October 2024
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Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.

[pib] Transport and Marketing Assistance (TMA) scheme for Specified Agriculture Products

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Transport and Marketing Assistance Scheme

Mains level: Export promotion schemes in India

The Centre has revised “Transport and Marketing Assistance” (TMA) scheme for Specified Agriculture Products’.

What is the TMA Scheme?

  • The TMA Scheme was introduced in 2019 to provide assistance for the international component of freight, to mitigate the disadvantage of higher freight costs faced by the Indian exporters of agriculture products.
  • All exporters, duly registered with relevant Export Promotion Council as per Foreign Trade Policy, of eligible agriculture products, shall be covered under this scheme.
  • The assistance, at notified rates, will be available for the export of eligible agriculture products to the permissible countries, as specified from time to time.
  • Assistance would be provided in cash through a direct bank transfer as part reimbursement of freight paid.

Following major changes have been made in the revised scheme:

  • Dairy products, which were not covered under the earlier scheme, will be eligible for assistance under the revised scheme.
  • Rates of assistance have been increased, by 50% for exports by sea and by 100% for exports by air.

List of ineligible products

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The national security discourse is changing

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Humanitarian Assistance and Disaster Relief (HADR)

Mains level: Paper 3- Interplay between national security and domestic policies

Context

From a rising China to the pressures of climate change; from the challenges of counter-terrorism to the COVID-19 pandemic (the four Cs), the old order is collapsing much faster than the ability of nations to create the foundations of a new one.

The reduced difference between the domestic and foreign policy of the  U.S.

  • The idea that foreign and domestic policies are tightly intertwined is not a novel one.
  • All serious grand strategic thinking in democracies looks for sustenance in popular public support.
  • A process that was started by former U.S. President Donald Trump has been taken forward by the Biden Administration.
  • Asserting that “foreign policy is domestic policy and domestic policy is foreign policy,” the new administration has suggested that their task is to re-imagine American national security for the unprecedented combination of crises they face at home and abroad.
  • These crises include the pandemic, the economic crisis, the climate crisis, technological disruption, threats to democracy, racial injustice, and inequality in all forms”.
  • There is a growing bipartisan acknowledgment in the U.S. today that the requirements of American national security today are different from what they were during the Cold War.
  • Today’s strategic environment requires a different response for national security: one that shores up domestic industrial base helps in maintaining pre-eminence in critical technologies, makes supply chains for critical goods more resilient, protects critical infrastructure from cyberattacks and responds with a sense of urgency to climate change.

Indian situation: Dependence on the external supply chain is the national security challenge

  • In India too, there is greater recognition of the challenges emanating on national security from domestic vulnerabilities.
  • Dependence on Chinese manufacturing: One of the most significant consequences of the COVID-19 pandemic has been to reveal how deeply India has been dependent on Chinese manufacturing for critical supplies.
  • At a time when Indian armed forces were facing the People’s Liberation Army, this exposed India to a new realization that dependence on overseas supply chains is a national security challenge of the highest order.
  • Dimensions of national security: The Indian Army chief has argued that “national security comprises not only warfare and defence but also financial security, health security, food security, energy security, and environmental security apart from information security”.

Way forward for India

  • Shore up domestic capacities: India has since moved towards increasing domestic capacities in critical areas and also started looking at free trade agreements through a new lens.
  • Whole-of-government approach: Army Chief had suggested that instead of viewing national security “primarily from the perspective of an armed conflict, there is a need to take a whole-of-government approach towards security”.
  • Investment in armed forces: The Army chief has pointed out that investment in the armed forces contributes to the national economy.
  • Therefore, indigenization of defence procurement provides an impetus to indigenous industries, aid to civil authorities, or Humanitarian Assistance and Disaster Relief (HADR).
  • Demand for hi-tech military products by the armed forces helps entire industries.
  • Transportation and logistics capacities of the armed forces are acting as force enablers for the Government in times of emergencies.

Consider the question “The idea that foreign and domestic policies are tightly intertwined is not a novel one. In light of this, examine the challenges facing India’s national security that are linked with its domestic vulnerability. Suggest the ways forward.”

Conclusion

As nations across the world reconceptualise their strategic priorities, policymakers will need to think more creatively about the roles of various instruments of statecraft. National security thinking is undergoing a shift. India cannot be left behind.

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Foreign Policy Watch: India-Afghanistan

The fall of Afghanistan, the fallout in West Asia

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Geopolitical dynamics with Taliban's formation of legitimate govt

Three weeks after they walked into Kabul without any resistance, the Taliban now has announced an interim Council of Ministers.

Chord with Pakistan: Crowing of its puppets

  • Pakistan appears to have got its way. This government formation has tightly controlled the head of its Inter-Services Intelligence (ISI).
  • Afghanistan’s acting PM is Mullah Hassan Akhund, a close associate of former Taliban founder Mullah Omar.
  • Abdul Ghani Baradar is his deputy, but again, this could be a token position.
  • Baradar had been arrested in 2010 by the Pakistanis for pursuing a dialogue with the Hamid Karzai government without Pakistani sanction and jailed for eight years.
  • Pakistan’s true proteges are Sirajuddin Haqqani, the acting interior minister, and Mohammed Yaqoob, the acting defence minister, a son of Mullah Omar, who is also close to Haqqani.

The West Asian players

Saudi Arabia, Qatar and Iran have been direct role-players in Afghan affairs for over 25 years.

  • Sheikhdom involvement: In the 1990s, the first two were supporters and sources of funding for the Taliban, while Iran was an antagonist. After 9/11, all three countries became deeply involved with the Taliban. Since 2005, the Gulf sheikhdoms have contributed millions of dollars to different Taliban leaders and factions.
  • Iran’s defiance of the US: Iran began a substantial engagement with various Taliban leaders from 2007 and provided funding, weapons, training and refuge when required. It wanted the Taliban to maintain pressure on the U.S. forces to ensure their speedy departure from the country.
  • Regional competition: In the 2010s, when the US began to engage with Iran on the nuclear issue, Saudi Arabia became more directly involved in Afghan matters to prevent Iran’s expanding influence among Taliban groups. Thus, besides Syria and Yemen, Iran and Saudi Arabia have also made Afghanistan an arena for their regional competitions.
  • Earliest acknowledgment of the Taliban: In 2012, Qatar, on U.S. request, allowed the Taliban to open an office in Doha as a venue for their dialogue with the Americans. This has made Qatar an influential player in Afghan affairs, with deep personal ties with several leaders, many of whom keep their families in Doha.

Competitions for influence

The low-key reactions of the Gulf countries to recent developments in Kabul reflect the uncertainties relating to the Taliban in power.

Nature of the govt: Their ability to remain united, their policies relating to human rights, and, above all, whether the Taliban will again make their country a sanctuary for extremist groups.

Fractionalization within terror groups: The country already has several thousand foreign fighters, whose ranks could swell with extremists coming in from Iraq and Syria, and threaten the security of all neighbouring states.

Three sets of regional players are active in Afghanistan today:

  1. Pakistan-Saudi coalition: This has been the principal source of support for the Taliban-at-war. They would like to remain influential in the new order, but neither would like to see the Taliban revert to their practices of the 1990s that had justifiably appalled the global community.
  2. Turkey and Qatar: They represent the region’s Islamist coalition and, thus, share an ideological kinship with the Taliban. Both would like to see a moderate and inclusive administration.
  3. Iran: While many of its hardliners are overjoyed at the U.S. “defeat”, more reflective observers recall the earlier Taliban emirate which was viscerally hostile to Shias and Iran. Iran also sees itself as the guardian of the Tajik, Uzbek and Hazara minorities in the country.

Options Available: The outlook for security

Linking with Israel-Palestine Conflict: The region now has two options: one, an Israel-centric security order in which the Arab Gulf states would link themselves with Israel to confront Iran. This is being actively promoted by Israeli hawks since it would tie Israel with neighbouring Arab states without having to concede anything to meet Palestinian aspirations.

Comprehensive regional security arrangement: The other option is more ambitious: The facilitators and guarantors of this security arrangement are likely to be China and Russia: over the last few years, both have built close relations with the major states of the region. i.e., Iran, Saudi Arabia, Turkey, Afghanistan and Pakistan.

Consensus to ward away the US

  • The Gulf Cooperation Council (GCC) states led by Saudi Arabia lifted the over three-year blockade of Qatar.
  • The discussions between Iran and Saudi Arabia and plans are in place for the next meetings.
  • Turkey has initiated diplomatic overtures towards Egypt and Saudi Arabia.
  • None of these initiatives involves the Americans.

Conclusion: A new order is in making

  • These developments suggest that the germ of a new regional security order in West Asia is already sown in fertile ground.

Way forward for India

  • The Indian policies are at a crossroads. Continued bandwagoning with the US makes no sense.
  • Indian diplomacy should harmonize with the regional capitals, including Beijing, which can be a natural ally on issues of terrorism.
  • The bottom line is that India’s vital interests remain to be secured.
  • Demonizing the Taliban can only be counterproductive.

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Foreign Policy Watch: India – Germany

 How India and Germany can work together to tackle climate change?

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: India-Germany relations

Both nations, India and Germany with innovative economies and many highly-trained people can tackle the climate challenge.

India-Germany Relations: A backgrounder

Freedom struggle: Subhas Chandra Bose, a prominent freedom fighter for Indian independence, made a determined effort to obtain India’s independence from Britain by seeking military assistance from the Axis powers. The Indische Legion was formed to serve as a liberation force for British-ruled India principally made up of Indian prisoners of war.

Diplomacy: India maintained diplomatic relations with both West Germany and East Germany and supported their reunification in 1990. Contrary to France and the UK, Germany has no strategic footprint in Asia.

Past contentions: Germany condemned India for liberating Goa from Portuguese rule in 1961 and supported Portugal’s dictatorial regime under Salazar against India. It was critical of India for intervening in the 1971 Bangladesh Liberation War.  It rejected India’s 1998 nuclear tests.

Quest for UNSC: India and Germany both seek to become permanent members of the UNSC and have joined with Japan and Brazil to coordinate their efforts via the G4 collective.

Cultural ties: Germany has supported education and cultural programs in India. Germany helped establish the IIT Madras after both governments signed an agreement in 1956 and increased its cooperation and supply of technology and resources over the decades to help expand the institution

Trade and investment: Germany is India’s largest trading partner in Europe. Germany is the 8th largest foreign direct investor (FDI) in India.

Common concerns

  • In South Asia and Europe, we have become used to extremely hot weather, flooding, dramatic depletion of groundwater tables, and drought.
  • The EU has adopted an ambitious Green Deal to achieve net-zero greenhouse gas emissions by 2050 and to decouple economic growth from the consumption of natural resources.

Why the two?

  • India is one of few countries that looks set to deliver on the national goals it set itself as part of the Paris agreement.
  • Compared to other G20 countries, its per capita emissions are very low.
  • Germany recently adopted laws on reducing greenhouse gases more quickly, achieving climate neutrality by 2045 and stopping the use of coal for electricity production by 2038.

Collaborated efforts to date

  • In 2015, India’s PM and Germany’s Federal Chancellor agreed to further strengthen the two countries’ strategic partnership.
  • On this basis, Germany and India have succeeded in building up a cooperation portfolio worth almost 12 billion euros.
  • Already, nine out of 10 measures support climate goals and SDGs together.

Indo-German development cooperation focuses on three areas:

  1. Transition to renewable energies
  2. Sustainable urban development and
  3. Sustainable management of natural resources

What does Germany have to offer?

  • As a pioneer of the energy transition, Germany is offering knowledge, technology transfer, and financial solutions.
  • The pandemic has shown global supply chains are vulnerable.
  • Yet, when it comes to agriculture and natural resources, there are smart solutions that are being tested in India and Germany for more self-reliance, including agroecological approaches and sustainable management of forests, soils, and water.
  • Experience in India has shown that these methods also boost incomes for the local population and make them less dependent on expensive fertilizers, pesticides and seeds.

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ISRO Missions and Discoveries

Tasks accomplished by the Chandrayaan-2

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Chandrayaan-3 Mission

Mains level: Accomplishments of India's Lunar Mission

The failure of Chandrayaan-2, India’s second mission to the Moon, to make a soft landing on the lunar surface had led to much disappointment.  But that did not mean the entire mission had been wasted.

Chandrayaan-2: A quick recap

  • Chandrayaan-2 consisted of an Orbiter, Lander and Rover, all equipped with scientific instruments to study the moon.
  • The Orbiter would watch the moon from a 100-km orbit, while the Lander and Rover modules were to be separated to make a soft landing on the moon’s surface.
  • ISRO had named the Lander module as Vikram, after Vikram Sarabhai, the pioneer of India’s space programme, and the Rover module as Pragyaan, meaning wisdom.

Utility of the Orbit

  • The Orbiter part of the mission has been functioning normally. It is carrying eight instruments.
  • Each of these instruments has produced a handsome amount of data that sheds new light on the moon and offers insights that could be used in further exploration.

Some of the most significant results so far:

(a) Water

  • The presence of water on the Moon had already been confirmed by Chandrayaan-1, India’s first mission to the Moon that flew in 2008.
  • Using far more sensitive instruments, the Imaging Infra-Red Spectrometer (IIRS) onboard Chandrayaan-2 has been able to distinguish between hydroxyl and water molecules and found unique signatures of both.
  • This is the most precise information about the presence of H2O molecules on the Moon to date.
  • Previously, water was known to be present mainly in the polar regions of the Moon.
  • Chandrayaan-2 has now found signatures of water at all latitudes, although its abundance varies from place to place.

(b) Minor elements

  • The Large Area Soft X-ray Spectrometer (CLASS) measures the Moon’s X-ray spectrum to examine the presence of major elements such as magnesium, aluminum, silicon, calcium, titanium, iron, etc.
  • This instrument has detected the minor elements chromium and manganese for the first time through remote sensing, thanks to a better detector.
  • The finding can lay the path for understanding magmatic evolution on the Moon and deeper insights into the nebular conditions as well as planetary differentiation.
  • CLASS has mapped nearly 95% of the lunar surface in X-rays for the first time.
  • Sodium, also a minor element on the Moon surface, was detected without any ambiguity for the first time.

(c) Study of Sun

  • One of the payloads, called Solar X-ray Monitor (XSM), besides studying the Moon through the radiation coming in from the Sun, has collected information about solar flares.
  • XSM has observed a large number of microflares outside the active region for the first time.
  • This has great implications on the understanding of the mechanism behind the heating of the solar corona, which has been an open problem for many decades.

Utility of this Data

  • While the Orbiter payloads build upon existing knowledge of the Moon in terms of its surface, sub-surface and exosphere, it also paves the path for future Moon missions.
  • Four aspects — mineralogical and volatile mapping of the lunar surface, surface and subsurface properties and processes involved, quantifying water in its various forms across the Moon surface, and maps of elements present on the moon — will be key for future scope of work.
  • A key outcome from Chandrayaan-2 has been the exploration of the permanently shadowed regions as well as craters and boulders underneath the regolith, the loose deposit comprising the top surface extending up to 3-4m in depth.
  • This is expected to help scientists to zero in on future landing and drilling sites, including for human missions.

Who is going to use it?

  • Some key future Moon missions that hope to make use of such data include the Japan Aerospace Exploration Agency (JAXA)-ISRO collaboration Lunar Polar Exploration (LUPEX) mission scheduled for launch in 2023/2024.
  • Its aim is to obtain knowledge of lunar water resources and to explore the suitability of the lunar polar region for setting up a lunar base.
  • NASA’s Artemis missions plan to enable human landing on the Moon beginning 2024 and target sustainable lunar exploration by 2028.
  • The Chinese Lunar Exploration Programme too plans to establish a prototype of the International Lunar Research Station (ILRS) at the lunar south pole and build a platform supporting large-scale scientific exploration.

What was missed because of the crash-landing?

  • The most obvious miss has been the opportunity to demonstrate the technology to make a soft landing in outer space.
  • The lander Vikram and rover Pragyaan were carrying instruments to carry out observations on the surface.
  • These were supposed to pick up additional information about the terrain, and composition, and mineralogy.
  • While the instruments onboard the Orbiter is making “global” observations, those on the lander and rover would have provided much more local information.
  • The two diverse sets of data could have helped prepare a more composite picture of the Moon.

Future with the Chandrayaan-3

  • ISRO scientists maintain that the accident was caused by a relatively small error that has been identified and corrected.
  • But, to demonstrate this technology all over again, ISRO would have to send a fresh mission, Chandrayaan-3, planned for next year.
  • It is expected to have only a lander and rover, and no Orbiter.

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RBI Notifications

[pib] Account Aggregator Network (AAN): A financial data-sharing system

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Account Aggregator Network (AAN) and its regulation

Mains level: Account Aggregator Network (AAN)

The Account Aggregator system in banking has been started off with eight of India’s largest banks. In this newscard, we shall learn it in a FAQ manner.

What is an Account Aggregator?

  • An Account Aggregator (AA) is a type of RBI regulated entity (with an NBFC-AA license) that helps an individual securely and digitally access and share information from one financial institution they have an account with to any other regulated financial institution in the AA network.
  • Data cannot be shared without the consent of the individual.
  • There will be many Account Aggregators an individual can choose between.
  • Account Aggregator replaces the long terms and conditions form of ‘blank cheque’ acceptance with a granular, step by step permission and control for each use of your data.

How would it improve an average person’s financial life?

  • India’s financial system involves many hassles for consumers today.
  • This includes sharing of physical signed and scanned copies of bank statements, stamp documents, or having to share your personal username and password to give your financial history to a third party.
  • The AAN would replace all these with a simple, mobile-based, simple, and safe digital data access & sharing process.
  • This will create opportunities for new kinds of services — eg new types of loans.
  • The individual’s bank just needs to join the Account Aggregator network.

How is AAN different to Aadhaar eKYC data sharing?

  • Aadhaar eKYC and CKYC only allow sharing of four ‘identity’ data fields for KYC purposes (eg name, address, gender, etc).
  • Similarly, credit bureau data only shows loan history and/or a credit score.
  • The AAN allows sharing of transaction data or bank statements from savings/deposit/current accounts.

What kind of data can be shared?

  • Today, banking transaction data is available to be shared (for example, bank statements from a current or savings account) across the banks that have gone live on the network.
  • Gradually the AA framework will make all financial data available for sharing, including tax data, pensions data, securities data (mutual funds and brokerage), and insurance data will be available to consumers.
  • It will also expand beyond the financial sector to allow healthcare and telecom data to be accessible to the individual via AA.

Can AAs view or ‘aggregate’ personal data? Is the data sharing secure?

  • Account Aggregators cannot see the data; they merely take it from one financial institution to another based on an individual’s direction and consent.
  • Contrary to the name, they cannot ‘aggregate’ your data.
  • AAs are not like technology companies which aggregate your data and create detailed profiles of you.
  • The data AAs share is encrypted by the sender and can be decrypted only by the recipient.
  • The end to end encryption and use of technology like the ‘digital signature’ makes the process much more secure than sharing paper documents.

Can a consumer decide they don’t want to share data?

Yes. Registering with an AA is fully voluntary for consumers.

  • If the bank the consumer is using has joined the network, a person can choose to register on an AA, choose which accounts they want to link, and share their data.
  • A customer can reject a consent to share request at any time.
  • If a consumer has accepted to share data in a recurring manner over a period (eg during a loan period), it can also be revoked at any time later as well by the consumer.

Duration of the data shared

  • The exact time period for which the recipient institution will have access will be shown to the consumer at the time of consent for data sharing.

How can a customer get registered with an AA?

  • One can register with an AA through their app or website.
  • AA will provide a handle (like username) which can be used during the consent process.
  • Today, four apps are available for download (Finvu, OneMoney, CAMS Finserv, and NADL) with operational licenses to be AAs.
  • Three more have received in principle approval from RBI (PhonePe, Yodlee, and Perfios) and may be launching apps soon.
  • A customer can register with any AA to access data from any bank on the network.

Does a customer need to pay the AA for using this facility?

  • This will depend on the AA. Some may charge a small user fee.
  • Some AAs may be free because they are charging a service fee to financial institutions.

What new services can a customer access if their bank has joined the AA network of data sharing?

The two key services that will be improved for an individual is access to loans and access to money management.

  • If a customer wants to get a small business or personal loan today, there are many documents that need to be shared with the lender.
  • This is a cumbersome and manual process today, which affects the time taken to procure the loan and access to a loan.
  • Similarly, money management is difficult today because data is stored in many different locations and cannot be brought together easily for analysis.
  • Through Account Aggregator, a company can access tamper-proof secure data quickly and cheaply, and fast track the loan evaluation process so that a customer can get a loan.
  • Also, a customer may be able to access a loan without physical collateral, by sharing trusted information on a future invoice or cash flow directly from a government system like GST or GeM.

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Textile Sector – Cotton, Jute, Wool, Silk, Handloom, etc.

PLI Scheme for Textiles

Note4Students

From UPSC perspective, the following things are important :

Prelims level: PLI scheme for various sectors

Mains level: Textile sector of India

The Union Government has approved Production Linked Incentive (PLI) Scheme for Textiles.  This move is a part of the overall announcement of PLI Schemes for 13 sectors made earlier during the Union Budget 2021-22.

What is PLI Scheme?

  • As the name suggests, the scheme provides incentives to companies for enhancing their domestic manufacturing apart from focusing on reducing import bills and improving the cost competitiveness of local goods.
  • PLI scheme offers incentives on incremental sales for products manufactured in India.
  • The scheme for respective sectors has to be implemented by the concerned ministries and departments.

Criteria laid for the scheme

  • Eligibility criteria for businesses under the PLI scheme vary based on the sector approved under the scheme.
  • For instance, the eligibility for telecom units is subject to the achievement of a minimum threshold of cumulative incremental investment and incremental sales of manufactured goods.
  • The minimum investment threshold for MSME is Rs 10 crore and Rs 100 crores for others.
  • Under food processing, SMEs and others must hold over 50 per cent of the stock of their subsidiaries, if any.
  • On the other hand, for businesses under pharmaceuticals, the project has to be a greenfield project while the net worth of the company should not be less than 30 per cent of the total committed investment.

What are the incentives involved?

  • An incentive of 4-6 per cent was offered last year on mobile and electronic components manufacturers such as resistors, transistors, diodes, etc.
  • Similarly, 10 percent incentives were offered for six years (FY22-27) of the scheme for the food processing industry.
  • For white goods too, the incentive of 4-6 per cent on incremental sales of goods manufactured in India for a period of five years was offered to companies engaged in the manufacturing of air conditioners and LED lights.

What is in the box for Textiles?

  • The PLI scheme for textiles aims to promote the production of high value Man-Made Fibre (MMF) fabrics, garments and technical textiles.
  • Any person or company willing to invest a minimum of Rs 300 crore in plant, machinery, equipment and civil works (excluding land and administrative building cost) to produce products of MMF fabrics, garments and products of technical textiles will be eligible.
  • Investors willing to spend a minimum of Rs 100 crore under the same conditions shall be eligible.

Benefits offered

  • PLI scheme for Textiles will promote production of high value MMF Fabric, Garments and Technical Textiles in country.
  • The incentive structure has been so formulated that the industry will be encouraged to invest in fresh capacities in these segments.
  • This will give a major push to the growing high-value MMF segment which will complement the efforts of the cotton and other natural fiber-based textiles industry.
  • This will help to generate new opportunities for employment and trade, resultantly helping India regain its historical dominant status in global textiles trade.

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Back2Basics: India’s textile sector

  • The textile industry in India traditionally, after agriculture, is the only industry that has generated huge employment for both skilled and unskilled labour.
  • The domestic textiles and apparel industry contributes 5% to India’s GDP, 7% of industry output in value terms, and 12% of the country’s export earnings.
  • The textile industry continues to be the second-largest employment generating sector in India. It offers direct employment to over 35 million in the country.
  • India is first in global jute production and shares 63% of the global textile and garment market. India is second in global textile manufacturing and also second in silk and cotton production.
  • 100% FDI is allowed via automatic route in textile sector.

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Foreign Policy Watch: India-Sri Lanka

Sri Lanka’s economic crisis poses challenges for India

Note4Students

From UPSC perspective, the following things are important :

Prelims level: SAARC Currency Swap Framework 2019-2022

Mains level: Paper 2- India-Sri Lanka relations

Context

On 31 August 2021, Sri Lanka declared a state of economic emergency, as it is running out of foreign exchange reserves for essential imports like food.

Economic cooperation with Sri Lanka

  • India is Sri Lanka’s third-largest export destination, after the US and UK.
  • More than 60% of Sri Lanka’s exports enjoy the benefits of the India-Sri Lanka Free Trade Agreement, which came into effect in March 2000.
  •  India is also a major investor in Sri Lanka.
  •  Foreign direct investment (FDI) from India amounted to around $ 1.7 billion over the years from 2005 to 2019.
  • Concessional financing of about $ 2 billion has been provided to Sri Lanka through various Indian government-supported Lines of Credit across sectors like railways, infrastructure and security.
  • India’s development partnership with Sri Lanka has always been demand-driven, with projects covering social infrastructure like education, health, housing etc.
  • The Reserve Bank of India (RBI) had signed a currency-swap agreement with the Central Bank of Sri Lanka (CBSL) under the Saarc Currency Swap Framework 2019-22.

Factors responsible for economic emergency in Sri Lanka

  • Tourism: Tourism, a big dollar earner for Sri Lanka, has suffered since the Easter Sunday terror attacks of 2019, followed by the pandemic.
  • Declining FDI: Earnings fell from $3.6 billion in 2019 to $0.7 billion in 2020, even as FDI inflows halved from $1.2 billion to $670 million over the same period.
  • Debt distress: Its public debt-to-GDP ratio was at 109.7% in 2020, and its gross financing needs remain high at 18% of GDP, higher than most of its emerging economy peers.
  •  The external debt-to-GDP ratio stood at 62% in 2020 and is predominantly owed by its public sector.
  • More than $2.7 billion of foreign currency debt will be due in the next two years.

How economic crisis may push Sri Lanka to align its policies with China

  • Reliance on Chinese credit: Sri Lanka has increasingly relied on Chinese credit to address its foreign debt burden.
  • Unable to service its debt, in 2017, Sri Lanka lost the unviable Hambantota port to China for a 99-year lease.
  • Increasing bilateral trade: China’s exports to Sri Lanka surpassed those of India in 2020 and stood at $3.8 billion (India’s exports were $3.2 billion).
  • Strategic investment by China: Owing to Sri Lanka’s strategic location at the intersection of major shipping routes, China has heavily invested in its infrastructure (estimated at $12 billion between 2006 and 2019).
  • In May, Sri Lanka passed the Colombo Port City Economic Commission Act, which provides for establishing a special economic zone around the port and also a new economic commission, to be funded by China.

Implications for India

  • Relations between India and Sri Lanka seem to have plummeted since the beginning of this year.
  • In February, Sri Lanka backed out from a tripartite partnership with India and Japan for its East Container Terminal Project at the Colombo Port, citing domestic issues.
  • Sri Lanka’s economic crisis may further push it to align its policies with Beijing’s interests.
  • India is already on a diplomatic tightrope with Afghanistan and Myanmar.
  • Other South Asian nations like Bangladesh, Nepal and the Maldives have also been turning to China to finance large-scale infrastructure projects.

Way forward

  • Nurturing the Neighbourhood First policy with Sri Lanka will be important for India.
  • Explore possibility through regional platforms: The BIMSTEC and the Indian Ocean Rim Association could be leveraged to foster cooperation in common areas of interest like technology-driven agriculture and marine sector, IT, renewable energy, and transport and connectivity.
  • Cooperation on private sector investment: Both countries could also cooperate on enhancing private sector investments to create economic resilience.

Consider the question “How economic troubles in Sri Lanka could impact India? Suggest the way forward.”

Conclusion

With its economy in deep trouble, Sri Lanka may get further pushed towards China, India has to deliver on its Neighbourhood First policy to protects itself from the adverse fallout.

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Agricultural Sector and Marketing Reforms – eNAM, Model APMC Act, Eco Survey Reco, etc.

How India’s food systems must respond to the climate crisis

Note4Students

From UPSC perspective, the following things are important :

Prelims level: EAT-Lancet diet

Mains level: Paper 3- Food system issues

Context

This month, the UN Secretary-General will convene the Food Systems Summit. There is a proposal to have an International Panel on Food and Nutritional Security (IPFN) — an “IPCC for food,” similar to the panel on climate change.

Issues with India’s agriculture?

  • What is a food system? According to the Food and Agriculture Organisation (FAO), food systems encompass the entire range of actors involved in the production, aggregation, processing, distribution, consumption and disposal of food products.
  • Effects of Green Revolution: The Green Revolution succeeded in making India food sufficient, however, it also led to water-logging, soil erosion, groundwater depletion and the unsustainability of agriculture.
  • Deficit mindset: Current policies are still based on the “deficit” mindset of the 1960s.
  • Biased policies: The procurement, subsidies and water policies are biased towards rice and wheat.
  • Three crops (rice, wheat and sugarcane) corner 75 to 80 per cent of irrigated water.
  • Lack of diversification: Diversification of cropping patterns towards millets, pulses, oilseeds, horticulture is needed for more equal distribution of water, sustainable and climate-resilient agriculture.

Issues with various elements of India’s food system

1) Changes needed in India’s agriculture

  • The narrative of Indian agriculture has to be changed towards more diversified high-value production, better remunerative prices and farm incomes.
  • Inclusive: It must be inclusive in terms of women and small farmers.
  • Similarly, women’s empowerment is important particularly for raising incomes and nutrition.
  • Women’s cooperatives and groups like Kudumbashree in Kerala would be helpful.
  • Small farmers require special support, public goods and links to input and output markets.
  • Better remunerative prices: Farmer producer organisations help get better prices for inputs and outputs for small-holders.
  • The ITC’s E-Choupal is an example of technology benefiting small farmers.
  • Innovation: One of the successful examples of a value chain that helped small-holders, women and consumers is Amul (Anand Milk Union Ltd) created by Verghese Kurien.
  • Such innovations are needed in other activities of food systems.

2) Hunger and malnutrition in India

  • The NFHS-5 shows that under-nutrition has not declined in many states even in 2019-20. Similarly, obesity is also rising.
  • A food systems approach should focus more on the issues of undernutrition and obesity.
  • Safe and healthy diversified diets are needed for sustainable food systems.
  • The EAT-Lancet diet, which recommends a healthy and sustainable diet, is not affordable for the majority of the population in India.
  • Animal-sourced foods are still needed for countries like India. For instance, per capita consumption of meat is still below 10 kg in India as compared to 60 to 70 kg in the US and Europe.

3) Ensuring sustainability of food system

  • Estimates show that the food sector emits around 30 per cent of the world’s greenhouse gases.
  • Sustainability has to be achieved in production, value chains and consumption.
  • How to achieve sustainability? Climate-resilient cropping patterns have to be promoted.
  • Instead of giving input subsidies, cash transfers can be given to farmers for sustainable agriculture.

4) Health and social protection

  • Food systems also need health infrastructure.
  • The Covid-19 pandemic has exposed the weak health infrastructure in countries like India.
  • Inclusive food systems need strong social protection programmes.
  • India has long experience in these programmes. Strengthening India’s National Rural Employment Guarantee Act, public distribution system (PDS), nutrition programmes like ICDS, mid-day meal programmes, can improve income, livelihoods and nutrition for the poor and vulnerable groups.

5) Role of non-agriculture

  • Some economists like T N Srinivasan argued that the solution for problems in agriculture was in non-agriculture.
  • Reduce pressure on agriculture: Therefore, labour-intensive manufacturing and services can reduce pressure on agriculture.
  • Income from agriculture is not sufficient for smallholders and informal workers.
  • Strengthening rural MSMEs and food processing is part of the solution.

Conclusion

India should also aim for a food systems transformation, which can be inclusive and sustainable, ensure growing farm incomes and nutrition security.

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Renewable Energy – Wind, Tidal, Geothermal, etc.

Green hydrogen, a new ally for a zero carbon future

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Pink hydrogen

Mains level: Paper 3- Green hydrogen

Context

The forthcoming 26th UN Climate Change Conference of the Parties (COP26) in Glasgow from November 1-12, 2021 is to re-examine the coordinated action plans to mitigate greenhouse gases and climate adaptation measures.

How Green hydrogen as a fuel can be a game changer?

  • Hydrogen is the most abundant element on the planet, but rarely in its pure form which is how we need it.
  • High energy density: It has an energy density almost three times that of diesel.
  • ‘Green hydrogen’, the emerging novel concept, is a zero-carbon fuel made by electrolysis using renewable power from wind and solar to split water into hydrogen and oxygen.
  • Best solution to remain under 1.5° C: The International Energy Agency (IEA) forecasts the additional power demand to be to the tune of 25%-30% by the year 2040.
  • Thus, power generation by ‘net-zero’ emission will be the best solution to achieve the target of expert guidelines on global warming to remain under 1.5° C.
  • Untapped potential: Presently, less than 0.1% or say ~75 million tons/year of hydrogen capable of generating ~284GW of power, is produced.

Challenges: Production and storage cost

  • The challenge is to compress or liquefy the LH2 (liquid hydrogen); it needs to be kept at a stable minus 253° C.
  • This leads to its ‘prior to use exorbitant cost’.
  • The ‘production cost’ of ‘Green hydrogen’ has been considered to be a prime obstacle.
  • The production cost of this ‘green source of energy’ is expected to be around $1.5 per kilogram (for nations having perpetual sunshine and vast unused land), by the year 2030; by adopting various conservative measures.

Experiments in India

    • The Indian Railways have announced the country’s first experiment of a hydrogen-fuel cell technology-based train by retrofitting an existing diesel engine; this will run under Northern Railway on the 89 km stretch between Sonepat and Jind.
  • The project will not only ensure diesel savings to the tune of several lakhs annually but will also prevent the emission of 0.72 kilo tons of particulate matter and 11.12-kilo tons of carbon per annum.

Way forward for India

  • India is the world’s fourth-largest energy-consuming country (behind China, the United States and the European Union), according to the IEA’s forecast, and will overtake the European Union to become the world’s third energy consumer by the year 2030.
  • It is high time to catch up with the rest of the world by going in for clean energy, decarbonising the economy and adopting ‘Green hydrogen’ as an environment-friendly and safe fuel for the next generations.

Conclusion

In order to achieve the goal of an alternative source of energy, adopting a multi-faceted practical approach to utilise ‘Green hydrogen’ offers a ray of hope.

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Women empowerment issues – Jobs,Reservation and education

NDA to admit Women: Centre

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Women in Armed FOrces

The Centre gave the Supreme Court the “good news” that it had taken a decision to allow women entry into the National Defence Academy (NDA), so far a male bastion for recruitment into the Armed Forces.

About National Defence Academy

  • The NDA is the joint defence service training institute of the Indian Armed Forces, where cadets of the three services train together before they go on to respective service academy for further pre-commission training.
  • It is located in Khadakwasla, Pune, Maharashtra.
  • It is the first tri-service academy in the world.
  • Applicants to the NDA are selected via a written exam conducted by the UPSC every year, followed by extensive interviews by the Services Selection Board.

What was the latest development?

  • Recently, the Supreme Court upheld the right of serving Short Service Commission (SSC) women officers of the Navy to be granted Permanent Commission (PC) on a par with their male counterparts.

Women in Armed Forces: Significance

  • The court ruled that women naval officers cannot be denied the right to equal opportunity and dignity entitled to under the Constitution on specious grounds such as physiology, motherhood and physical attributes.
  • The battle for gender equality is about confronting the battles of the mind.
  • History is replete with examples where women have been denied their just entitlements under law and the right to fair and equal treatment in the workplace.

Why males have ever dominated the armed forces?

  • Militaries across the world help entrench hegemonic masculine notions of aggressiveness, strength and heterosexual prowess in and outside their barracks.
  • The military training focuses on creating new bonds of brotherhood and camaraderie between them based on militarized masculinity.
  • This temperament is considered in order to enable conscripts to survive the tough conditions of military life and to be able to kill without guilt.
  • To create these new bonds, militaries construct a racial, sexual, gendered “other”, attributes of whom the soldier must routinely and emphatically reject.

Dimensions of the Issue

Gender is not a hindrance: As long as an applicant is qualified for a position, one’s gender is arbitrary. It is easy to recruit and deploy women who are in better shape than many men sent into combat.

Combat Readiness: Allowing a mixed-gender force keeps the military strong. The armed forces are severely troubled by falling retention and recruitment rates. This can be addressed by allowing women in the combat role.

Effectiveness: The blanket restriction for women limits the ability of commanders in theatre to pick the most capable person for the job.

Tradition: Training will be required to facilitate the integration of women into combat units. Cultures change over time and the masculine subculture can evolve too.

Cultural Differences & Demographics: Women are more effective in some circumstances than men. Allowing women to serve doubles the talent pool for delicate and sensitive jobs that require interpersonal skills, not every soldier has.

Hurdles for Women

Capabilities of women: Although women are equally capable, if not more capable than men, there might be situations that could affect the capabilities of women such as absence during pregnancy and catering to the responsibilities of motherhood, etc.

Adjusting with the masculine setup: To then simply add women to this existing patriarchal setup, without challenging the notions of masculinity, can hardly be seen as “gender advancement”.

Fear of sexual harassment: Sexual harassment faced by women military officers is a global phenomenon that remains largely unaddressed, and women often face retaliation when they do complain.

Gender progressiveness could be an illusion: Women’s inclusion is criticized as just another manoeuvre to camouflage women’s subjugation and service as women’s liberation.

Battle of ‘Acceptance’: Acceptance of women in the military has not been smooth in any country. Every army has to mould the attitude of its society at large and male soldiers in particular to enhance acceptability of women in the military.

Job Satisfaction: Most women feel that their competence is not given due recognition. Seniors tend to be over-indulgent without valuing their views. They are generally marginalised and not involved in any major decision-making.

Doubts about Role Definition: The profession of arms is all about violence and brutality. To kill another human is not moral but soldiers are trained to kill.

Physical and Physiological Issues: The natural physical differences in stature, strength, and body composition between the sexes make women more vulnerable to certain types of injuries and medical problems. The natural processes of menstruation and pregnancy make women particularly vulnerable in combat situations.

Comfort Level: Most women accepted the fact that their presence amongst males tends to make the environment ‘formal and stiff’. The mutual comfort level between men and women colleagues is often very low.

Conclusion

  • Concern for equality of sexes or political expediency should not influence defence policies.
  • Armed forces have been constituted with the sole purpose of ensuring defence of the country and all policy decisions should be guided by this overriding factor.
  • All matters concerning defence of the country have to be considered in a dispassionate manner.
  • No decision should be taken which even remotely affects the cohesiveness and efficiency of the military.

Way ahead

  • Induction of women into armed forces should be on the basis of their abilities and not on the basis of their gender.
  • The training for both women and men should be standardized to eliminate differentiation based on physical capabilities.
  • The career aspects and opportunities for women need to be viewed holistically keeping the final aim in focus.

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Minority Issues – SC, ST, Dalits, OBC, Reservations, etc.

Domicile Based Job Quota

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Article 16

Mains level: Equal opportunity enshrined in Constitution

The Jharkhand Assembly has passed a Bill, which provides 75% reservation for local people in the private sector up to ₹40,000 salary a month.

Try answering this PYQ first:

Q.One of the implications of equality in society is the absence of- (CSP 2018)

(a) Privileges

(b) Restraints

(c) Competition

(d) Ideology

What is the move?

  • Every employer shall register such employees receiving gross monthly salary as wages not more than ₹ 40,000 as the limit notified by the government from time to time on the designated portal within three months of the Act coming into force.
  • Every employer shall fill up 75% of the total existing vacancies on the date of notification of this Act and subsequent thereto by local candidates with respect to such posts where the gross monthly salary or wages are not more than ₹40,000”.
  • The Bill provides for the local MLA to supervise the employment procedure and issue directions to the employer concerned as it may deem fit.

Other such states

  • Once notified, Jharkhand will become the third State in the country, after Andhra Pradesh and Haryana, to pass such law.
  • In 2019, Andhra Pradesh passed such law, while in June last, Haryana passed law, reserving 75% quota for the local people in private jobs with monthly salary less than ₹50,000.

What is Quota for Locals?

Ans. Constitutional provision for Equal Treatment

  • Article 16 of the Constitution guarantees equal treatment under the law in matters of public employment. It prohibits the state from discriminating on grounds of place of birth or residence.
  • Article 16(2) states that “no citizen shall, on grounds only of religion, race, caste, sex, descent, place of birth, residence or any of them, be ineligible for, or discriminated against in respect of, any employment or office under the State”.
  • The provision is supplemented by the other clauses in the Constitution that guarantee equality.
  • However, Article 16(3) of the Constitution provides an exception by saying that Parliament may make a law “prescribing” a requirement of residence for jobs in a particular state.
  • This power vests solely in the Parliament, not state legislatures.

Why does the Constitution prohibit reservation based on domicile?

  • When the Constitution came into force, India turned itself into one nation from a geographical unit of individual principalities and the idea of the universality of Indian citizenship took root.
  • India has single citizenship, and it gives citizens the liberty to move around freely in any part of the country.
  • Hence the requirement of a place of birth or residence cannot be qualifications for granting public employment in any state.

But are reservations not granted on other grounds such as caste?

  • Equality enshrined in the Constitution is not mathematical equality and does not mean all citizens will be treated alike without any distinction.
  • To this effect, the Constitution underlines two distinct aspects which together form the essence of equality law:
  1. Non-discrimination among equals, and
  2. Affirmative action to equalize the unequal

Supreme Court rulings on quota for locals

  • The Supreme Court has ruled against reservation based on place of birth or residence.
  • In 1984, ruling in Dr Pradeep Jain v Union of India, the issue of legislation for “sons of the soil” was discussed.
  • The court expressed an opinion that such policies would be unconstitutional but did not expressly rule on it as the case was on different aspects of the right to equality.
  • In a subsequent ruling in Sunanda Reddy v State of Andhra Pradesh (1995), the Supreme Court affirmed the observation in 1984 ruling to strike down a state government policy that gave 5% extra weightage to candidates.
  • In 2002, the Supreme Court invalidated appointment of government teachers in Rajasthan in which the state selection board gave preference to “applicants belonging to the district or the rural areas of the district concerned”.
  • In 2019, the Allahabad HC struck down a recruitment notification by the UP PSC which prescribed preference for women who are “original residents” of the UP alone.

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Minimum Support Prices for Agricultural Produce

Issues related to MSP

Note4Students

From UPSC perspective, the following things are important :

Prelims level: MSP system, Crop Seasons in India

Mains level: MSP Mechanism

The Centre has increased the Minimum Support Price (MSP) for various crops ahead of the upcoming rabi season harvest.

Answer this PYQ from CSP 2018

Q.Consider the following:

  1. Areca nut
  2. Barley
  3. Coffee
  4. Finger millet
  5. Groundnut
  6. Sesamum
  7. Turmeric

The Cabinet Committee on Economic Affairs has announced the Minimum Support Price for which of the above?

(a) 1, 2, 3 and 7 only

(b) 2, 4, 5 and 6 only

(c) 1, 3, 4, 5 and 6 only

(d) 1, 2, 3, 4, 5 and 7

 

Post your answers here.

What is the Minimum Support Price (MSP) system?

  • MSP is a form of market intervention by the Govt. of India to insure agricultural producers against any sharp fall in farm prices.
  • MSP is price fixed by GoI to protect the producer – farmers – against excessive falls in price during bumper production years.

Who announces it?

  • MSP is announced at the beginning of the sowing season for certain crops on recommendations by Commission for Agricultural Costs and Prices(CACP) and announced by Cabinet Committee on Economic Affairs (CCEA) chaired by the PM of India.

Why MSP?

  • The major objectives are to support the farmers from distress sales and to procure food grains for public distribution.
  • They are a guaranteed price for their produce from the Government.
  • In case the market price for the commodity falls below the announced MSP due to bumper production and glut in the market, government agencies purchase the entire quantity offered by the farmers at the announced MSP.

Historical perspective

  • Till the mid-1970s, Government announced two types of administered prices:
  1. Minimum Support Prices (MSP)
  2. Procurement Prices
  • The MSPs served as the floor prices and were fixed by the Govt. in the nature of a long-term guarantee for investment decisions of producers, with the assurance that prices of their commodities would not be allowed to fall below the level fixed by the Government, even in the case of a bumper crop.
  • Procurement prices were the prices of Kharif and rabi cereals at which the grain was to be domestically procured by public agencies (like the FCI) for release through PDS.
  • It was announced soon after harvest began.
  • Normally procurement price was lower than the open market price and higher than the MSP.

Crops Covered

  1. Government announces minimum support prices (MSPs) for 22 mandated crops and fair and remunerative prices (FRP) for sugarcane.
  2. The mandated crops are 14 crops of the kharif season, 6 rabi crops and two other commercial crops.
  3. The list of crops is as follows:
  • Cereals (7) – paddy, wheat, barley, jowar, bajra, maize and ragi
  • Pulses (5) – gram, arhar/tur, moong, urad and lentil
  • Oilseeds (8) – groundnut, rapeseed/mustard, toria, soyabean, sunflower seed, sesamum, safflower seed, and nigerseed
  • Raw cotton
  • Raw jute
  • Copra
  • De-husked coconut
  • Sugarcane (Fair and remunerative price)
  • Virginia flu cured (VFC) tobacco

Exception for Sugar

  • The pricing of sugarcane is governed by the statutory provisions of the Sugarcane (Control) Order, 1966 issued under the Essential Commodities Act (ECA), 1955.
  • Prior to the 2009-10 sugar season, the Central Government was fixing the Statutory Minimum Price (SMP) of sugarcane, and farmers were entitled to share profits of a sugar mill on a 50:50 basis.
  • As this sharing of profits remained virtually unimplemented, the Sugarcane (Control) Order, 1966 was amended in October 2009 and the concept of SMP was replaced by the Fair and Remunerative Price (FRP) of sugarcane.

Back2Basics: Rabi and Kharif Crops

Rabi Crops Kharif Crops
·         Rabi crops are sown at the end of monsoon or the beginning of winter. They are also known as winter crops. ·         Kharif crops are sown at the beginning of the rainy season and are also known as monsoon crops.
·         Flowering requires a long day length. ·         Flowering requires a short day length.
·         These crops need a warm climate for seed germination and cold climate for growth. ·         These crops require a lot of water and hot weather to grow. They depend on rainfall.
·         Unseasonal rainfall can damage Rabi crops. ·         Kharif crops depend on rainfall patterns.
·         The harvesting months are March and April. ·         These crops are harvested in September and October
·         Examples: Mustard, wheat, cumin, coriander etc. ·         Examples: Rice, bajra, groundnut.

Zaid Crops

  • The wide range of crops that grow in the short season between Kharif and Rabi crop seasons are known as Zaid crops. These are the months of March till July.
  • Examples: Pumpkin, cucumber, bitter gourd etc.

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Health Sector – UHC, National Health Policy, Family Planning, Health Insurance, etc.

Outpatient Opioid Assisted Treatment Centres

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Drug rehabiliation

The state government in Punjab is banking on Outpatient Opioid Assisted Treatment Centres (OOAT) to curb the drug menace in the state.

What are the OOAT Centres?

  • The move to set up OOAT centres in Punjab began in October 2017.
  • The centres administer de-addiction medicine, a combination of buprenorphine and naloxone, to the opioid-dependent people registering there.
  • Administered in the form of a pill, the treatment is primarily for addicts of opioid drugs, including heroin, poppy husk and opium.
  • There are such private and state-run centres in Punjab.

Why is the Punjab government planning?

  • Punjab is planning to open OOAT linked extension centres and clinics in rural areas to broaden the outreach of this treatment.
  • The idea is that patients get medicine nearer their place of residence.
  • It will also reduce pressure on existing OOAT centres which cater to patients from far-off places.

Administering medicine at OOAT Centres

The patients are broadly put into three categories or phases.

  • In the induction phase, the newly-registered patients are administered medicine at the OOAT centres for a week or two to manage withdrawal symptoms in the presence of the doctor and counselor.
  • In the second, stabilization, phase, which extends between two to four months.
  • The patient is put on watch for taking any opioid-based “super-imposed” illicit drug and accordingly maximum tolerated dose is administered to nullify the kick of the “super-imposed” drug.
  • In the third, maintenance, phase, the patient is given take-home medicine and it continues for a year and a half before an assessment is done to see whether the medicine can be tapered off.

Why is Punjab banking so much on OOAT therapy?

There are two major approaches to wean away opioid-dependent persons.

  • One is the abstinence approach and another alternate medication approach.
  • There are more chances of relapse in an abstinence-based approach as compared to alternate medication for de-addiction.
  • In the abstinence approach, it would have taken years to rehabilitate patients by admitting them to facilities and there would have been increased chances of relapse.
  • On the other hand, the alternate medication approach has been acknowledged as better in various scientific studies worldwide.

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Water Management – Institutional Reforms, Conservation Efforts, etc.

Universal Declaration of the Rights of Rivers

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Rights of River

Mains level: River conservation

Activists have highlighted the plight of rivers as well as the support building up for according rights to them under the Universal Declaration of the Rights of Rivers.

What constitutes the Rights of Rivers?

  • Flow: If we look at a river as an ecosystem instead of cubic metres of water, then the ambit of rights gets broadened.
  • Flora and fauna: It includes aquatic flora and fauna, the biodiversity in its catchment areas, forests, its tributaries, groundwater, the rocks and soil in its bed and banks.
  • Human settlements: The rights of rivers in a sense would mean the ecological causes and conditions making up the natural habitat. Human settlements dependent is the prime factor.
  • Economy: Such rights should not put an end to fishing or other localized, subsistence-based human needs related to the river, but rather push for a healthy relationship respecting the river as an ecosystem.

Universal Declaration of the Rights of Rivers

  • The declaration is a civil society initiative to define the basic rights to which all rivers are entitled, according to a note by non-profit, International Rivers.
  • This trend of granting rights to nature, taking place across the world, signals the beginnings of a radical shift from an extractive mindset to one where conservation safeguards are being extended to nature.
  • The right to recognize rivers as living entities rather than mere human property started in 2008.
  • That year, Ecuador became the first country to constitutionally recognize the Rights of Nature.

Present campaigns

  • In the one year since the declaration, rights have been recognised or declared for the Boulder Creek watershed in the US, the Magpie River in Canada, the Alpayacu river in Ecuador and the Paraná river and its wetlands in Argentina.
  • Several campaigns calling for rights to be accorded to rivers have also incorporated the declaration.
  • These include campaigns for the Lempa river in El Salvador, Tavignanu river in France, Ethiope river in Nigeria, the Indus river in Pakistan and the Frome river in the UK.
  • In 2017, a treaty agreement between the Whanganui Iwi (a Māori tribe) and the New Zealand government recognized the Whanganui River as a legal person.

Recognition of such rights in India

  • In 2017, the Uttarakhand HC ruled that the Indian rivers Ganga and Yamuna, the Gangotri and Yamunotri glaciers, as well as other related natural elements are “legal persons” with all corresponding rights, duties, and liabilities of a living person.
  • Subsequently, in 2018, the same high court ruled that the entire animal kingdom has rights equivalent to that of a living person.

Challenges

  • Cultural practices: Activists and communities have been arguing for a need of cultural change that can bring about the ethic of care with regard to the rest of nature. Indigenous people have had such an ethic in their worldviews and ways of living.
  • Development paradigm: The most critical challenge is whether can rights be protected without changing the current development paradigm. Any paradigm shift also needs questioning of fundamental forms of injustices, including capitalism, statism, anthropocentrism, and patriarchy.
  • Cross-boundary issues: Rivers don’t necessarily follow human-made political boundaries. Indus, one of the longest that runs through China, Pakistan, and India, doesn’t flow as per political boundaries. Its contiguity demands a cross-boundary approach.
  • Cooperation deficit: There is still very limited understanding across the world on how a law on the rights of rivers can be implemented. What would be the best ways to ensure custodianship, restitution, compensation.

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Climate Change Impact on India and World – International Reports, Key Observations, etc.

Places in news: Qeqertaq Avannarleq Island

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Qeqertaq Avannarleq

Mains level: Impact of climate change

A group of researchers who went out to collect samples off the coast of Greenland in July found themselves on a tiny, uninhabited and previously unknown island.

Qeqertaq Avannarleq

  • Measuring 60×30 metres and with a peak of three metres above sea level, it has now become the new northernmost piece of land on Earth.
  • Before this, Oodaaq was marked as the Earth’s northernmost terrain.
  • The new island is made up of seabed mud and moraine, i.e. soil, rock and other material left behind by moving glaciers, and has no vegetation.
  • The group has suggested the discovery be named ‘Qeqertaq Avannarleq’, which is Greenlandic for “the northernmost island”.

How this island came to existence?

Ans. Undoubtedly, climate change in Greenland

  • Global warming has had a severe effect on the ice sheet of Greenland.
  • The new island, which was exposed by shifting pack ice, is, however, not a direct consequence of climate change.

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Needed: A tribunal for CAPF

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Security Force Court

Mains level: Paper 3- Tribunal for CAPF

Context

There have been numerous cases of Central Reserve Police Force (CRPF) officers overstaying leave. The Ministry of Home Affairs (MHA) to issue orders to the CRPF headquarters to “include the provisions of Security Force Court (SFC), for initiating disciplinary action against the delinquent officers.

Departmental enquiries Vs SFC

  • The SFC is a purely judicial process where the guilt must be proved beyond reasonable doubt and the charged official is at liberty to engage a legal practitioner to defend him.
  • Departmental enquiry is a quasi-judicial proceeding where the mere element of the preponderance of probability is enough to determine guilt.
  • Though the Central Reserve Police Force Act of 1949 provides for conducting judicial trial by a Commandant in his capacity as a Magistrate, seldom is it exercised as it gets into the realm of the judicial process.
  • Hence, the conduct of a departmental enquiry is the better option.

What leads to delay in departmental enquiries against gazetted officers?

  • CRPF rules lay down the procedure for the conduct of departmental enquiries against non-gazetted ranks, and in normal circumstances, the departmental enquiries are completed within three to six months.
  • But when gazetted officers are charge-sheeted, the time taken to order the enquiries is longer.
  • Delay due to getting the views of other institutions: In the case of a gazetted officer, the other institutions like the Union Public Service Commission, the Central Vigilance Commission, the Department of Personnel and Training, and the MHA are also roped in for their views and legal opinion.
  • Dealy due to postponement: When the delinquent officers appear before the inquiring authority presence of the presenting officer and the defence assistant of the charged official is also required.
  • Even if one of them fails to appear for the hearing, the conduct of enquiry must be postponed.
  • Procedural delay: Often, the enquiry is conducted ex parte (without the presence of the charged official), so the recorded statements and other documents must be sent to the charged official.
  • Quite often, delays occur in providing certain prosecution documents to the charged official who may demand them for preparing his own defence.
  • Postal delays further aggravate the matter.
  • Since most officers are busy with operational matters, which gain priority over everything else.

Way forward

  • Appoint retired officers as inquiring authorities: The solution lies in appointing retired officers as inquiring authorities, who can afford to devote their time to the conduct of enquiries as is being done in most departments of the government.
  • Tribunal for CAPF: With increasing cases being filed in the High Courts across the country in service matters, it is high time the government considered the setting up of tribunals for the CAPFs on the lines of the Armed Forces Tribunal for defence services.
  • Retired officers of the rank of Inspectors General and Additional Directors General from the CAPFs could be part of these tribunals along with retired judges of High Courts.

Conclusion

Taking the steps suggested here would ensure the speedy delivery of justice and reduce the burden of the High Courts.

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The economic reforms — looking back to look ahead

Note4Students

From UPSC perspective, the following things are important :

Prelims level: HRC

Mains level: Paper 3- Reforms to deal with the issues after 1991 reforms

Context

The economic reforms, so far, have been more focused on the technical nature of the economy than the system, process and people. The fundamentals need to be set right with a focus on human capital, technology readiness and productivity.

Benefits and limits of economic reforms of 1991

  • Economic reforms of 1991 — and from time to time, subsequent interjections for liberalisation of economy and trade — have enabled some credible gains for the country.
  • Benefits: Foreign exchange reserves (over $600 billion), sustained manufacturing contribution in GDP, increased share in global exports (from 0.6% in the 1990s to 1.8%), robust software exports, and sustained economic growth in the range of 6%-8% are clear indicators of its success.
  • Limits: Primary drivers of the economy — human capital, technology readiness, productivity, disposable income, capital expenditure, process innovation in setting up businesses, and institutional capacity — have not got enough recognition.

Issues affecting the Indian economy

1) Lack of Human resource capital formation

  • The human resource capital (HRC) formation, a good determinant of labour productivity, has been missing over the entire period of reforms.
  • The HRC rank for India stands at 103; Sri Lanka is at 70, China at 34, and South Korea at 27, as brought out by the Global Human Capital Report, 2017.
  • Factors responsible for low HRC: The lack of quality education, low skilled manpower, and inadequacies in basic health care have resulted in low HRC.

2) Low disposable income

  • The World Bank database on GDP for 2019 indicates the low per capita GDP in India, at $2,104 (at $6,997 in PPP terms, ranked 125th globally) against the world average of $11,429 (at $17,678 in PPP terms).
  • Low per capita GDP has direct links to low per capita family income.
  • Low wages: The report by Deloitte (Global Manufacturing Competitiveness Index in 2016) reflects that the hourly wages in India have been $1.7; they are $38, $24, $20.7, and $3.3 for the United States, Japan, South Korea, and China, respectively.
  • Low wages have a direct bearing on the disposable income of families, affecting demand.

3) Low R&D expenditure

  • India’s research and development expenditure stand at 0.8% of GDP, for other fast-emerging economies such as South Korea, it is (4.5%), China (2.1%), and Taiwan (3.3%).
  • Reduced technology readiness: This low expenditure is resulting in lower capacity for innovation in technologies and reduced ‘technology readiness’, especially for manufacturing.

4) Low labour productivity: Result of low HRC and lack of technology readiness

  • The lack of HRC and low technology readiness have impacted labour productivity adversely.
  • World Bank publication of 2018 indicates that India’s labour productivity in manufacturing is less than 10% of the advanced economies including Germany and South Korea, and is about 40% of China.
  • Low productivity has unfavourable consequences for competitiveness, manufacturing growth, exports and economic growth.

5) Long time and more cost in setting up a business

  • There are difficulties in acquiring land for businesses, inefficient utilization of economic infrastructure, and in providing business services.
  • This results in a long time and more cost in setting up enterprises, resulting in a loss of creative energy of entrepreneurs.

Way forward

  • Investment in human capital and technology: First, to attract large investment in manufacturing and advanced services, at a basic level, investment in human capital and technology is a prerequisite.
  • Technology readiness: The reports by McKinsey and the World Economic Forum on advanced manufacturing suggest that Industry 4.0 will be defined by new technologies such as robotics, 3-D printing, artificial intelligence (AI), the Internet of things (IoT), etc.
  • Consequently, efforts for technology readiness are very essential to stay competitive.
  • It demands enhancing public research and development expenditure to 2% of GDP over the next three years.
  • Strategies to enhance per capita income: There is a need to work on strategies to enhance per capita income by more wages for workers through higher skills and enhancing minimum wages, besides improving the social security net.
  • Promote business-centric approach: Using insights from the work of Nobel laureate (1993) Douglass C. North, it is necessary to build the capacity of public institutions to create a good environment for business and industry.
  • Policy reforms should lay an emphasis on process innovation and promote a business-centric approach to create a friendly ecosystem and for efficient internal supply chain management to integrate with the global supply chain.
  • Innovative nature in public policymaking: The future of the economy should be particularly viewed in the backdrop of a significant and irreversible shift in terms of reliance on the global supply chain as a result of the knowledge-intensive nature of businesses and exponential effects caused by advanced technologies under Industry 4.0, since the 2010s.
  • Therefore, the strategies adopted since the 1990s till now may not ensure adequate returns and call for innovative approaches in public policymaking.

Consider the question “The economic reforms, so far, have been more focussed on the technical nature of the economy than the system. This resulted in fundamental deficiencies. Suggest the way forward to deal with these deficiencies.”

Conclusion

In sum, it necessitates a systemic approach for policy reforms for setting the economic fundamentals right and to achieve higher growth.

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G20 : Economic Cooperation ahead

India appoints Sherpa for G20 Summit

Note4Students

From UPSC perspective, the following things are important :

Prelims level: G20, G7 and its members

Mains level: G20

The government has appointed a union minister as Sherpa for the G20 summit.

Who is a Sherpa (in IR context)?

  • A sherpa is the personal representative of a head of state or government who prepares an international summit, particularly the annual G7 and G20 summits.
  • Between the G7 summits, there are multiple sherpa conferences where possible agreements are laid out.
  • This reduces the amount of time and resources required at the negotiations of the heads of state at the final summit.
  • The name sherpa—without further context—refers to sherpas for the G7 summit, but the designation can be extended to different regular conferences where the participation of the head of state is required.
  • The sherpa is generally quite influential, although they do not have the authority to make a final decision about any given agreement.
  • The name is derived from the Sherpa people, a Nepalese ethnic group, who serve as guides and porters in the Himalayas, a reference to the fact that the sherpa clears the way for a head of state at a major summit.

About G20

  • Formed in 1999, the G20 is an international forum of the governments and central bank governors from 20 major economies.
  • Collectively, the G20 economies account for around 85 percent of the Gross World Product (GWP), 80 percent of world trade.
  • To tackle the problems or address issues that plague the world, the heads of governments of the G20 nations periodically participate in summits.
  • In addition to it, the group also hosts separate meetings of the finance ministers and foreign ministers.
  • The G20 has no permanent staff of its own and its chairmanship rotates annually between nations divided into regional groupings.

Aims and objectives

  • The Group was formed with the aim of studying, reviewing, and promoting high-level discussion of policy issues pertaining to the promotion of international financial stability.
  • The forum aims to pre-empt the balance of payments problems and turmoil on financial markets by improved coordination of monetary, fiscal, and financial policies.
  • It seeks to address issues that go beyond the responsibilities of any one organization.

Members of G20

The members of the G20 consist of 19 individual countries plus the European Union (EU).

  • The 19 member countries of the forum are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, United Kingdom and the United States.
  • The European Union is represented by the European Commission and by the European Central Bank.

Its significance

  • G20 is a major international grouping that brings together 19 of the world’s major economies and the European Union.
  • Its members account for more than 80% of global GDP, 75% of trade and 60% of population.

India and G20

  • India has been a member of the G20 since its inception in 1999.

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Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.

Govt. mulls allowing local sales by SEZ units sans import tag

Note4Students

From UPSC perspective, the following things are important :

Prelims level: SEZs, Baba Kalyani Committee

Mains level: Read the attached story

The government is considering a proposal to allow producers in Special Economic Zones (SEZs) to sell their output to the domestic market without treating them as imports.

What are SEZs?

  • A Special Economic Zone (SEZ) is an area in which the business and trade laws are different from the rest of the country.
  • SEZs are located within a country’s national borders, and their aims include increasing trade balance, employment, increased investment, job creation, and effective administration.
  • To encourage businesses to set up in the zone, financial policies are introduced.
  • These policies typically encompass investing, taxation, trading, quotas, customs, and labor regulations.
  • Additionally, companies may be offered tax holidays, where upon establishing themselves in a zone, they are granted a period of lower taxation.

SEZs in India

  • The SEZ policy in India first came into inception on April 1, 2000.
  • The prime objective was to enhance foreign investment and provide an internationally competitive and hassle-free environment for exports.
  • The idea was to promote exports from the country and realizing the need for a level playing field must be made available to the domestic enterprises and manufacturers to be competitive globally.
  • Subsequently, the SEZ Act 2005, was enacted to provide the umbrella legal framework, covering all important legal and regulatory aspects of SEZ development as well as for units operating in SEZs.

Who can set up SEZs? Can foreign companies set up SEZs?

  • Any private/public/joint sector or state government or its agencies can set up an SEZ.
  • Yes, a foreign agency can set up SEZs in India.

What is the role of state governments in establishing SEZs?

  • State governments will have a very important role to play in the establishment of SEZs.
  • A representative of the state government, who is a member of the inter-ministerial committee on private SEZ, is consulted while considering the proposal.
  • Before recommending any proposals to the ministry of commerce and industry (department of commerce), the states must satisfy themselves that they are in a position to supply basic inputs like water, electricity, etc.

Are SEZs controlled by the government?

  • In all SEZs, the statutory functions are controlled by the government.
  • The government also controls the operation and maintenance function in the central government-controlled SEZs. The rest of the operations and maintenance are privatized.

Are SEZs exempt from labor laws?

  • Normal labor laws are applicable to SEZs, which are enforced by the respective state governments.
  • The state governments have been requested to simplify the procedures/returns and for the introduction of a single-window clearance mechanism by delegating appropriate powers to development commissioners of SEZs.

Who monitors the functioning of the units in SEZ?

  • The performance of the SEZ units is monitored by a unit approval committee consisting of a development commissioner, custom, and representative of the state government on an annual basis.

What are the special features for business units that come to the zone?

  • Business units that set up establishments in an SEZ would be entitled to a package of incentives and a simplified operating environment.
  • Besides, no license is required for imports, including second-hand machinery.

How do SEZs help a country’s economy?

  • SEZs play a key role in the rapid economic development of a country.
  • In the early 1990s, it helped China and there were hopes that the establishment in India of similar export-processing zones could offer similar benefits – provided, however, that the zones offered attractive enough concessions.
  • Traditionally the biggest deterrents to foreign investment in India have been high tariffs and taxes, red-tapism, and strict labor laws.
  • To date, these restrictions have ensured that India has been unable to compete with China’s massively successful light-industrial export machine.

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