Daily Prelims Notes 1 November 2023

November 1, 2023
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Category: DPN

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Daily Prelims Notes

1 November 2023

1. This is the world’s fastest-growing economy, and it could grow an ‘explosive’ 100%

Subject: Geography

Section: Economic geography

Context:

Guyana, a country in South America with a population of about 800,000 people, is projected to grow 38% by the end of the year — an “extremely fast” pace, according to recent gross domestic product forecasts by the International Monetary Fund.

Details:

It is the world’s fastest growing economy (GDP growth of 62.3% in 2022) and on track to grow by more than 100% by 2028. The growth is largely fueled by profits from its oil production and export sector.
Forecasts say that the real GDP in Guyana will rise about 115% in the next five years.
Guyana’s agriculture, mining and quarrying sectors are also performing well.

Growth in Real GDP around the world in 2023

Risks to the forecast:

Over time, oil prices will be quite volatile and eventually stay low. That’s why Guyana should diversify its economy.
Guyana may face risks of Dutch disease.
- Dutch disease is an economic term referring to the negative repercussions that arise from rapid development as a result of newfound resources, which paradoxically harms the broader economy.
Challenges: Political risks, division in society between Indo- and Afro-Guyanese populations, corruption and organized crime.

Stabroek offshore field:

It is at the Atlantic coast of Guyana, operated by Exxon mobil.
The oil production in Guyana will jump from around 390,000 barrels per day this year to over a million barrels per day by 2027 as new offshore fields in the country’s Stabroek Block are opened.

Guyana:

It is a country on the northern mainland of South America.
Guyana is an indigenous word which means “Land of Many Waters”.
The capital city is Georgetown.
It is the third-smallest sovereign state by area in mainland South America after Uruguay and Suriname.
Bordered by the Atlantic Ocean to the north, Brazil to the south and southwest, Venezuela to the west, and Suriname to the east.

Source of this article: https://www.cnbc.com/2023/09/27/worlds-fastest-growing-economy-guyana-could-grow-100percent-in-5-years.html

2. Brazzaville Summit of the Three Basins ends with a declaration

Subject: Geography

Section: Maps

Context:

The Summit of the Three Basins concluded with the declaration by the Heads of State and Government of the States.
The meeting was attended by delegates from countries in the three basins of the Amazon, Congo and Borneo-Mekong-Southeast Asia, at Brazzaville, capital of the Republic of Congo.

Details:

The three ecosystems of biodiversity and tropical forests provide ecosystem services.
These three tropical forests cover a third of the world’s land surface, are protected in the future.
The seven-point declaration urged nations to:

Recognise the value of enhanced cooperation between the three basins
Recognise that sovereign management of biodiversity, forests and associated resources of the three basins is essential
Develop solutions together
Pool and capitalise on existing knowledge, experience, resources and achievements
Involve all states and national authorities, including indigenous peoples, youth, women, civil society, academia and the private sector
Encourage financial mobilisation and the development of traditional and innovative financing mechanisms
Establish a sustainable system of remuneration for the ecosystem services provided by the three basins

Amazon basin:

The Amazon basin is the part of South America drained by the Amazon River and its tributaries. The Amazon drainage basin covers an area of about 7,000,000 km2 (2,700,000 sq mi), or about 35.5 percent of the South American continent.
It is located in the countries of Bolivia, Brazil, Colombia, Ecuador, Guyana, Peru, Suriname, and Venezuela, as well as the territory of French Guiana.
Most of the basin is covered by the Amazon rainforest, also known as Amazonia. With a 5.5 million km2 (2.1 million sq mi) area of dense tropical forest, it is the largest rainforest in the world.
Politically the basin is divided into Peruvian Amazonia, Amazônia Legal of Brazil, the Amazon natural region of Colombia, Amazonas (Venezuelan state), and parts of Bolivia and Ecuador.
It is home to 10% of the world’s biodiversity with 40,000 species of plants, 3,000 species of freshwater fish, and over 370 reptiles, in addition to other still unknown and unrecorded species.
Amazon Basin has an organization, the OCTA (Organization of the Amazon Cooperation Treaty) bringing together eight states with the Amazon rainforest in common, who have signed the Amazon Cooperation Treaty (TCA).

Congo basin:

It is the sedimentary basin of the Congo River.
It is located in Central Africa, in a region known as west equatorial Africa.
It is sometimes known simply as the Congo. It contains some of the largest tropical rainforests in the world and is an important source of water used in agriculture and energy generation.
The rainforest in the Congo Basin is the largest rainforest in Africa and second only to the Amazon rainforest in size, with 300 million hectares compared to the 800 million hectares in the Amazon.
Deforestation and degradation of the ecology by the impacts of climate change may increase stress on the forest ecosystem, in turn making the hydrology of the basin more variable.
Eight sites of the Congo Basin are inscribed on the World Heritage List, five being also on the list of World Heritage in Danger (all five located in Democratic Republic of the Congo). Fourteen percent of the humid forest is designated as protected.
Countries wholly or partially in the Congo region: Angola, Gabon, Burundi, Cameroon, Central African Republic, Democratic Republic of the Congo, Republic of the Congo, Rwanda, Tanzania, Zambia.
Congo Basin Climate Commission (CCBC) was established in 2016 under the auspices of the African Union, including all states in the extended Congo River basin and neighboring basins of the Atlantic, Indian Ocean, and Morocco, an original associate member. Its objective is to accelerate the implementation of climate transition and economic transformation of the Congo Basin in a logic of sustainable development.

Borneo-Mekong-Southeast Asia basin:

It is the world’s third largest carbon sink, and is composed of two sub-regions, the island of Borneo and the Mekong River.
- The Mekong River is one of the largest rivers in the world, crossing six countries: China, Myanmar, Thailand, Laos, Cambodia, and Vietnam, which share the natural resources and land surrounding it.
- Borneo, the fourth largest island in the world, is divided between Brunei, Malaysia, and Indonesia.
- The island represents only 1% of the world’s land, but holds about 6% of the world’s biodiversity in its tropical forests, which are the habitat of local populations and indigenous peoples who depend on them for their food and clean water supply.
The massive expansion of oil palm cultivation for the production of biofuels could lead to the destruction of the last primary forests in the area.
Other activities that led to deforestation in this region are: palm oil, rubber, pulp and paper, or timber trade.

Source of this article: https://www.downtoearth.org.in/news/environment/brazzaville-summit-of-the-three-basins-ends-with-a-declaration-92565

https://thethreebasinsummit.com/the-three-basins/

3. Hamoon most unusual cyclone in India in 30 years, changed categories 4 times in a day: Experts

Subject: Geography

Section: Physical geography (Climatology)

Context:

The very severe Bay of Bengal cyclone Hamoon made landfall about 16 hours earlier than the IMD predicted timeline at Chattogram, Bangladesh.

Details:

The landfall timing, location and speed at landfall, appeared to change within four hours between morning and noon on October 24.
The landfall category changed from deep depression to a cyclonic storm. The landfall point shifted south from the initial predicted location in between Khepupara and Chittagong.
The cyclone quickened considerably under the influence of westerly winds and hence had landfall earlier than initially predicted.
Various factors influencing the cyclone hamoon: High pressure zone over the China region, Westerly trough, Weakening of cyclone Tej in the Arabian Sea, cooler than normal northern Bay of Bengal.
- The upper-level westerly wind flow, which remains atop the cyclonic system, often has shearing effects on the clouds. This results in the cyclonic system losing strength and the rainfall getting reduced — exactly what happened in the case of Hamoon.
It was unusual on several fronts-
- Traditionally, the cyclone track should have been towards Tamil Nadu, Andhra Pradesh and the Odisha coast, but instead it recurved towards Bangladesh, which was captured and predicted by IMD much earlier. But what could not be captured and predicted was the dominating role of westerly wind that pushed the cyclonic system quickly towards the north-east.
- Hamoon changed categories at least four times in the 24 hours before the landfall.

The conditions favourable for the formation and intensification of tropical storms are:

Large sea surface with temperature higher than 27° C.
Presence of the Coriolis force.
Small variations in the vertical wind speed.
A pre-existing weak low-pressure area or low-level-cyclonic circulation.
Upper divergence above the sea level system.

Source of this article: https://www.downtoearth.org.in/news/natural-disasters/hamoon-most-unusual-cyclone-in-india-in-30-years-changed-categories-4-times-in-a-day-experts-92534

4. Pioneer ecologist Madhav Gadgil on his life spent in, and for, India’s biodiversity

Subject: Environment

Section: Biodiversity

Context:

One of India’s pioneering ecologists, Madhav Gadgil looks back on his journey in a new memoir titled A Walk Up The Hill: Living with People and Nature.

About Madhav Gadgil and his book:

Gadgil has a people-centric approach to biodiversity conservation.
He has worked with Indian Institute of Science, Bengaluru.
The Bombay Natural History Society journal published a paper written by him and his colleague V. D. Vartak titled Sacred Groves of India: a plea for continued conservation.
His approach was that nature could be conserved by working with, rather than against the people. The alternative seemed possible in UNESCO’s Man and Biosphere programme launched in 1971. In 1986 the Nilgiris Biosphere Reserve was constituted.
He pointed out how rampant mining was destroying the sylvan landscape with groundwater and springs drying up.
He said that under the WildLife Protection Act 1972 , the forest department deliberately weakened the van panchayats and harassed leaders of the Chipko movement. This led to the degradation of the habitat of goral and other wildlife species, triggering the landslide of Chamoli in 2021.

Gadgil committee report 2011:

His report of the Western Ghats Ecology Expert Panel was monumental.
It was bold with 39 guidelines for initiating bottom-up democratic decisions from the gram sabha level.
These included no economic zones, no new hill stations, rehabilitation of mined areas with special focus on reviving water resources, promoting organic agricultural practices, strict control of explosives to kill fish, no mining or large storage dams in areas demarcated ESZ 1 (Environmentally Sensitive Zone), no new mining in ESZ 2, no new railway line and no new national/state highways in ESZ 1.
The report promoted people-owned, small-scale hydropower systems.
A high-level working group, headed by Krishnaswamy Kasturirangan was appointed to examine the report in 2012.

Environmental concerns raised by him:

Replacement of original trees by exotics like eucalyptus, Sea levels have been rising more rapidly than expected in tropics, ground has been sinking in cities like Mumbai and Ernakulam, lowering of groundwater level due to overuse, the entire west coast is plagued by blatant violation of coastal regulatory zones norms, environmentally degrading projects like the Vasco Da Gama Coal Port in Goa, Tadadi Coal Port in Karnataka and the Vizhinjam Coal Port in Kerala.

Sacred groves:

Services provided by them are: protect water sources, shelter medicinal plants, shelters for animals. In Ambi Valley, the Mangaon sacred grove provided shelter to a breeding population of barking deer.
Ficus tree: It is a genus of about 850 species of woody trees, shrubs, vines, epiphytes and hemiepiphytes in the family Moraceae. Collectively known as fig trees or figs, they are native throughout the tropics with a few species extending into the semi-warm temperate zone. The common fig (F. carica) is a temperate species native to southwest Asia and the Mediterranean region (from Afghanistan to Portugal), which has been widely cultivated from ancient times for its fruit, also referred to as figs.
The fruit of most other species are also edible though they are usually of only local economic importance or eaten as bushfood. They are extremely important food resources for wildlife. Figs are also of considerable cultural importance throughout the tropics, both as objects of worship and for their many practical uses.

Source of this article: https://india.mongabay.com/2023/10/book-review-pioneer-ecologist-madhav-gadgil-on-his-life-spent-in-and-for-indias-biodiversity/

5. Former forest officer Rajiv Bhartari on zoning in Corbett Tiger Reserve and its impacts

Subject: Environment

Section: National Parks & Reserves

Corbett tiger reserve:

Corbett National Park created in 1936 was modeled after Yellowstone National Park in the USA.
- Lord Malcolm Hailey was then the Governor of United Provinces, later Uttar Pradesh.
- It was initially known as Hailey National Park in 1936. Post-independence in 1947, Hailey National Park was renamed as Ramganga National Park in 1955, and subsequently Corbett National Park in 1957 after the death of Jim Corbett.
Corbett National Park became Corbett Tiger Reserve in 1973 with the introduction of Project Tiger.
Corbett, located in Uttarakhand, hosts one of the highest tiger densities in the world, it also harbors the largest tiger population in any protected area in the world.
In 1985, the 25th Working Session of the IUCN Commission on National Parks and Protected Areas (CNPPA) was held in Corbett National Park.
It operates on the basis of two spatially distinct units — the core and the buffer.
- Within these two, there are also tourism zones and spatially exclusive units meant to control where and when visitors can access the reserve and spot the elusive tiger.

Zoning of tiger reserves:

The concept of zoning was first introduced as part of Project Tiger.
Core-buffer zoning in protected areas is a spatial strategy for the management of large cats such as tigers to increase population and limit human wildlife conflict.

It involves a binary system based on the degree of protection given to the species, being greater in core areas, where needs of carnivores are privileged, and to a lesser degree in buffer area that give preference to human uses to offset restrictions placed on human activities in core zones.

Zoning is a form of territorialisation too as it involves the establishment of new boundaries, regulation of access and control of use through authority.
3 critical points in zoning of corbett tiger reserve:

In 1973 with the declaration of Project Tiger and Corbett’s inclusion in it.
In 1991 Corbett Tiger Reserve was increased in size by two and a half times.
- The entire Corbett National Park was made a core area, and the buffer zone was created outside the national park, by adding the Kalagarh Forest Division, including Sonanadi Wildlife Sanctuary (WLS) and parts of Ramnagar and Terai West Forest Divisions.
In 2006, the WLPA (1972) underwent a major amendment, when legal provisions for tiger reserves were added to the parent Act.
- The original WLPA of 1972 did not mention or define a tiger reserve. Neither did it define a core or buffer area.
- But the Amendment Act 2006 defines the core, or the critical tiger habitat, as an area that needs to be kept as “inviolate” for the purpose of tiger conservation.
- Meanwhile, the buffer is an area that requires a lesser degree of habitat protection, and where coexistence between humans and wildlife is promoted. These legal definitions make the existence and role of a “core” and a “buffer” more rigid than before.

Panchayat van (community forests):

Unique to Uttarakhand state.
It is the legally demarcated village forests under the control of the Village Forest Council, whereas van panchayat refers to the Village Forest Council or governance institution which the state of Uttarakhand granted authority for managing these forests.
The power of managing the forest resides with the locally elected sarpanch (headman) of the van panchayat (village forest committee).
In 2010, both the core and buffer areas of Corbett Tiger Reserve were legally notified.
The NTCA has a policy of providing funds for relocation from the core area only. But with the change in the status of the Sonanadi WLS from buffer area to core area in 2010, the NTCA gave a budgetary grant for the relocation of the nomadic Gujjars from the sanctuary.

Source of this article: https://india.mongabay.com/2023/10/interview-former-forest-officer-rajiv-bhartari-on-zoning-in-corbett-tiger-reserve-and-its-impacts/

6. Why the Goa government is in the dock over notifying a tiger reserve

Subject: Environment

Section: Wildlife Protection Act

Context:

The Goa bench of the Bombay High Court directed the Goa government to notify a tiger reserve in Mhadei Wildlife Sanctuary (WLS) and other contiguous areas of the state within three months.
The court also directed the state to determine and settle the rights and claims of Scheduled Tribes and other forest dwellers within a year.

Details:

It was recommended by the National Tiger Conservation Authority (NTCA) in terms of Section 38 (V) (1) of the Wildlife Protection Act.
The 2014 Status of Tigers (Co-predators & Prey) in India report, released by the statutory body National Tiger Conservation Authority (NTCA) formed under the Wild Life (Protection) Act of 1972, speaks about the tiger presence in the region.
The state government argued before the court that the provisions of section 38-V (1) of the Wildlife Protection Act were only directory and not mandatory.

Catigao- Mhadei forest complex:

The Cotigao-Mhadei forest complex of Goa comprises five protected areas:

Mhadei Wildlife Sanctuary,
Bhagwan Mahavir Wildlife Sanctuary and Mollem National Park,
Bhagwan Mahavir National Park,
Netravali Wildlife Sanctuary and
Cotigao Wildlife Sanctuary.

They together cover an area of 750 sq mts, forming a contiguous belt connecting the forests of Karnataka and Maharashtra.

Mhadei Wildlife Sanctuary (WLS):

The Mhadei Wildlife Sanctuary is a 208.5-km2 (80.5-mi2) protected area in the Indian state of Goa in the Western Ghats of South India.
Goa is the only state in India which has protected the complete Western Ghats’ section within a state.
This region is part of the Western Ghats landscape, and is regarded as a Global Biodiversity Hotspot.
Goa’s four wildlife sanctuaries are located on the eastern side of the state in the Western Ghats, covering an area of about 750 km2 (290 sq mi).
The Mahdei Wildlife Sanctuary and Bhagwan Mahaveer Sanctuary and Mollem National Park all fall within the Mhadei River basin.
Netravali Wildlife Sanctuary is located just to the south of Mhadei in Goa.
The sanctuary includes the Vagheri Hills, some of the highest peaks in North Goa.
The Mhadei River, known downstream as the Mandovi River, the lifeline of the state of Goa, originates in Karnataka, travels28.8 km (17.9 mi) in Karnataka, passes 9.4 km (5.8 mi) through the Mahdei Wildlife Sanctuary and meets the Arabian Sea at Panaji after traveling 81.2 km (50.5 mi) in Goa.

Source of this article: https://indianexpress.com/article/explained/explained-law/maratha-quota-what-sc-bombay-hc-have-said-9007855/

7. What the rapid ice melt in West Antarctica means

Subject: Environment

Section: Climate Change

Context:

The rapid melting of West Antarctica’s ice sheet due to warm waters around it is now unavoidable, no matter how much carbon emissions are cut, according to a new study.

About the study:

Title: ‘Unavoidable future increase in West Antarctic ice-shelf melting over the twenty-first century’.
Study conducted at: Amundsen Sea, West Antarctica.

Consequence of glacier melting:

It would raise the global mean sea level by 5.3 metres or 17.4 feet. That will negatively impact people living in vulnerable coastal cities across the world, including in India.
India has a long coastline and a dense population and is therefore vulnerable to sea level rise.
Even under a best-case scenario of limiting global warming to 1.5 degree Celsius above pre-industrial levels, water in West Antarctica will continue to get warmer three times faster than in the 20th century, leading to an increased melting of the region’s ice sheet.

Ice sheet:

It is a mass of glacial ice that covers more than 50,000 square kilometres of land — roughly large enough to blanket Uttarakhand in ice.
There are two major ice sheets in the world today: Greenland ice sheet and Antarctic ice sheet.
Together, they contain about two-thirds of all the freshwater on Earth.

How is the West Antarctic ice sheet melting?

Warm ocean waters melt ice shelves — the edges of an ice sheet which floats on the ocean.
If an ice shelf thins or disappears, these glaciers tend to speed up, discharging more ice into the ocean and causing sea level rise.
Both ice shelves and ice sheets are different from sea ice, which is the free-floating ice that surrounds the polar regions. Sea ice is created by sea water freezing.
Glacier melting is happening in Amundsen Sea, west Antarctica.

Amundsen sea:

It is an arm of the Southern Ocean off Marie Byrd Land in western Antarctica.
It lies between Cape Flying Fish (the northwestern tip of Thurston Island) to the east and Cape Dart on Siple Island to the west.
Cape Flying Fish marks the boundary between the Amundsen Sea and the Bellingshausen Sea.
West of Cape Dart there is no named marginal sea of the Southern Ocean between the Amundsen and Ross Seas. The Norwegian expedition of 1928–1929 under Captain Nils Larsen named the body of water for the Norwegian polar explorer Roald Amundsen while exploring this area in February 1929.

Source of this article: https://indianexpress.com/article/explained/explained-law/maratha-quota-what-sc-bombay-hc-have-said-9007855/

8. A Gaganyaan for the seas: inside India’s ‘Deep Ocean Mission’

Subject: Geography

Section: Economic Geography

Deep Ocean Mission (DOM)- Samudrayaan:

DOM is one of nine missions under the Prime Minister’s Science, Technology, and Innovation Advisory Council (PMSTIAC). It is imperative that DOM supports the blue-economy priority area, blue trade, and blue manufacturing in India.
It is India’s ambitious quest to explore and harness the depths of the ocean, implemented by the Ministry of Earth Sciences (MoES).
Approved in 2021 at a cost of nearly Rs 4,077 crore over a five-year period in a phased manner.
India will, for the first time, embark on a journey to a depth of 6,000 metres in the ocean using an indigenously developed submersible with a three-member crew (called ‘Aquanauts’).
The ‘New India 2030’ document outlines a blue economy as the sixth core objective for India’s growth.
The years 2021-2030 have been designated by the United Nations as the ‘Decade of Ocean Science’.
Countries such as the U.S.A., Russia, China, France, and Japan have already achieved successful deep-ocean crewed missions.

The mission has six pillars:

Development of technologies for deep-sea mining and a manned submersible to carry three people to a depth of 6,000 metres in the ocean. The submersible will be equipped with a suite of scientific sensors, tools and an integrated system for mining polymetallic nodules from the central Indian Ocean;
Development of ocean climate change advisory services, involving an array of ocean observations and models to understand and provide future climate projections;
Technological innovations for the exploration and conservation of deep-sea biodiversity;
Deep-ocean survey and exploration aimed at identifying potential sites of multi-metal hydrothermal sulphides mineralisation along the Indian Ocean mid-oceanic ridges;
Harnessing energy and freshwater from the ocean; and
Establishing an advanced Marine Station for Ocean Biology, as a hub for nurturing talent and driving new opportunities in ocean biology and blue biotechnology.

Institutional collaboration for DOM:

MoES institutes, especially the Centre for Marine Living Resources and Ecology (CMLRE), Indian National Centre for Ocean Information Services (INCOIS), National Centre for Coastal Research (NCCR), National Centre for Polar and Ocean Research (NCPOR) and National Institute of Ocean Technology (NIOT) will collaborate with other national institutes and academia to achieve the objectives outlined in DOM.
The minerals we can mine from the ocean bed in the central Indian Ocean region, allocated to us by the United Nations International Seabed Authority (ISA), include copper, manganese, nickel, and cobalt.

Matsya6000:

The NIOT, an autonomous institute under MoES, has been entrusted with the mandate of developing indigenous technologies for DOM.
Matsya6000, a deep-ocean submersible designed to accommodate a crew of three members.
Equipped with a suite of scientific sensors and tools, Matsya6000 boasts an operational endurance of 12 hours, which is extendable to 96 hours in the event of an emergency.
Its sub-sea endurance is limited, it offers an excellent intervention mechanism and operates untethered.
Constructed from a titanium alloy, the sphere is engineered to withstand pressures of up to 6,000 bar.
Communication is achieved through sound – an acoustic phone and modem. The navigation and positioning systems are state-of-the-art, too.
It will not be actively lowered through sinking; instead, it will function as a free-floating system, for energy efficiency. It can move at a speed of about 5.5 km/hr using underwater thrusters, which is adequate.
With Matsya, India will be the only country to have an entire ecosystem of underwater vehicles encompassing deep-water ROVs, polar ROVs, AUVs, deep-water coring systems, and more.

Deep ocean mining vehicle- Varaha:

A deep-sea locomotion trial was conducted on the seabed at a depth of 5,270 m using our underwater mining system, ‘Varaha’.
It is a self-propelled track-based seabed mining system.
It operates on the flexible riser technique: the mining vehicle is lowered to the ocean bed from a surface ship using a high-strength flexible cord system. Once the vehicle reaches the ocean bed, it will be able to move around while the surface ship moves in tandem.
It uses a high-power pressure pump system to facilitate the extraction of precious polymetallic nodules.

Why has the mission decided to explore the depth of 6000m?

Polymetallic nodules, which contain precious metals like copper, manganese, nickel, iron, and cobalt, are found approximately 5,000 m deep, and polymetallic sulphides occur at around 3,000 m in the central Indian Ocean. Therefore, our interests span depths of 3,000-5,500 m. By equipping ourselves to operate at a depth of 6,000 m, we can effectively cater to both the Indian Exclusive Economic Zone and the central Indian Ocean.

Exploring the deep oceans is more challenging than exploring outer space:

The fundamental distinction lies with the high pressure in the deep oceans. While outer space is akin to a near perfect vacuum, being one meter underwater puts as much pressure on an object of one square meter area as if it were carrying about of 10,000kg of weight.
Landing on the ocean bed also presents challenges due to its incredibly soft and muddy surface.
Extracting materials requires a large amount of power and energy.
Remotely operated vehicles prove ineffective in the deep oceans due to the absence of electromagnetic wave propagation in this medium.
Visibility also poses a significant hurdle.
Other factors: variations in temperature, corrosion, salinity, etc.

Source of this article: https://www.thehindu.com/sci-tech/science/deep-ocean-mission-matsya6000-seabed-mining-blue-economy/article67457379.ece

9. Stocktaking climate finance — a case of circles in red ink

Subject: Environment

Section: Climate Change

Climate Change 2023: Synthesis Report:

It is based on the Intergovernmental Panel on Climate Change’s (IPCC) sixth assessment cycle which began in 2015.
The report provides the main scientific input to COP28 and the Global Stocktake.
The report reiterates that humans are responsible for all global heating over the past 200 years leading to a current temperature rise of 1.1°C above pre-industrial levels, which has led to more frequent and hazardous weather events that have caused increasing destruction to people and the planet. The report reminds us that every increment of warming will come with more extreme weather events.
The report outlines that the 1.5°C limit is still achievable and outlines the critical action required across sectors and by everyone at all levels. The report focuses on the critical need for action that considers climate justice and focuses on climate resilient development.
It outlines that by sharing best practices, technology, effective policy measures, and mobilizing sufficient finance, any community can decrease or prevent the usage of carbon-intensive consumption methods.

Estimating adequate climate finance:

At the Copenhagen Change Conference in 2009, the developed countries made the commitment to mobilize $100 billion per year by 2020.
Under Article 9 of the Paris Agreement on Climate Change, it is also mandatory for the developed countries to provide in their Biennial Update Reports (BUR), information relating to the financial resources which they have provided and, also, the projected levels of public financial resources to be provided to developing country parties.
Developed countries are required, in accordance with the decision accompanying the Paris Agreement, to collectively mobilize $100 billion through 2025, before a new collective quantified goal (NCQG) ‘from a floor of $100 billion per year is to be set at the end of 2024’.
At the 26th United Nations Climate Change conference in Glasgow in 2021, the developed countries noted of being able to mobilize only a total of $79.6 billion.
For India, its third BUR says that its financial needs derived from its NDCs for adaptation and mitigation purposes for 2015-30 are $206 billion and $834 billion, respectively.
India has reiterated its demand for a just transition at COP27.

Unclear burden sharing formula:

There is no agreed approach among developed countries to share the burden of this goal of providing $100 billion.
The Global Environment Facility, a UNFCCC-designated funding agency providing grant and concessional loan to developing countries, is replenished every four years.
The Green Climate Fund (GCF), set up to administer a portion of the $100 billion for developing country parties to switch over to low-emissions and climate resilient development path, had its second replenishment on October 5, 2023.

Global Stocktake:

It is a Party-driven process conducted in a transparent manner and with the participation of non-Party stakeholders, that enables countries and other stakeholders to see where they’re collectively making progress toward meeting the goals of the Paris Agreement – and where they’re not.
It’s like taking inventory. It means looking at everything related to where the world stands on climate action and support, identifying the gaps, and working together to agree on solutions and pathways (to 2030 and beyond).
Administered by: UNFCCC.

Green Climate Fund (GCF):

It is a fund established in 2010, within the framework of the United Nations Framework Convention on Climate Change as an operating entity of the Financial Mechanism to assist developing countries in adaptation and mitigation practices to counter climate change. The GCF is based in Incheon, South Korea. It is governed by a Board of 24 members and supported by a Secretariat.
Objective: To “support projects, programmes, policies and other activities in developing country Parties using thematic funding windows”. It is intended that the Green Climate Fund be the centerpiece of efforts to raise Climate Finance under the UNFCCC.

Source of this article: https://www.thehindu.com/opinion/op-ed/stocktaking-climate-finance-a-case-of-circles-in-red-ink/article67481653.ece

10. London AI Summit

Subject: Science & Tech

Section: Awareness in IT

Context: The United Kingdom is set to host a pivotal two-day artificial intelligence (AI) summit

More about the news:

Britain is organizing the inaugural AI Safety Summit, bringing together governments, academia, and companies involved in cutting-edge artificial intelligence (AI) to discuss the risks associated with AI technology.
Prime Minister Rishi Sunak aims to position Britain as an intermediary between the United States, China, and the European Union in the AI domain.
The guest list for the event at Bletchley Park includes world leaders, tech executives like Elon Musk and Sam Altman, and academics.
The summit focuses on “frontier AI,” which refers to highly capable general-purpose AI models.
High-profile participants include U.S. Vice President Kamala Harris, European Commission President Ursula von der Leyen, China’s vice tech minister, and United Nations’ Secretary-General Antonio Guterres.
The agenda includes discussions on topics such as AI’s potential use by terrorists to create bioweapons and the technology’s capacity to surpass human capabilities, potentially causing worldwide disruption.

Some more facts about London AI Summit:

The London AI Summit 2023 is a two-day event that will bring together the most forward-thinking technologists and business professionals to explore the real-world applications of AI.
The summit will feature a variety of sessions, including keynote addresses, panel discussions, and technical talks from leading experts in the field of AI.

11. Afghans heads to Pakistan border as deportation deadline loom:

Subject: IR

Section: Current Affairs

Context: Tens of thousands of Afghans flee Pakistan as deadline looms

More about the news:

Over 20,000 Afghans residing in Pakistan rushed to the borders ahead of a government deadline for 1.7 million undocumented individuals to leave or face arrest and deportation.
The Pakistan government plans to arrest undocumented Afghans who refuse to leave and process them for forced return to Afghanistan.
Many Afghans are reluctant to return due to the dire situation in their home country.
In the border areas, thousands waited to cross into Afghanistan, facing further registration hurdles once over the border.
Pakistan’s actions have drawn criticism from the Taliban government’s defense minister.

What is The UN Refugee Convention 1951:

The UN Refugee Convention is a United Nations treaty that defines the status of refugees and outlines their rights, as well as the obligations of nations that provide asylum.
The 1951 UN Refugee Convention grants specific rights to individuals who are escaping persecution based on factors like race, religion, nationality, social group affiliation, or political opinion.
The Convention also specifies criteria for excluding certain individuals from refugee status, such as those involved in war crimes.
It includes provisions for visa-free travel for individuals holding travel documents issued under the convention.
The Convention is based on Article 14 of the 1948 Universal Declaration of Human Rights, which recognizes the right of people to seek asylum in other countries when facing persecution.
Refugees may enjoy additional rights and benefits in a host country beyond what the Convention prescribes.
The 1967 Protocol expanded the scope of the convention to include refugees from all regions, whereas the 1951 Convention initially covered only European refugees.
Both the 1951 UN Convention and the 1967 Protocol remain the foundation of refugee protection, with their provisions remaining as relevant today as when they were initially formulated.
India is not a signatory to this convention.

12. PM launches ‘MY Bharat platform’ for youth

Subject: Science & Tech

Section: Awareness in IT

Context: Prime Minister Narendra Modi laid the foundation stone for Amrit Vatika and Amrit Mahotsav Memorial and launched the Mera Yuva Bharat (MY Bharat) platform

More about the news:

Prime Minister Narendra Modi inaugurated the Amrit Vatika and Amrit Mahotsav Memorial and launched the Mera Yuva Bharat (MY Bharat) platform during an event in New Delhi.
This event marked the conclusion of the Azadi Ka Amrit Mahotsav and celebrated the collective strength of Indian youth, emphasizing their role in nation-building.

What is MERA YUVA BHARAT (MY BHARAT):

It is an autonomous body that will benefit the youth in the age group of 15-29 years, in line with the definition of ‘Youth’ in the National Youth Policy.
In case of programme components specifically meant for the adolescents, the beneficiaries will be in the age group of 10-19 years.
It will help in Setting the focus of the Government on Youth Led development and to make the Youth “active drivers” of development and not merely “passive recipients”
Mera Yuva Bharat (MY Bharat) is ‘Phygital Platform’ (physical + digital) comprising physical activity along with an opportunity to connect digitally.

13. What is Apple’s ‘state-sponsored attackers’ alert:

Subject: Science & Tech

Section: Cyber-Security

Context: Several top opposition leaders and a few journalists have reported receiving a notification from Apple about “state-sponsored attackers who are remotely trying to compromise” their iPhones.

More about the news:

Several Indian opposition leaders, including Mallikarjun Kharge and Shashi Tharoor, received Apple alerts warning of “state-sponsored attackers” attempting to compromise their iPhones, raising concerns of government surveillance.
Information Technology Minister Ashwini Vaishnaw promised an investigation, while politicians called it a violation of fundamental rights.
The situation is reminiscent of the Pegasus spyware scandal, prompting calls for changes in the IT Act to subject surveillance using sophisticated software to judicial oversight.

Who are these “state-sponsored attackers” that Apple refers to:

In response to the allegations, Apple issued a statement clarifying that they do not assign the source of the threat notifications to any particular state-sponsored attacker.
According to Apple’s perspective, state-sponsored attackers are highly funded and possess advanced capabilities, and their attack strategies evolve over time. The identification of such attacks depends on threat intelligence signals, which can be inherently imperfect and incomplete.
It is plausible that certain notifications from Apple regarding threats could be false alarms or that certain attacks may go undetected.
Government-backed attackers focus their efforts on specific individuals and their devices, typically based on their identity or activities. This sets these attacks apart from those executed by typical cybercriminals, who tend to target a larger number of users for financial gain.
According to Apple, state-sponsored attacks often have a brief duration and are intentionally designed to remain undetected, taking advantage of vulnerabilities that might not be publicly known.

What are apple threat notifications:

Apple’s threat notifications are a way of alerting and helping users who may have been targeted by state-sponsored attackers.
As a response to these attacks, the company has developed a system that can spot activity that matches certain patterns.
When an attack is detected, a Threat Notification is sent by email and iMessage to the email addresses and phone numbers that are linked to the affected user’s Apple ID.

What does Apple advise users should do when an attack is detected:

Some of the general security tips that Apple recommends are updating to the latest software versions, setting a passcode, enabling two-factor authentication, and using a strong password for the Apple ID.
It also recommends that users should download apps only from the App Store, use a different password for each online account, and avoid clicking on links or attachments from unknown sources.
Apple also suggests that users activate the Lockdown Mode.

What exactly is the Lockdown Mode, and how can it be turned on

The Lockdown Mode is a feature introduced in its latest software updates to specifically protect against rare and sophisticated cyber-attacks such as these.
Lockdown Mode is only available on devices that run iOS 16 or later, iPadOS 16 or later, watchOS 10 or later and macOS Ventura or later.
When one activates Lockdown Mode, his/her device will enter into a state of high security, where many usual functions will be restricted or disabled.
For E.g., He/she will not be able to send or receive attachments, links, or link previews in messages.

14. President terminates services of Army Major

Subject: Polity

Section:

Context: President terminates services of Army Major posted with Strategic Forces Command unit

More about the news:

President Draupadi Murmu has terminated the services of an Indian Army Major who was posted with a Strategic Forces Command (SFC) unit.
This action was taken following an Army inquiry that found the Major involved in multiple lapses compromising national security.
The termination was carried out under the powers conferred by Section 18 of the Army Act, 1950, and Article 310 of the Constitution.
The investigation into the Major’s activities began in March 2022 when a Board of Officers was formed to look into matters related to the compromise of national security by the officer.
This board was authorized to seize digital devices and conduct an initial investigation into various suspicions, including social media violations, sharing/leakage of classified information, and espionage activities.
The inquiry revealed that the Major had stored secret documents on his electronic devices in violation of Army regulations.
He was also found to be in communication with a Pakistani intelligence operative through social media chats. Additionally, the Major’s association with other senior officers of the Army, some of whom were part of a WhatsApp chat group called ‘Patiala Peg,’ was investigated, and he was called as a witness in a Court of Inquiry against some officers related to this group.
Furthermore, the Army has issued a show cause notice to a Brigadier and a Lieutenant Colonel for administrative/disciplinary action due to their violation of social media policies and membership in the ‘Patiala Peg’ WhatsApp group, where objectionable content was shared.
The group had been suspected of infiltration by a Pakistan Intelligence Operative, and an investigation was underway to determine if any classified military information had been shared by its members.
Mobile phones and personal digital assets of these officers were seized in March 2022 for this investigation.

What is Army Act,1950:

The Army Act, 1950 is an Indian act governing military law in the Indian Armed Forces.
The Army Act was passed by the Parliament on 22 May 1950 and was effective on 22 July 1950.
It is the primary legislation governing the Indian Army.
It was enacted to consolidate and amend the law relating to the government of the regular Army. The Act covers a wide range of topics, including the following:
- The composition and organization of the Army
- The powers and duties of officers and soldiers
- The discipline and maintenance of good order in the Army
- The trial and punishment of offenses under military law
- The rights and privileges of soldiers
The Army Act applies to all members of the regular Army, including officers, soldiers, and civilian employees.
It also applies to certain other persons, such as reservists and persons accompanying the Army on active service.
Some of the important provisions of the Army Act include:
- The power of the Central Government to raise and maintain the Army
- The power of the Central Government to make regulations for the government, discipline, and administration of the Army
- The establishment of a system of courts-martial for the trial of offenses under military law
- The power of the Central Government to grant pardons and remissions of sentences
- The provision of certain rights and privileges to soldiers, such as immunity from arrest for debt and immunity from seizure of property
The Army Act is an important piece of legislation that ensures the effective functioning of the Indian Army.
It is also a safeguard for the rights and privileges of soldiers.
The Army Act, 1950 is not the only law that governs the Indian Army. There are also other laws, such as the Army Rules, 1954, and the Army Regulations, 1987, which provide more detailed guidance on the implementation of the Army Act.
The Army Act, 1950 is not applicable to the Indian Navy or the Indian Air Force. These two services have their own separate laws, namely the Navy Act, 1957, and the Air Force Act, 1950.

What is Article 310 of Indian Constitution:

It states that every person in the defence or civil service of the Union holds office during the pleasure of the President, and every member of the civil service in the States holds office during the pleasure of the Governor.

What are some military powers of the President:

The President is the supreme commander of the defence forces of India. In that capacity, he appoints the chiefs of the Army, the Navy and the Air Force.
He can declare war or conclude peace, subject to the approval of the Parliament.
Article 53 clearly specifies that the President is the Supreme Commander of the Union of India’s Armed Forces.

15. Akhaura-Agartala rail link to be inaugurated virtually by PM Modi, Sheikh Hasina today

Subject: IR

Section: Places in news

Context:

In a historic move, Bangladesh and northeast India will re-establish rail connectivity through Tripura on Wednesday, after a gap of nearly seven and a half decades.

About Akhaura-Agartala Rail Link

This rail link stretches over 12.24 km, with a 6.78 km dual gauge rail line in Bangladesh and 5.46 km in Tripura.
Akhaura junction, located in Bangladesh’s Brahmanbaria district, has historical ties with India’s northeastern region, dating back to the colonial era.
The connection was originally constructed in the late 19th century to cater to Assam’s tea industry’s demand for access to the Chittagong port.
The project gained momentum in 2010 when then-PM Manmohan Singh signed an agreement to rebuild the rail link during PM Sheikh Hasina’s visit to Delhi.

Significance of the project

Multilevel connectivity: Akhaura is currently well-connected by rail, river, and road to several industrial areas in Bangladesh, including Dhaka, Chittagong, and Sylhet.
NE connectivity: The rail link to Agartala is expected to enhance connections between India’s northeast and Chittagong, facilitating the transportation of goods.
Shortened Routes: The Akhaura link has the potential to significantly reduce travel time and distance for trains traveling to Tripura, southern Assam, Mizoram, Kolkata, and the rest of India, compared to the longer route via Guwahati and Jalpaiguri stations.
Unique Event: This event is unique as it marks the first direct rail connection between Akhaura and Agartala, with the first trains anticipated to run between Nischintapur and Gangasagar stations.

Economic Potential

Trade Expansion: The rail link is expected to boost India-Bangladesh trade in various sectors, including agriculture products, tea, sugar, construction items, iron and steel, and consumer goods, while also fostering people-to-people relationships.
Expanded Connectivity: The Akhaura-Agartala rail route is seen as a significant initiative to enhance India’s connectivity with Southeast Asian regions, holding potential for regional economic growth.

16. T.N. moves SC against Governor Ravi over delay in clearing Bills

Subject: Polity

Section:

Context:

The Tamil Nadu government has moved a writ petition in the Supreme Court against Governor R. N. Ravi for creating a “constitutional deadlock” by inexplicably delaying or even failing to consider and give assent to crucial Bills passed by the Assembly, and stymieing day to day governance in a way which is threatening to bring administration in the State to a grinding halt.

Allegations and Criticisms

Failure to Fulfill Constitutional Duties: The opposition, represented by DMK spokesperson Saravanan, alleges that Governor RN Ravi has not fulfilled his constitutional responsibilities by delaying the approval of bills and resolutions.
Constitutional Mockery: The attorney accused the Governor of mocking the Constitution and emphasizes the need for swift action on pending bills and resolutions.
Previous Rulings: The Supreme Court has previously delivered judgments, notably in the Perarivalan case, reprimanding Governors for not approving Cabinet resolutions.

Provisions related to Governor

Advisory Council: Article 163 establishes a council of ministers headed by the Chief Minister to aid and advise the Governor in performing their functions, except in specific discretionary cases.
Bill Assent Process: Article 200 outlines the process for a bill passed by the Legislative Assembly of a State to be presented to the Governor for assent or other actions.
Reservation of Bills: The Governor may reserve a bill for the President’s consideration if they believe it may infringe upon the powers of the High Court, as outlined in Article 201.
Presidential Assent: Article 201 states that the President may assent to or withhold assent from a reserved bill.
Constitutional Immunity: Under Article 361, Governors enjoy complete immunity from court proceedings for actions taken in the exercise of their powers.

Recent Instances of Withholding Assent

Chhattisgarh (2020): The Chhattisgarh Governor withheld assent to a bill amending the Chhattisgarh Lokayukta Act, 2001.
Tamil Nadu (2021): The Tamil Nadu Governor reserved a bill exempting state students from NEET medical entrance exams for the President’s consideration after a significant delay.
Kerala (2023): Kerala’s Governor signed five bills into law but withheld assent to six others, citing concerns about their constitutionality and legality.

Some Recommendations

Nabam Rebia and Bamang Felix vs Dy.Speaker (2016): The SC clarified that a Governor’s discretion under Article 200 is limited to deciding whether a bill should be reserved for the President’s consideration.The Court emphasized that actions or inactions by the Governor regarding bill assent can be subject to judicial review.
Punchhi Commission (2010): This commission recommended the establishment of a time limit within which the Governor should decide on granting assent or reserving a bill for the President’s consideration.
National Commission to Review the Working of the Constitution (NCRWC): NCRWC proposed a four-month time limit for the Governor to decide on a bill’s fate. It also suggested the removal of the Governor’s power to withhold assent except in cases explicitly stipulated in the Constitution.

Conclusion

The dispute between the government and the Governor underscores the importance of timely decision-making to ensure the effective functioning of the state administration.

17. In the Pegasus battle, the fight for surveillance reform

Subject: Science & Tech

Section: Cyber-Security

Context:

A year has passed since the disclosures about the Pegasus Project revealed the threat to India’s democracy. A leading digital news platform reported that the cellphones of at least 300 Indians had been hacked with Pegasus, the spyware

from the Israel Based NSO Group; 10 of the cases were confirmed by Amnesty International’s Security Lab using forensic analysis. The victims, important members of India’s constitutional order, included cabinet Ministers, Opposition leaders, journalists, judges and human rights defenders.

Some Facts about Pegasus Spyware

Functionality: Pegasus, like its name suggests, is a spyware designed to surveil individuals through their smartphones.
Covert Installation: It infiltrates a target’s device by enticing them to click on an exploit link, installing the malware without their knowledge or consent.
Comprehensive Access: Once installed, Pegasus grants the attacker complete control over the victim’s phone, enabling eavesdropping, data retrieval, and even activation of the camera and microphone.

About Pegasus Spyware Case

Global Revelation: In July 2021, a collaborative global investigative project uncovered the use of Pegasus spyware, developed by NSO Group, an Israeli cybersecurity company, to target mobile phones worldwide, including India.
Government Denials: The Indian government denied the allegations and accused the opposition of undermining national security but did not explicitly deny using Pegasus.
Supreme Court’s Involvement: On October 27, 2021, the Supreme Court appointed an Expert Committee headed by Justice R V Raveendran to investigate the allegations, considering their public importance and potential violation of citizens’ fundamental rights.
Cyber Terrorism: This intrusion constitutes a cyber-terrorism attempt and calls for the application of Section 66(F) of the Information Technology Act 2008 (IT Act) to deal with the perpetrators.

Expert Committee’s Mandate

Terms of Reference: The committee had seven terms of reference, including determining the entity that procured Pegasus, verifying if petitioners were targeted, and assessing the legal basis for using spyware like Pegasus on Indian citizens.
Policy Recommendations: It was also tasked with making recommendations on a legal and policy framework for cybersecurity to protect citizens’ privacy.
Technical Expertise: The committee comprised technical experts from various fields, including cybersecurity and forensic sciences.

Key Findings

Lack of Conclusive Evidence: On August 25, 2022, the Supreme Court revealed that the expert committee did not find conclusive evidence of Pegasus use in the 29 phones it examined.
Government Non-Cooperation: The Centre did not cooperate with the committee, as observed by the panel itself.
Malware Discovery: While malware was found in five phones, it could not be definitively linked to Pegasus.
Inconclusive Determination: The committee concluded that the limited data available made it inconclusive to determine Pegasus use.
National Security Concerns: The committee’s report contained information about malware that could pose threats to national security and private confidential information.

Implications

Fundamental Right to Privacy: Protecting citizens’ smartphones through technologies like encryption is crucial for national security.
Need for Inquiry: Establishing an independent high-level inquiry with credible members and experts can restore confidence and ensure transparency.
Global Cooperation: Given the multinational impact of such attacks, coordinated global cooperation is essential for a thorough investigation.
Data Sovereignty and Privacy: Citizens’ data sovereignty should encompass their right to privacy, with stringent punishments for privacy violations.

Conclusion

The Pegasus spyware case, which raised significant concerns about citizen privacy and national security, prompted a comprehensive investigation by the Supreme Court-appointed Expert Committee.
While the committee did not find conclusive evidence of Pegasus use, it emphasized the potential risks associated with malware and cybersecurity.
The case remains open, and further developments may shed light on the extent of surveillance and privacy infringements.

18. How cargo transport can be improved

Subject: Economy

Section:

Key Facts:

In 2018-19, before the onset of COVID-19, the IR loaded 62 million tonne (MT) of general cargo consisting of 45 MT of general goods, 12 MT of domestic containers and 5 MT of parcels, earning a total of ₹8,247 crore with the average earnings per tonne being ₹1,339 for goods and ₹3,384 for parcel.
However, general cargo loading is nowhere near what a Rail India Technical and Economic Service (RITES) study had projected in 2008 for the next ten years between 194 to 292 MT depending on the IR’s efforts.
The Indian Railways (IR) is one of the cheaper modes of transportation for moving bulk cargo. However, it only has a ~30% share.

What are the initiatives for increasing bulk cargo?

The IR has taken some initiatives in the bulk cargo arena:
Relaxation of rake movement rules: It provides a facility to load from/to multiple locations, permitted mini rakes and introduced private freight terminals (PFTs).
Gati Shakti Terminal (GCT) policy: It will lead to all PFTs and private sidings being converted into GCTs. A private siding is a railway line that is owned by a company and is connected to a railway.
Partnership with private freight operators: IR has encouraged them to invest in wagons thus helping in the induction of privately-owned wagons to facilitate specialized traffic like automobiles and fly ash.

What should IR do?

Reducing barriers: IR should reduce non-price barriers to entry of private players.
Developing common-user facilities at cargo aggregation and dispersal points: Especially in mining clusters, industrial clusters and large cities.
Collaboration with State governments: The knowledge of these clusters rests with the States, and thus collaboration with State governments is necessary.
Transport new commodities as well: For instance, fly ash.
Wagon-design reforms: IR should encourage and liberalize the design of new wagons amenable to higher and efficient loading.
Parity in environmental regulation: Absence of stringent environmental regulations in the road sector has led to some users moving cargo by road. There should be no such disparity in regulation between modes of transport.

19. SBI and LIC may be recognized as Maharatna’s

Subject: Economy

Section:

SBI’s Economic Research Department (ERD) emphasizes the absence of SBI and LIC from the Maharatnas list despite their significant profitability, raising questions about the relevance of the existing classification.
Only ONGC from the Maharatnas list features among the top 10 most profitable companies, suggesting that Maharatna’s status might not accurately reflect superior performance.
Advocacy for a balanced Maharatna list includes representation from the BFSI sector, underscoring the significant contributions of sector champions.
SBI and LIC’s market leadership and substantial balance sheet sizes are highlighted, emphasizing their potential for enhanced autonomy and quicker decision-making processes.
The ERD stresses the need for an updated classification that incorporates deserving entities from the services sector, considering the transformative post-COVID business landscape.
The proposal for “Amrit Ratna” recognition is put forward for certain PSUs, recognizing their immense contributions to the nation’s development over the years.
Recommendations for revising the benefits associated with the Maharatna/Navratna tag are suggested to ensure they align with the evolving needs of different sectors, enhancing their competitiveness and future readiness.
Given the significance of the services sector in India’s GDP growth, the suggestion is made to include stalwarts from this domain to complement the manufacturing sector, aligning with the goal of achieving a $5 trillion economy.

Obtaining the Maharatna status for a public sector undertaking (PSU):

Navratna status: The PSU should already have the Navratna status, which entails significant operational and financial autonomy.
Listing on Indian stock exchange: The PSU must be listed on the Indian stock exchange with the prescribed public shareholding.
Average annual turnover: The average annual turnover of the PSU should be more than Rs. 25,000 crore over the last three years.
Average annual net worth: The PSU should maintain an average annual net worth of more than Rs. 15,000 crore over the past three years.
Average annual net profit after tax: The PSU should have an average annual net profit after tax exceeding Rs. 5,000 crore during the last three years.
Global presence or international operations: The PSU must demonstrate significant global presence or involvement in international operations.

Meeting these criteria would qualify a PSU for Maharatna status, signifying its exceptional performance, significant scale, and global outreach in the public sector domain.

Obtaining Navratna status for a Central Public Sector Enterprise (CPSE):

Miniratna Category – I or Schedule ‘A’ CPSEs: The CPSE should belong to either the Miniratna Category – I or Schedule ‘A’ classification to be eligible for Navratna status.
Rating: The CPSE must have received an ‘Excellent’ or ‘Very Good’ rating in at least three of the last five years. This rating is typically given by the Department of Public Enterprises (DPE).
Composite score: The CPSE should achieve a composite score of 60 or above in the following six performance indicators: Net Profit to Net Worth, Cost of Services, Earnings per Share, Manpower cost to cost of production or services, PBDIT (Profit Before Depreciation, Interest, and Taxes) to Capital Employed, and PBDIT to Turnover.

Meeting these criteria would qualify a CPSE for Navratna status, indicating its high performance, financial robustness, and overall excellence in the public sector domain.

Obtaining Miniratna status for a Central Public Sector Enterprise (CPSE) in both Category I and Category II:

Miniratna Category-I status:

The CPSE must have made a profit continuously for the last three years.
The pre-tax profit should be Rs.30 crores or more in at least one of the three years.
It should maintain a positive net worth status.

Miniratna Category-II status:

The CPSE must have made a profit for the last three years continuously.
It should maintain a positive net worth status.
The CPSE should not have defaulted in the repayment of loans or interest payments on any loans due to the Government.
The CPSE should not be dependent upon budgetary support or Government guarantees.

20. Amrit Kaal

Subject: Economy

Section:

Amrit Kaal symbolizes the next 25 years (up to 2047), leading to the centenary of India’s independence. It sets out to build a robust and all-encompassing economy, with particular emphasis on youth, job creation, and the establishment of a stable macro-environment.

Amrit Kaal will be steered by seven intertwined priorities, akin to the ‘Saptarishi’ (Seven Sages), as outlined in the Budget 2023-24.

Inclusive Development
- Extending the philosophy of “Sabka Saath, Sabka Vikas.”
- Focus on agriculture and cooperatives, accessible education & skilling, and affordable health for all.
Reaching the Last Mile
- Government’s commitment to extending essential services and infrastructure to every citizen, regardless of location or socio-economic status.
Infrastructure and Investment
- Boosting economic growth and employment by increasing investments in infrastructure and productive capacity.
Unleashing the Potential
- Enhancing the ease of doing business and promoting trust-based governance through transparent and accountable administration.
Green Growth
- Steering the economy towards sustainable development and achieving climate goals.
Youth Power
- Empowering the youth and aiding the ‘Amrit Peedhi’ (new generation) to realize their dreams through initiatives and digital platforms.
Financial Sector
- Promoting financial stability, ensuring the efficient flow of credit, enhancing convenience for companies, and undertaking measures for financial inclusion.

21. Role of Technology in controlling smuggling

Finance Minister Nirmala Sitharaman called for the use of technology and intergovernmental cooperation to apprehend the masterminds behind smuggling and illicit trade networks.
The focus of enforcement agencies should be on catching the ‘brain’ behind illegal trade to deter unlawful activities that harm the economy and citizens.
The types of smuggled goods have remained consistent over the years, including precious metals, narcotics, and reserves from forests or marine life.
Emphasized the importance of international cooperation, particularly with the World Customs Organization (WCO), to crack down on smuggling masterminds.
Destroying all confiscated goods is vital to deter illicit trade, preventing their re-entry into the market and restoring citizens’ confidence.
Information sharing among enforcement agencies should include innovative ideas on empowering authorities through legislation and procedures to combat smuggling.
Need for modern technology and trade facilitative measures to address the challenges posed by sophisticated smuggling networks.

World Customs Organization (WCO):

The World Customs Organization (WCO) was established in 1952 as the Customs Co-operation Council (CCC) with a mission to enhance the effectiveness and efficiency of Customs administrations globally.
It serves as the global center of Customs expertise and is the sole international organization with expertise in Customs matters, representing the voice of the international Customs community.
The WCO is divided into six regions, each represented by a regionally elected Vice-Chairperson to the WCO Council.
The organization acts as a platform for national Customs delegates to engage in dialogue, exchange experiences, and benefit from various Conventions and international instruments. It also provides technical assistance and training services to its members.
In addition to facilitating legitimate international trade, the WCO is recognized for its efforts in combating fraudulent activities globally.
It administers the World Trade Organization’s Agreements on Customs Valuation, which establish a system for determining the value of imported goods, and the Rules of Origin, which are used to ascertain the origin of a particular commodity.

22. Inclusion of cryptocurrency suggested by GTRI

Inclusion of cryptocurrency in the e-commerce sector negotiations at the World Trade Organization (WTO) recommended by the Global Trade Research Initiative (GTRI).
Ongoing WTO negotiations involve two key aspects: a. Joint initiative on e-commerce: Discussions encompass tariffs, customs clearance, paperless trading, online privacy, and cybersecurity, impacting 89 WTO members. b. E-commerce moratorium: Introduced in 1998, the moratorium restricts countries from applying customs duties on electronic transmissions, last extended for two years in June 2022.
The recent withdrawal of the United States from multiple points of negotiation has posed a significant obstacle in the e-commerce discussions, potentially triggering a global reassessment of e-commerce policies.
India has chosen to abstain from these talks, citing concerns about unregulated digital trade and emphasizing the need to preserve policy space for digital advancement and revenue generation through customs duties.
India’s opposition to the continuation of the e-commerce moratorium is based on the argument that it disproportionately affects developing countries.
The United Nations Conference on Trade and Development’s impact assessment indicates a substantial potential tariff revenue loss for developing countries, emphasizing the need to regulate imports and foster revenue generation.
The GTRI emphasizes the importance of considering cryptocurrency within the WTO’s e-commerce negotiations to establish an updated regulatory framework that aligns with the evolving global digital trade landscape.

World Trade Organization (WTO)

The WTO is the primary global international organization responsible for trade regulations among nations.

History

General Agreement on Tariffs and Trade (GATT) originated from the 1944 Bretton Woods Conference.
The Havana Charter, intended to establish the International Trade Organization (ITO), never came into force.
GATT, signed by 23 countries in 1947, was the only multilateral instrument governing trade until the establishment of the WTO in 1995.
The Uruguay Round from 1987 to 1994 led to the Marrakesh Agreement, establishing the WTO.

Governance

Ministerial Conference: The WTO’s top decision-making body, convening every two years.
General Council: Represents all member governments and acts on behalf of the Ministerial Conference.
Dispute Settlement Body (DSU): Deals with disputes between WTO members according to the Understanding on Rules and Procedures Governing the Settlement of Disputes.
Appellate Body: Established in 1995, it is a standing body of seven members hearing appeals from reports issued by panels in WTO member disputes.

About GTRI

GTRI stands for the Global Trade Research Initiative.

It is a think tank that focuses on conducting research and analysis related to global trade, international economics, and various policy issues concerning trade and commerce.

The organization aims to provide insights and recommendations to policymakers, businesses, and other stakeholders to facilitate informed decision-making and promote effective trade policies at the global level.

About UNCTAD

UNCTAD stands for the United Nations Conference on Trade and Development.

It is a permanent intergovernmental body established by the United Nations General Assembly in 1964. UNCTAD’s primary objective is to promote inclusive and sustainable development, particularly in the areas of international trade, investment, finance, and technology.

UNCTAD conducts research, provides policy analysis, and offers technical assistance to help developing countries integrate into the global economy on equitable terms.

It also serves as a forum for intergovernmental deliberations, consensus-building, and policy dialogue on key trade and development issues.

Cryptocurrency

It refers to digital or virtual currencies that use cryptography for security. These digital currencies operate on decentralized networks based on blockchain technology, which makes them secure and immune to government interference or manipulation.

Cryptocurrencies enable secure online transactions and are typically used for buying and selling goods and services, as well as for investment and speculative purposes.

Some of the most well-known cryptocurrencies include Bitcoin, Ethereum, Ripple, and Litecoin, among others. The use and acceptance of cryptocurrencies have been growing globally, although their regulation and legal status vary significantly from one country to another.

23. Monetary policy transmission in India

Subject: Economy

Section:

The RBI’s rate hikes since 2022 have highlighted a disparity in the transmission of policy rate changes, with lending rates increasing at a slower pace compared to deposit rates. This phenomenon has been particularly noticeable in the current economic cycle, presenting various implications for different stakeholders in the financial system.

Deposit Rate Increase: The Weighted Average Domestic Term Deposit Rates (WADTDR) for fresh deposits have witnessed a significant rise, partly driven by banks’ requirements for funds to support rapid credit growth. Larger depositors have received relatively higher rewards compared to smaller ones.
Limited Transmission in Lending Rates: Despite the policy rate hikes, lending rates have not increased at a proportionate rate. The overall increase in lending rates has been notably lower than that of deposit rates, with existing loan rates exhibiting a slower rise.
Impact of CASA Deposits: Banks have managed to maintain lower lending rates by leveraging their current account and savings account (CASA) deposits, which constitute a significant portion of their total deposits. These accounts have not experienced any changes in interest rates during this cycle, allowing banks to sustain comparatively lower lending rates.
Effect of MCLR and EBLR Loans: While a significant proportion of loans (around 44.8%) remain linked to the Marginal Cost of Funds Based Lending Rate (MCLR), the transmission of rate changes is relatively slower due to various operational factors influencing the MCLR calculation. Conversely, loans (around 50.2%) linked to the External Benchmark Linked Loan Rate (EBLR) have the advantage of immediate resetting when policy rates change, ensuring a more rapid transmission of rate changes.
Competition for Deposits and Incremental Credit: Tight liquidity conditions have intensified competition among banks for deposits, potentially leading to increased rates for depositors. Simultaneously, competition for incremental credit might have restrained some banks from sharply increasing lending rates, especially in specific segments like housing, vehicle, and education loans.

About Internal Benchmark Lending Rate (IBLR):

Lenders establish an internal benchmark rate for determining interest rates on loans.
Several benchmark rates were introduced over the years, including BPLR, Base Rate, and MCLR.
These rates aimed to ensure transparent and efficient pricing in the lending market.

Issues with IBLR Regime:

Banks often did not pass on the full benefits of RBI’s repo rate cuts to borrowers.
Complex internal variables within the IBLR-linked loans hindered the seamless transmission of policy changes.

BPLR (Benchmark Prime Lending Rate):

Used as a benchmark rate by banks for lending until June 2010.
Loans were priced based on the actual cost of funds.
The rate varied across banks and depended on the cost of funds, among other factors.

Base Rate:

Replaced BPLR and was used for loans taken between June 2010 and April 2016.
Considered the minimum interest rate at which commercial banks could lend to customers.
Calculated based on the cost of funds, unallocated cost of resources, and return on net worth.

MCLR (Marginal Cost of Funds based Lending Rate):

Introduced in April 2016 as a benchmark lending rate for floating-rate loans.
Considers the marginal cost of funds, negative carry on account of the cash reserve ratio, operating costs, and tenor premium.
Linked to actual deposit rates, ensuring that when deposit rates rise, MCLR increases and lending rates go up accordingly.

External Benchmark Lending Rate (EBLR):

RBI mandated the adoption of a uniform external benchmark by banks from October 1, 2019, it was intended to plug the deficiencies in MCLR.
Four external benchmarking mechanisms were introduced, RBI repo rate, 91-day T-bill yield, 182-day T-bill yield, any other benchmark market interest rate as developed by the Financial Benchmarks India Pvt. Ltd.
Banks have the flexibility to set the spread over the external benchmark, with interest rate resets required at least once every three months.

Significance of EBLR:

Aims to facilitate faster and effective transmission of monetary policy changes.
Enhances transparency in interest rate setting and standardizes the process of fixing interest rates for different loan categories.
Introduces a more dynamic and responsive lending environment in line with the objectives of the RBI’s monetary policy framework.

Monetary Policy Normalization in India:

Involves adjustments made by the Reserve Bank of India to control the amount of money in the economy.
Entails a shift from a loose monetary policy, involving increased liquidity and reduced interest rates, to a tight monetary policy that raises interest rates and reduces liquidity.

Reverse Repo Normalization:

Refers to an increase in the reverse repo rates by the Reserve Bank of India.
Part of the broader strategy of monetary policy normalization to counter rising inflation and bring the rates back to their usual positions.
Aims to reduce excess liquidity, elevate interest rates across the economy, and discourage excessive borrowing by consumers and businesses.

Repo Rate:

The rate at which the RBI lends short-term money to banks against securities.
One of the key tools used by the central bank to control the money supply in the economy.

Reverse Repo Rate:

The rate at which banks park their short-term excess liquidity with the RBI.
Used by banks when they have surplus funds that they are not able to invest for reasonable returns.

SLR (Statutory Liquidity Ratio):

Mandates that every bank maintain a minimum proportion of their Net Demand and Time Liabilities as liquid assets in the form of cash, gold, and un-encumbered approved securities.
A tool used by the RBI to restrict the bank’s leverage position to pump more money into the economy.

CRR (Cash Reserve Ratio):

Mandates that banks hold a certain proportion of their deposits in the form of cash with the RBI or currency chests.
Used by the RBI to control liquidity in the banking system and ensure that banks have enough cash to meet their payment obligations.

Marginal Standing Facility (MSF):

A window for banks to borrow from the Reserve Bank of India during emergency situations when inter-bank liquidity dries up completely.
Banks pledge government securities at a rate higher than the repo rate under the Liquidity Adjustment Facility (LAF).