Daily Prelims Notes 24 November 2024

November 24, 2024
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Category: DPN

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Daily Prelims Notes

24 November 2024

Table Of Contents

1. Bank of India Plans to Raise ₹5000 Crore via Infrastructure Bonds

Sub : Eco

Sec: Monetary Policy

Bond Issuance Details:
- Bank of India (BoI) will issue 10-year infrastructure bonds next week.
- The issuance includes a base size of ₹2,000 crore and a greenshoe option of ₹3,000 crore, totaling ₹5,000 crore.
Purpose of Bonds:
- Infrastructure bonds are used to fund long-term infrastructure projects.
- These bonds have a minimum tenor of seven years and provide banks with funding exempt from regulatory requirements like Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR).
Bank’s Fundraising Plans:
- BoI’s board approved raising ₹10,000 crore through long-term infra bonds in FY 2024-25.
- In July, BoI raised ₹5,000 crore through 10-year infra bonds at a 7.54% coupon rate.

Regulatory Advantages of Infra Bonds:

No CRR/SLR Requirements: Funds raised through infra bonds can be fully utilized for income-generating activities, unlike Certificates of Deposit (CDs) and retail deposits.
More economical for banks compared to deposits due to regulatory exemptions.

Demand Drivers for Infrastructure Bonds:

Government Spending:
- Increased spending on infrastructure development has fueled demand for funds.
Key Sectors of Investment:
- Sectors such as steel, roads, and renewable energy are major drivers of fund requirements.

Greenshoe Option:

Definition: A Greenshoe option is an over-allotment option that allows underwriters to sell additional shares (usually up to 15%) in an initial public offering (IPO) if demand exceeds expectations.
How it works: The company issuing shares authorizes underwriters to sell extra shares and this stabilizes stock prices by meeting excess demand.
Purpose: To maintain market stability and reduce volatility during the listing phase.
Example: If 100 million shares are issued with a 15% Greenshoe option, underwriters can sell an additional 15 million shares if demand is high.

Coupon Rate:

Definition: The coupon rate is the annual interest rate paid by a bond issuer to the bondholder, expressed as a percentage of the bond’s face value.
How it works: If a bond has a face value of ₹1,000 and a coupon rate of 5%, the bondholder will receive ₹50 annually as interest.
Example: A bond with a face value of ₹10,000 and a coupon rate of 8% pays ₹800 annually.
Importance: Helps investors evaluate the return on bonds compared to other investment options.

Certificates of Deposit (CDs):

Definition: CDs are short-term, negotiable money market instruments issued by banks and financial institutions to raise funds.
Features:
- Issued at a discount to face value, with tenure ranging from 7 days to 1 year.
- Bearer instruments that are transferable by endorsement.
- Typically carry higher interest rates than savings accounts due to the fixed tenure.

2. Finance deadlock pushes COP29 to the brink of failure

Sub: Env

Sec : Int convention

Context:

COP29 Finalizes the New Collective Quantified Goal (NCQG) on climate finance, replacing the $100 billion per year target under the Paris Agreement.
Progress:
- The proposed NCQG increased from $250 billion to $300 billion annually (by 2035).
- Developing countries demand $1.3 trillion annually by 2035, citing historical emissions and per capita GDP disparities.
- A sharp divide persists between developed and developing nations.

Major Agreements Reached

Carbon Markets:
- UN-supervised global carbon trading market under Article 6 of the Paris Agreement.
- Carbon credits to be traded bilaterally (Art. 6.2) or globally (Art. 6.4).
- India sees this as an opportunity to strengthen its domestic carbon-trading market.

Key Developments in Climate Finance

Finance Mobilization:
- Commitment to triple climate finance through Adaptation Fund, Special Climate Fund, and LDC Fund.
- Plan to channel $300 billion via bilateral and multilateral institutions to mobilize the $1.3 trillion target.
Focus Areas:
- Increasing grant financing and improving accessibility for eligible countries.
- Periodic reviews of fund allocations and utilization.

Controversial Trade Measures

China’s Petition:
- Proposed discussion on “unilateral restrictive trade measures” like the EU’s Carbon Border Adjustment Mechanism (CBAM).
- CBAM imposes taxes on non-compliant imports and is set to fully implement by 2026.

Key Takeaways from COP29

Developing countries remain firm on equitable finance contributions and grant-based funding.
Developed countries emphasize shared responsibilities and leveraging diverse funding sources.
Agreements on carbon markets and partial commitments to climate finance signal incremental progress.

Adaptation Fund:

The Adaptation Fund was established in 2001 to finance concrete adaptation projects and programmes in developing country Parties to the Kyoto Protocol that are particularly vulnerable to the adverse effects of climate change.
The Adaptation Fund is financed with a share of proceeds from the clean development mechanism (CDM) project activities and other sources of funding. The share of proceeds amounts to 2 per cent of certified emission reductions (CERs) issued for a CDM project activity.
The Adaptation Fund is supervised and managed by the Adaptation Fund Board (AFB). The AFB is composed of 16 members and 16 alternates and meets at least twice a year (Membership of the AFB).

Special Climate Change Fund (SCCF):

The Special Climate Change Fund, one of the world’s first multilateral climate adaptation finance instruments, was created at the 2001 Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC) to help vulnerable nations in addressing these negative impacts of climate change.
The SCCF is managed by the GEF and operates in parallel with the Least Developed Countries Fund (LDCF). Both funds have a mandate to serve the Paris Agreement.

Special Climate Change Fund – Objectives

The primary objective of SCCF’s funding is to help developing nations take adaptation measures.
Additionally, though to a much lesser extent, SCCF also supports technology transfer and mitigation in particular industries.
The three strategic goals for the SCCF are as follows in accordance with the GEF Programming Strategy:

By using innovation and technology transfer to adapt to climate change, decrease vulnerability and boost resilience.
To mainstream resilience to climate change and adaptation for systemic impact.
To encourage the creation of favorable conditions for coordinated and efficient climate change adaptation.

Least Developed Countries Fund (LDCF):

Came in 2001.
The LDCF, along with the Special Climate Change Fund (SCCF), is mandated to serve the Paris Agreement.
The Least Developed Countries Fund (LDCF) is a critical mechanism under the UN Framework Convention on Climate Change (UNFCCC) to support climate resilience in Least Developed Countries (LDCs).
It is operated by the Global Enivornment Facility (GEF).

Objectives of LDCF

Strengthening resilience: Helps LDCs prepare for a more resilient future by addressing short-, medium-, and long-term climate change vulnerabilities.
Reducing climate vulnerability: Focuses on priority sectors and ecosystems most affected by climate change.

Key Functions of LDCF

Support for National Plans:
- Implements National Adaptation Programs of Action (NAPAs): Country-specific strategies to address urgent adaptation needs.
- Supports National Adaptation Plans (NAPs): Comprehensive plans to address long-term adaptation goals.
- Aligns with the LDC work program under UNFCCC.
Building capacity and enabling policies:
- Bolsters technical and institutional capacity at national and local levels.
- Creates a policy environment conducive to adaptation investments.
- Reduces systemic barriers and promotes innovation and private sector engagement.

Source: TH

3. Why the world needs a global plastic treaty

Sub : Env

Sec: Int Convention

Context:

In 2022, the United Nations Environment Assembly (UNEA) agreed to negotiate a legally binding global treaty aimed at tackling plastic pollution, including marine pollution.
Representatives from more than 170 countries are set to meet in Busan, Republic of Korea, for the fifth and final round of these negotiations. The aim is to finalize the treaty by the end of 2024.

Surge in Plastic Production:

Global plastic production doubled from 234 million tonnes (mt) in 2000 to 460 mt in 2019. By 2040, this is projected to rise to 700 mt, according to a report by the Organisation for Economic Co-operation and Development (OECD)..

Need for a Global Plastic Treaty:

Plastic takes between 20 to 500 years to decompose. Less than 10% of plastic produced is recycled. About 400 mt of plastic waste is generated annually, a figure expected to increase by 62% between 2024 and 2050.
In 2020, plastic production accounted for 6% of global greenhouse gas emissions. If current trends continue, emissions from plastic production could grow by 20% by 2050.
Plastic waste pollutes rivers and oceans, breaking down into microplastics, and poses serious health risks, including endocrine disruption, cancer, and reproductive disorders.
Marine and land ecosystems are also severely impacted by plastic pollution.

India’s contribution:

India is responsible for about 20% of global plastic pollution, emitting 9.3 million tonnes of plastic waste annually.

Negotiation focus:

Life-cycle approach: Negotiations are centred around creating global rules to address plastic pollution across its entire life cycle, from production to disposal and recycling.
There is debate on imposing production caps. Countries such as Saudi Arabia, Russia, and India have opposed stricter production restrictions, advocating for downstream measures like improved waste management and sustainable plastic use.
Some countries, including Rwanda, propose ambitious targets for reducing plastic pollution, such as a 40% reduction by 2040 from 2025 levels.

India’s Position:

India opposes any limits on the production of polymers, stating that such measures are beyond the scope of the UNEA’s mandate.
India advocates for the inclusion of provisions for financial and technical support in the treaty.
India stresses that any decisions regarding harmful chemicals in plastics should be based on scientific evidence and regulated at the national level.
The country has already banned single-use plastics in 2022.

4. UN one step closer to treaty to punish crimes against humanity

Sub : IR

Sec : Int org

Context:

The United Nations General Assembly adopted a resolution that paves the way for negotiations on a first-ever treaty on preventing and punishing crimes against humanity.
The resolution was approved by consensus in the General Assembly’s legal committee, which includes all 193 UN member states, following tense negotiations, particularly with Russia.
The resolution was led by Mexico and Gambia, with backing from 96 other countries.

Importance of the Treaty:

There has been growing incidences of crimes inflicted on civilians, such as those in Ethiopia, Sudan, Ukraine, Israel, Gaza, and Myanmar.
The treaty process is seen as a critical step toward accountability for the growing number of crimes against humanity worldwide, aiming for a survivor-centric and progressive legal framework.
This treaty aims to fill a gap in international law, as while global treaties exist for war crimes, genocide, and torture, there has been no specific treaty for crimes against humanity.
These crimes include actions like murder, torture, sexual slavery, and deportation.
The International Criminal Court (ICC) addresses some of these issues, but its jurisdiction does not cover all countries.

Negotiation Process:

The resolution outlines a time-bound process with preparatory sessions scheduled for 2026 and 2027, followed by three-week negotiation sessions in 2028 and 2029 to finalize the treaty.

Jurisdictional issue of ICC:

International Criminal Court, which punishes major perpetrators of war crimes, crimes against humanity, and genocide, currently has 124 member countries. However, the ICC does not have jurisdiction over nearly 70 other countries.
The ICC defines crimes against humanity as large-scale attacks on civilians, including murder, rape, imprisonment, enforced disappearances, and torture.

5. Study shows fatal spread of H5N1 from ferrets to suckling kits

Sub: Sci

Sec: Health

Context:

Researchers have found that lactating ferrets with mammary gland infection with the H5N1 influenza virus (2.3.4.4b clade) are capable of spreading it to pups.
The virus was previously considered unlikely to spread among mammals, but recent outbreaks in marine mammals and cattle challenge this assumption, highlighting the potential for interspecies transmission.

About H5N1 virus:

H5N1 is a highly pathogenic avian influenza virus that primarily infects birds. The virus can also infect mammals (including humans) that have been exposed to infected birds
The H5N1 virus is primarily spread among birds, especially wild and migratory birds, through direct contact with infected faeces or respiratory secretions.

Spread of H5N1 influenza virus (2.3.4.4b clade):

The highly pathogenic avian influenza A(H5N1) virus of clade 2.3.4.4b, which emerged in 2020, has spread across Africa, Asia, Europe, and the Americas, causing widespread mortality in seabirds, marine mammals, and more recently, farm animals.
By 2023, the virus infected and killed thousands of sea lions and other marine mammals in South America. It also spread to cattle in the U.S. in March 2024, with farm workers becoming infected shortly after.
As of November 2024, 58 human cases and significant outbreaks in dairy herds have been reported.

Infection in cows:

The H5N1 virus of clade 2.3.4.4b infects the mammary glands of cows, with high levels of viral RNA and infectious virus detected in milk. This raises concerns about the potential for milk to act as a medium for virus transmission to offspring and humans.

Research on H5N1 Transmission in Ferrets

Researchers used lactating ferrets to study the transmission of H5N1 (clade 2.3.4.4b) via milk.
The researchers found that lactating ferrets with mammary gland infection with the H5N1 influenza virus (2.3.4.4b clade) are capable of spreading and causing disease in suckling ferret pups.
The study found that ferrets directly infected through milk had 100% mortality, but the virus did not spread efficiently through respiratory droplets.

Human Cases:

The virus has spread to humans in rare cases, especially among individuals with direct contact with infected animals. The first case in a U.S. farm worker was reported in 2023, following exposure to infected cattle.
This raises concerns about the zoonotic potential of the virus and the risk of a broader human outbreak.

6. Impact of Early HPV Vaccination on Cervical Cancer Prevention: Insights from a Scottish Study

Sub: Sci

Sec: Health

Why in News

A recent population-based study conducted in Scotland has highlighted the effectiveness of early HPV vaccination in preventing cervical cancer. This research, covering data from 1988 to 2016, shows that women vaccinated at a young age have a significantly lower risk of developing cervical cancer.

Key Findings:

The study tracked women vaccinated with the bivalent HPV vaccine when they were 12-13 years old. It found no cervical cancer cases in this group.
The HPV immunization program in Scotland began in 2008, targeting young girls with routine vaccination.
Routine vaccination for girls aged 12-13 is highly effective in preventing invasive cervical cancer.
In the 14-18 age group, three doses of the vaccine significantly reduced the incidence of invasive cancer, although the protection was not absolute.
No cases of invasive cervical cancer have been reported in those vaccinated at 12-13 years.

About Human Papillomavirus (HPV):

It is a common virus with over 100 strains, some of which can lead to cervical cancer and other cancers, as well as genital warts. HPV types 16 and 18 are responsible for around 70% of cervical cancer cases worldwide.

About HPV Vaccine:

The HPV vaccine is designed to prevent infections from high-risk HPV strains linked to cancer. It works best when administered before exposure to the virus, ideally during pre-adolescence (ages 11-13).
“Valent” in HPV Vaccines: The term “valent” refers to the number of different HPV (Human Papillomavirus) strains a vaccine targets. Each type of HPV vaccine is designed to protect against specific strains known to cause cervical cancer and other HPV-related diseases.

Bivalent Vaccine

Targets: HPV types 16 and 18.
Coverage: Provides protection against the two strains responsible for about 70% of cervical cancer cases.
Example: Cervarix.

Cross-Protection of the Bivalent Vaccine:

The bivalent vaccine also offers cross-protection against HPV types 31, 33, and 45, expanding its effectiveness to approximately 85% of HPV-positive invasive cervical cancers.
This cross-protection is broader than that of the quadrivalent vaccine, though not as comprehensive as the nonavalent (nine-valent) vaccine.
Monitoring the emergence of other HPV types in vaccinated populations will be crucial to assess the long-term impact.

Quadrivalent Vaccine

Targets: HPV types 6, 11, 16, and 18.
Coverage: In addition to cervical cancer, it protects against strains causing genital warts (types 6 and 11).
Example: Gardasil.

Nonavalent (Nine-valent) Vaccine

Targets: HPV types 6, 11, 16, 18, 31, 33, 45, 52, and 58.
Coverage: Offers the broadest protection, covering about 90% of HPV-related cancers and diseases.
Example: Gardasil 9.

What is Cervical Cancer?

Cervical cancer develops in a woman’s cervix. It is the 4th most common type of cancer among women, globally and 2nd most common among women in India.
India contributes the largest share of the global cervical cancer burden; nearly 1 in every 4 deaths globally due to cervical cancer (as per The Lancet study).
Almost all cervical cancer cases (99%) are linked to infection with high-risk HPV, an extremely common virus transmitted through sexual contact.
Effective primary (HPV vaccination) and secondary prevention approaches (screening for and treating precancerous lesions) will prevent most cervical cancer cases.
When diagnosed, cervical cancer is one of the most successfully treatable forms of cancer, as long as it is detected early and managed effectively.
Cancers diagnosed in late stages can also be controlled with appropriate treatment and palliative care.
With a comprehensive approach to prevent, screen and treat, cervical cancer can be eliminated as a public health problem within a generation.

7. Improving Delhi’s Air Quality: Challenges and Actions of the CAQM

Sub: Env

Sec: Pollution

Why in News

Delhi’s air quality has been at dangerous levels for much of the last two weeks, raising concerns among citizens and environmental bodies. The Supreme Court recently criticized the Commission for Air Quality Management (CAQM) for not effectively managing the pollution crisis, despite its authority and resources.

About Commission for Air Quality Management (CAQM):

Commission for Air Quality Management in National Capital Region (NCR)and Adjoining Areas (CAQM) was established by the CAQM Ordinance, 2020 and CAQM, Act 2021.
The Act provides for the constitution of a Commission for better coordination, research, identification, and resolution of problems related to air quality in the National Capital Region(NCR) and adjoining areas.
Adjoining areas have been defined as areas in the states of Haryana, Punjab, Rajasthan, and Uttar Pradesh adjoining the NCRwhere any source of pollution may cause adverse impact on air quality in the NCR.
Apart from consolidating all agencies that monitored, investigated and planned mitigation of air pollution in the region, the commission has replaced the Supreme Court-appointed Environment Pollution (Prevention and Control) Authority (EPCA) which had been running for 22 years.

Objectives: The CAQM aims to:

Facilitate coordination between different government agencies.
Conduct research on air quality.
Address air pollution and related challenges effectively.

Legal Authority: The CAQM has comprehensive powers under the CAQM Act, 2021 to:

Take measures to improve air quality.
Issue binding directions to agencies and authorities.
Address complaints and enforce compliance.

Penalty Provisions: Under Section 14 of the Act, the commission can initiate strict actions against officials or stakeholders who do not adhere to its directives.

Supreme Court’s Concerns:

The Supreme Courthas consistently monitored Delhi’s air quality and has often criticized government agencies for inaction. The court expressed dissatisfaction with the CAQM’s approach, stating:
The CAQM’s actions were delayed despite deteriorating air quality.
Implementation of Stage IV of the Graded Response Action Plan (GRAP)was postponed, despite forecasts indicating severe pollution.

What is GRAP:

GRAP is a set of emergency measuresthat kick in to prevent further deterioration of air quality once it reaches a certain threshold in Delhi-NCR region.
It wasapproved by the Supreme Court in 2016 and was notified in 2017.
For theimplementation of the plan, the Centre decided to set up the Commission for Air Quality Management (CAQM) in the National Capital Region and Adjoining Areas.

What are different stages of GRAP:

The GRAP are divided into four stages:

Stage 1– “poor” AQI of 201 and 300
Stage 2– “very poor” AQI of 301-400
Stage 3– “severe” AQI of 401-450
Stage 4– “severe plus” AQI more than 450.

8. Celebrating the Legacy of Raja Raja Chola I

Sub : History

Sec : Medieval India

Why in News

The birth anniversary of the revered Chola Emperor, Raja Raja Chola I, is celebrated annually with great enthusiasm during the Sadhaya Vizha festival in Thanjavur, Tamil Nadu. This celebration commemorates the emperor’s military achievements and cultural contributions, making it a notable event in Indian history.

About Raja Raja Chola I:

Born as Arulmozhi Varmanin 947 CE.
Reigned as Raja Raja Chola Ifrom 985 to 1014 CE. Also known as Raja Raja the Great.
Belonged to the Chola Dynasty, one of the longest-ruling dynasties in South India.
Expanded the Chola Empire to include parts of Sri Lanka, the Maldives, and southern India.
Successfully captured northern Sri Lanka and named it Mummudi Chola Mandalam.
Annexed territories of the Pandyas and Cheras, asserting Chola dominance.
Established Chola naval supremacy in the Indian Ocean, leading to the first overseas conquests in Indian history.

Administrative Reforms:

Introduced efficient revenue administrationand a well-structured bureaucracy.
Conducted land surveysto assess resources and implement tax collection.
Standardized weights and measures, enhancing economic management.
Divided the empire into administrative units called Valanadu(province) and Kurram (sub-division).

Cultural Contributions:

A great patron of art, architecture, and literature.
Commissioned the construction of the Brihadeeswarar Templein Thanjavur, a UNESCO World Heritage Site.
Promoted Tamil literatureand encouraged the composition of religious texts and hymns.
Supported Saivism(devotion to Lord Shiva), reflected in temple architecture and iconography.

Economic Achievements:

Strengthened the economy through irrigation projectsand development of agricultural infrastructure.
Promoted trade with Southeast Asia, establishing strong maritime trade routes.
Issued high-quality gold and copper coins, standardizing currency and trade.

Legacy:

Laid the foundation for the Chola naval fleet, making the Cholas a dominant naval power.
His governance style set a precedent for administrative efficiencyand cultural patronage.
His life and rule are popularized in Tamil literature, particularly in Kalki Krishnamurthy’s novel Ponniyin Selvan.

Religious Patronage:

Built and renovated several temples, solidifying his reputation as a temple builder.
Generous patron of Shaiva sects, promoting the worship of Shiva.
Endowed temples with lands, gold, and other resources for the conduct of religious ceremonies.

Death and Succession:

Died in 1014 CE and was succeeded by his son Rajendra Chola I, who expanded the empire further.
His burial site is believed to be at Udaiyalur, near Kumbakonam, Tamil Nadu.

About Chola Dynasty:

The Cholas (8th-12th century AD) are remembered as one of the longest ruling dynasties in the southern regions of India.
The reign of the Cholas began in the 9th century when they defeated the Pallavasto come into power. This rule stretched over for over five long centuries until the 13th century.
The medieval period was the era of absolute power and development for the Cholas. This is when kings like Aditya I and Parantaka
From here Rajaraja Chola and Rajendra Cholafurther expanded the kingdom into the Tamil region.
Later Kulothunga Cholatook over Kalinga to establish a strong rule. This magnificence lasted until the arrival of the Pandyas in the early 13th century.

Sadhaya Vizha Celebrations:

The Sadhaya Vizha is celebrated in the Tamil month of Aippasi (mid-October to mid-November) with religious and cultural activities.
The heart of the celebrations is the iconic Brihadeeswarar Temple in Thanjavur, a symbol of Raja Raja’s devotion and architectural legacy.
The festival includes sacred rituals such as the abhishekam (holy bath) of Lord Peruvudaiyar, followed by the perundeepa vazhipaadu, a lamp-waving ceremony, and the swami purappadu, a grand procession of the deity.
The celebrations feature classical dance performances and hymns sung by traditional Tamil singers, known as odhuvars.

About Brihadeeswarar Temple:

The Brihadeeswarar Temple, also known as the “Big Temple,” is a UNESCO World Heritage Site and a prime example of Chola architecture, dedicated to Lord Shiva (Peruvudaiyar).
Raja Raja Chola I personally oversaw the temple’s construction, ensuring it stood as a testament to his devotion and vision. The temple remains a symbol of Chola grandeur.
The temple contains extensive Tamil inscriptions that provide details on its construction, rituals, offerings, and administrative matters, highlighting Raja Raja’s meticulous planning.