Daily Prelims Notes 20 May 2023

Daily Prelims Notes

20 May 2023

Table Of Contents

1. Adani-Hindenburg Supreme Court Panel Report
2. Centre’s decision to withdraw Rs. 2000 notes from circulation
3. Foreign Venture Capital Investors (FVCI)
4. SWFT vs UPI
5. Arsenic Exposure
6. Centre passes ordinance to nullify SC decision favoring Delhi govt
7. G7 Hiroshima Summit
8. Supreme Court at full strength
9. India’s women in science and their struggle
10. Pakistan and Iran decided to inaugurate the border market

1. Adani-Hindenburg Supreme Court Panel Report

Subject :Economy

Section: Capital Market

Context: Supreme Court on Friday (May 19) made public the report of the court-appointed expert panel in the Hindenburg-Adani row case. SEBI) is yet to submit its report, the expert panel in its report disclosed that SEBI has been investigating the ownership of 13 “opaque” overseas entities related to Adani since October 2020.

The committee covered the following:

• Market Volatility: Report found high volatility in the securities market due to the Hindenburg-Adani row.
• On the first issue, the report says that while “there was certainly high volatility in Adani stocks after publication of the Hindenburg report”
• Investor Awareness: agreed with SEBI’s steps on ensuring investors are making informed decisions, but questioned whether there is too much information for the average investor.
• Regulatory failure if any that led to the conclusions drawn by the Hindenburg report. panel said that SEBI is looking into whether Adani has floated regulations in three aspects.
  • Minimum public shareholding: Sebi regulations require a publicly listed company to have a minimum of 25% of its shares to be held by the public. To assess this SEBI is looking at the ownership of certain portfolio investors. (of 13 overseas entities, 12 are foreign porfolio investors)
  • Related Party transactions: SEBI (Listing Obligations and Disclosure Requirements) requires disclosure of transactions by listed companies with related parties that benefit related party (ie. Adani here). No comment as investigation still on.
  • Price Maipulation: No evidence yet. SEBI’s active surveillance framework that tracks high price and volume movements has not found any manipulation till now, although several alerts were triggered, even before the Hindenburg report.
• The 6 member committee comprised of two former justices, one former SBI chairman, one securities lawyer and Infosys co-founder Nandan Nilekani.

2. Centre’s decision to withdraw Rs. 2000 notes from circulation

Subject :Economy

Section: Monetary Policy

Specifics:

• Not demonetization: Firstly the note will continue to be legal tender, even though public is encouraged to deposit/exchange these by 30^th September.
• Extended window for deposit/exchange.

Reasons:

• Exact reason not given, but the RBI’s stand is to discourage high value notes.
• And these were introduced as a means of filling the currency vacuum created by demonetization in a short period of time, hence the high value.
• The withdrawal decision is seen in view of upcoming assembly and general elections, which see high cash demand.

Impact on:

• economy:
• Not likely to be major, as Rs. 2,000 notes constitute only about 10% of currency in circulation
• But small businesses and cash intensive sectors like agriculture and construction could see some disruption in short term.
• Banking:
• With 30^th sept deadline, Banks will see their deposits rise.
• Bank liquidity will increase with higher cash holdings.
• Bond Market:
• As banks invest the excess deposits in government securities, we will see a short term drop in market interest rates in government bonds.

3. Foreign Venture Capital Investors (FVCI)

Subject :Economy

Section: Capital Market

FVCI is an investor incorporated and established outside India, who invests primarily in unlisted securities of Venture Capital undertakings and Venture Capital Funds in India.

Venture Capital Funds in turn are pooled investment funds that invest in seek private equity (unlisted) in start-ups and small and medium enterprises with strong growth potential. These are generally considered high risk- high return investments. SEBI is recently formalizing the regulatory framework for FVCIs. It is recommended that they hold investments in demat format.

4. SWFT vs UPI

Subject: Economy

Section: External Sector 

Also to be noted:

• After Russian banks were cut off from SWIFT, the System for Transfer of Financial Messages (SPFS) was developed by Russia’s central bank as an alternative to SWIFT.
• It has been suggested India now should also start developing its CBDC or digital rupee-based Global Payments Interface (GPI) for cross-border payments.
• Japan, which said it was seriously considering joining Indian UPI to increase interoperability.
• UPI and/or RuPay are already available in countries like Singapore, Nepal, Bhutan and United Arab Emirates (UAE) for Indians travelling there.
• For non-resident Indians (NRIs), there are 10 countries which allow making payments (UPI) through their local phone numbers, including Australia, Canada, the UAE, Oman, Qatar, Singapore, Hong Kong, the UK and the US.

5. Arsenic Exposure

Subject : Environment

Section: Pollution

Concept :

• A recent peer-reviewed study suggests that even low levels of arsenic consumption may impact cognitive function in children, adolescents, and young adults.

Arsenic

• Arsenic is a chemical element with the symbol As and atomic number 33.
• Arsenic occurs in many minerals, usually in combination with sulfur and metals, but also as a pure elemental crystal.
• Arsenic is a metalloid. It has various allotropes, but only the gray form, which has a metallic appearance, is important to industry.
• The primary use of arsenic is in alloys of lead(for example, in car batteries and ammunition).
• Arsenic is a common n-type dopant in semiconductor electronic devices. It is also a component of the III-V compound semiconductor gallium arsenide.
• Arsenic and its compounds, especially the trioxide, are used in the production of pesticides, treated wood products, herbicides, and insecticides.
• These applications are declining with the increasing recognition of the toxicity of arsenic and its compounds.

Impact of Arsenic Contamination

• Arsenic is highly toxic in its inorganic
• People are exposed to elevated levels of inorganic arsenic through drinking contaminated water, using contaminated water in food preparation and irrigation of food crops, industrial processes, eating contaminated food and smoking tobacco.
• Long-term exposure to inorganic arsenic, mainly through drinking-water and food, can lead to chronic arsenic poisoning. Skin lesions and skin cancer are the most characteristic effects.

What Is the Permissible Limit?

• The recommended limit is 10 10ug/l. Arsenic contamination in communities across India has increased by 145 per cent in the past five years, according to a report by The Guardian.
• In rural parts of the country, it is wreaking havoc in the lives of people.
• Arsenic contamination in India was widespread in the 1990s in West Bengal and later in Bihar, Jharkhand, Uttar Pradesh, Assam and Manipur.

6. Centre passes ordinance to nullify SC decision favoring Delhi govt

Subject : polity

Section: Federalism

Concept :

• The recent ordinance issued by the Centre on the control of services in Delhi has sparked controversy and raised questions about the constitutional status of the national capital.

Details

• The ordinance, which was promulgated on May 19, 2023, effectively nullifies the Supreme Court verdict that had given the power of transfer and posting of bureaucrats to the elected Delhi government.
• The ordinance designates the Lieutenant-Governor (L-G) as the administrator of Delhi, with the final say on the postings and transfer of all bureaucrats serving the Delhi government.

Creates a new Statutory Body

• Composition
• The ordinance creates a new statutory body called the National Capital Civil Service Authority (NCCSA), which will consist of;
• The Chief Minister
• The Chief Secretary
• The Principal Secretary (Home) of Delhi.
• Function
• The NCCSA will make recommendations to the L-G regarding matters concerning transfer, posting, vigilance and other incidental matters of all Group A officials and officers of Delhi, Andaman and Nicobar Island Civil Service (DANICS) serving in the affairs of the Delhi government.
• However, the L-G can reject or return the recommendations of the NCCSA, and in case of a dispute, his decision will be final.

Arguments by the Centre

• The Centre has defended the ordinance as a necessary measure to ensure administrative balance and harmony in Delhi.
• They argued that the ordinance is in line with Article 239AA of the Constitution, which gives special status to Delhi as a Union Territory with a legislative assembly.
• They cited Article 239AB, which empowers the President to suspend or modify any provision relating to Delhi in case of a failure of constitutional machinery.

Criticism

• The ordinance has been widely criticised by the Delhi Government, as an attempt to undermine its authority and autonomy.
• The State Government has accused the Centre of violating the constitutional principles of democracy and federalism and showing contempt for the Supreme Court’s judgment.
• They also claimed that the ordinance will hamper the effective functioning and delivery of services by the Delhi government.

7. G7 Hiroshima Summit

Subject : International Relations

Section: Places in news

Concept :

• Hiroshima, a city on Japan’s main island Honshu, will host this year’s Group of Seven (G7) Summit, an annual gathering of the leaders of the world’s richest and most industrialised nations.

Details

• This year, Hiroshima will host the Group of Seven (G7) Summit, an annual meeting of leaders from seven of the world’s most powerful democracies: Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
• The summit will take place from May 19 to 21 at a hotel near the Peace Memorial Park.
• The leaders will discuss various global issues and challenges, such as climate change, economic recovery, health security, human rights, and regional stability.

Why Hiroshima?

• The choice of Hiroshima as the venue of the G7 Summit reflects Japan’s Prime Minister Fumio Kishida’s commitment to put nuclear disarmament and nonproliferation at the forefront of the international agenda.
• Kishida is a native of Hiroshima and has been a vocal advocate for abolishing nuclear weapons and preventing their proliferation.
• He has also invited leaders from other countries that have been affected by nuclear testing or accidents, such as Kazakhstan, Marshall Islands, Ukraine, and Belarus, to join some sessions of the summit as guests.

Background

• Hiroshima was the first city in the world to experience the devastating effects of a nuclear weapon, when an atomic bomb was dropped by the United States on August 6, 1945, near the end of World War II.
• The blast killed tens of thousands of people instantly and left many more injured or sick from radiation exposure.
• The city was almost destroyed, except for a few buildings that survived the firestorm.

Present day 

• Today, Hiroshima is a vibrant and prosperous regional hub, with a population of about 1.2 million people.
• It is a major industrial, commercial, and cultural centre.
• It is also a symbol of peace and resilience, as it has rebuilt itself from the ashes and dedicated itself to promoting nuclear disarmament and nonproliferation.
• The city hosts several monuments and museums that commemorate the victims of the atomic bombing and educates visitors about its consequences and lessons.

Atomic Bomb Dome

• One of the most iconic landmarks in Hiroshima is the Atomic Bomb Dome, which was formerly the Hiroshima Prefectural Industrial Promotion Hall.
• It was one of the few structures that remained standing near the hypocenter of the explosion, and it has been preserved as a memorial to the tragedy.
• The dome is part of the Hiroshima Peace Memorial Park, which also includes the Children’s Peace Monument, the Peace Memorial Museum, and the Cenotaph for the A-Bomb Victims.

Natural beauty and Cultural heritage

• Hiroshima is also known for its natural beauty and cultural heritage.
• It is surrounded by mountains and sea, and it has many parks and gardens that offer scenic views and relaxation.
• It is famous for its local cuisine, especially okonomiyaki, a savoury pancake with various toppings, and oysters, which are harvested from the nearby Seto Inland Sea.
• It is also home to several historical and religious sites, such as Hiroshima Castle, Shukkei-en Garden, Mitaki Temple, and Itsukushima Shrine.

8. Supreme Court at full strength

Subject : Polity

Section: Judiciary

Concept :

• Chief Justice of India Y. Chandrachud administered the oath of office to Justices Prashant Kumar Mishra and K.V. Viswanathan, bringing the Supreme Court of India back to its full strength of 34 judges.
• The Supreme Court of India comprises the Chief Justice and 33 other Judges appointed by the President of India.
• Justices Mishra and Viswanathan replaced retiring Justices Dinesh Maheshwari and M.R. Shah.
• The swearing-in ceremony took place in the presence of the full court and members of the Bar, following their speedy appointments approved by the government.
• Justice Viswanathan, who could become the 58th Chief Justice of India in August 2030, is the ninth lawyer directly elevated to the Supreme Court Bench. Justice Mishra previously served as the Chief Justice of the Andhra Pradesh High Court.

Constitutional Provisions

• Article 124(1) states that there shall be a Supreme Court of India consisting of a Chief Justice of India and, until Parliament by law prescribes a large number, of not more than seven other judges.
• Article 124(2) states that every judge of the Supreme Court shall be appointed by the President by warrant under his hand and seal after consultation with such number of the judges of Supreme Court and of the High Courts (in states).
• The Parliament is competent to increase the number of judges if it deems necessary.

9. India’s women in science and their struggle

Subject :International relations

Section: Neighbouring countries

Context: Recent data from the Department of Science and Technology (DST) showed women made up 28% of participants in 2018-19 in extramural Research and Development (R&D) projects, up from 13% in 2000-01

Status on Women scientist

• Percentage of women in R&D is 16.6% among total number of scientists working in S&T organizations.
• There are 56,747 women scientists directly engaged in R&D activities out of total 3.42 lakh R&D personnel at various Research & Development (R&D) establishments.
• The proportion of women in the scientific workforce is lower in India than in advanced countries
• Many women are unable to make it because of a lack of funds and opportunities
• the lack of security and safety of the cities and towns limits the options and opportunities for girls to a large extent
• Families, especially those from lower income backgrounds, don’t send their daughters for tuitions or coaching to faraway places at odd hours
• women scientists find it difficult to achieve work-life balance, especially in the child-bearing and rearing years

Government Initiatives to promote women in S&T:

I-STEM (Indian Science Technology and Engineering facilities Map): Women in Engineering, Science, and Technology (WEST)

• It was launched on 5^thSeptember 2022 by Office of the Principal Scientific Adviser (PSA)
• This programme will cater to women with a STEM background and empower them to contribute to the science, technology, and innovation ecosystem.
• I-STEM is a national web portal for sharing research equipment/facilities and is the umbrella under which many programmes for promoting collaborations in R&D and technological innovation among and between academia and industry
• Provide a separate platform to scientifically inclined women researchers, scientists, and technologists for pursuing research in basic or applied sciences in frontier areas of science and engineering.

Women in Science and Engineering-KIRAN (WISE-KIRAN)

• Under this, women scientists are being encouraged to pursue research in frontier areas of science and engineering, on problems of societal relevance and to take up S&T-based internship followed by self-employment.
• It primarily aimed at providing opportunities to women scientists and technologists between the age group of 27-57 years who had a break in their career but desired to return to mainstream.
• It was implemented by Department of Science & Technology (DST)

Consolidation of University Research through Innovation and Excellence (CURIE) Programme:

• It provides support for development of research infrastructure and creation of state-of-the-art research laboratories
• To enhance women’s participation in S&T domain.
• It was implemented by Department of Science & Technology (DST)

Vigyan Jyoti

• the “Vigyan Jyoti” has been introduced in the year 2019-20 at the school level wherein meritorious girl students of Class 9-12 are being encouraged to pursue higher education and career in STEM field.
• Envisaged hand-holding and interventions right from the school level i.e., Class IX and which will continue till the PhD level to encourage girls to pursue a career in underrepresented areas of STEM.
• Various activities such as science camps, special lectures/ classes, counselling of students and parents, interaction with role models, tinkering activities, visit to Knowledge Partners/ Research Labs/ Industries/ NGOs are being conducted in the programme in order to motivate girls.
• It was implemented by Department of Science & Technology (DST)

SERB-POWER (Promoting Opportunities for Women in Exploratory Research)

• It is a scheme of Science and Engineering Research Board of DST
• It aims to address lower participation of women scientists in research activities and to mitigate gender disparity in science and engineering.

Other Initiatives:

In addition to this, Department of Biotechnology (DBT) is also implementing ‘Biotechnology Career Advancement and Re-orientation Programme (BioCARe)’ to enhance the participation of Women Scientists in Biotechnology research

Government instituted Janaki Ammal National Women Bioscientist Awards to recognize the contributions of senior and young women scientists in the country who are working in the areas of Biology and Biotechnology.

Ministry of Earth Sciences has initiated a special award called “National Award for Woman Scientist” since 2018 which is being conferred to one-woman scientist each year

10. Pakistan and Iran decided to inaugurate the border market

Subject :International relations

Section: Neighbouring countries

Context: The top leaders of Pakistan and Iran on Thursday inaugurated the first border market as relations warm between the two countries

Concept:

• Border market, which is located at Mand town in Pakistan’s Balochistan province and adjacent to Pishin city in Iran’s Sistan-Baluchestan province.
• Memorandum of Understanding (MOU) to establish Border Markets along the border was signed between Pakistan & Iran in April 2021.
• Three Border Markets are now being established at Gabd, Mund & Chedgi in Balochistan, near our border with Iran.”
• these facilities would enhance cross-border trade, foster economic growth and open up new avenues of opportunity for local businesses.

Why it has opened now?

• Iran-Pakistani relations have been contentious because of cross-border attacks by Pakistani militants along their shared border
• Small separatist groups have been behind a long-running insurgency calling for Baluchistan’s independence from the central government in Islamabad. Pakistani anti-Iran militants have also targeted the Iranian border in recent years, increasing the friction between the two countries
• Pakistan has close ties with Sunni powerhouse Saudi Arabia, but has tried to maintain a relationship with the predominantly Shiite Iran. Riyad and Tehran, long-time rivals, restored ties earlier this year in a Chinese-brokered agreement.