Note4Students
From UPSC perspective, the following things are important :
Prelims level: Critical information infrastructure
Mains level: Critical information infrastructure, need for global norms of protection
Central Idea
- Technology has become pervasive, impacting various aspects of society, including national and foreign policies, governance, service delivery, and warfare. However, this dependence on technology also exposes critical systems to potential disruptions. Safeguarding critical systems is a nation’s responsibility to ensure the continuity of vital services.
What is critical information infrastructure?
- Critical information infrastructure refers to the interconnected systems and assets that are essential for the functioning of a nation’s society, economy, and government. It encompasses the hardware, software, networks, data, and communication channels that support vital services and processes.
- It includes sectors such as transportation, energy, banking and finance, healthcare, telecommunications, water and sanitation, emergency services, and government networks.
- Protecting critical information infrastructure is crucial to ensure the continuity of services, safeguard sensitive data, and defend against cyber threats, including cyberattacks, data breaches, and other malicious activities.
Differences in defining critical information infrastructure
- Criteria for Criticality: Different countries employ distinct criteria to determine the criticality of information infrastructure.
- For example: One country may consider infrastructure critical if its failure impacts national security, economy, public health, or safety. Another country may define critical infrastructure based on the potential for sustained supply shortages, disruptions to public safety and security, or other significant consequences.
- Scope of Infrastructure: There may be variations in the scope of infrastructure considered critical. While certain sectors like energy, transportation, banking, and telecommunications are commonly recognized as critical across many countries, there might be differences in identifying sub-sectors or specific enterprises within those sectors. Some countries may include additional sectors like water and sanitation, emergency services, healthcare, or government networks in their definition of critical information infrastructure.
- Overlapping Criteria: In some cases, the criteria used to identify critical infrastructure may overlap with one another. For instance, ensuring the availability, delivery, or integrity of essential services can encompass vital societal functions, information flow, and communication channels. Harmonizing these overlapping criteria can help establish specific and comprehensive criteria that cater to the needs of all countries.
- National Context: National priorities and contextual factors also influence the definition of critical information infrastructure. Countries may consider their unique geopolitical situation, existing threats, vulnerabilities, and the potential impact on their economy and citizens. This context-specific approach allows each country to address its specific challenges and ensure the protection of infrastructure crucial to its national well-being.
Role of the G20 in developing global norms for protecting critical infrastructure
- Platform for Discussion: The G20 provides a platform for member countries to engage in discussions and exchanges on pressing global issues, including cybersecurity and the protection of critical infrastructure. It brings together policymakers, experts, and stakeholders from various sectors to share insights, experiences, and best practices.
- Building Consensus: The G20 aims to build consensus among member countries on critical issues related to protecting infrastructure. Through dialogue, negotiations, and diplomatic efforts, the G20 seeks to develop common understandings and principles that can guide international cooperation in safeguarding critical information infrastructure.
- Initiating Discussions: The G20 has the capacity to initiate discussions on specific topics and themes relevant to critical infrastructure protection. By placing the issue on the G20 agenda, it draws attention to the importance of addressing cybersecurity risks and establishing global norms in this area.
- Leveraging Economic Influence: The G20 represents around 85 percent of global GDP, over 75 percent of global trade, and a significant portion of the world population. This economic influence provides the G20 with leverage to drive discussions and encourage member countries to prioritize the protection of critical infrastructure.
- Collaboration with International Organizations: The G20 collaborates with international organizations such as the United Nations (UN), International Telecommunication Union (ITU), and Organization for Economic Cooperation and Development (OECD). This collaboration helps leverage the expertise, resources, and frameworks of these organizations to inform discussions and develop comprehensive approaches to protecting critical infrastructure.
- Promoting International Stability: The G20 recognizes that protecting critical infrastructure is crucial for international stability and economic cooperation. By advocating for global norms and responsible state behavior, the G20 aims to enhance cybersecurity, prevent disruptions, and promote a secure digital environment for economic activities.
- Influencing Policy Development: The G20’s discussions and recommendations on critical infrastructure protection can influence policy development at the national and international levels. Member countries may align their policies and frameworks with the norms and principles identified through G20 deliberations, thereby fostering harmonization and cooperation.
Recommendations to the G20
- Common Definition and Critical Sectors: The G20 should adopt a phased approach, beginning with establishing a common definition of critical infrastructure. Subsequently, a broader consensus on critical sectors should be built, followed by the formulation of common principles for regulating critical infrastructure. This process will facilitate a global consensus, ensure cooperation among member countries, and guide nations that are in the early stages of regulating critical infrastructure.
- Common Principles: While formulating common principles for regulating critical infrastructure, the G20 should reaffirm and adopt existing norms as the foundation for future discussions. This includes commitments made in G20 documents like the Hamburg Action Plan and the Buenos Aires Declaration. Furthermore, the G20 can draw from the initiatives of other multilateral groupings, such as the G7, G8, and OECD, that have focused on protecting critical infrastructure.
- Respecting International Law: The G20 should commit to protecting critical infrastructure and refrain from intentionally damaging it. Member countries should conduct themselves in accordance with international law and uphold responsible state behavior in cyberspace.
- International Cooperation: G20 countries must enhance cooperation to prevent, mitigate, trace, and investigate cyber incidents targeting critical infrastructure. Sharing information regarding such incidents should be encouraged. Adopting international standards relevant to critical infrastructure will help harmonize approaches to regulation and enforcement, reducing conflicts and improving cooperation.
- Capacity Building: Investing in research and development and building capacity in emerging technologies such as artificial intelligence (AI), drones, and space is crucial. G20 countries should support low- and middle-income nations in accessing research and technologies. Additionally, countries should respond to requests for assistance from states whose critical infrastructure has been affected, and promote the application of certified security technologies based on international standards.
- Multistakeholder Approach: A multistakeholder commitment is vital to protecting critical information infrastructure. Governments, technology companies, and civil society groups should collaborate to share and analyze critical infrastructure information, prevent attacks, and respond to damage. Awareness should be raised to ensure stakeholders understand the nature and extent of critical information infrastructure and their respective roles in protecting it.
- National Laws: G20 countries should incorporate the principles and norms for protecting critical infrastructure into their national laws. This will help create a culture of enforcement and cooperation at both the national and international levels.
- Institutional Mechanism: Establishing an institutional mechanism for continuous research and the development of new standards for protecting critical infrastructure is essential. Drawing lessons from initiatives like the Christchurch Call, public-private partnerships can play a crucial role in establishing a global order for a safe cyberspace.
Conclusion
- The protection of critical information infrastructure is of paramount importance in today’s interconnected world. The G20, with its representation of major economies and commitment to international cooperation, plays a crucial role in developing global norms for safeguarding critical infrastructure. By establishing a common understanding and definition of critical information infrastructure, the G20 can facilitate discussions and build consensus among member countries.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: NA
Mains level: Universal Health Coverage, challenges and India's G20 presidency
Central Idea
- India’s G20 presidency is gaining momentum, with a focus on harnessing shared responsibilities and collaborative governance to enhance global safety from pandemics. It seeks to bridge the gap between the Global North and Global South, recognizing the inclusive memberships of G20 and other plurilateral arrangements that span the global community.
Importance of Health as a global public good
- Interconnectedness: In today’s interconnected world, diseases can quickly spread across borders, transcending geographical boundaries. The health of individuals and communities in one part of the world can have direct implications for others. Therefore, addressing health issues becomes a shared responsibility for all nations.
- Impact on Global Stability: Health crises, such as pandemics, can have severe social, economic, and political consequences. They can disrupt economies, strain healthcare systems, and cause social unrest. By ensuring health as a global public good, we contribute to global stability, sustainable development, and peaceful coexistence.
- Humanitarian Imperative: Health is a fundamental human right. Everyone deserves access to quality healthcare and the opportunity to lead a healthy life. Treating health as a global public good ensures equitable access to healthcare services, regardless of an individual’s nationality or socioeconomic status.
- Economic Productivity: Healthy populations are essential for economic productivity and growth. By investing in health as a global public good, we can create conditions for individuals to thrive, contribute to their communities, and participate actively in economic activities.
- Prevention and Preparedness: Addressing health as a global public good requires proactive measures to prevent and prepare for health emergencies. By investing in disease surveillance, research, and robust healthcare systems globally, we can better detect and respond to outbreaks, mitigating their impact and saving lives.
- Collaboration and Knowledge Sharing: Recognizing health as a global public good encourages collaboration among nations. By sharing knowledge, best practices, and resources, countries can collectively work towards improving public health outcomes, fostering innovation, and finding solutions to complex health challenges.
- Achieving Sustainable Development Goals: Health is intricately linked to several Sustainable Development Goals (SDGs), including good health and well-being (SDG 3), poverty eradication (SDG 1), and gender equality (SDG 5). Treating health as a global public good support the achievement of these interconnected goals, leading to a more equitable and sustainable world.
India’s response to Covid-19: Whole-of-society and whole-of-government approach
- Early Measures and Nationwide Lockdown: India implemented one of the world’s largest and strictest nationwide lockdowns in March 2020 to contain the spread of the virus. This decision aimed to break the chain of transmission and provide time to strengthen healthcare infrastructure.
- Testing and Surveillance: India significantly ramped up its testing capacity, expanding the network of testing laboratories across the country. The government implemented various testing strategies, including rapid antigen tests and RT-PCR tests, to detect and track Covid-19 cases.
- Healthcare Infrastructure: To bolster healthcare infrastructure, the government initiated several measures such as establishing dedicated Covid-19 hospitals, increasing the number of ICU beds, ventilators, and oxygen supply, and mobilizing healthcare professionals to regions facing surges in cases.
- Vaccine Development and Rollout: India played a crucial role in vaccine development, with its indigenous vaccine candidates receiving regulatory approval. The country launched an ambitious vaccination drive, prioritizing healthcare workers, frontline workers, and vulnerable populations. India also contributed to global vaccine supply through the export of vaccines under the Vaccine Maitri initiative.
- Economic Relief Measures: Recognizing the socioeconomic impact of the pandemic, the government introduced economic relief measures, including financial assistance, direct benefit transfers, and welfare schemes to support vulnerable sections of society affected by lockdowns and job losses.
- Collaborations and International Aid: India engaged in international collaborations, sharing its experiences and expertise, and cooperating with other countries in areas such as research, drug repurposing, and knowledge exchange. The country also received international assistance in the form of medical supplies and equipment.
- Focus on Healthcare Infrastructure and Research: The government emphasized strengthening healthcare infrastructure, investing in research and development, and promoting indigenous manufacturing of medical equipment and supplies. Efforts were made to enhance testing capacity, develop innovative solutions, and support research on therapies and diagnostics.
- Communication and Awareness: The government and health authorities prioritized public communication and awareness campaigns to disseminate accurate information, promote preventive measures, and combat misinformation related to the virus.
What is Universal Health Coverage (UHC) by 2030?
- UHC 2030 is a global movement and partnership that aims to accelerate progress towards achieving Universal Health Coverage (UHC) by the year 2030.
- UHC 2030 is a collaborative initiative led by multiple stakeholders, including governments, international organizations, civil society, and the private sector, with the goal of ensuring that all individuals and communities have access to essential healthcare services without suffering financial hardship.
- UHC 2030 builds upon the commitment made by United Nations member states in 2015 through the Sustainable Development Goals (SDGs).
Challenges in achieving UHC by 2030?
- Financing: Adequate and sustainable financing is crucial for UHC. Many countries struggle with limited healthcare budgets, inefficient resource allocation, and inadequate public financing. Mobilizing sufficient funds to cover the costs of expanding healthcare services and ensuring financial protection for all individuals can be a significant challenge.
- Health Workforce: The availability, distribution, and quality of healthcare professionals pose challenges to UHC. Many countries face shortages of skilled healthcare workers, particularly in rural and remote areas. Strengthening the health workforce, ensuring equitable distribution, and improving their training and retention are critical for delivering quality healthcare services.
- Health Infrastructure: Insufficient and inadequate healthcare infrastructure, including facilities, equipment, and technologies, can hinder the achievement of UHC. Many regions, especially in low-income countries, lack the necessary healthcare infrastructure to provide essential services to all populations. Investments in infrastructure development and strengthening are required to expand access and ensure quality care.
- Inequities and Vulnerable Populations: UHC aims to address health inequities and reach vulnerable and marginalized populations. However, socioeconomic disparities, gender inequalities, and discrimination can hinder equitable access to healthcare services. Special attention is needed to address these inequities and ensure that UHC benefits all individuals, irrespective of their social or economic status.
- Health Information Systems: Establishing robust health information systems is essential for effective UHC implementation. However, many countries face challenges in data collection, management, and utilization. Strengthening health information systems, including electronic health records and data analytics, is crucial for monitoring progress, making informed decisions, and improving service delivery.
- Political Will and Governance: UHC requires strong political commitment and effective governance. Political will at the national level is necessary to prioritize UHC, allocate resources, and implement necessary policy reforms. Ensuring transparency, accountability, and efficient governance mechanisms are crucial to prevent corruption, ensure equitable service delivery, and maintain public trust.
- Changing Disease Patterns: The evolving burden of diseases, including the rise of non-communicable diseases, poses challenges to UHC. Chronic conditions require long-term management and specialized care, placing additional strain on healthcare systems. Adapting healthcare delivery models and integrating prevention and control strategies for these diseases are essential components of UHC.
- Global Health Security: Public health emergencies and global health security threats, as witnessed during the Covid-19 pandemic, can disrupt healthcare systems and hinder progress towards UHC. Strengthening health emergency preparedness and response capacities is vital to mitigate the impact of outbreaks and ensure continuity of healthcare services.
How India’s G20 presidency: Significant role in achieving UHC by 2030
- Knowledge Sharing and Best Practices: As the G20 president, India can facilitate the sharing of knowledge and best practices among member countries. This includes sharing successful UHC models, innovative healthcare delivery approaches, and strategies to overcome challenges. By promoting knowledge exchange, countries can learn from each other’s experiences and accelerate progress towards UHC.
- Advocacy for UHC: India can use its platform as G20 president to advocate for UHC as a global priority. Through diplomatic channels and international forums, India can emphasize the importance of UHC in achieving sustainable development and equitable healthcare access. This advocacy can encourage other G20 member countries to prioritize UHC and align their policies and actions accordingly.
- Collaboration with Global Health Organizations: India’s G20 presidency can facilitate collaboration with global health organizations such as the World Health Organization (WHO), World Bank, and other relevant entities. By working closely with these organizations, India can contribute to the development and implementation of strategies and initiatives that support UHC, including capacity building, technical assistance, and funding mechanisms.
- Promoting Innovative Financing Mechanisms: India can explore and promote innovative financing mechanisms for UHC. This includes advocating for increased public investment in healthcare, exploring public-private partnerships, and encouraging the development of social health insurance schemes. By identifying and sharing successful financing models, India can provide valuable insights to other G20 countries on sustainable funding for UHC.
- Strengthening Primary Healthcare Systems: India’s G20 presidency can focus on strengthening primary healthcare systems, which are integral to UHC. This involves enhancing access to quality primary healthcare services, addressing health workforce shortages, improving infrastructure, and promoting preventive and promotive healthcare measures. Sharing India’s experiences and initiatives in primary healthcare can inspire other countries to invest in this essential aspect of UHC.
- Leveraging Digital Health Technologies: India has made significant strides in adopting digital health technologies, and its G20 presidency can highlight the potential of these technologies in advancing UHC. By sharing digital health success stories and facilitating collaborations in areas such as telemedicine, health information systems, and mobile health applications, India can accelerate the adoption of digital solutions for healthcare access and delivery.
- South-South Cooperation: India’s G20 presidency can promote South-South cooperation and collaboration among G20 member countries and other nations from the Global South. By fostering partnerships, sharing experiences, and supporting capacity-building efforts, India can facilitate collective progress towards UHC in regions that face similar challenges.
Conclusion
- India’s G20 presidency aims to leverage collaborative governance and shared responsibilities to create a safer world from pandemics. India’s engagement with Japan’s G7 presidency and the focus on resilient, equitable, and sustainable UHC and global health architecture development further demonstrate shared responsibilities and the commitment to addressing public health emergencies. Through collective efforts, we can heal our planet, foster harmony within our global family, and offer hope for a better future.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Key welfare schemes
Mains level: Child health and nutrition programms, Welfare schemes and challenges
Central Idea
- The Union Budget of the current year has faced widespread criticism for its dwindling allocations towards welfare schemes, undermining the importance of social spending in the post-COVID-19 recovery phase. Over the years, central allocations for welfare schemes and sectors ensuring basic rights have steadily decreased as a proportion of GDP. This alarming trend raises concerns about the government’s commitment to addressing crucial issues such as child malnutrition, hunger, and education.
Key Welfare Programs
- Saksham Anganwadi and Poshan 2.0: These programs aim to address child malnutrition and hunger. Starting from 2021-22, the Anganwadi program (Integrated Child Development Services – ICDS) was merged with POSHAN Abhiyaan and a nutrition scheme for adolescent girls.
- Mid-Day Meal (MDM) Scheme: The MDM scheme provides nutritious meals to approximately 12 crore children in schools. The program has shown positive outcomes, including improved attendance, learning outcomes, and reduced stunting among children.
- Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA): MGNREGA guarantees 100 days of employment per rural household and plays a vital role in providing income support to rural households.
- National Food Security Act (NFSA): NFSA aims to provide subsidized grains to over 80 crore people, ensuring food security.
- National Social Assistance Programme (NSAP): NSAP provides pensions and monetary assistance to vulnerable sections such as the elderly, widows, and disabled individuals below the poverty line.
- PM Matru Vandana Yojana (PMMVY): The scheme provides conditional cash transfers to women in the unorganized sector, aiming to cover all eligible women and births as per the NFSA mandate
Concerns regarding their resource allocations
- Saksham Anganwadi and Poshan 2.0: The allocation for these programs has decreased from 0.13% of GDP in 2014-15 to 0.07% in 2023-24. This decline in budgetary support raises concerns about the programs’ ability to effectively address child malnutrition and hunger.
- MDM Scheme: The budget allocation for the MDM scheme has decreased by 50% as a share of GDP, from 0.08% in 2014-15 to 0.04% in 2023-24. This reduced allocation poses challenges in providing nutritious meals to children and improving their overall health outcomes.
- MGNREGA: The MGNREGA expenditure as a share of GDP has declined from 0.26% in 2014-15 to 0.20% in 2023-24. This decrease in allocation raises concerns about the program’s ability to provide sufficient employment opportunities to rural households.
- National Food Security Act : The expenditure on NFSA as a share of GDP has decreased from 0.94% in 2014-15 to 0.65% in 2023-24. This reduction in allocation poses challenges in ensuring food security for a significant population.
- National Social Assistance Programme (NSAP): The allocation for NSAP as a share of GDP has declined from 0.06% in 2014-15 to 0.03% in 2023-24. This decrease raises concerns about the adequacy of pensions and monetary assistance provided to vulnerable sections.
- PM Matru Vandana Yojana: The PMMVY budget falls significantly short of the required amount, hindering its effectiveness in providing adequate maternity benefits.
Why these is distress among the working class?
- Low Wages and Income Inequality: Many workers, particularly those in the informal sector, earn low wages that are insufficient to meet their basic needs. Income inequality further exacerbates the disparity between the wages of the working class and the higher-income groups, leading to financial distress.
- Lack of Job Security: Many working-class individuals, especially those in the informal economy, face precarious employment conditions without job security or benefits. Uncertainty regarding employment continuity, lack of social protection, and limited access to formal labor rights contribute to their distress.
- Limited Access to Social Protection: A significant portion of the working-class lacks access to adequate social protection mechanisms, such as health insurance, pension schemes, and unemployment benefits. This leaves them vulnerable to economic shocks and reduces their resilience in times of crises.
- Declining Real Wages: Despite economic growth, the growth in real wages has not kept pace, resulting in stagnation or minimal growth in purchasing power for many workers. This phenomenon limits their ability to improve their living standards and contributes to distress.
- Exploitative Working Conditions: The working class often faces exploitative working conditions, including long working hours, unsafe work environments, lack of breaks, and limited rights to collective bargaining. These conditions can negatively impact physical and mental well-being, contributing to distress.
- Lack of Skill Development and Upward Mobility: Limited opportunities for skill development and upward mobility can trap workers in low-wage jobs with limited prospects for advancement. This lack of upward mobility can lead to frustration and distress among the working class.
- Inadequate Social Services: Insufficient access to quality healthcare, education, and affordable housing places an additional burden on the working class. The lack of affordable and accessible services exacerbates their financial stress and limits their ability to meet essential needs.
Way Ahead
- Prioritize Social Spending: The government should prioritize social spending, especially in the post-COVID-19 recovery period, to ensure adequate resources for welfare schemes. Allocating sufficient funds to programs addressing child nutrition, working class welfare, social assistance, and education is essential to uplift vulnerable sections of society.
- Increase Budget Allocations: The budget allocations for child nutrition and hunger programs, such as Saksham Anganwadi and Poshan 2.0, and the mid-day meal scheme need to be increased to effectively tackle malnutrition and improve children’s health outcomes. Adequate funding will ensure the successful implementation and expansion of these programs.
- Strengthen MGNREGA and NFSA: Recognizing the importance of MGNREGA and NFSA in providing rural employment and food subsidies, the government should prioritize and enhance the budget allocations for these schemes. This will support the livelihoods of the rural population and alleviate poverty and distress.
- Focus on Wage Growth: To address the distress among the working class, there should be a focus on policies that promote wage growth. This can be achieved through skill development programs, labor reforms, and measures to improve the employment ecosystem, ensuring better wages and improved livelihoods.
- Enhance Social Security Programs: The government should consider increasing allocations for social security programs, such as the National Social Assistance Programme (NSAP), to provide adequate support to the elderly, widows, and disabled individuals. Raising the pension amounts and expanding the coverage will help alleviate financial hardships among vulnerable sections of society.
- Allocate Sufficient Funds for Education and Healthcare: Given the importance of education and healthcare, the government should allocate adequate funds for school education and healthcare infrastructure. This will help improve access to quality education, reduce dropout rates, and ensure affordable and accessible healthcare for all.
- Improve HDI and Social Indicators: To uplift India’s Human Development Index (HDI) rank and address rising malnutrition levels, it is crucial to increase social expenditure in proportion to the country’s GDP growth. This can be achieved by redirecting revenue foregone due to tax concessions and adopting efficient fiscal management practices.
- Strengthen Monitoring and Evaluation: Effective monitoring and evaluation mechanisms should be put in place to ensure that allocated funds are utilized efficiently and reach the intended beneficiaries. Regular assessment of the impact and outcomes of welfare schemes will help identify areas of improvement and enable evidence-based policy decisions.
Facts for prelims
Prevalence of Iron deficiency anemia in India
- Iron deficiency anemia is a significant public health concern in India. According to the National Family Health Survey (NFHS-5) conducted in 2019-2020, the prevalence of anemia among women aged 15-49 years is 53%, while among children aged 6-59 months, it is 41%.
- Iron deficiency anemia affects both rural and urban populations, with higher rates observed in certain regions and vulnerable groups such as pregnant women and young children.
What is Iron deficiency anemia?
- It is a common type of anemia that occurs when there is a lack of iron in the body. Iron is an essential mineral needed for the production of hemoglobin, a protein in red blood cells that carries oxygen to tissues throughout the body.
- When iron levels are insufficient, the body is unable to produce enough healthy red blood cells, leading to a decrease in oxygen-carrying capacity and resulting in symptoms such as fatigue, weakness, pale skin, shortness of breath, and difficulty concentrating.
- Iron deficiency anemia can be caused by inadequate dietary intake of iron, poor iron absorption, chronic blood loss, or certain medical conditions.
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Conclusion
- The decline in allocations for welfare schemes in the Union Budget raises concerns about the government’s commitment to social development, impacting crucial areas such as child nutrition, working-class welfare, and access to education and healthcare. To foster inclusive growth, there is an urgent need to prioritize social expenditure, increase budget allocations, and address the pressing issues facing vulnerable sections of society.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: London Interbank Offered Rate (LIBOR)
Mains level: Read the attached story
Central Idea: The RBI has issued an advisory to banks and other RBI-regulated entities regarding the transition away from London Interbank Offered Rate (LIBOR) July 1.
What is London Interbank Offered Rate (LIBOR)?
|
Explanation |
| Definition |
LIBOR is a benchmark interest rate used in financial transactions such as loans, derivatives, and bonds.
It is the interest rate at which banks can borrow funds from other banks in the London interbank market.
It serves as a benchmark rate for various financial transactions worldwide. |
| Calculation Method |
LIBOR rates are calculated based on submissions from a panel of major banks in London.
These banks estimate their borrowing costs for various currencies and tenors.
The submissions are used to calculate an average rate, which is published daily by the Intercontinental Exchange (ICE), the administrator of LIBOR. |
| Currencies and Tenors |
LIBOR is calculated for different currencies and tenors ranging from overnight to one year.
The currencies include USD, EUR, GBP, JPY, CHF, and others.
The tenors represent the time periods for which the rates are quoted. |
| Importance |
It has been widely used since the 1980s as a benchmark for financial contracts worth trillions of dollars globally.
It serves as a reference rate for various loans, derivatives, and other financial instruments. |
Why is RBI moving away from LIBOR?
Like many other countries, has been working towards transitioning away from LIBOR. The primary reasons for this transition include:
- Manipulation risks: Following the global financial crisis in 2008, there were concerns about the reliability and potential manipulation of LIBOR.
- Discontinuation of LIBOR: The regulatory authority in the UK that oversees LIBOR, announced in 2017 that it will no longer compel banks to submit the necessary data to calculate LIBOR after the end of 2021.
- Adoption of alternative Reference Rates: Various countries, including India, have identified and adopted alternative reference rates that are more reliable and based on actual market transactions. Ex RBI introduced the Secured Overnight Financing Rate (SOFR).
- Alignment with International Standards: Many countries have already initiated the shift to alternative reference rates, necessitating India’s alignment to maintain consistency and harmonization in international financial markets.
- Risk Mitigation: RBI’s move aims to mitigate the potential risks associated with an unreliable or manipulated benchmark rate.
Related terminologies
Mumbai Interbank Forward Outright Rate (MIFOR): MIFOR is a benchmark rate used in Indian financial markets. It represents the forward premium or discount on the USD-INR exchange rate based on the LIBOR rate.
Fallbacks: They are provisions inserted into contracts to establish alternative reference rates if the original benchmark rate (such as LIBOR) becomes unavailable or unreliable. |
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From UPSC perspective, the following things are important :
Prelims level: Greenwashing, Global Financial Innovation Network (GFIN)
Mains level: Read the attached story
Central Idea: The RBI has announced its participation in the Global Financial Innovation Network’s (GFIN) Greenwashing TechSprint.
What is Greenwashing?
- Greenwashing is a term used to describe the practice of making exaggerated, misleading, or unsubstantiated claims about the environmental, social, and governance (ESG) credentials of a product, service, or company.
- It is a deceptive marketing strategy that aims to portray an organization as environmentally friendly or socially responsible, even when its actions or practices do not align with these claims.
- It creates the perception that a company is taking steps towards sustainability or social responsibility, but in reality, it may be engaging in practices that are harmful to the environment or society.
There are various forms of greenwashing that companies may employ to deceive consumers or investors. These include:
- Vague or ambiguous claims: Companies may use general statements or buzzwords without providing specific details or evidence to support their environmental or social claims. For example, stating that a product is “eco-friendly” without explaining the specific environmental benefits or certifications.
- Irrelevant or misleading labels: Companies may use misleading labels or certifications that give the impression of sustainability or social responsibility but lack meaningful standards or independent verification. This can confuse consumers who rely on such labels to make informed choices.
- Hidden trade-offs: Greenwashing can involve emphasizing one positive aspect of a product or company’s operations while ignoring or downplaying other negative impacts. For instance, a company may highlight its use of renewable energy while disregarding other harmful environmental practices.
- Lack of transparency: Companies may fail to provide transparent information about their sustainability practices or refuse to disclose relevant data. This lack of transparency makes it difficult for consumers to verify the accuracy of the company’s claims.
- Inconsistent messaging: Some companies may adopt green initiatives or promote sustainable products as a public relations exercise, without making substantial changes to their overall operations. This inconsistency between their messaging and actual practices is a form of greenwashing.
Implications of greenwashing
- It undermines consumer trust, as people may make purchasing decisions based on misleading information.
- It also hampers the credibility of genuinely sustainable businesses by creating scepticism in the market.
- Moreover, it can divert attention and resources away from genuinely sustainable companies and initiatives.
Back2Basics: Global Financial Innovation Network (GFIN)
- GFIN was officially launched in January 2019.
- It was inspired by the successful collaboration between 11 financial regulators during a cross-border pilot project known as the “Global Sandbox” in 2018.
- The pilot project demonstrated the benefits of regulatory cooperation and information sharing in fostering responsible innovation in the financial sector.
- GFIN consists of financial regulators and related organizations from around the world.
- The network includes regulatory authorities, central banks, and supervisory bodies.
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From UPSC perspective, the following things are important :
Prelims level: Carbon Dating
Mains level: Not Much
Central Idea: Allahabad high court ordered the ASI to conduct the carbon dating process of the ‘Shivling’ found in the premises of the Gyanvapi mosque, without causing any damage to the structure.
What is Carbon Dating?
- Carbon dating is a widely-used method for determining the age of organic materials that were once living.
- The method is based on the radioactive decay of Carbon-14 (C-14), an isotope of carbon with an atomic mass of 14.
- It works by measuring the ratio of C-12 to C-14 in the atmosphere, as well as in plants and animals that acquire carbon through photosynthesis or food consumption.
The half-life concept
- Carbon-14 has a half-life of 5,730 ± 40 years—i.e., half the amount of the radioisotope present at any given time will undergo spontaneous disintegration during the succeeding 5,730 years.
- Because carbon-14 decays at this constant rate, an estimate of the date at which an organism died can be made by measuring the amount of its residual radiocarbon.
Limitations of Carbon Dating
- Carbon dating has certain limitations and cannot be applied in all circumstances.
- It is not suitable for determining the age of non-living things such as rocks.
- Carbon dating becomes less accurate for objects older than 40,000-50,000 years, as the amount of detectable C-14 becomes significantly small.
- Other radiometric dating methods are employed to determine the age of inanimate objects, which rely on the decay of radioactive elements present in the material.
- Examples of such methods include potassium-argon dating and uranium-thorium-lead dating, which analyze the ratios of specific isotopes to estimate the age of rocks.
Other Dating Methods
In addition to radiometric dating, there are alternative methods to determine the age of objects.
- Cosmogenic nuclide dating: CRN is one such method that utilizes radioactive decay to estimate age and is commonly used to study the age of ice cores in Polar Regions.
- Potassium-argon dating: A radiometric dating method that measures the ratio of potassium to argon isotopes in rocks to determine their age.
- Uranium-thorium-lead dating: A radiometric dating method that analyses the ratios of uranium, thorium, and lead isotopes in rocks to estimate their age.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Alligator Gar
Mains level: Not Much
Central Idea: The Jammu and Kashmir Lake Conservation and Management Authority (LCMA) discovered a rare type of fish known as “Alligator Gar” for the first time during the ongoing cleaning of famous Dal Lake in Srinagar.
Alligator Gar
|
Information |
| Scientific Name |
Atractosteus spatula |
| Size and Weight |
Up to 8 feet in length, over 300 pounds |
| Appearance |
Long, narrow body; crocodile-like head; sharp teeth |
| Distribution |
Central and North America, freshwater habitats |
| Fossil Record |
Traces back to the Early Cretaceous, over 100 million years ago |
| Feeding Habits |
Voracious predator, feeds on fish, turtles, waterfowl, etc. |
| Coloration |
Brown or olive on upper body, lighter underside |
| Longevity |
Can live for several decades |
| Conservation Status |
Least Concerned (IUCN) |
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