Daily Prelims Notes 11 April 2022

April 11, 2022
Posted by: OptimizeIAS Team
Category: DPN

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Daily Prelims Notes

11 April 2022

Table Of Contents

1. Bengaluru has become the first Indian city to get into the global network of silk cities

Subject: Geography

Section: Economic geography

Context: Bengaluru has become the first Indian city to get into the global network of silk cities

Silk Production in India:

Silk is the most elegant textile in the world with unparalleled grandeur, natural sheen, and inherent affinity for dyes, high absorbance, light weight, soft touch and high durability and known as the “Queen of Textiles” the world over.
India has the unique distinction of being the only country producing all the five known commercial silks, namely, mulberry, tropical tasar, oak tasar, eri and muga (golden yellow glitter is unique and prerogative of India).
Major silk producing states in the country: Mulberry sericulture is mainly practised in states such as Karnataka, Andhra Pradesh, Assam, West Bengal(concentrated in Murshidabad) , Jharkhand and Tamil Nadu
North East has the unique distinction of being the only region producing four varieties of silk viz., Mulberry, Oak Tasar, Muga and Eri.
Overall NE region contributes 18% of India’s total silk production.
India is the second largest producer of silk in the world.
India is the largest consumer of silkin the world.
Geographical Indications of Indian silk

Baluchari Saree – West Bengal
Salem Silk – Tamil Nadu
Arani Silk – Tamil Nadu
Molakalmuru Sarees – Karnataka
Ilkal Sarees – Karnataka
Muga Silk – Assam
Orissa Ikat – Odisha
Kancheepuram Silk – Tamil nadu
Mysore Silk – Karnataka
Chanderi Fabric – Madya Pradesh

2. IMF Support System

Subject :Economy

Section: External sector

Context

Sri Lanka will need about $3 billion in external assistance within the next six months to help restore supplies of essential items, including fuel and medicines, to manage a severe economic crisis.

Concept:

The IMF assists countries hit by crises by providing them financial support to create breathing room as they implement adjustment policies to restore economic stability and growth. It also provides precautionary financing to help prevent and insure against crises.

The IMF provides financial support for balance of payments needs upon request by its member countries. Unlike development banks, the IMF does not lend for specific projects.

Typically, a country’s government and the IMF must agree on a program of economic policies before the IMF provides lending to the country. A country’s commitments to undertake certain policy actions, known as policy conditionality, are in most cases an integral part of IMF lending

However, for some arrangements, countries can use IMF resources with no or limited conditionality if they have already established their commitment to sound policies or where they are designed for urgent and immediate needs.

The IMF’s various lending instruments are tailored to different types of balance of payments need as well as the specific circumstances of its diverse membership

General Resources Account-All IMF members are eligible to access the Fund’s resources in the General Resources Account (GRA) on non-concessional terms.

Funds for PRGT lending are obtained through bilateral loan agreements at market interest rates. Subsidy resources make up the difference between the market rates received by lenders and the concessional rates paid by LIC borrowers.

Poverty Reduction and Growth Trust-concessional financial support (currently at zero interest rates) available through the Poverty Reduction and Growth Trust
Stand-By Arrangements (SBAs)- in case of emerging and advanced market economies in crises, the bulk of IMF assistance has been provided through Stand-By Arrangements to address short-term or potential balance of payments problems.
Standby Credit Facility (SCF) -Financing for LICs with actual or potential short-term balance of payments and adjustment needs caused by domestic or external shocks, or policy slippages—can also be used on a precautionary basis during times of increased risk and uncertainty.
The Extended Fund Facility (EFF) -Fund’s main tool for medium-term support to emerging and advanced countries facing protracted balance of payments problems
Extended Credit Facility (ECF) for low-income countries are the Fund’s main tools for medium-term support to countries facing protracted balance of payments problems
Flexible Credit Line (FCL) or the Precautionary and Liquidity Line (PLL)-To help prevent or mitigate crises and boost market confidence during periods of heightened risks, members with already strong policies can use the Flexible Credit Line (FCL) or the Precautionary and Liquidity Line (PLL).
The Rapid Financing Instrument (RFI) –for emerging and advanced countries provide rapid assistance to countries with urgent balance of payments needs, including from commodity price shocks, natural disasters, and domestic fragilities.
Rapid Credit Facility (RCF)-Rapid financial support as a single up-front payout for low-income countries facing urgent balance of payments needs—possible repeated disbursements over a (limited) period in case of recurring or ongoing balance of payments needs.
Catastrophe Containment and Relief Trust-In February 2015, the IMF repurposed the Post-Catastrophe Debt Relief Trust, into the Catastrophe Containment and Relief Trust. Under the new trust the IMF can join international debt relief efforts for poor countries hit by the most catastrophic of natural disasters. It can also assist countries battling public health disasters—such as infectious disease epidemics—with grants for debt service relief.

GRA-supported programs are expected to resolve the member’s BoP problems during the program period, while PRGT programs envisage a longer duration for addressing BoP problems.

The Policy Support Instrument (PSI) and the Policy Coordination Instrument (PCI) do not provide financial support, but the PSI is a PRGT instrument while the PCI applies to both PRGT and GRA.

3. Inflation Survey

Subject: Economy

Section: Inflation

Context

According to the RBI survey, for a majority of population and age groups, uncertainty in inflation expectations increased for both three months and one year horizons, as compared to the previous survey round according to the Inflation Expectations Survey of Households.
According to the central bank’s Consumer Confidence Survey (CCS), consumer confidence for the current period continued on its recovery path.

Concept:

Inflation Expectations Survey of Households-
- The survey is conducted at bi-monthly intervals by the Reserve Bank of India.
- It provides directional information on near-term inflationary pressures as expected by the respondents and may reflect their own consumption patterns. Hence, they should be treated as households’ sentiments on inflation.
- The survey aims at capturing subjective assessments on price movements and inflation, of approximately 6,000 households, based on their individual consumption baskets, across 18 cities, including -Ahmedabad, Bengaluru, Bhopal, Bhubaneswar, Chandigarh.
- The survey seeks qualitative responses from households on price changes (general prices as well as prices of specific product groups).
- It measures Households’ median inflation perceptions in three periods– for the current period, three months ahead as well as in the one year ahead period.

Consumer Confidence Survey-
- It is conducted every two months by the Reserve Bank of India.
- The CCS is a survey that indicates how optimistic or pessimistic consumers are regarding their expected financial situation. If the consumers are optimistic, spending will be more, whereas if they are not so confident, then their poor consumption pattern may lead to recession.
- Consumer Confidence Survey (CCS) for the March 2022 round was conducted from March 02 to March 11, 2022 in 19 major cities including Bengaluru, Chennai, Delhi, Hyderabad, Ahmedabad, Jaipur, Lucknow, Patna, Thiruvananthapuram, Mumbai.
- The survey obtains current perceptions (vis-à-vis a year ago) and one year ahead expectations on general economic situation, employment scenario, overall price situation and own income and spending from 5,984 households across these cities.
- Based on these specific responses, the RBI constructs two indices: the Current Situation Index (CSI) and the Future Expectations Index (FEI).
- The CSI maps how people view their current situation (on income, employment etc.) vis a vis a year ago. The FEI maps how people expect the situation to be (on the same variables) a year from now.

Consumer Confidence Survey- march 2022

4. What is default and its impact

Subject :Economy

Section: External sector

Context:

S&P on Saturday lowered Russia’s foreign currency ratings to “selective default” on increased risks that Moscow will not be able and willing to honour its commitments to foreign debt holders.

Details:

Russia had made coupon and principal payments on dollar-denominated Eurobonds in rubles which investors may not be able to convert into dollars equivalent to the originally due amounts given the amount of economic sanctions on Russia.

S&P assigns a selective default rating when it believes the debtor has selectively defaulted on a specific issue or class of obligations but will continue to meet its payment obligations on other issues or classes of obligations in a timely manner.

Sovereign debt Default

Sovereign debt is the bonds a Sovereign country sells to the banks in foreign currency to finance its domestic financial requirement.

Sovereign default is the failure by a government to repay its national debts. Sovereign default is the same as a default on debt by a private individual or business, but by a national government that fails to repay its interest or principal due.

Sovereign nations are not subject to normal bankruptcy laws and always have the power to escape responsibility for their debts, often without legal consequences.

Nations that maintain their own currency and whose debt is denominated in that currency will have the option to effectively default by inflating their currency and printing more money to cover the outstanding portion.

Causes:

Sovereign defaults are relatively rare and are often precipitated by an economic crisis affecting the defaulting nation.

Economic downturns, political upheaval, and excessive public spending and debt can all be warning signs that lead to sovereign default.
Higher interest rates and a lower credit rating among lenders, making it more difficult to borrow in the future.
Large scale short term borrowing- Governments that rely on financing through short-term bonds may be especially vulnerable to a sovereign debt default since short-term bonds already face a difficult conflict of maturity mismatch between short-term bond financing and the long-term asset value of a country’s tax base.

Impact:

Recession- In the United States, for instance, the interest rates on many mortgages, car loans, and student loans are pegged to U.S. Treasury rates. If borrowers were to experience dramatically higher payments as the result of a U.S. debt default, the result would be substantially less disposable income to spend on goods and services, which could ultimately lead to a recession.
Stagflation– reduction in output and employment along with high inflation.
Reduction in investment confidence and rise in unproductive investments.
Difficult to borrow in future
Large scale capital outflows and currency depreciation

5. Different types of food index -FAO

Subject: Economy

Section: External sector

Context: Global food prices rising

Concept:

The Food Price Index (FFPI)

By the Food and Agriculture Organisation (FAO) on a monthly basis.
First introduced in 1996.
Purpose: To track the developments in the global agricultural commodity markets, and to keep an eye on the world food situation.
Base period: 2014-16
The FAO Food Price Index (FFPI) records the monthly fluctuations in the international food prices for a basket of five commodities:

- Cereals– The FAO Cereal Price Index
- Vegetable oil-The FAO Vegetable Oil Price Index
- Dairy products-The FAO Dairy Price Index
- Meat-The FAO Meat Price Index
- Sugar– The FAO Sugar Price Index

Unlike for other commodity groups, most prices utilized in the calculation of the FAO Meat Price Index are not available when the FAO Food Price Index is computed and published; therefore, the value of the Meat Price Index for the most recent months is derived from a mixture of projected and observed prices. This can, at times, require significant revisions in the final value of the FAO Meat Price Index which could in turn influence the value of the FAO Food Price Index.

Other Publication of FAO

The State of World Fisheries and Aquaculture (SOFIA).
The State of the World’s Forests (SOFO).
The State of Food Security and Nutrition in the World (SOFI).
The State of Food and Agriculture (SOFA).
The State of Agricultural Commodity Markets (SOCO).

6. Project 39 A

Subject: Polity

Section: DPSP

Project 39A is inspired by Article 39-A of the Indian Constitution, a provision that furthers the intertwined values of equal justice and equal opportunity by removing economic and social barriers. These are constitutional values of immense importance given the manner in which multiple disparities intersect to exclude vast sections of our society from effectively accessing justice. Using empirical research to re-examine practices and policies in the criminal justice system, Project 39A aims to trigger new conversations on legal aid, torture, forensics, mental health in prisons, and the death penalty.

Article 39 a

The State shall secure that the operation of the legal system promotes justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities.
The article was inserted by the Constitution (Forty-second Amendment) Act, 1976

7. Solid State Batteries

Subject: Science & Tech

Context- The move away from liquid electrolytes, which are highly flammable organic solvents.

Concept-

The government of India recently announced a major push towards solid-state battery research.
A consortium of 15 institutions, including the IITs of Bombay, Roorkee, Kanpur, Kharagpur, has been set up, with IISER as the lead centre.
This initiative of the Department of Science and Technology is one of three that constitute the ‘Integrated Clean Energy Material Acceleration Platform’.
The consortium “aims to accelerate the development of solid-state battery technology using AI [artificial intelligence] and ML [machine learning], through automated processes.

What are Solid-state batteries?

A solid-state battery is a battery technology that uses solid electrodes and a solid electrolyte, instead of the liquid or polymer gel electrolytes found in lithium-ion or lithium polymer batteries.
Such batteries can provide potential solutions for many problems of liquid Li-ion battery, such as flammability, limited voltage, unstable solid-electrolyte interphase formation, poor cycling performance and strength.
Solid state battery claims to prevent dendrites formation.
- It uses a solid-state separator technology that eliminates the side reaction between the liquid electrolyte and the carbon/graphite in the anode of conventional lithium-ion cells.
The replacement of the separator enables the use of a lithium-metal anode which is more energy-dense than conventional anodes, allows the battery to store more energy in the same volume.

Advantages of Solid State Battery:

The advantages of the solid-state battery technology include higher cell energy density (by eliminating the carbon anode), lower charge time (by eliminating the need to have lithium diffuse into the carbon particles in conventional lithium-ion cells).
It has the ability to undertake more charging cycles and thereby a longer life, and improved safety.
Lower cost could be a game-changer, given that at 30 per cent of the total cost, battery expenses are a key driver of the vehicle costs.
solid-state electrolytes are typically less reactive than today’s liquid or gel-type electrolytes.

What are Li-ion Batteries?

Lithium-ion batteries use aqueous electrolyte solutions, where ions transfer to and fro between the anode (negative electrode generally made of graphite) and cathode (positive electrode made of lithium), triggering the recharge and discharge of electrons.
The energy density of lithium-ion cells used in today’s mobile phones and electric vehicles is nearly four times higher than that of older-generation nickel-cadmium batteries.

Its limitations

Low energy density: Despite improvements in technology over the last decade, issues such as long charging times and weak energy density persist.
Small appliances: While lithium-ion batteries are seen as sufficiently efficient for phones and laptops, they still lack the range that would make EVs a viable alternative.
Extreme reactivity: One major problem is that lithium metal is extremely reactive.
Corrosion of cells: The main form of lithium corrosion is dendrites (branched lithium structures) that grow out from the electrode and can potentially pierce the separator short-circuiting the cell.
Fire hazard: In current lithium-ion batteries, in which the electrolyte is a flammable liquid, dendrite formation can trigger a fire.

8. Sixth Mass Extinction

Subject: Environment

Section: Biodiversity

Context- The ongoing sixth mass extinction may be one of the most serious environmental threats to the persistence of civilisation, according to new research.

Concept-

What is the mass extinction of species?

Mass extinction refers to a substantial increase in the degree of extinction or when the Earth loses more than three-quarters of its species in a geologically short period of time.
So far, during the entire history of the Earth, there have been five mass extinctions.
The five mass extinctions that took place in the last 450 million years have led to the destruction of 70-95 per cent of the species of plants, animals and microorganisms that existed earlier.
These extinctions were caused by “catastrophic alterations” to the environment, such as massive volcanic eruptions, depletion of oceanic oxygen or collision with an asteroid.
After each of these extinctions, it took millions of years to regain species comparable to those that existed before the event.

What is the sixth mass extinction?

The sixth, which is ongoing, is referred to as the Anthropocene extinction.
Researchers have described it as the “most serious environmental problem” since the loss of species will be permanent.

Why it is attributable to humans?

The Global Assessment Report on Biodiversity and Ecosystem Services”, the first such by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) released in 2019, shows that the current rate and scale of extinction is unprecedented and is being caused majorly by humans.
One of the reasons that humanity is an “unprecedented threat” to many living organisms is because of their growing numbers.
The loss of species has been occurring since human ancestors developed agriculture over 11,000 years ago.
Since then, the human population has increased from about 1 million to 7.7 billion.

Changes occurred and occurring:

The IPBES assessment says that 1 million animal and plant species face extinction and thousands of these would become extinct within decades.
About 40 per cent of the planet’s amphibian species are threatened with extinction.
Since 1900, the number of native species in most of the land-based habitats has declined by 20 per cent.
The World Wildlife Fund’s (WWF’s) “Living Planet Report 2020” says the Asia Pacific region lost 45 per cent of its vertebrate population in four-and-half decades, while the average global loss is 68 per cent.
The biennial report, prepared jointly by WWF and Zoological Society of London, is based on the global dataset analysed between 1970 and 2016. The report has tracked almost 21,000 populations of mammals, birds, fish and reptiles globally to reach its conclusions. It showed the loss of vertebrate population was the highest in the Caribbean and Latin America (94 per cent), followed by Africa (65 per cent), with Europe and Central Asia showing the least loss (24 per cent).
The loss could be higher than the global average in India, which has lost 12 per cent of its wild mammals, 19 per cent of its amphibians and 3 per cent of its birds over the past five decades.

Reasons for Extinction:

The “Living Planet Report 2020” points out five major reasons behind the biodiversity loss across the planet:
- changes in land and sea use (habitat loss and degradation),
- overexploitation of species,
- invasive species and disease,
- pollution and
- climate change.

Vulnerable regions:

Tropical regions have seen the highest number of declining species.
- In South and Southeast Asia, large-bodied species of mammals have lost more than four-fifths of their historical ranges.
While fewer species are disappearing in temperate zones, the percentage is just as high or higher.
As many as half of the number of animals that once shared our planet are no longer here, a loss described as “a massive erosion of the greatest biological diversity in the history of Earth”.
In the Asia Pacific region, including India that is experiencing loss of species higher than the global average, habitat degradation is the biggest trigger, followed by species overexploitation and invasive species and disease. The role of pollution and climate change was proportionately higher at 16 per cent.

What happens when species go extinct?

Impact can be tangible such as in the form of a loss in crop pollination and water purification.
If a species has a specific function in an ecosystem, the loss can lead to consequences for other species by impacting the food chain.
Effects of extinction will worsen in the coming decades as the resulting genetic and cultural variability will change entire ecosystems.

9. Eastern Rajasthan Canal Project

Subject: Geography

Section: Mapping

Context- The Chief Minister of Rajasthan has demanded the national project status for the Eastern Rajasthan Canal Project (ERCP).

Concept-

The main advantage of a project which has received national project status is that 90% of the funding for the project will be given by the central government.
The estimated cost of the ERCP is around Rs. 40,000 crore.

About the Eastern Rajasthan Canal Project:

It aims to harvest surplus water available during rainy season in rivers in Southern Rajasthan such as Chambal and its tributaries, including Kunnu, Parvati, Kalisindh, and use this water in south-eastern districts of the state, where there is scarcity of water for drinking and irrigation.
ERCP is planned to meet drinking and industrial water needs of the southern and south eastern Rajasthan, for humans and Livestock till the year 2051.
It proposes to provide drinking water to 13 districts of Rajasthan and provide irrigation water for 2.8 lakh hectares of land through 26 different large and medium projects.
13 districts: Jhalawar, Baran, Kota, Bundi, Sawai Madhopur, Ajmer, Tonk, Jaipur, Karauli, Alwar, Bharatpur, Dausa and Dholpur.

Chambal River:

It is one of the most pollution-free rivers of India.
It originates at the Singar Chouri peak in the northern slopes of the Vindhya mountains (Indore, Madhya Pradesh). From there, it flows in the North direction in Madhya Pradesh for a length of about 346 km and then follows a north-easterly direction for a length of 225 km through Rajasthan.
It enters U.P. and flows for about 32 km before joining the Yamuna River in Etawah District.
It is a rainfed river and its basin is bounded by the Vindhyan mountain ranges and the Aravallis. The Chambal and its tributaries drain the Malwa region of northwestern Madhya Pradesh.
The Hadauti plateau in Rajasthan occurs in the upper catchment of the Chambal River to the southeast of the Mewar Plains.
Tributaries: Banas, Kali Sindh, Sipra, Parbati, etc.
Main Power Projects/ Dam: Gandhi Sagar Dam, Rana Pratap Sagar Dam, Jawahar Sagar Dam, and Kota Barrage.
The National Chambal Sanctuary is located along river Chambal on the tri-junction of Rajasthan, Madhya Pradesh and Uttar Pradesh. It is known for critically endangered gharial, the red-crowned roof turtle, and the endangered Ganges river dolphin.