinvestment Scenario:
- The strategic disinvestment of entities like IDBI Bank, Shipping Corporation, BEML, PDIL, HLL Life Care Ltd, and NMDC Steel Ltd is still pending.
Guidelines for Dividends:
- CPSEs follow guidelines set by the Finance Ministry, requiring the payment of an annual dividend of 30% of Profit After Tax (PAT) or 30% of the government’s equity, whichever is higher.
- The guidelines also consider factors like cash and free reserves, with CPSEs having the option to issue bonus shares or pay special dividends based on their financial position.
Consistent Dividend Policy:
- In 2020, an advisory recommended a consistent dividend policy for CPSEs.
- CPSEs paying higher dividends (100% dividend or ₹10 per share) were encouraged to consider quarterly dividend payments, while others could follow a half-yearly frequency.
- The advisory suggested that CPSEs should aim to pay at least 90% of the projected annual dividend in one or more interim dividend installments.

Evolution of Divestment in India:

Initiation (1991):
- Divestment in India emerged as a by-product of economic reforms initiated in 1991.
- The objective was to redefine the role of the government versus the market.
Formalization (1996):
- The Divestment Commission was established in 1996 to examine and recommend withdrawal from non-strategic sectors.
Department of Divestment (1999):
- The Department of Divestment was formed in December 1999.
- Later, in September 2001, it became the Ministry of Disinvestment.
- Shifted to the Ministry of Finance in May 2004.
- Renamed as the Department of Investment and Public Asset Management (DIPAM).
Objectives of Divestment:
- Redefine the government’s role versus the market.
- Inject market discipline in PSUs’ decision-making.
- Revive loss-making public enterprises.
- Generate additional resources for fiscal deficit and capital expenditure.

Maharatna and Navratna Categories for CPSEs:

Maharatna Category:

Criteria for Qualification:
- Must have Navratna status.
- Listed on the Indian stock exchange with prescribed public shareholding.
- Average annual turnover > Rs. 25,000 crores (last 3 years).
- Average annual net worth > Rs. 15,000 crores (last 3 years).
- Average annual net profit after tax > Rs. 5,000 crores (last 3 years).
- Significant global presence/international operations.

Navratna Category:

Criteria for Qualification:
- Must have Navratna status.
- Miniratna Category – I or Schedule ‘A’ CPSEs.
- ‘Excellent’ or ‘Very Good’ rating in 3 of the last 5 years.
- Average annual turnover > Rs. 25,000 crores (last 3 years).
- Average annual net worth > Rs. 15,000 crores (last 3 years).
- Composite score of 60 or above in 6 performance indicators including Net Profit to Net Worth, Cost of Services, Earnings per Share, etc.

Miniratna Category-I:

Criteria for Qualification:
- Made profit in the last 3 years continuously.
- Pre-tax profit is Rs. 30 crores or more in at least 1 of the last 3 years.
- Positive net worth status.
- Listed on the Indian stock exchange with prescribed public shareholding.

Miniratna Category-II:

Criteria for Qualification:
- Made profit for the last 3 years continuously.
- Positive net worth status.
- Not defaulted in the repayment of loans/interest payment on any loans due to the Government.
- Not dependent upon budgetary support or Government guarantees.

Tax and Non-Tax Receipts:

Tax Receipts:

Tax receipts refer to the revenue collected by the government through various taxes imposed on individuals, businesses, and other entities. Taxes are a primary source of government revenue and are utilized to fund public services, infrastructure development, social welfare programs, and other government expenditures. There are two main categories of taxes:

Direct Taxes:
- These are taxes levied directly on individuals and entities based on their income or profits.
- Examples include income tax, corporate tax, and wealth tax.
Indirect Taxes:
- These are taxes imposed on the production and consumption of goods and services.
- Examples include goods and services tax (GST), excise duty, and customs duty.

Non-Tax Receipts:

Non-tax receipts encompass various sources of revenue for the government that are not derived from taxes. These receipts contribute to the government’s income and financial resources. Key components of non-tax receipts include:

Dividends and Profits:
- Revenue earned by the government from its investments in public sector enterprises, often in the form of dividends.
Interest Receipts:
- Interest earned on loans extended by the government, including loans to other countries.
Fee and User Charges:
- Revenue generated from fees and charges for specific government services, licenses, permits, or the use of government-owned assets.
Disinvestment Proceeds:
- Funds generated from the sale of government-owned assets, such as shares in public sector enterprises, strategic disinvestment, and privatization.
Grants and Aid:
- Financial assistance received from other governments, international organizations, or entities for specific projects, programs, or developmental purposes.
Recoveries:
- Amounts recovered by the government, including loan repayments and recoveries from individuals or entities.

DIPAM (Department of Investment and Public Asset Management):

DIPAM is a government department under the Ministry of Finance in India. It plays a crucial role in the management of the government’s investments and assets.

DIPAM is involved in the strategic disinvestment of public sector enterprises and the monetization of non-core assets.

Its key functions include:

Strategic Disinvestment:
- Planning and executing the strategic sale of government equity in public sector enterprises.
Monetization of Non-Core Assets:
- Identifying and monetizing non-core assets owned by the government.
Financial Management:
- Managing the government’s financial investments, including disinvestment proceeds.
Asset Management:
- Efficient management of government assets to enhance returns.
Policy Formulation:
- Formulating policies related to disinvestment and asset management.

Interim Budget vs. Vote on Account – Key Differences

Nature and Timing:
- Interim Budget: Presented during an election year, covering expenses and revenues until a new government is formed after the general elections.
- Vote on Account: Passed as a convention through the Interim Budget to approve essential government expenditures, such as salaries and ongoing expenses, before the elections. Valid for up to two months, extendable if necessary.
Content:
- Interim Budget: Includes estimates of expenditure, revenue, fiscal deficit, financial performance, and projections for the upcoming financial year. Cannot include major policy announcements or schemes, following Election Commission guidelines.
- Vote on Account: Lists only the expenditure borne by the government, focusing on essential costs.
Discussion and Approval:
- Interim Budget: Requires discussion in the Lok Sabha and formal approval.
- Vote on Account: Passed by the Lok Sabha without discussion, as it deals specifically with expenditure.
Tax Regime Impact:
- Interim Budget: Can propose changes in the tax regime, allowing adjustments to taxes.
- Vote on Account: Cannot change taxes under any circumstances.
Validity Period:
- Interim Budget: Similar to a full budget but covers projections for a few months.
- Vote on Account: Usually valid for two months but can be extended if necessary.

3. Supreme Court Directs Probe into Hindenburg Research

Subject: Economy

Section: Capital Market

Investigation Order:
- The Supreme Court has directed the Securities and Exchange Board of India (SEBI) and investigating agencies to probe the conduct of Hindenburg Research.
- The investigation aims to determine if the losses suffered by Indian investors due to Hindenburg’s short position in Adani group entities involved any legal violations.
Background:
- Hindenburg’s report alleged that the Adani group manipulated share prices and violated regulations by not disclosing transactions with related parties.
Court’s Observation:
- The court noted that the volatility in Adani stocks had an impact at an individual level but did not pose a systemic market-level risk.
- It emphasized that the SEBI investigation into the Adani group was comprehensive and inspired confidence.
SEBI’s Investigation:
- SEBI had completed 22 out of 24 investigations into the Adani group following the Hindenburg report.
- The remaining two were pending due to awaited inputs from foreign regulators.
- The court ordered SEBI to expedite the pending investigations, preferably within three months.
- The court dismissed contentions that SEBI’s amendments in Foreign Portfolio Investors (FPI) Regulations and Listing Obligations and Disclosure Requirements (LODR) Regulations hindered the investigation. It noted that such claims lacked merit and did not challenge the validity of the regulations.
- It emphasized that such reports could serve as inputs but should not be regarded as conclusive proof of the inadequacy of SEBI’s investigation.
Conclusion:
- The Supreme Court’s judgment underscores the need for a thorough investigation into the allegations made by Hindenburg Research and emphasizes the role of regulatory authorities in ensuring market integrity.

Hindenburg Research’s Accusations Against Adani Group: A Comprehensive Overview

Hindenburg Research:

Hindenburg Research is a US-based investment research firm.
Specialization: It specializes in forensic financial research, aiming to uncover corruption, fraud, and irregularities in the business world.
Firm founded in 2017.

Short Selling:

Short selling is the sale of a security or share that the seller does not own.

Process: In short selling, an investor sells borrowed shares with the expectation of buying them back at a lower price later.

Opposite of Traditional Investment: Unlike traditional investments where an investor buys shares with the hope that their value will rise, short selling profits from a decline in the stock’s value.

Borrowing Shares: Investors do not need to own the shares they sell short; instead, they borrow shares from brokers or dealers.

Hindenburg’s Allegations Against Adani Group:

Nature of Allegations: Hindenburg Research accused the Adani Group of engaging in stock manipulation and accounting fraud.
Controlled Entities: Hindenburg claimed that the Adani family controlled offshore shell entities in tax havens, from the Caribbean and Mauritius to the United Arab Emirates.
Accusations: The alleged activities involve corruption, money laundering, taxpayer theft, and siphoning off money from the group’s listed companies.

Investigation by SEBI on the directions of Supreme Court: –

SEBI’s investigation into the Adani-Hindenburg matter, directed by the Supreme Court in March 2023.
Similar allegations by the Organized Crime and Corruption Reporting Project (OCCRP) against the Adani Group.

SEBI’s Investigation:

Supreme Court-directed investigation into Rule 19A violations, non-disclosure of related party transactions, and stock price manipulation.
OCCRP alleges Mauritius-based funds linked to the Adani family invested in Adani companies’ stocks.

OCCRP’s Allegations:

OCCRP report alleges stock manipulation by the Adani Group.
Exclusive documents indicate Adani family-connected investors influencing stock prices.

About OCCRP:

Global network of investigative reporters founded in 2006.
Focus on investigating organized crime and systemic corruption.
Over 150 journalists in 30 countries, collaborating with global partners.

Rule 19(A) of the Securities Contracts (Regulation) Rules, 1957:

Rule 19(A) is a provision under the Securities Contracts (Regulation) Rules, 1957, which falls under the regulatory framework of the Securities and Exchange Board of India (SEBI).
The rule is designed to prevent concentrated ownership and promote liquidity in the securities market.
Mandates listed companies to maintain a minimum of 25% public shareholding.
Ensures sufficient shares for trading and promotes price discovery.

Rule 19A Violations:

Five listed Adani companies violated Rule 19A, suspected FPIs were front companies for Adani promoters.
SEBI unable to establish prima facie contraventions due to regulatory loopholes.

Regulatory Amendments:

Amendments to FPI and LODR regulations in 2018 and 2019 opened loopholes, allowing concealment of ultimate beneficiaries.
Subsequent amendments in November 2021 sought to plug regulatory gaps but had deferred prospective effects.

FPI Rules and Disclosure:

Changes in FPI rules in 2018 eliminated the requirement for disclosing “ultimate natural person.”
SEBI’s challenges in obtaining evidence due to repealed provisions and compliance by FPIs.

IPO (Initial Public Offering):

An Initial Public Offering (IPO) is the process through which a private company offers its shares to the public for the first time, allowing it to raise capital from external investors.

Process:
- The company hires investment banks to underwrite the offering.
- Approval is obtained from SEBI.
- Shares are offered to the public through various channels like stock exchanges.
- Investors can buy shares, and the company becomes publicly traded.

FPO (Follow-on Public Offering):

A Follow-on Public Offering (FPO) occurs when a company that is already publicly traded issues new shares to the public.

Process:

Similar to an IPO but involves a company that is already listed on a stock exchange.
New shares are offered to existing and new investors.
The company works with investment banks to facilitate the offering.

Free Float:

Free float refers to the portion of a company’s shares that are held by public investors and are available for trading on the open market.

Calculation:

It includes shares held by individual and institutional investors but excludes shares held by insiders, promoters, and strategic investors.
Usually expressed as a percentage of the total outstanding shares.
Importance:
- A higher free float increases liquidity, making it easier to buy or sell shares in the market.
- Stocks with a smaller free float may experience higher price volatility.
- Larger free float can contribute to a more stable stock price.

Securities and Exchange Board of India (SEBI)

Introduction:

SEBI is the regulatory authority for the Indian securities market, established on April 12, 1992, by the SEBI Act 1992.
Its primary goal is to promote transparency and safeguard investors’ interests in the Indian capital market.

History:

Before SEBI, the securities market was regulated by various government institutions, leading to inconsistency.
To conduct search and seizure operations and impose stricter punishments for market manipulation and insider trading.

Objectives:

Regulating the functioning of the Indian capital market.
Safeguarding investors’ interests.
Creating a safe investment environment through rules and regulations.
Preventing malpractices in the Indian stock market.

Functions and Powers:

Functions:
- Protecting investors’ interests.
- Promoting the development of the securities market.
- Regulating business operations in the securities market.
- Serving as a platform for various market participants.
- Educating investors about securities markets.
- Prohibiting fraudulent and unfair trade practices.
- Monitoring company takeovers and share acquisitions.
- Ensuring the efficiency and up-to-date nature of the securities market.
Powers:
- Passing judgments in cases of fraud and unethical practices.
- Examining financial records and gathering evidence against violations.
- Formulating rules and regulations to protect investors’ interests.
- Eliminating malpractices in the securities market.

4. Concerns raised by RBI over Credit Information Companies (CICs)

Subject: Economy

Section: Monetary Policy

Reserve Bank of India (RBI) expressed concerns over Credit Information Companies (CICs), urging them to address key areas for service improvement.

Rise in Customer Complaints:
- RBI flagged an increase in customer complaints related to credit information.
Six Key Areas of Focus:
- CICs were advised to concentrate on six crucial areas:
  - Data Quality Improvement: Emphasis on enhancing the quality of data.
  - Timely Complaint Resolution: Ensure timely redressal of customer complaints.
  - Internal Ombudsman Framework: Strengthen the internal ombudsman framework.
  - Streamlining Data Correction: Simplify the process for handling data correction requests.
  - Cybersecurity and Data Privacy: Strengthen cybersecurity and data privacy through a robust information security governance framework.
  - Data Usage Concerns: Address concerns arising from the use of data for consulting and analytics.

Overview of Credit Information Companies (CICs)

Functions of CICs:

CICs collect public data, credit transactions, and payment histories of individuals and companies related to loans and credit cards.
They gather data from various sources, including banks, financial institutions, lenders, and credit-granting entities, and compile it into credit reports.

Creditworthiness Assessment:

Banks and non-banking financial institutions refer to CIC reports and scores to assess the creditworthiness of borrowers before granting loans or issuing credit cards.

Regulatory Framework:

CICs in India are regulated and supervised by the Reserve Bank of India (RBI) and governed by the Credit Information Companies Regulation Act, 2005 (CICRA).
As per CICRA, every credit institution, like banks, must be a member of at least one CIC.

Functions of CICs:

Credit Reports: CICs collect and maintain credit-related information from various sources, including banks, financial institutions, and credit card companies. They compile this information into credit reports for individuals and businesses.
Credit Scores: CICs calculate credit scores based on the credit history and financial behavior of individuals. Credit scores provide a numerical representation of creditworthiness.
Risk Assessment: Lenders use credit reports and scores from CICs to assess the credit risk associated with potential borrowers. This information helps in making informed lending decisions.

Major CICs in India:

Credit Information Bureau (India) Limited (CIBIL): One of the leading credit bureaus in India, CIBIL provides credit information reports and scores to individuals and businesses.
Equifax: Equifax is a global credit information company operating in India. It offers credit reports and scores to assist in risk assessment.
Experian: Experian is another major credit information company providing credit reports, scores, and analytics to support lending decisions.
CRIF High Mark: CRIF High Mark is a credit bureau that offers a range of credit information services, including credit reports and analytics.

CIBIL Score:

It is a three-digit numeric summary of an individual’s credit history.
Derived using credit history found in the CIBIL Report, considering the borrower’s credit profile over the last 36 months.
Range: The score ranges from 300 to 900, with higher scores indicating a better credit profile.
Lender Evaluation: Lenders use the CIBIL report and score to assess the risk of lending and decide on loan/credit card applications.
Approval Chances: The closer the CIBIL Score is to 900, the higher the chances of approval for credit card or loan applications.

5. Researchers engineer plant cells to produce drug for cancer

Subject: Science and Tech

Section: Biotechnology

In the news:

Researchers from IIT Madras and Mandi worked on enhancing the production of the anti-cancer drug camptothecin (CPT) by metabolically engineering plant cells.

Details:

The decline in this plant’s population prompted the exploration of alternative sources.
IIT Madras researchers identified a microbe as a sustainable CPT source and developed a metabolic model for N. nimmoniana cells.
They aim to enable efficient commercial drug production, reducing the need to exploit endangered plants.
The team is funded by SERB and the Department of Science and Technology.
The process involves cultivating plant cells in the lab, engineering them for increased CPT production, and navigating regulatory approval for genetically modified cell lines. However, optimization at the bioreactor level is pending.

Significance of developing the novel process:

The importance of this research lies in providing a sustainable method for CPT production, given its significance in chemotherapy.
This work not only focuses on CPT but also sets a platform for enhancing the production of other valuable plant-derived compounds.
The collaborative effort between these institutions emphasizes the potential of model-based metabolic engineering in understanding and boosting the production of essential phytochemicals.

About Camptothecin (CPT):

It is a potent topoisomerase inhibitor discovered in 1966 from the Camptotheca acuminata tree in China. Initially used in traditional Chinese medicine, it exhibited promising anticancer properties in clinical trials, particularly against various cancers like breast, ovarian, colon, lung, and stomach.
Despite its therapeutic potential, challenges such as low solubility and adverse effects led to the development of synthetic versions and derivatives.
CPT has been discovered in other plants, such as Chonemorpha fragrans.
Currently, this drug is derived from the endangered Nathapodytes nimmoniana plant, requiring massive amounts of plant material.
Camptothecin’s current extraction mainly occurs in Southeast Asia, where the plant is critically endangered.

Source: The Hindu

6. New class of antibiotics that can kill drug-resistant bacteria finally on the horizon?

Subject: Science and Tech

Section: Biotechnology

In the news:

F Hoffmann-La Roche AG found a new antibiotic class effective against gram-negative bacteria after a five-decade drought in new classes.

Details:

Zosurabalpin, the antibiotic, shows promise against drug-resistant Acinetobacter strains in mice and is undergoing human trials.
Two related macrocyclic peptide molecules are also in development.
World Health Organization classified CRAB (carbapenem-resistant Acinetobacter baumannii) as a critical pathogen, responsible for 700 deaths and $281 million in healthcare costs in 2017.
- The pathogen CRAB induced pneumonia and sepsis.
CRAB infections often occur in critically ill, immunocompromised patients or those with medical devices like catheters.
Gram-negative bacteria pose treatment challenges due to their protective outer membrane, including lipopolysaccharide (LPS).
Roche and Harvard scientists detailed how the antibiotic targets the LPS transport machine in Acinetobacter, aiding in outer membrane disruption.
Pharmaceutical companies have limited focus on antibiotic development, with only a small percentage of molecules directed at bacterial infections.

Significance:

The rising antimicrobial resistance (AMR) crisis claims millions of lives annually and threatens health coverage and sustainable development goals.
AMR’s projected impact is alarming, with estimates suggesting it could surpass cancer-related deaths in the next few decades.
Urgent innovation in antibiotics is crucial to combat AMR’s growing threat to global health and sustainability.

Source: DTE

7. Mayurbhanj’s red ant chutney receives GI tag. Why this is important for nutritional security of tribals

Subject: Environment

Section: Species in news

In the news:

Similipal kai chutney, made with red weaver ants by tribal people in Odisha’s Mayurbhanj district, received the geographical identity tag.

Details:

The Mayurbhanj Kai Society Ltd applied in 2020 under the Geographical Indications of Goods Act, of 1999.
Scientists analyzed the red weaver ants, revealing nutritional benefits like proteins, vitamins, and minerals.

Similipal kai chutney:

Ants are gathered, cleaned, and mixed with ingredients like salt, ginger, garlic, and chillies to make the chutney. Additionally, they’re used in soups and consumed as a functional ingredient for health issues.
Consumption is linked to improved appetite, eyesight, brain health, and natural remedies against depression, fatigue, and memory loss.
Kai pimpudi is used in medicinal oil for rheumatism, gout, etc. It’s also consumed for health benefits, aiding immunity and disease prevention.
Indigenous people collect kai pimpudi (red weaver ants) from nearby forests, selling them and the chutney at high demand and profitable rates.

Kai pimpudi (Red weaver ants):

Red weaver ants create nests in trees, forming colonies with various nests, providing protection, and serving as bio-control agents against pests.

Legal Framework:

Geographical indications assign products to the place of their origin. It conveys an assurance of quality and distinctiveness for such goods.
Under Articles 1 (2) and 10 of the Paris Convention for the Protection of Industrial Property, geographical indications are covered as an element of Intellectual Property Rights.
They are also covered under Articles 22-24 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement.

How does a GI tag affect the community based dish?

A Geographical Indications (GI) tag will help put the savoury dish to the global food table. The tag will bring about the uniqueness in the dish’s identity- meaning- it will be recognised as the one dish found in a particular country.

This will patent Kai Chutney and therefore make it harder for anyone else to misuse the identity of kai or mislead customers.

Simlipal National Park:

Simlipal is a tiger reserve in the Mayurbhanj district in the Odisha.
It is part of the Mayurbhanj Elephant Reserve, which includes three protected areas –Similipal Tiger Reserve, Hadgarh Wildlife Sanctuary and Kuldiha Wildlife Sanctuary.
It 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 a 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 leopards, leopard cats, fishing cats, jungle cats and wolves. The active management of muggers has revived its population on the banks of the rivers Khairi and Deo.
It is also home to the largest population of elephants in Odisha.
This protected area has been part of the UNESCO World Network of Biosphere Reserves since 2009.

Source: DTE

8. Why Eknath Shinde has dug up a dargah dispute in the hills

Subject: Geography

Section: Places in news

Context: Maharashtra Chief Minister Eknath Shinde said to the liberate of the Haji Malang Dargah in Kalyan

About Haji Malang Dargah:

Located on the lowest plateau of Malanggad which is a hill fort 3,000 feet above sea level on the Matheran hill ranges
The Haji Malang Dargah is revered by both Hindus and Muslims.
The shrine was built in honor of an Arab missionary, Haji Abd-ul-Rahman who was popularly known as Haji Malang.
Supreme Court in one of the case observed that the dargah was a composite structure that cannot be governed either by Hindu or Muslim law, but only by its own special custom or by general law of trusts

About Matheran hill ranges:

Matheran is an automobile-free hill station and a municipal council in the Karjat taluka of the Raigad district located in the Indian state of Maharashtra.
It is one of the smallest hill stations in India.
It is situated on the Western Ghats range at an elevation of around 2,625 feet above sea level.
Matheran has a reasonably dense forest cover.
Matheran has been declared an eco sensitive region by the Union Environment Ministry and can be called a Health Sanatorium in itself.
The town also has a large monkey population, including Bonnet Macaques and Hanuman Langurs.
The nearby Lake Charlotte is the main source of Matheran’s drinking water.

9. 10th century Kadamba inscription written in Kannada and Sanskrit found in Goa

Subject: History

Section: Ancient India

Context:

An inscription written in Kannada and Sanskrit and said to be of 10^th century A.D. Kadamba period has been discovered in the Mahadeva temple at Cacoda in southern Goa.

About Kadamba Dynasty (345-535 C.E.)

Founder – The Kadamba dynasty is believed to have been founded by Mayurasharma, who was originally a feudatory of the Pallavas, a prominent dynasty of South India.
Capital – The early capital of the Kadamba dynasty was Banavasi, located in present-day Karnataka.Later, the capital was shifted to Vaijayanti (modern-day Banavasi).
Extent – The Kadamba dynasty was an ancient Indian dynasty that ruled over parts of South India, particularly the present-day Karnataka region, from the 4th to the 6th centuries CE.
End – The Kadamba kingdom came to an end with Pulakeshin II’s capture of Banavasi during the reign of Ajavarman.

Kadambas of Goa

They were the subordinates of Chalukyas of Kalyana.
Chalukyan emperor Tailapa II appointed Kadamba Shasthadeva as mahamandaleshwara of Goa for his help in overthrowing the Rashtrakutas.
Kadamba Shasthadeva conquered the city of Chandavara from the Shilaharas in 960 A.D and later, he conquered the port of Gopakapattana (present Goa).
Gundayya, the son of Talara Nevayya, may have participated in this battle, and won the port at the cost of his life.
His father may have erected a memorial stone with the inscription in the temple of Mahadev of Cacoda to commemorate the heroic fight of his son.

The Inscription

The inscription was discovered in the Mahadeva temple at Cacoda in southern Goa.
It is in the literary style of Talangre inscription of Jayasimha I of the same period.
Message – Talara Nevayya’s son Gundayya having taken a vow to fulfil his father’s desire of capturing a gopura of the port of Goa, fought and died after fulfilling his father’s wish.
The record is composed as a vocal statement on the death of his son from the mouth of a lamenting father.

10. SC declines to take up plea by Indian held in Prague for ‘plot’ to kill Pannun

Subject: IR

Section: International Organisation

Context:

The Supreme Court refused to intervene in a plea by an Indian national for assistance from the Union government to defend his rights in a foreign court after being detained in Prague for alleged involvement in a conspiracy to murder the U.S. based Khalistani activist Gurpatwant Singh Pannun.

Supreme Courts Judgement:

Judiciary held that Supreme Court could not do anything in a sensitive matter involving public international law, and it was up to the Government of India to decide how to deal with the issue.

About Vienna Convention on Consular Relations, 1963:

The Vienna Convention on Consular Relations is an international treaty that defines a framework for consular relations between sovereign states.
It codifies many consular practices that originated from state custom and various bilateral agreements between states.
The Convention was adopted on 24 April 1963 following the United Nations Conference on Consular Relations in Vienna, Austria.
The treaty consists of 79 articles, with the preamble emphasizing the continued application of customary international law to matters not addressed in the Convention.

Some key provisions of the convention:

Article 5 outlines thirteen functions of a consul, including protecting the interests of the sending State and its nationals, assisting nationals, and promoting relations between the sending and receiving States.
Article 23 allows the host nation to declare a consular staff member persona non grata at any time, with the sending state required to recall the individual promptly, or they may lose consular immunity.
Article 31 establishes the inviolability of consular premises, prohibiting the host nation from entering or damaging the premises.
Article 35 safeguards freedom of communication between the consul and their home country, ensuring that consular bags are not opened or detained, and consular couriers are not detained.
Article 36 addresses communication between consular officers and nationals of the sending state, granting consular officers the right to communicate with and visit nationals who are arrested or detained.
Article 37 mandates prompt notification to consular officers if a sending state’s national dies, has a guardian appointed, or if a vessel or aircraft of the sending state is involved in an incident in the receiving state.
Article 40 requires the receiving state to treat consular officers with respect and prevent any attack on their person, freedom, or dignity.
Articles 58-68 cover honorary consular officers, detailing their powers and functions.

11. Aditya L1, ISRO’s mission to study Sun, set to be placed in final orbit tomorrow

Subject :Science and Tech

Section: Space tech

Context: India’s maiden solar mission Aditya-L1 is set to reach its intended destination L1 point on January 6, 2024

More on news:

Aditya L1 has successfully undergone four earth-bound maneuvers and a Trans-Lagrangean Point 1 Insertion maneuvers.
The Aditya L1 spacecraft is expected to reach the Lagrangian point (L1) on January 6, and will attempt a crucial maneuver to bind the spacecraft to an orbit around L1.
ISRO Scientists and Engineers from the Mission Operations Complex of ISTRAC will perform this crucial maneuver which will bind Aditya-L1 to an orbit around L1.
Upon reaching its final destination, the spacecraft will be able to view the sun without any eclipses.

About Aditya L1:

Aditya L1 is India’s first mission to study the Sun.
Aditya-L1 is also ISRO’s second astronomy observatory-class mission after AstroSat (2015).
It was launched using the Polar satellite Launch Vehicle.
The spacecraft will travel 1.5 million km from the Earth to the Lagrange 1 or L1 point between the Earth and the Sun.
The main objective of the mission is to get a deeper understanding of the star closest to us, and how its radiation, heat, flow of particles, and magnetic fields affects us.
The main payload is the Visible Emission Line Coronagraph (VLEC) which was designed by the Indian Institute of Astrophysics and will help study the solar corona from the lowermost part upwards.
The Solar Ultraviolet Imaging Telescope (SUIT) designed by the Inter University Centre for Astronomy and Astrophysics (IUCAA) will capture the UV image of the solar photosphere and chromosphere.
The Solar Low Energy X-ray Spectrometer (SoLEXS) and High Energy L1 Orbiting X-ray Spectrometer (HEL1OS) are developed by the UR Rao Satellite Centre and will help in studying X-ray flares.
The Aditya Solar wind Particle EXperiment (ASPEX) developed by ISRO’s Physical Research Laboratory and Plasma Analyser Package for Aditya (PAPA) developed by Space Physics Laboratory of ISRO’s Vikram Sarabhai Space Centre are designed to study the solar wind and energetic ions.
Advanced Tri-axial High-Resolution Digital Magnetometers (MAG) will measure the interplanetary magnetic fields at the L1 point.
The spacecraft also has a coronagraph that will allow scientists to look much closer to the surface of the Sun and complement the data from NASA and European Space Agency’s Solar and Heliospheric Observatory (SOHO) mission.

Lagrange points:

There are five Lagrange points i.e. L1 to L5, between any two orbiting celestial bodies.
These points can act as parking spots in space where the gravitational pull of the celestial objects equals the centripetal force required to keep a satellite in orbit.
This means satellites placed at Lagrange points do not need to expend a lot of fuel to remain in position.
Lagrange point 1 or L1 is one of the five points which is located around 1.5 million kilometers away, where the gravitational forces of the Sun and the Earth are in equilibrium.
Both the European Space Agency (ESA) and NASA- Solar and Heliospheric Observatory (SOHO) have placed their satellites at L1.

12. Amit Shah launches portal for procurement of pulses

Subject: Polity

Section: National Body

Context: Recently, The Cooperation Minister said that tur farmers can register on the portal to sell their produce to NAFED and NCCF even before the sowing operation.

More on news:

The Union Cooperation Minister urged farmers to cultivate pulses on a large scale to reduce dependency on imports.
The two cooperatives namely the National Agricultural Cooperative Marketing Federation of India Limited (NAFED) and the National Cooperative Consumers’ Federation of India Limited (NCCF) would procure produce at a minimum support price or the market price.
Tur dal procurement portal was inaugurated to help farmers to register and sell their produce to NAFED and NCCF. A similar facility will be launched in future for urad and masoor farmers as well as maize farmers.
The country is dependent on the import of some varieties of pulses except chana and moong.

About National Agricultural Cooperative Marketing Federation of India Limited(NAFED):

National Agricultural Cooperative Marketing Federation of India Ltd.(NAFED) was established in 1958 and is registered under the Multi State Co-operative Societies Act.
Nafed is aimed at promoting Co-operative marketing of Agricultural Produce to benefit the farmers.
The objectives of the NAFED is to organize, promote and develop marketing, processing and storage of agricultural, horticultural and forest produce, distribution of agricultural machinery, implements and other inputs, undertake inter-state, import and export trade, wholesale or retail as the case may be and to act and assist for technical advice in agricultural, production for the promotion and the working of its members, partners, associates and cooperative marketing, processing and supply societies in India.
Agricultural farmers are the main members of Nafed, who have the authority to say in the form of members of the General Body in the working of Nafed.

National Cooperative Consumers’ Federation of India Limited(NCCF):

NCCF was established on 16th October, 1965 to function as the apex body of consumer cooperatives in the country.
The organization aims to promote consumer cooperative movement in the country, and aspires to facilitate the voluntary formation and democratic functioning of cooperatives, based on self-reliance and mutual aid for overall economic betterment and financial autonomy.
It is registered under the Multi-State Co-operative Societies Act, 2002.
It operates through a network of 24 Branch Offices located in different parts of the country.
NCCF Headquarters is located in New Delhi.

About Pulses:

India is the largest producer , consumer and importer of pulse .
In India they are typically grown during Rabi season.
Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and Karnataka are the top five pulses producing states.